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114th Congress    }                                       {      Report
                        HOUSE OF REPRESENTATIVES
 1st Session      }                                       {     114-101

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



 
               AGOA EXTENSION AND ENHANCEMENT ACT OF 2015

                                _______
                                

  May 1, 2015.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

Mr. Ryan of Wisconsin, from the Committee on Ways and Means, submitted 
                             the following

                              R E P O R T

                        [To accompany H.R. 1891]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 1891) to extend the African Growth and Opportunity 
Act, the Generalized System of Preferences, the preferential 
duty treatment program for Haiti, and for other purposes, 
having considered the same, report favorably thereon without 
amendment and recommend that the bill do pass.

                                CONTENTS

                                                                   Page
 I. SUMMARY AND BACKGROUND............................................2
        A. Purpose and Summary...................................     2
        B. Background and Need for Legislation...................     3
        C. Legislative History...................................     7
II. EXPLANATION OF THE BILL...........................................8
        Title I: Extension of African Growth and Opportunity Act.     8
        Title II: Extension of Generalized System of Preferences.    17
        Title III: Extension of Preferential Duty Treatment 
            Program for Haiti....................................    19
        Title IV: Other Provisions...............................    20
III.VOTES OF THE COMMITTEE...........................................21

IV. BUDGET EFFECTS OF THE BILL.......................................21
        A. Committee Estimate of Budgetary Effects...............    21
        B. Statement Regarding New Budget Authority and Tax 
            Expenditures Budget Authority........................    22
        C. Cost Estimate Prepared by the Congressional Budget 
            Office...............................................    22
 V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE.......28
        A. Committee Oversight Findings and Recommendations......    28
        B. Statement of General Performance Goals and Objectives.    28
        C. Information Relating to Unfunded Mandates.............    28
        D. Applicability of House Rule XXI 5(b)..................    29
        E. Tax Complexity Analysis...............................    29
        F. Congressional Earmarks, Limited Tax Benefits, and 
            Limited Tariff Benefits..............................    29
        G. Duplication of Federal Programs.......................    29
        H. Disclosure of Directed Rule Makings...................    30
VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED............30
        A. Text of Existing Law Amended or Repealed by the Bill, 
            as Reported..........................................    30
        B. Changes in Existing Law Proposed by the Bill, as 
            Reported.............................................    90

                       I. SUMMARY AND BACKGROUND


                         A. Purpose and Summary


African Growth and Opportunity Act

    Title I reaffirms Congress's commitment to sub-Saharan 
Africa by ensuring a long-term extension of the African Growth 
and Opportunity Act, which is the cornerstone of the trade and 
investment relationship between the United States and sub-
Saharan Africa.
    First enacted in 2000, AGOA provides preferential duty 
treatment to sub-Saharan African countries that continue to 
make progress on economic and political reform; market 
incentives and private sector growth; the eradication of 
poverty; and the importance of women to economic growth and 
development. Currently 39 countries receive benefits under 
AGOA.
    The bill reaffirms Congress's commitment to sub-Saharan 
Africa through findings and statements of policy on the 
importance of AGOA and expanding trade and investment ties 
between the United States and sub-Saharan Africa. The bill 
takes note of AGOA's successes in promoting trade and 
investment ties between the United States and sub-Saharan 
Africa, as well as its success in promoting economic growth, 
development, poverty reduction, democracy, the rule of law, and 
stability in sub-Saharan Africa. The bill also finds that the 
elimination of barriers to trade will improve utilization of 
AGOA and further strengthen trade and investment ties.
    Benefits under AGOA are set to expire on September 30, 
2015. The bill provides a long-term extension of AGOA for 10 
years, including a 10-year extension of the third-country 
fabric provisions.
    The bill promotes greater regional integration by expanding 
the rule of origin to allow for combining inputs from all AGOA 
beneficiaries to count towards meeting the rule of origin for 
AGOA-eligible products. The bill also simplifies customs 
procedures to make it easier to complete paperwork on imports 
from AGOA beneficiaries.
    The bill includes statements of policy encouraging the 
adoption of the WTO Trade Facilitation Agreement. The bill also 
addresses unfair practices by the European Union that condition 
access to the European market on signing trade agreements.
    Under existing law, the President must annually evaluate 
whether AGOA beneficiaries are making continual progress in 
meeting the eligibility criteria in the statute. These criteria 
include, for example, whether countries in sub-Saharan Africa 
have established, or are making continual progress toward 
meeting the criteria outlined in the original AGOA legislation. 
While this bill does not change the eligibility criteria, it 
does include several key improvements to the annual review 
process. For example, the bill provides flexibility to allow 
the Administration to withdraw, suspend, or limit benefits 
under AGOA if it determines that such action would be more 
effective than termination. In addition, the bill ensures 
greater predictability and certainty by requiring the 
Administration to notify Congress and any affected country at 
least 60 days before removing a country from the program or 
withdrawing, suspending, or limiting any benefits. The bill 
also reinstates an exhaustive biennial report to Congress on 
AGOA countries and utilization of the program, which will 
further strengthen Congressional oversight of the program.
    Furthermore, the bill improves transparency and 
participation in the annual AGOA review process by making it 
more public and ensuring that the Administration establishes 
mechanisms for public input. One such mechanism is the creation 
of a new petition process that allows any party, at any time, 
to petition USTR about whether a country is meeting the AGOA 
eligibility criteria. Another mechanism allows the President to 
conduct out-of-cycle reviews of eligible countries and a sense 
of Congress that the President should initiate a review of 
South Africa or any other beneficiary country that is not in 
compliance with Section 104(a) of AGOA within 30 days of 
enactment.
    Recognizing that those countries with strategies for taking 
advantage of the benefits of AGOA tend to have the most success 
under the program, the bill encourages AGOA beneficiaries to 
develop biennial utilization strategies and commits the United 
States to working with AGOA beneficiaries to develop and 
implement such strategies.
    The bill reaffirms the United States' commitment to deepen 
and expand trade and investment relationships with sub-Saharan 
Africa, including through the negotiation of free trade 
agreements, by requiring the Administration to develop a long-
term strategy for negotiating trade agreements with sub-Saharan 
Africa and setting clear statements of U.S. policy.
    Title II would extend the Generalized System of Preferences 
(GSP) through December 31, 2017, and provide retroactive 
benefits to July 31, 2013 for products that would be eligible 
as of the effective date. The program expired on July 31, 2013. 
It would also make certain cotton articles eligible for Least-
Developed Beneficiary Developing Countries (LDBDCs), 
implementing U.S. WTO commitments.
    Title III would extend benefits now available to Haiti 
under the Caribbean Basin Economic Recovery Act (CBERA), as 
amended, through 2025.
    Title IV would offset revenue for budgetary purposes.

                 B. Background and Need for Legislation


African Growth and Opportunity Act

    AGOA has been the cornerstone of United States economic 
engagement with sub-Saharan Africa since it was enacted in 
2000. Congress has legislated five times since AGOA's original 
enactment to extend and expand the benefits under AGOA.
    Economic and political conditions have improved 
dramatically since AGOA was first enacted. The AGOA Ambassadors 
Working Group estimates that AGOA has generated about 350,000 
direct jobs and 1 million indirect jobs in sub-Saharan Africa 
and about 100,000 jobs in the United States.
    Approximately 70 percent of imports from AGOA-eligible 
countries entered under the AGOA program in 2013 (another 20 
percent enter under GSP), though the level of utilization 
varies from country to country. Since adoption of AGOA in 2000, 
U.S. imports under the program grew more than three-fold, 
rising from $7.6 billion in 2001 to $24.8 billion in 2013. 
Petroleum products continue to account for the largest portion 
of AGOA imports, with an 82 percent share of overall AGOA 
imports in 2013. Apparel products account for only 1-2 percent 
of total products imported under the AGOA program but support 
tens of thousands of jobs in Africa.
    Overall, AGOA has had a positive impact on foreign direct 
investment flows to sub-Saharan Africa. Since enactment of 
AGOA, U.S. investment has grown at an annual rate of 14 
percent, and the U.S. investment stock has increased by about 
six times. Despite this strong growth, U.S. direct investment 
in sub-Saharan Africa accounts for only 1 percent of total U.S. 
direct investment outflows.
    Similarly, political conditions have strengthened in many 
African countries. According to its report, AGOA: Eligibility 
Process and Economic Development in Sub-Saharan Africa [GAO-15-
300], the General Accountability Office concluded that, 
although isolating impacts is difficult, AGOA-eligible 
countries had higher average income-per person than ineligible 
countries and higher governance scores than ineligible 
countries, including on rule of law and political stability 
criteria.
    Even as trade and investment have grown, significant 
economic and political challenges remain in sub-Saharan Africa. 
Major barriers remain to U.S.-African trade and investment as 
well as intra-African trade, including high tariffs, forced 
localization requirements, legal restrictions on investment, 
and customs barriers, among others. Substantial supply-side 
constraints, such as poor infrastructure, lack of regional 
integration, and other obstacles, also contribute to depress 
trade and investment flows.
    Committee Oversight: As part of its oversight function, the 
Committee has conducted a thorough process of reviewing AGOA 
legislation and consulting with interested stakeholders about 
the possibility of extending and renewing AGOA. This process 
includes congressional hearings, participation in AGOA Forum 
meetings by Committee Members and staff, informal consultations 
with interested stakeholders including the African diplomatic 
corps and senior African officials, as well as studies from the 
International Trade Commission and the General Accountability 
Office. All of these efforts have informed the Committee's 
development of this legislation and confirmed the need to 
extend AGOA for another ten years.
    To supplement the research conducted by the International 
Trade Commission, in December 2013 a group of bipartisan 
leaders from the House Ways and Means Committee, Senate Finance 
Committee, House Foreign Affairs Committee, and Senate Foreign 
Relations Committee requested the General Accountability Office 
(GAO) to conduct a study to examine the contribution of AGOA to 
economic growth and political reform, barriers to AGOA 
utilization, as well as potential ways to strengthen the 
program. To date, GAO has produced four reports.
    The first report, ``African Growth and Opportunity Act: 
Observations on Competitiveness and Diversification of U.S. 
Imports from Beneficiary Countries'' [GAO-14-722R], examined 
the competitiveness and diversification of U.S. imports under 
AGOA from 2001 to 2013. GAO found that U.S. imports from AGOA 
countries have increased significantly since the program was 
implemented in 2001 but remain a small share of total U.S. 
imports. GAO also noted that while imports of non-oil and 
mineral products have increased, oil and mineral products still 
represent the vast majority of U.S. imports from sub-Saharan 
Africa.
    The second report, ``African Growth and Opportunity Act: 
USAID Could Enhance Utilization by Working with More Countries 
to Develop Export Strategies'' [GAO-15-218], examined U.S. 
government trade capacity building (TCB) assistance in support 
of AGOA, and the extent to which USAID has made efforts to 
develop strategic approaches to AGOA utilization with sub-
Saharan African countries. The GAO report highlighted several 
trade-related challenges in sub-Saharan Africa that benefit 
from TCB assistance. In addition to lacking marketing 
expertise, market information, and business contacts to 
effectively export to the U.S. market, many AGOA-eligible 
countries have poor infrastructure conditions that undermine 
export competitiveness. GAO recommended encouraging AGOA 
beneficiary countries to develop utilization strategies and to 
use those strategies to coordinate TCB efforts.
    The third report, ``African Growth and Opportunity Act: 
Eligibility Process and Economic Development in Sub-Saharan 
Africa'' [GAO-15-300], analyzed the annual AGOA eligibility 
review process, the role of AGOA in supporting reform 
objectives, and how sub-Saharan African countries have 
developed since the enactment of AGOA. GAO determined that 
AGOA-beneficiaries fared better on economic and development 
metrics than sub-Saharan African countries that did not 
participate in the program. GAO also found that since AGOA was 
enacted, income per person has been higher in AGOA-eligible 
countries, on average, than in ineligible countries. Moreover, 
AGOA beneficiaries have received more foreign aid per person 
and higher foreign direct investment than countries that have 
not participated in the program.
    The fourth report, ``African Growth and Opportunity Act: 
Lessons Learned from Other Countries' Trade Arrangements with 
Sub-Saharan Africa'' [GAO-15-393R], examined the 
recommendations for AGOA made by the Administration and 
recommended that Congress enact a long-term extension of AGOA 
to reduce risks for investors, although it also cautioned that 
a long-term extension could limit U.S. flexibility in making 
changes to its trading arrangement with sub-Saharan African 
countries. Moreover, GAO found that many U.S. domestic 
commodity groups and producers have raised concerns about 
expanding AGOA's product coverage. GAO examined changing the 
rules of origin and concluded that some rules of origin changes 
could increase use of AGOA preferences, but there is an 
increased likelihood that the benefits would accrue to non-AGOA 
countries. Lastly, GAO examined changing the eligibility 
criteria and review processes and found that revising 
eligibility criteria could limit preferences to fewer countries 
and may negatively impact regional integration.

Generalized System of Preferences

    Title V of the Trade Act of 1974, as amended, grants 
authority to the President to provide duty-free treatment on 
imports of eligible articles from designated beneficiary 
developing countries (BDCs), subject to certain conditions and 
limitations. To qualify for GSP benefits, each beneficiary 
country is subject to mandatory and discretionary eligibility 
criteria.
    The purpose of the GSP program is to promote three broad 
policy goals: (1) to foster economic development in developing 
economies through increased trade rather than foreign aid; (2) 
to promote U.S. trade interests by encouraging beneficiary 
countries to open their markets and comply more fully with 
international trading rules; and (3) to help maintain U.S. 
international competitiveness by lowering costs for U.S. 
business, as well as lowering prices for American consumers.
    The program expired on July 31, 2013. This bill extends the 
Generalized System of Preferences (GSP) until December 31, 2017 
and provides retroactive relief to eligible products that were 
imported during GSP's lapse.
    The bill promotes export growth and economic development 
for developing countries by continuing to provide duty-free 
entry for approximately 5,000 agricultural and non-agricultural 
products from 126 designated beneficiary countries and 
territories. It also benefits U.S. companies by eliminating an 
estimated $2 million a day in tariffs on imported goods, 
supporting an estimated 80,000 jobs in the United States 
through the movement of GSP products from ports to 
manufacturers, farmers, and stores. Renewal of GSP fosters 
innovation and U.S. competitiveness in the global marketplace 
by lowering costs for intermediate goods, including components, 
parts, and material imported from designated beneficiary 
developing countries.
    In addition, Title II implements certain commitments taken 
by the United States relating to cotton. At the World Trade 
Organization's Eighth Ministerial Conference, the United States 
agreed to adopt duty-free and quota-free treatment for certain 
upland cotton for LDBDCs. In 2012, the Administration, after 
seeking input from the International Trade Commission (ITC) and 
consulting with Congress, added the appropriate in-quota tariff 
lines to the GSP program. This bill makes the out-of-quota 
tariff lines eligible under GSP. The ITC analyzed whether there 
would be any negative effect from making these products duty-
free and quota-free for LDBDCs, and it received no statements 
of opposition.

Preference Programs for Haiti

    Congress first provided expanded benefits on apparel 
exports from Haiti to the United States in the Haitian 
Hemispheric Opportunity through Partnership Encouragement Act 
of 2006 (HOPE I). The program was extended and expanded in 2008 
through HOPE II legislation. After the devastating earthquake 
in 2010, Congress adopted the HELP Act, which included 
additional flexibility and further extended the program.
    In 2006, Haiti's exports to the United States totaled just 
$496.1 million. In 2014, they totaled $908.2 million. While 
conditions have improved, economic conditions in Haiti remain 
challenging and long-term certainty is important to continuing 
to attract investment to Haiti.
    The bill would extend the HOPE and HELP programs for 
products from Haiti until September 30, 2025. Such an extension 
would promote export growth and economic development for Haiti 
by continuing to provide duty-free entry for a variety of 
products, including certain apparel products.

                         C. Legislative History


Background

    H.R. 1891, to extend the African Growth and Opportunity 
Act, the Generalized System of Preferences, the preferential 
duty treatment program for Haiti, and for other purposes, was 
introduced on April 17, 2015, and was referred to the Committee 
on Ways and Means.

Committee hearings

    On July 18, 2013, the Committee held a hearing on the U.S. 
trade agenda with Ambassador Michael Froman, the United States 
Trade Representative. The hearing included discussion about the 
importance of the preferences programs and the upcoming 
expiration of GSP.
    On April 3, 2014, the Committee held a hearing on the U.S. 
trade agenda with Ambassador Michael Froman, United States 
Trade Representative. Among the issues covered was the need for 
renewal of GSP and extension of AGOA and the importance of both 
programs in furthering the U.S. trade agenda.
    On July 29, 2014, the Subcommittee on Trade held a hearing 
on U.S. trade with Africa and the African Growth and 
Opportunity Act. The hearing focus included: (1) deepening and 
expanding trade and investment ties with sub-Saharan Africa; 
(2) the effectiveness of AGOA and potential revisions to the 
program to promote improved utilization; (3) barriers to trade 
in Africa; (4) barriers to regional integration in Africa; and 
(5) capacity building and efforts to promote regional 
integration and integration into global supply chains, 
including through implementation of the WTO Trade Facilitation 
Agreement.
    On August 4-5, 2014, Representatives Young and Rangel 
participated in the Africa Growth and Opportunity Act (AGOA) 
Forum in Washington, D.C. and met with officials from the 
United States and AGOA countries.
    On February 3, 2015, the Committee held a hearing on the 
U.S. trade agenda with Ambassador Michael Froman, United States 
Trade Representative. The Committee heard testimony about the 
importance of AGOA and GSP renewal, including the benefits of 
the preferences programs for international development and the 
U.S. economy.
    On April 22, 2015, the Committee held a hearing on 
expanding American trade with accountability and transparency 
with Treasury Secretary Jack Lew, Agriculture Secretary Tom 
Vilsack, and Commerce Secretary Penny Prtizker. The Committee 
heard testimony on the Administration's support for this 
legislation and timely renewal of the preference programs.

Committee action

    The Committee on Ways and Means marked up H.R. 1891, to 
extend the African Growth and Opportunity Act, the Generalized 
System of Preferences, the preferential duty treatment program 
for Haiti, and for other purposes, on April 23, 2015, and 
ordered the bill favorably reported by voice vote (with a 
quorum being present).

                      II. EXPLANATION OF THE BILL


        TITLE I: EXTENSION OF AFRICAN GROWTH AND OPPORTUNITY ACT


                        SECTION 101: SHORT TITLE

Present law

    No provision.

Explanation of provision

    Section 101 entitles the bill the ``AGOA Extension and 
Enhancement Act of 2015''.

Reason for change

    The Committee believes that the short title reflects the 
significant revision and expansion of the AGOA program.

Effective date

    The provision is effective upon enactment.

                         SECTION 102: FINDINGS

Present law

    This section supplements and updates findings in previous 
AGOA legislation, including Section 102 of the African Growth 
and Opportunity Act.

Explanation of provision

    In Section 102, Congress finds that:
    (1) Since its enactment, the African Growth and Opportunity 
Act has been the centerpiece of trade relations between the 
United States and sub-Saharan Africa and has enhanced trade, 
investment, job creation, and democratic institutions 
throughout Africa.
    (2) Trade and investment, as facilitated by the African 
Growth and Opportunity Act, promote economic growth, 
development, poverty reduction, democracy, the rule of law, and 
stability in sub-Saharan Africa.
    (3) Trade between the United States and sub-Saharan Africa 
has more than tripled since the enactment of the African Growth 
and Opportunity Act in 2000, and United States direct 
investment in sub-Saharan Africa has grown almost six-fold.
    (4) It is in the interest of the United States to engage 
and compete in emerging markets in sub-Saharan African 
countries, to boost trade and investment between the United 
States and sub-Saharan African countries, and to renew and 
strengthen the African Growth and Opportunity Act.
    (5) The long-term economic security of the United States is 
enhanced by strong economic and political ties with the 
fastest-growing economies in the world, many of which are in 
sub-Saharan Africa.
    (6) It is a goal of the United States to further integrate 
sub-Saharan African countries into the global economy, 
stimulate economic development in Africa, and diversify sources 
of growth in sub-Saharan Africa.
    (7) To that end, implementation of the Agreement on Trade 
Facilitation of the World Trade Organization would strengthen 
regional integration efforts in sub-Saharan Africa and 
contribute to economic growth in the region.
    (8) The elimination of barriers to trade and investment in 
sub-Saharan Africa, including high tariffs, forced localization 
requirements, restrictions on investment, and customs barriers, 
will create opportunities for workers, businesses, farmers, and 
ranchers in the United States and sub-Saharan African 
countries.
    (9) The elimination of such barriers will improve 
utilization of the African Growth and Opportunity Act and 
strengthen regional and global integration, accelerate economic 
growth in sub-Saharan Africa, and enhance the trade 
relationship between the United States and sub-Saharan Africa.

Reason for change

    These provisions supplement and update Congressional 
findings to reflect the success of AGOA since its enactment and 
continuing challenges in sub-Saharan Africa. This section 
reaffirms Congress's commitment to sub-Saharan Africa through 
findings on the importance of AGOA and expanding trade and 
investment ties between the United States and sub-Saharan 
Africa. This section takes note of AGOA's successes in 
promoting trade and investment ties between the United States 
and sub-Saharan Africa, as well as its success in promoting 
economic growth, development, poverty reduction, democracy, the 
rule of law, and stability in sub-Saharan Africa.
    The Committee notes the positive effect that digital trade 
has had in supporting development among AGOA beneficiaries. The 
President should continue to encourage sub-Saharan Africa to 
promote policies that expand Internet access and to eliminate 
barriers to the digital economy in Africa, including through 
the AGOA.
    This section also finds that the elimination of barriers to 
trade will improve utilization of AGOA and further strengthen 
trade and investment ties. The Committee remains concerned by 
persistent tariff and non-tariff barriers to trade and 
investment in sub-Saharan Africa that impede trade and regional 
integration. In addition to persistently high-tariffs, non-
tariff barriers impede U.S. exports sub-Saharan Africa as well 
as regional trade.

Effective date

    The provision is effective upon enactment.

    SECTION 103: EXTENSION OF THE AFRICAN GROWTH AND OPPORTUNITY ACT

Present law

    Under current law, AGOA and the special rule of origin on 
third-country fabric expires on September 30, 2015.

Explanation of provision

    Section 103 extends AGOA and the special rule of origin on 
third-country fabric from September 30, 2015 to September 30, 
2025.

Reason for change

    The Committee believes that long-term extension is 
important to encourage investment and support current 
investors. Extension of the third-country fabric provision is 
important to continue to support the development of the textile 
and apparel industry in Africa and support integration of the 
textile and apparel industry into global supply chains. At the 
same time, the Committee is supportive of efforts underway to 
develop a more integrated African supply chain so that further 
renewal of third-country fabric provisions will not be 
necessary.

Effective date

    The provision is effective upon enactment.

          SECTION 104: PROMOTING GREATER REGIONAL INTEGRATION

Present law

    Section 506A(b) of the Trade Act of 1974 provides the rules 
of origin for AGOA-eligible products.

Explanation of provision

    Section 104(a) allows producers to include the direct costs 
of processing operations performed in one or more beneficiary 
sub-Saharan African countries or former beneficiary sub-Saharan 
African countries in achieving the required minimum 35 percent 
local value content.
    Section 104(b) allows a producer to include value-added 
from any AGOA-beneficiary country or former AGOA beneficiary 
country in calculating the required minimum 35 percent local 
value content.
    Section 104(c) authorizes the President to amend the 
Harmonized Tariff Schedule of the United States (HTSUS) to add 
the special tariff treatment symbol ``D'' in the ``Special'' 
subcolumn of the HTSUS for every product with the special 
tariff treatment symbol ``A'' in the ``Special'' subcolumn to 
clarify that every article described in section 503(a)(1) of 
title V of the Trade Act of 1974 that is the growth, product, 
or manufacture of a beneficiary sub-Saharan African country 
will be eligible for the preferential tariff treatment 
described in amended section 506A(b)(2).

Reason for change

    These provisions simplify the rules of origin for AGOA and 
encourage further regional integration.
    In order to encourage greater regional integration in 
Africa, section 104(a) amends section 506A(b)(2) of the Trade 
Act of 1974, as amended, to allow accumulation of the direct 
costs of processing operations performed in one or more 
beneficiary sub-Saharan African countries or former beneficiary 
sub-Saharan African countries in achieving the required minimum 
35 percent local value content. The Committee believes that 
this will continue to promote greater regional integration in 
Africa.
    Section 104(b) ensures that the general rules of origin 
governing duty-free treatment under the GSP program would apply 
to any article described in section 503(a)(1) of title V of the 
Trade Act of 1974 that is the growth, product or manufacture of 
a beneficiary sub-Saharan African country. The general rule of 
origin governing duty-free treatment under the GSP program 
would continue to apply to imports from beneficiary sub-Saharan 
African countries of any item, other than textiles or apparel 
products or textile luggage, that is designated as import 
sensitive under section 503(b)(1) of title V of the Trade Act 
of 1974.
    Section 104(c) authorizes the President to simplify import 
paperwork and eliminates confusion by allowing importers of 
products under AGOA to mark ``D'' in all instances for any 
AGOA- or GSP-eligible product.

Effective date

    The amendments made by sections 104(a) and (b) apply to 
eligible products 30 days after enactment. Section 104(c) is 
effective immediately upon enactment.

           SECTION 105: MONITORING AND REVIEW OF ELIGIBILITY

Present law

    Section 506A(a) of the Trade Act of 1974 authorizes the 
President to designate sub-Saharan African countries as 
eligible for AGOA benefits and requires the President to 
monitor, review, and report to Congress annually on the 
progress of each sub-Saharan country in meeting the eligibility 
criteria set forth in the AGOA statute.

Explanation of provision

    Section 105(a) amends section 506A(a)(3) of the Trade Act 
of 1974 to require the President to provide at least 60 days' 
notification and explanation to Congress and the sub-Saharan 
African country in question of his intention to terminate the 
designation of such country as a beneficiary sub-Saharan 
African country.
    Section 105(b) amends section 506A of the Trade Act of 1974 
to allow the President to withdraw, suspend, or limit duty-free 
treatment for certain articles if he determines that such 
treatment would be more effective in promoting compliance with 
eligibility requirements than terminating benefits. The 
President is required to notify Congress and the country in 
question at least 60 days in advance of any action, along with 
the reasons for such action.
    Section 105(c) amends section 506A of the Trade Act of 1974 
to require the President to annually publish in the Federal 
Register, as part of the annual monitoring and review of 
countries, a notice of the annual review and a request for 
public comments on whether beneficiary countries are meeting 
the eligibility criteria. It also requires the United States 
Trade Representative to hold a public hearing within 30 days of 
the President's publication.
    Section 105(c) also requires the President to create a new 
petition process in which interested parties may file a 
petition with the United States Trade Representative at any 
time regarding the compliance of any AGOA beneficiary country.
    Section 105(c) authorizes the President to initiate an out-
of-cycle review of any beneficiary sub-Saharan African country, 
at any time, to determine whether it is making continual 
progress in meeting the eligibility criteria. If a country 
fails the out-of-cycle review, the President shall terminate or 
withdraw, suspend, or limit the application of duty-free 
treatment. The President shall consult with Congress before 
initiating an investigation and report after a conclusion. In 
addition, it is the sense of Congress that the President should 
initiate a review of South Africa or any other beneficiary 
country that is not in compliance with Section 104(a) of AGOA 
within 30 days of enactment.

Reason for change

    Under current practice, the President is not required to 
provide advanced notice to Congress of his intent to terminate 
the designation of a beneficiary country. As a result, the 
President has often notified Congress fewer than 10 days before 
benefits are to be terminated. This does not provide adequate 
certainty and predictability for the program. Section 105(a) 
brings notification obligations under AGOA in line with the 
notification obligations under the GSP program.
    The purpose of section 105(b) of the bill is to provide the 
President with greater flexibility in administering the program 
when a country is found to violate one or more of the 
eligibility criteria. Under the current statute, the 
President's only option is to terminate eligibility for the 
program, effective January 1 of the following year. However, in 
some cases, termination of all benefits is not necessarily the 
most effective way to address the underlying problem. For 
example, if a beneficiary's actions and policies with regards 
to a specific sector of their economy violate the eligibility 
criteria, then the most effective action to address the 
violation may be to limit AGOA benefits with respect to that 
sector, rather than for all products. Similarly, if there is an 
event that contravenes the eligibility criteria that may be 
temporary in nature, then suspension of benefits for a limited 
period of time may be a more effective way to address the issue 
than termination of benefits altogether. Finally, if an event 
occurs that is so egregious that the Administration determines 
benefits should be removed before January 1 of the following 
year, this language gives the President the authority to 
withdraw those benefits within 60 days, with termination to 
follow on January 1 of the following year. The Committee 
expects that the Administration will, in appropriate 
circumstances, make full use of the additional flexibility 
provided in this section to address situations where 
beneficiary countries have taken steps which violate 
eligibility criteria and which may limit or exclude 
international trade and investment.
    While this provision provides additional flexibility, the 
default for a breach of the criteria remains termination of 
benefits on January 1 of the following year because AGOA 
provides benefits above and beyond GSP and includes additional 
eligibility criteria. As such, before invoking the 
flexibilities set out in the bill, the President must determine 
that withdrawing, suspending, or limiting benefits under the 
bill is more effective in promoting compliance with the 
criteria than terminating benefits and shall notify Congress of 
the rationale for this determination.
    As the Committee has noted in the findings section, it has 
heard significant concerns about new and continuing barriers to 
trade in sub-Saharan Africa. Section 105(c) enhances existing 
consultation requirements and creates a new petition process 
that allows for interested parties to have their concerns 
adequately aired at any time. The Committee intends for this 
process to improve input into the AGOA-eligibility review 
process and better inform the Administration of developments. 
The Administration should take these petitions into account 
when annually reviewing AGOA eligibility and in informing out-
of-cycle reviews.
    Under current law the Administration can review a country's 
eligibility at any time. However, the Committee believes that 
statutorily establishing a formal out-of-cycle review provides 
an additional tool to the Administration to regularly review a 
country's eligibility. The Committee does not intend for out-
of-cycle reviews to be common. Instead, a formal out-of-cycle 
review should be instituted by the Administration only when it 
has exhausted all other options. Such a review should occur 
prior to taking steps to terminate a country's eligibility or 
withdraw, suspend, or limit benefits, should such action be 
necessary. These reviews should be conducted promptly, and 
reporting to Congress required by this provision should be 
detailed. If the Administration determines not to take action 
as a result of an out-of-cycle review, the Committee expects 
regular consultations and continued monitoring of developments.
    This section also includes a Sense of Congress provision 
directing the Administration to initiate a review of South 
Africa, and any other similarly situated country, within 30 
days of enactment. The Committee remains very concerned by 
several steps taken by South Africa, including imposition of 
sanitary and phytosanitary measures that are not based on 
science and restrict U.S. exports. For example, poultry and 
poultry products face either express importation bans or SPS 
measures tantamount to an importation ban. Similarly, South 
Africa limits imports of certain cuts and ages of U.S. beef, as 
well as other U.S. ruminant animals and products. With respect 
to pork and pork products, South Africa maintains import 
restrictions on U.S. pork that require unnecessary, and highly 
onerous, export certificates that are not based on science.
    The Committee is also concerned that some AGOA 
beneficiaries have failed to fully implement their WTO 
obligations. In particular, the Committee notes that South 
Africa imposes anti-dumping duties on U.S. poultry using 
methodologies that appear to be inconsistent with WTO 
obligations. These duties have been in place for nearly as long 
as the AGOA program and have effectively shut the market to 
U.S. exports. Similarly, the Committee is concerned by recent 
discussions of policies in South Africa that would restrict 
investment in certain sectors and potentially even nationalize 
existing investments.
    Furthermore, the Committee is concerned by South Africa's 
deteriorating foreign investment climate, including its 
termination of bilateral investment treaties and recent 
legislative proposals to limit foreign ownership in certain 
sectors.

Effective date

    The provision is effective upon enactment.

           SECTION 106: BIENNIAL AGOA UTILIZATION STRATEGIES

Present law

    No provision.

Explanation of provision

    Section 106(a) establishes a Sense of Congress that 
eligible sub-Saharan African countries should develop biennial 
AGOA Utilization Strategies to more effectively and 
strategically utilize benefits available under AGOA and that 
the United States trade capacity building agencies should work 
with and provide appropriate resources in developing and 
implementing these strategies. It also encourages USTR to 
consider requesting strategies from Regional Economic 
Communities, as appropriate.
    Section 106(b) establishes that AGOA Utilization Strategies 
should identify strategic needs and priorities to bolster AGOA 
utilization and sets forth suggested content.
    Section 106(c) calls on AGOA eligible countries and USTR to 
publish public versions of their utilization plans on the 
Internet.

Reason for change

    These provisions implement recommendations from the 
Government Accountability Office that the United States 
encourage the development of utilization strategies. At its 
hearing last year on AGOA, the Committee also received 
testimony that those countries that have unilaterally adopted 
AGOA utilization strategies have more effectively grown and 
diversified exports under AGOA. The Committee believes that 
these AGOA utilization strategies should inform trade capacity 
building efforts, including allocation of resources.

Effective date

    The provision is effective upon enactment.

SECTION 107: DEEPENING AND EXPANDING TRADE AND INVESTMENT TIES BETWEEN 
                SUB-SAHARAN AFRICA AND THE UNITED STATES

Present law

    This provision builds on findings in previous AGOA 
legislation, including Section 103 of the African Growth and 
Opportunity Act.

Explanation of provision

    This section establishes the policy of the United States to 
deepen and expand investment ties between sub-Saharan Africa 
and the United States.
    Section 107(a) establishes that the United States should 
continue to seek all opportunities to deepen and expand ties 
between sub-Saharan Africa and the United States through 
accession by sub-Saharan African countries to the World Trade 
Organization and negotiation of Trade and Investment Framework 
Agreements, Bilateral Investment Treaties, and Free Trade 
Agreements with individual countries and regional economic 
communities.
    Section 107(b) states that the United States should 
continue to seek to agreements with individual countries as 
well as regional economic communities, as appropriate.
    Section 107(c) provides that the United States should 
continue to promote the full implementation of commitments made 
under WTO agreements to improve AGOA utilization and promote 
trade and investment.
    Section 107(d) provides that the United States should 
continue to promote the negotiation of trade agreements that 
cover substantially all trade between parties, and to object in 
all forums if other countries negotiate agreements that do not 
cover substantially all trade.

Reason for change

    The Committee believes that deeper trade and investment 
ties between sub-Saharan Africa and the United States will 
further mutually-shared development and national security 
goals. The Committee encourages the Administration to expand 
our Trade and Investment Framework Agreements (TIFAs) and 
Bilateral Investment Treaties (BITs), including by concluding 
BITs with regional groupings. As countries become ready, the 
United States should transition to FTAs for the most robust 
trade relationship.
    Section 107(c) addresses several important points. First, 
sub-Saharan African countries that are already members of the 
World Trade Organization should fully implement existing 
commitments and be in compliance with their obligations. The 
Committee believes that full implementation of these 
commitments is important to encouraging more robust trade and 
investment relationships.
    Second, full implementation of the WTO Trade Facilitation 
Agreement (TFA), which was agreed to in December 2013 at the 
9th WTO Ministerial, will facilitate removing barriers to trade 
and promoting infrastructure development within sub-Saharan 
Africa. Analysis by the Peterson Institute for International 
Economics suggests that implementation of the TFA could add $1 
trillion to the global economy. The TFA also provides 
flexibility to developing countries and least developed 
countries (LDCs) as well as mechanisms for technical assistance 
to support implementation. These provisions will be especially 
significant in sub-Saharan Africa, where lower levels of 
automation and transparency contribute to higher transaction 
costs, and a significant percentage of countries are landlocked 
(and therefore must transit other countries' borders just to 
reach their export destination).
    Already, Mauritius has submitted its ratification 
instrument to the WTO. The Committee welcomes this important 
step and encourages all AGOA beneficiaries to promptly take the 
necessary steps to submit ratification instruments to the WTO 
prior to the 10th WTO Ministerial in Kenya in December 2015.
    Section 107(d) reflects the Committee's strong concerns 
about the EU's efforts to push African countries from its own 
unilateral preference program into reciprocal, bilateral trade 
agreements--what it calls Economic Partnership Agreements 
(EPAs), which do not cover substantially all trade. Of 
particular concern, the tariff preferences in the EU-South 
Africa EPA have now largely entered into force, and U.S. 
exporters are at a significant disadvantage. These EPAs raise 
WTO concerns because they are reported not to cover 
substantially all trade and carve out many economically 
significant and sensitive sectors. The EU continues to push 
EPAs with many AGOA members that would further disadvantage 
U.S. exporters.
    The Committee believes that AGOA is--and should remain--a 
unilateral preference program and does not intend to seek 
reciprocity through AGOA. However, the Committee notes that the 
EU's approach disadvantages U.S. companies seeking to do 
business with Africa and raises serious policy and development 
concerns.

Effective date

    The provision is effective upon enactment.

                          SECTION 108: REPORTS

Present law

    Reports required under AGOA have expired.

Explanation of provision

    Section 108(a) requires the President to submit a biennial 
comprehensive report to Congress on the trade and investment 
relationship between the United States and sub-Saharan Africa. 
The first such report must be submitted not later than one year 
after the date of enactment.
    Section 108(b) requires the United States Trade 
Representative to submit to Congress every five years a report 
that evaluates each AGOA eligible country's path toward 
becoming a trade agreement partner, identifies sub-Saharan 
countries that have expressed an interest in entering into a 
free trade agreement with the United States, and establishes a 
plan for negotiating and concluding such agreements. The first 
such report must be submitted not later than one year after the 
date of enactment.
    Section 108(c) sunsets these reports consistent with the 
duration of this Act.

Reason for change

    Both of these reports were required under the original AGOA 
legislation, but expired in 2007. The Committee found these 
reports to be valuable and an important aspect of its 
oversight. As a result, it is renewing both reports, with some 
modifications to reflect developments.
    The report required in section 108(a) should be 
comprehensive in its review of each country's performance 
against the required eligibility criteria. In particular, the 
Committee expects that the Administration will thoroughly 
review each aspect of the eligibility criteria and where an 
AGOA-eligible country is making less than full progress towards 
meeting the criteria, provide detailed information on the 
actions the Administration will take to ensure that greater 
progress is made.
    The report required in section 108(b) is meant to 
supplement and expand upon the section 108(a) report. In this 
report, the Administration is expected to provide an analysis 
that allows the Committee to evaluate and understand which 
AGOA-eligible countries may soon be ready for trade agreement 
negotiations and where gaps exist between existing U.S. trade 
agreement practice and the domestic laws of those countries. 
The Administration should also use this gap-analysis to inform 
its selection of potential trade agreement negotiating 
partners. In particular, the Committee notes that the 
Administration should carefully evaluate the feasibility of 
negotiating a trade agreement with each AGOA-eligible country 
(or regional economic community, if appropriate) and not just 
those AGOA-eligible countries that the Administration has 
sought to negotiate with in the past.

Effective date

    The provision is effective upon enactment.

                   SECTION 109: TECHNICAL AMENDMENTS

Present law

    No provision.

Explanation of provision

    Section 109 deletes section 104(b) of the African Growth 
and Opportunity Act, as amended.

Reason for change

    Section 104(b) of the African Growth and Opportunity Act is 
duplicative of other provisions.

Effective date

    The provision is effective upon enactment.

                        SECTION 110: DEFINITIONS

Present law

    Section 506A of the Trade Act of 1974 and Section 107 of 
the African Growth and Opportunity Act.

Explanation of provision

    Section 110 defines terms used in this bill in the same way 
as previous legislation.

Reason for change

    This section ensures that the terms used in this bill have 
the same meaning as previous legislation.

Effective date

    The provision is effective upon enactment.

        TITLE II: EXTENSION OF GENERALIZED SYSTEM OF PREFERENCES


    SECTION 201: EXTENSION OF THE GENERALIZED SYSTEM OF PREFERENCES

Present law

    Title V of the Trade Act of 1974 contains the legislative 
authorization for the GSP program. Section 505 of the Trade Act 
of 1974, as amended, provides that no duty-free treatment under 
Title V shall remain in effect after July 31, 2013.

Explanation of provision

    Section 201 amends Section 505 of the Trade Act of 1974 to 
extend the Generalized System of Preferences program until 
December 31, 2017, and retroactively applies to goods imported 
on or after July 31, 2013 that would have been eligible for 
duty-free treatment under the GSP program as of the date of 
enactment.

Reasons for change

    The Committee believes GSP has been a highly effective 
program in meeting its goals of fostering development in 
developing economies through trade, promoting U.S. trade 
interests by encouraging beneficiary countries to open their 
markets and comply with international trade rules, and 
maintaining U.S. competitiveness by lowering costs for U.S. 
businesses and lowering prices for U.S. consumers. Further, to 
prevent an unintended gap in duty-free treatment, the Committee 
provides for a retroactive extension of the program.

Effective date

    This provision applies to eligible imports 30 days after 
enactment.

SECTION 202: AUTHORITY TO DESIGNATE CERTAIN COTTON ARTICLES AS ELIGIBLE 
                   ARTICLES ONLY FOR LDBDCS UNDER GSP

Present law

    Section 505(b) of the Trade Act of 1974 prohibits the 
President from designating certain articles as eligible for 
duty-free treatment.

Explanation of provision

    Section 202 amends Section 503(b) of the Trade Act of 1974 
to authorize the President to designate certain cotton 
articles, classifiable under subheadings 5201.00.18, 
5201.00.28, 5201.00.38, 5202.99.30, and 5203.00.30 of the 
Harmonized Tariff Schedules of the United States, as eligible 
articles for countries designated as least-developed 
beneficiary developing countries under the GSP program.

Reasons for change

    The Committee believes that authorizing the President to 
designate certain cotton articles as eligible articles for 
LDBDCs would encourage continued and enhanced economic 
engagement between LDBDCs and the international marketplace. 
The Committee, while recognizing the sensitivity of cotton 
product imports, believes that the extension of eligibility to 
cotton articles classifiable under subheading 5201.00.18, 
5201.00.28, 5201.00.38, 5202.99.30, and 5203.00.30 will promote 
the objectives of the GSP program and will not disadvantage the 
integrity or competitiveness of the U.S. domestic cotton 
industry.

Effective date

    This provision is effective upon enactment.

  SECTION 203: APPLICATION OF COMPETITIVE NEED LIMITATION AND WAIVER 
  UNDER GENERALIZED SYSTEM OF PREFERENCES WITH RESPECT TO ARTICLES OF 
 BENEFICIARY DEVELOPING COUNTRIES EXPORTED TO THE UNITED STATES DURING 
                           CALENDAR YEAR 2014

Present law

    Section 503(c)(2) and (d) of the Trade Act of 1974 provides 
for the administration of competitive need limitations and 
waivers. Present law requires the Administration to complete 
this process by July 1 of each year.

Explanation of provision

    Section 203 allows the Administration to complete the 
competitive need limitation and waiver determinations by 
October 1, 2015 for products entered in 2014.

Reasons for change

    This provision allows additional time for the 
Administration to conduct its annual competitive need 
limitations and waivers review.

Effective date

    This provision is effective immediately upon enactment.

 TITLE III: EXTENSION OF PREFERENTIAL DUTY TREATMENT PROGRAM FOR HAITI


SECTION 301: EXTENSION OF PREFERENTIAL DUTY TREATMENT PROGRAM FOR HAITI

Present law

    Under the Caribbean Basin Economic Recovery Act, benefits 
under Section 213A(b)(1)(B)(v)(I) begin to expire on December 
20, 2017 and under Section 213A(h) all benefits expire on 
September 30, 2020.

Explanation of provision

    Section 301 amends Section 213A of the Caribbean Basin 
Economic Recovery Act to extend benefits to Haiti through 
September 30, 2025.

Reasons for change

    The Committee believes the HOPE and HELP programs have 
played an important role in helping to improve the economic 
conditions in Haiti and supporting recovery since the 
devastating earthquake in 2010. Studies suggest that HOPE/HELP 
support an estimated 30,000 jobs in Haiti that are created by 
the apparel industry, the core export industry and primary 
source of employment growth. A long-term extension of HOPE/HELP 
will further encourage foreign investment and job creation by 
extending trade preferences to reinvigorate the apparel 
industry and attract new and expanded foreign direct 
investment. This extension also reaffirms U.S. foreign policy 
and national security interests by promoting trade and long-
term investments in Haiti.

Effective date

    This provision is effective upon enactment.

                       TITLE IV: OTHER PROVISIONS


                     SECTION 401: CUSTOMS USER FEES

Present law

    Under Section 13031(a) of the Consolidated Omnibus Budget 
Reconciliation Act of 1985, the Secretary of the Treasury is 
authorized to charge and collect fees for the provision of 
certain customs services. Pursuant to Section 13031(j)(3), the 
Secretary of the Treasury may not charge fees for the provision 
of certain customs services after September 30, 2024.

Explanation of the provision

    Section 401(a) amends Section 13031(j)(3)(A) of the 
Consolidated Omnibus Budget Reconciliation Act of 1985 to 
extend the period that the Secretary of the Treasury may charge 
for certain customs services for imported goods from September 
30, 2024 to July 7, 2025.
    Section 401(b) extends the ad valorem rate for the 
Merchandise Processing Fee collected by Customs and Border 
Protection that offsets the costs incurred in processing and 
inspecting imports, from June 30, 2021 to June 30, 2025.

Reasons for change

    The Committee believes it is appropriate to extend the 
merchandise processing fees for budgetary offset purposes.

Effective date

    This provision is effective upon enactment.

       SECTION 402: TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES

Present law

    In general, corporations are required to make quarterly 
estimated tax payments of their income tax liability.\1\ For a 
corporation whose taxable year is a calendar year, these 
estimated tax payments must be made by April 15, June 15, 
September 15, and December 15. The amount of any required 
estimated payment is 25 percent of the required annual 
payment.\2\ The required annual payment is 100 percent of the 
tax liability for the taxable year or the preceding taxable 
year. The option to use the preceding taxable year is not 
available if the preceding taxable year was not a 12-month 
taxable year or the corporation did not file a return in the 
preceding taxable year showing a liability for tax. Further, in 
the case of a corporation with taxable income of at least $1 
million in any of the three immediately preceding taxable 
years, the option to use the preceding taxable year is only 
available for the first installment of such corporation's 
taxable year.\3\ In addition, in the case of a corporation with 
assets of at least $1 billion (determined as of the end of the 
preceding taxable year), payments due in July, August or 
September of 2017, are increased to 100.25 percent of the 
payment otherwise due.\4\ For each of the periods affected, the 
next required payment is reduced accordingly (i.e., payments 
due in October, November, or December of 2017 are reduced to 
99.75 percent of the payment otherwise due).
---------------------------------------------------------------------------
    \1\Sec. 6655.
    \2\Sec. 6655(d)(1).
    \3\Sec. 6655(d)(2) and (g)(2).
    \4\African Growth and Opportunity Act, Pub. L. No. 112-163, sec. 4.
---------------------------------------------------------------------------

Explanation of the provision

    In the case of a corporation with assets of at least $1 
billion (determined as of the end of the preceding taxable 
year), the provision increases the amount of the required 
installment of estimated tax otherwise due in July, August, or 
September of 2020 by 5.25 percent of such amount (determined 
without regard to any increase in such amount not contained in 
the Internal Revenue Code) (i.e., payments due in July, August 
or September of 2020, are increased to 105.25 percent of the 
payment otherwise due). The next required installment is 
reduced accordingly (i.e., payments due in October, November, 
or December of 2020 are reduced to 94.75 percent of the payment 
otherwise due).

Reasons for change

    The Committee believes it is appropriate to adjust the 
quarterly estimated tax payment requirements for corporations 
with $1 billion or more in assets to ensure that the 
legislation complies with certain Senate procedural 
requirements.

Effective date

    The proposal is effective on the date of enactment of the 
Act.

                      III. VOTES OF THE COMMITTEE

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the vote of the Committee on Ways and Means in its 
consideration of H.R. 1891, to extend the African Growth and 
Opportunity Act, the Generalized System of Preferences, the 
preferential duty treatment program for Haiti, and for other 
purposes, on April 23, 2015.
    The bill, H.R. 1891, was ordered favorably reported by 
voice vote (with a quorum being present).

                     IV. BUDGET EFFECTS OF THE BILL


               A. Committee Estimate of Budgetary Effects

    In compliance with clause 3(d) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the effects on the budget of the bill, H.R. 1891, as 
reported.
    The bill, as reported, is estimated to have the following 
effect on Federal budget receipts for fiscal years 2015-2025:

                                                                      FISCAL YEARS
                                                                  [Millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
   2015        2016        2017        2018        2019        2020        2021        2022       2023       2024       2025      2015-20      2015-25
--------------------------------------------------------------------------------------------------------------------------------------------------------
     ...                              3,781       -3,781                                                    3,781
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Pursuant to clause 8 of rule XIII of the Rules of the House 
of Representatives, the following statement is made by the 
Joint Committee on Taxation with respect to the provisions of 
the bill amending the Internal Revenue Code of 1986: the gross 
budgetary effect (before incorporating macroeconomic effects) 
in any fiscal year is less than 0.25 percent of the current 
projected gross domestic product of the United States for that 
fiscal year; therefore, the bill is not ``major legislation'' 
for purposes of requiring that the estimate include the 
budgetary effects of changes in economic output, employment, 
capital stock and other macroeconomic variables.

B. Statement Regarding New Budget Authority and Tax Expenditures Budget 
                               Authority

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee states that the 
revenue provision of the bill involves no new or increased 
budget authority.

      C. Cost Estimate Prepared by the Congressional Budget Office

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, requiring a cost estimate 
prepared by the CBO, the following statement by CBO is 
provided.

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, April 29, 2015.
Hon. Paul Ryan,
Chairman, Committee on Ways and Means, House of Representatives, 
        Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1891, a bill to 
extend the African Growth and Opportunity Act, the Generalized 
System of Preferences, the preferential duty treatment program 
for Haiti, and for other purposes.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Mark 
Grabowicz for federal spending and Ann Futrell and Susan Willie 
for federal revenues.
            Sincerely,
                                              Keith Hall, Director.
    Enclosure.

H.R. 1891--A bill to extend the African Growth and Opportunity Act, the 
        Generalized System of Preferences, the preferential duty 
        treatment program for Haiti, and for other purposes

    Summary: H.R. 1891 would extend the reduced tariff rates 
currently imposed on products imported under the African Growth 
and Opportunity Act (AGOA), the Generalized System of 
Preferences (GSP), and the Haitian Hemispheric Opportunity 
through Partnership Encouragement Act. The bill also would 
shift some corporate income tax payments between fiscal years 
and increase the rate of certain fees collected by Customs and 
Border Protection (CBP) as well as extend the authority to 
collect those fees.
    CBO and the staff of the Joint Committee on Taxation (JCT) 
estimate that enacting H.R. 1891 would reduce both direct 
spending and revenues by about $5.8 billion over the 2015-2025 
period--resulting in a reduction in deficits over the 11-year 
period of $16 million. Pay-as-you-go procedures apply because 
enacting the legislation would affect direct spending and 
revenues. CBO estimates that certain Congressional reports 
called for under H.R. 1891 would cost $1 million over the 2015-
2020 period, assuming availability of appropriated funds.
    CBO has determined that the nontax provisions of the bill 
contain no intergovernmental mandates as defined in the 
Unfunded Mandates Reform Act (UMRA) and would not affect the 
budgets of state, local, or tribal governments. JCT has 
determined that the tax provisions of the bill contain no 
intergovernmental or private-sector mandates.
    CBO has determined that the nontax provisions of H.R. 1891 
contain private-sector mandates on entities required to pay 
merchandise processing fees. CBO estimates the aggregate cost 
of the mandates would exceed the annual threshold established 
in UMRA for private-sector mandates ($154 million in 2015, 
adjusted annually for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary effects of H.R. 1891 are shown in the following 
table. The costs of this legislation fall within budget 
functions 750 (administration of justice) and 370 (advancement 
of commerce).

 
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              By fiscal year, in millions of dollars--
                                                                   -----------------------------------------------------------------------------------------------------------------------------
                                                                      2015      2016      2017     2018     2019     2020      2021      2022     2023     2024     2025    2015-2020  2015-2025
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                   CHANGES IN DIRECT SPENDING
Estimated Budget Authority........................................         0         0        0        0        0         0      -162     -873     -916     -962    -2,948          0     -5,861
Estimated Outlays.................................................         0         0        0        0        0         0      -162     -873     -916     -962    -2,948          0     -5,861
 
                                                                                       CHANGES IN REVENUES
 
Extension of African Growth and Opportunity Act...................         *      -121     -130     -238     -284      -298      -312     -329     -345     -365      -387     -1,071     -2,809
Extension of General System of Preferences........................    -1,051      -627     -665     -173        0         0         0        0        0        0         0     -2,516     -2,516
Extension of Preferential Duty Treatment for Haiti................         0         0        0        0      -12       -17       -75      -97     -101     -106      -112        -29       -520
Shift in Payment of Corporate Estimated Tax.......................         0         0        0        0        0     3,781    -3,781        0        0        0         0      3,781          0
                                                                   -----------------------------------------------------------------------------------------------------------------------------
    Total Changes in Revenues.....................................    -1,051      -748     -795     -411     -296     3,466    -4,168     -426     -446     -471      -499        165     -5,845
 
                                                    NET INCREASE OR DECREASE (-) IN THE DEFICIT FROM CHANGES IN DIRECT SPENDING AND REVENUES
Impact on Deficit.................................................     1,051       748      795      411      296    -3,466     4,006     -447     -470     -491    -2,449       -165        -16
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Sources: Congressional Budget Office and the Staff of the Joint Committee on Taxation
Notes: This estimate assumes enactment of H.R. 1891 by July 1, 2015; * = between -$500,000 and zero.
For direct spending, negative numbers indicate a decrease in outlays; for revenues, negative numbers indicate a reduction in revenues.
Components may not sum to totals because of rounding.
CBO estimates that implementing H.R. 1891 would cost about $1 million over the 2015-2020 period, assuming availability of appropriated funds, to prepare Congressional reports.

    Basis of estimate: For this estimate, CBO assumes that H.R. 
1891 will be enacted by July 1, 2015.

Direct spending

    Under current law, the authority to charge merchandise 
processing fees collected by Customs and Border Protection will 
expire after September 30, 2024. The bill would extend the 
authority to collect those fees through July 7, 2025. The bill 
also would raise the rate of the merchandise processing fee 
from 0.21 percent to 0.3464 percent of the value of goods 
entering the U.S. for the period beginning July 1, 2021, and 
ending June 30, 2025. CBO estimates those actions would 
increase offsetting receipts (certain collections that are 
treated as reductions in direct spending) by about $5.9 billion 
over the 2021-2025 period. To project collections of 
merchandise processing fees, CBO assumes that the fees 
collected in future years will grow at the same rate seen in 
recent years--about 5 percent. In 2014 collections from the 
merchandise processing fee totaled $2.3 billion. By 2024 CBO 
estimates those collections will total about $2.7 billion under 
current law. CBO expects that the proposed increase in the fee 
rate would have a very minor effect on the value of goods 
entering the U.S.

Revenues

    CBO's estimates of the revenue effects of proposals to 
lower tariff rates charged on imports from certain countries or 
on certain goods are based on historical data about the value 
and volume of those goods entering the United States. Using 
that historical data, CBO develops a baseline of future 
collections that accounts for expected growth in trade over the 
next ten years. To estimate tariff collections under the 
proposed legislation, CBO considers both general growth in 
trade as well as changes in demand that are likely to result 
from lower rates. The changes in revenues for each of the 
programs discussed below reflect the difference between the 
baseline estimate of collections for each program using 
effective tariff rates under current law and projected 
collections under each proposal using the proposed duty rate, 
net of payroll and income tax offsets. CBO assumes that the 
lower tariffs under the legislation would result in an increase 
in overall imports, as well as a diversion of imports from 
countries that would not be eligible for lower tariffs to those 
that would.
    Extension of African Growth and Opportunity Act. Under AGOA 
the U.S. provides nonreciprocal tariff reductions to roughly 40 
eligible sub-Saharan countries for certain goods that the U.S. 
imports. The bill would extend the authority for reduced 
tariffs under AGOA, which are set to expire at the end of 
September 30, 2015, through September 30, 2025. The bill also 
would extend the special rule that may apply to certain lesser-
developed sub-Saharan countries under AGOA. The special rule 
also expires on September 30, 2015. Under this rule a lesser-
developed country may export duty-free to the United States any 
apparel good that is assembled within the country, regardless 
of the origin of the fabric or yarn. In addition, the bill 
would revise the rules of origin for AGOA beneficiary countries 
under GSP to expand the value of products that would qualify 
for duty free treatment.
    CBO estimates that extending and amending AGOA would reduce 
revenues by $2.8 billion over the 2015-2025 period, net of 
payroll and income tax offsets. That estimate includes the 
revenue loss after December 31, 2017, from imports that are 
eligible for duty free treatment under GSP (which the bill 
extends through December 31, 2017).
    Extension of General System of Preferences. Under the GSP 
the U.S. affords nonreciprocal tariff reductions to 
approximately 130 developing countries. Generally, duty-free 
treatment of imported goods from GSP-designated developing 
countries is extended to products that are predominately 
produced only in those countries. The bill would renew GSP, 
which expired on July 31, 2013, and continue its authority 
through December 31, 2017. Under the bill, importers or 
exporters that would have otherwise qualified for reduced 
tariffs under GSP could obtain refunds for tariffs paid after 
July 30, 2013, that would not have been payable had GSP been in 
effect. CBO estimates that renewing GSP would reduce revenues 
by $2.5 billion over the 2015-2025 period, net of payroll and 
income tax offsets. This estimate includes the cost, through 
December 31, 2017, of imports that are eligible for duty free 
treatment under the African Growth Opportunity Act (which 
expires in September 2015).
    Extension of preferential duty treatment for Haiti. Under 
the Haitian Hemispheric Opportunity through Partnership 
Encouragement Act, certain textile and apparel goods imported 
to the U.S. from Haiti are eligible for duty-free treatment if 
restrictions regarding the source of the yarns and fabrics used 
in the imported goods are met. Portions of this program will 
begin to expire in 2016; H.R. 1891 would extend this duty-free 
status through 2025. CBO estimates that enacting this provision 
would reduce revenues by $520 million over the 2015-2025 
period, net of payroll and income tax offsets.
    Shift in payment of corporate estimated tax. H.R. 1891 
would shift payments of corporate estimated taxes between 
fiscal years 2020 and 2021. For corporations with at least $1 
billion in assets, the bill would increase the portion of 
corporate estimated payments due from July through September in 
2020. The staff of JCT estimates that those changes would 
increase revenues by $3.8 billion in 2020 and reduce revenues 
by the same amount in 2021.

Spending Subject to Appropriation

    H.R. 1891 would require the United States Trade 
Representative to prepare a series of reports on trade 
activities with sub-Saharan African countries and their 
interest in entering into free trade agreements with the United 
States. Based on the cost of similar reports, CBO estimates 
that the costs to prepare that series would be significantly 
less than $500,000 annually, and would total about $1 million 
over the 2015-2020 period.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays and revenues that are 
subject to those pay-as-you-go procedures are shown in the 
following table.

                               CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1891, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON APRIL 23, 2015
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                           By fiscal year, in millions of dollars--
                                                             -----------------------------------------------------------------------------------------------------------------------------------
                                                                2015      2016      2017      2018      2019      2020      2021      2022      2023      2024      2025    2015-2020  2015-2025
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           NET INCREASE OR DECREASE (-) IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact..............................     1,051       748       795       411       296    -3,466     4,006      -447      -470      -491    -2,449       -165        -16
Memorandum:
    Changes in Outlays......................................         0         0         0         0         0         0      -162      -873      -916      -962    -2,948          0     -5,861
    Changes in Revenues.....................................    -1,051      -748      -795      -411      -296     3,466    -4,168      -426      -446      -471      -499        165     -5,845
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Estimated impact on state, local, and tribal governments: 
CBO has determined that the nontax provisions of the bill 
contain no intergovernmental mandates as defined in UMRA and 
would not affect the budgets of state, local, or tribal 
governments. JCT has determined that the tax provisions of the 
bill contain no intergovernmental mandates.
    Estimated impact on the private sector: CBO has determined 
that the nontax provisions of H.R. 1891 would impose private-
sector mandates, as defined in UMRA, on entities required to 
pay merchandise processing fees. The bill would extend those 
fees through July 7, 2025; the fee rates would increase 
beginning July 1, 2021, and ending June 30, 2025. Some of the 
entities that are required to pay merchandise processing fees 
may also accrue savings related to the preferential tariff 
treatment accorded to certain products that would be extended 
under the bill. However, CBO estimates that the aggregate costs 
of the mandates would exceed the annual threshold established 
in UMRA for private-sector mandates ($154 million in 2015, 
adjusted annually for inflation).
    JCT has determined that the tax provisions of H.R. 1891 
contain no private-sector mandates as defined in UMRA.
    Previous CBO estimate: On April 17, 2015, CBO transmitted 
an estimate of the effects on direct spending and revenues of 
H.R. 1891, as introduced by the House Committee on Ways and 
Means on April 17, 2015. Estimated costs for both versions of 
H.R. 1891 are the same.
    Estimate prepared by: Federal Costs: Mark Grabowicz; 
Federal Revenues: Ann Futrell, Susan Willie, and staff of the 
Joint Committee on Taxation; Impact on State, Local, and Tribal 
Governments: Jon Sperl; Impact on the Private Sector: Paige 
Piper/Bach.
    Estimate approved by: Theresa Gullo, Assistant Director for 
Budget Analysis.

     V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE


          A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives (relating to oversight findings), 
the Committee advises that it was as a result of the 
Committee's review of the provisions of H.R. 1891 that the 
Committee concluded that it is appropriate to report the bill 
favorably to the House of Representatives with the 
recommendation that the bill do pass.

        B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
bill contains no measure that authorizes funding, so no 
statement of general performance goals and objectives for which 
any measure authorizes funding is required.

              C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
    The Committee has determined that the bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

                D. Applicability of House Rule XXI 5(b)

    Rule XXI 5(b) of the Rules of the House of Representatives 
provides, in part, that ``A bill or joint resolution, 
amendment, or conference report carrying a Federal income tax 
rate increase may not be considered as passed or agreed to 
unless so determined by a vote of not less than three-fifths of 
the Members voting, a quorum being present.'' The Committee has 
carefully reviewed the bill, and states that the bill does not 
involve any Federal income tax rate increases within the 
meaning of the rule.

                       E. Tax Complexity Analysis

    The following statement is made pursuant to clause 3(h)(1) 
of rule XIII of the Rules of the House of Representatives. 
Section 4022(b) of the Internal Revenue Service Restructuring 
and Reform Act of 1998 requires the staff of the Joint 
Committee on Taxation (in consultation with the Internal 
Revenue Service and the Treasury Department) to provide a tax 
complexity analysis. The complexity analysis is required for 
all legislation reported by the Senate Committee on Finance, 
the House Committee on Ways and Means, or any committee of 
conference if the legislation includes a provision that 
directly or indirectly amends the Internal Revenue Code and has 
widespread applicability to individuals or small businesses.
    Pursuant to clause 3(h)(1) of rule XIII of the Rules of the 
House of Representatives, the staff of the Joint Committee on 
Taxation has determined that a complexity analysis is not 
required under section 4022(b) of the IRS Reform Act because 
the bill contains no provisions that amend the Internal Revenue 
Code and that have ``widespread applicability'' to individuals 
or small businesses, within the meaning of the rule.

  F. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the bill, and states that the revenue 
provisions of the bill do not contain any congressional 
earmarks, limited tax benefits, or limited tariff benefits 
within the meaning of the rule.

                   G. Duplication of Federal Programs

    In compliance with Sec. 3(j)(2) of H. Res. 5 (114th 
Congress), the Committee states that no provision of the bill 
establishes or reauthorizes: (1) a program of the Federal 
Government known to be duplicative of another Federal program, 
(2) a program included in any report from the Government 
Accountability Office to Congress pursuant to section 21 of 
Public Law 111-139, or (3) a program related to a program 
identified in the most recent Catalog of Federal Domestic 
Assistance, published pursuant to the Federal Program 
Information Act (Public Law 95-220, as amended by Public Law 
98-169).

                 H. Disclosure of Directed Rule Makings

    In compliance with Sec. 3(i) of H. Res. 5 (114th Congress), 
the following statement is made concerning directed rule 
makings: The Committee estimates that the bill requires no 
directed rule makings within the meaning of such section.

       VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED


   Text of Existing Law Amended or Repealed by the Bill, as Reported

  In compliance with clause 3(e)(1)(A) of rule XIII of the 
Rules of the House of Representatives, the text of each section 
proposed to be amended or repealed by the bill, as reported, is 
shown below:

                           TRADE ACT OF 1974



           *       *       *       *       *       *       *
TITLE V--GENERALIZED SYSTEM OF PREFERENCES

           *       *       *       *       *       *       *


SEC. 503. DESIGNATION OF ELIGIBLE ARTICLES.

  (a) Eligible Articles.--
          (1) Designation.--
                  (A) In general.--Except as provided in 
                subsection (b), the President is authorized to 
                designate articles as eligible articles from 
                all beneficiary developing countries for 
                purposes of this title by Executive order or 
                Presidential proclamation after receiving the 
                advice of the International Trade Commission in 
                accordance with subsection (e).
                  (B) Least-developed beneficiary developing 
                countries.--Except for articles described in 
                subparagraphs (A), (B), and (E) of subsection 
                (b)(1) and articles described in paragraphs (2) 
                and (3) of subsection (b), the President may, 
                in carrying out section 502(d)(1) and 
                subsection (c)(1) of this section, designate 
                articles as eligible articles only for 
                countries designated as least-developed 
                beneficiary developing countries under section 
                502(a)(2) if, after receiving the advice of the 
                International Trade Commission in accordance 
                with subsection (e) of this section, the 
                President determines that such articles are not 
                import-sensitive in the context of imports from 
                least-developed beneficiary developing 
                countries.
                  (C) Three-year rule.--If, after receiving the 
                advice of the International Trade Commission 
                under subsection (e), an article has been 
                formally considered for designation as an 
                eligible article under this title and denied 
                such designation, such article may not be 
                reconsidered for such designation for a period 
                of 3 years after such denial.
          (2) Rule of origin.--
                  (A) General rule.--The duty-free treatment 
                provided under this title shall apply to any 
                eligible article which is the growth, product, 
                or manufacture of a beneficiary developing 
                country if--
                          (i) that article is imported directly 
                        from a beneficiary developing country 
                        into the customs territory of the 
                        United States; and
                          (ii) the sum of--
                                  (I) the cost or value of the 
                                materials produced in the 
                                beneficiary developing country 
                                or any two or more such 
                                countries that are members of 
                                the same association of 
                                countries and are treated as 
                                one country under section 
                                507(2), plus
                                  (II) the direct costs of 
                                processing operations performed 
                                in such beneficiary developing 
                                country or such member 
                                countries,
                        is not less than 35 percent of the 
                        appraised value of such article at the 
                        time it is entered.
                  (B) Exclusions.--An article shall not be 
                treated as the growth, product, or manufacture 
                of a beneficiary developing country by virtue 
                of having merely undergone--
                          (i) simple combining or packaging 
                        operations, or
                          (ii) mere dilution with water or mere 
                        dilution with another substance that 
                        does not materially alter the 
                        characteristics of the article.
          (3) Regulations.--The Secretary of the Treasury, 
        after consulting with the United States Trade 
        Representative, shall prescribe such regulations as may 
        be necessary to carry out paragraph (2), including, but 
        not limited to, regulations providing that, in order to 
        be eligible for duty-free treatment under this title, 
        an article--
                  (A) must be wholly the growth, product, or 
                manufacture of a beneficiary developing 
                country, or
                  (B) must be a new or different article of 
                commerce which has been grown, produced, or 
                manufactured in the beneficiary developing 
                country.
  (b) Articles That May Not Be Designated As Eligible 
Articles.--
          (1) Import sensitive articles.--The President may not 
        designate any article as an eligible article under 
        subsection (a) if such article is within one of the 
        following categories of import-sensitive articles:
                  (A) Except as provided in paragraph (4), 
                textile and apparel articles which were not 
                eligible articles for purposes of this title on 
                January 1, 1994, as this title was in effect on 
                such date.
                  (B) Watches, except those watches entered 
                after June 30, 1989, that the President 
                specifically determines, after public notice 
                and comment, will not cause material injury to 
                watch or watch band, strap, or bracelet 
                manufacturing and assembly operations in the 
                United States or the United States insular 
                possessions.
                  (C) Import-sensitive electronic articles.
                  (D) Import-sensitive steel articles.
                  (E) Footwear, handbags, luggage, flat goods, 
                work gloves, and leather wearing apparel which 
                were not eligible articles for purposes of this 
                title on January 1, 1995, as this title was in 
                effect on such date.
                  (F) Import-sensitive semimanufactured and 
                manufactured glass products.
                  (G) Any other articles which the President 
                determines to be import-sensitive in the 
                context of the Generalized System of 
                Preferences.
          (2) Articles against which other actions taken.--An 
        article shall not be an eligible article for purposes 
        of this title for any period during which such article 
        is the subject of any action proclaimed pursuant to 
        section 203 of this Act (19 U.S.C. 2253) or section 232 
        or 351 of the Trade Expansion Act of 1962 (19 U.S.C. 
        1862, 1981).
          (3) Agricultural products.--No quantity of an 
        agricultural product subject to a tariff-rate quota 
        that exceeds the in-quota quantity shall be eligible 
        for duty-free treatment under this title.
          (4) Certain hand-knotted or hand-woven carpets.--
        Notwithstanding paragraph (1)(A), the President may 
        designate as an eligible article or articles under 
        subsection (a) carpets or rugs which are hand-loomed, 
        hand-woven, hand-hooked, hand-tufted, or hand-knotted, 
        and classifiable under subheading 5701.10.16, 
        5701.10.40, 5701.90.10, 5701.90.20, 5702.10.90, 
        5702.42.20, 5702.49.10, 5702.51.20, 5702.91.30, 
        5702.92.00, 5702.99.10, 5703.10.00, 5703.20.10, or 
        5703.30.00 of the Harmonized Tariff Schedule of the 
        United States.
  (c) Withdrawal, Suspension, or Limitation of Duty-Free 
Treatment; Competitive Need Limitation.--
          (1) In general.--The President may withdraw, suspend, 
        or limit the application of the duty-free treatment 
        accorded under this title with respect to any article, 
        except that no rate of duty may be established with 
        respect to any article pursuant to this subsection 
        other than the rate which would apply but for this 
        title. In taking any action under this subsection, the 
        President shall consider the factors set forth in 
        sections 501 and 502(c).
          (2) Competitive need limitation.--
                  (A) Basis for withdrawal of duty-free 
                treatment.--
                          (i) In general.--Except as provided 
                        in clause (ii) and subject to 
                        subsection (d), whenever the President 
                        determines that a beneficiary 
                        developing country has exported 
                        (directly or indirectly) to the United 
                        States during any calendar year 
                        beginning after December 31, 1995--
                                  (I) a quantity of an eligible 
                                article having an appraised 
                                value in excess of the 
                                applicable amount for the 
                                calendar year, or
                                  (II) a quantity of an 
                                eligible article equal to or 
                                exceeding 50 percent of the 
                                appraised value of the total 
                                imports of that article into 
                                the United States during any 
                                calendar year,
                        the President shall, not later than 
                        July 1 of the next calendar year, 
                        terminate the duty-free treatment for 
                        that article from that beneficiary 
                        developing country.
                          (ii) Annual adjustment of applicable 
                        amount.--For purposes of applying 
                        clause (i), the applicable amount is--
                                  (I) for 1996, $75,000,000, 
                                and
                                  (II) for each calendar year 
                                thereafter, an amount equal to 
                                the applicable amount in effect 
                                for the preceding calendar year 
                                plus $5,000,000.
                  (B) Country defined.--For purposes of this 
                paragraph, the term ``country'' does not 
                include an association of countries which is 
                treated as one country under section 507(2), 
                but does include a country which is a member of 
                any such association.
                  (C) Redesignations.--A country which is no 
                longer treated as a beneficiary developing 
                country with respect to an eligible article by 
                reason of subparagraph (A) may, subject to the 
                considerations set forth in sections 501 and 
                502, be redesignated a beneficiary developing 
                country with respect to such article if imports 
                of such article from such country did not 
                exceed the limitations in subparagraph (A) 
                during the preceding calendar year.
                  (D) Least-developed beneficiary developing 
                countries and beneficiary sub-saharan african 
                countries.--Subparagraph (A) shall not apply to 
                any least-developed beneficiary developing 
                country or any beneficiary sub-Saharan African 
                country.
                  (E) Articles not produced in the united 
                states excluded.--Subparagraph (A)(i)(II) shall 
                not apply with respect to any eligible article 
                if a like or directly competitive article was 
                not produced in the United States on January 1, 
                1995.
                  (F) De minimis waivers.--
                          (i) In general.--The President may 
                        disregard subparagraph (A)(i)(II) with 
                        respect to any eligible article from 
                        any beneficiary developing country if 
                        the aggregate appraised value of the 
                        imports of such article into the United 
                        States during the preceding calendar 
                        year does not exceed the applicable 
                        amount for such preceding calendar 
                        year.
                          (ii) Applicable amount.--For purposes 
                        of applying clause (i), the applicable 
                        amount is--
                                  (I) for calendar year 1996, 
                                $13,000,000, and
                                  (II) for each calendar year 
                                thereafter, an amount equal to 
                                the applicable amount in effect 
                                for the preceding calendar year 
                                plus $500,000.
  (d) Waiver of Competitive Need Limitation.--
          (1) In general.--The President may waive the 
        application of subsection (c)(2) with respect to any 
        eligible article of any beneficiary developing country 
        if, before July 1 of the calendar year beginning after 
        the calendar year for which a determination described 
        in subsection (c)(2)(A) was made with respect to such 
        eligible article, the President--
                  (A) receives the advice of the International 
                Trade Commission under section 332 of the 
                Tariff Act of 1930 on whether any industry in 
                the United States is likely to be adversely 
                affected by such waiver,
                  (B) determines, based on the considerations 
                described in sections 501 and 502(c) and the 
                advice described in subparagraph (A), that such 
                waiver is in the national economic interest of 
                the United States, and
                  (C) publishes the determination described in 
                subparagraph (B) in the Federal Register.
          (2) Considerations by the president.--In making any 
        determination under paragraph (1), the President shall 
        give great weight to--
                  (A) the extent to which the beneficiary 
                developing country has assured the United 
                States that such country will provide equitable 
                and reasonable access to the markets and basic 
                commodity resources of such country, and
                  (B) the extent to which such country provides 
                adequate and effective protection of 
                intellectual property rights.
          (3) Other bases for waiver.--The President may waive 
        the application of subsection (c)(2) if, before July 1 
        of the calendar year beginning after the calendar year 
        for which a determination described in subsection 
        (c)(2) was made with respect to a beneficiary 
        developing country, the President determines that--
                  (A) there has been a historical preferential 
                trade relationship between the United States 
                and such country,
                  (B) there is a treaty or trade agreement in 
                force covering economic relations between such 
                country and the United States, and
                  (C) such country does not discriminate 
                against, or impose unjustifiable or 
                unreasonable barriers to, United States 
                commerce,
        and the President publishes that determination in the 
        Federal Register.
          (4) Limitations on waivers.--
                  (A) In general.--The President may not 
                exercise the waiver authority under this 
                subsection with respect to a quantity of an 
                eligible article entered during any calendar 
                year beginning after 1995, the aggregate 
                appraised value of which equals or exceeds 30 
                percent of the aggregate appraised value of all 
                articles that entered duty-free under this 
                title during the preceding calendar year.
                  (B) Other waiver limits.--(i) The President 
                may not exercise the waiver authority provided 
                under this subsection with respect to a 
                quantity of an eligible article entered during 
                any calendar year beginning after 1995, the 
                aggregate appraised value of which exceeds 15 
                percent of the aggregate appraised value of all 
                articles that have entered duty-free under this 
                title during the preceding calendar year from 
                those beneficiary developing countries which 
                for the preceding calendar year--
                          (I) had a per capita gross national 
                        product (calculated on the basis of the 
                        best available information, including 
                        that of the International Bank for 
                        Reconstruction and Development) of 
                        $5,000 or more; or
                          (II) had exported (either directly or 
                        indirectly) to the United States a 
                        quantity of articles that was duty-free 
                        under this title that had an aggregate 
                        appraised value of more than 10 percent 
                        of the aggregate appraised value of all 
                        articles that entered duty-free under 
                        this title during that year.
                  (ii) Not later than July 1 of each year, the 
                President should revoke any waiver that has 
                then been in effect with respect to an article 
                for 5 years or more if the beneficiary 
                developing country has exported to the United 
                States (directly or indirectly) during the 
                preceding calendar year a quantity of the 
                article--
                          (I) having an appraised value in 
                        excess of 1.5 times the applicable 
                        amount set forth in subsection 
                        (c)(2)(A)(ii) for that calendar year; 
                        or
                          (II) exceeding 75 percent of the 
                        appraised value of the total imports of 
                        that article into the United States 
                        during that calendar year.
                  (C) Calculation of limitations.--There shall 
                be counted against the limitations imposed 
                under subparagraphs (A) and (B) for any 
                calendar year only that value of any eligible 
                article of any country that--
                          (i) entered duty-free under this 
                        title during such calendar year; and
                          (ii) is in excess of the value of 
                        that article that would have been so 
                        entered during such calendar year if 
                        the limitations under subsection 
                        (c)(2)(A) applied.
          (5) Effective period of waiver.--Any waiver granted 
        under this subsection shall remain in effect until the 
        President determines that such waiver is no longer 
        warranted due to changed circumstances.
  (e) International Trade Commission Advice.--Before 
designating articles as eligible articles under subsection 
(a)(1), the President shall publish and furnish the 
International Trade Commission with lists of articles which may 
be considered 
for designation as eligible articles for purposes of this 
title. The provisions of sections 131, 132, 133, and 134 shall 
be complied with as though action under section 501 and this 
section were action under section 123 to carry out a trade 
agreement entered into under section 123.
  (f) Special Rule Concerning Puerto Rico.--No action under 
this title may affect any tariff duty imposed by the 
Legislature of Puerto Rico pursuant to section 319 of the 
Tariff Act of 1930 on coffee imported into Puerto Rico.

           *       *       *       *       *       *       *


SEC. 505. DATE OF TERMINATION.

  No duty-free treatment provided under this title shall remain 
in effect after July 31, 2013.

           *       *       *       *       *       *       *


SEC. 506A. DESIGNATION OF SUB-SAHARAN AFRICAN COUNTRIES FOR CERTAIN 
                    BENEFITS.

  (a) Authority To Designate.--
          (1) In general.--Notwithstanding any other provision 
        of law, the President is authorized to designate a 
        country listed in section 107 of the African Growth and 
        Opportunity Act as a beneficiary sub-Saharan African 
        country eligible for the benefits described in 
        subsection (b)--
                  (A) if the President determines that the 
                country meets the eligibility requirements set 
                forth in section 104 of that Act, as such 
                requirements are in effect on the date of the 
                enactment of that Act; and
                  (B) subject to the authority granted to the 
                President under subsections (a), (d), and (e) 
                of section 502, if the country otherwise meets 
                the eligibility criteria set forth in section 
                502.
          (2) Monitoring and review of certain countries.--The 
        President shall monitor, review, and report to Congress 
        annually on the progress of each country listed in 
        section 107 of the African Growth and Opportunity Act 
        in meeting the requirements described in paragraph (1) 
        in order to determine the current or potential 
        eligibility of each country to be designated as a 
        beneficiary sub-Saharan African country for purposes of 
        this section. The President's determinations, and 
        explanations of such determinations, with specific 
        analysis of the eligibility requirements described in 
        paragraph (1)(A), shall be included in the annual 
        report required by section 106 of the African Growth 
        and Opportunity Act.
          (3) Continuing compliance.--If the President 
        determines that a beneficiary sub-Saharan African 
        country is not making continual progress in meeting the 
        requirements described in paragraph (1), the President 
        shall terminate the designation of that country as a 
        beneficiary sub-Saharan African country for purposes of 
        this section, effective on January 1 of the year 
        following the year in which such determination is made.
  (b) Preferential Tariff Treatment for Certain Articles.--
          (1) In general.--The President may provide duty-free 
        treatment for any article described in section 
        503(b)(1)(B) through (G) that is the growth, product, 
        or manufacture of a beneficiary sub-Saharan African 
        country described in subsection (a), if, after 
        receiving the advice of the International Trade 
        Commission in accordance with section 503(e), the 
        President determines that such article is not import-
        sensitive in the context of imports from beneficiary 
        sub-Saharan African countries.
          (2) Rules of origin.--The duty-free treatment 
        provided under paragraph (1) shall apply to any article 
        described in that paragraph that meets the requirements 
        of section 503(a)(2), except that--
                  (A) if the cost or value of materials 
                produced in the customs territory of the United 
                States is included with respect to that 
                article, an amount not to exceed 15 percent of 
                the appraised value of the article at the time 
                it is entered that is attributed to such United 
                States cost or value may be applied toward 
                determining the percentage referred to in 
                subparagraph (A) of section 503(a)(2); and
                  (B) the cost or value of the materials 
                included with respect to that article that are 
                produced in one or more beneficiary sub-Saharan 
                African countries or former beneficiary sub-
                Saharan African countries shall be applied in 
                determining such percentage.
  (c) Beneficiary Sub-Saharan African Countries, Etc.--For 
purposes of this title--
          (1) the terms ``beneficiary sub-Saharan African 
        country'' and ``beneficiary sub-Saharan African 
        countries'' mean a country or countries listed in 
        section 107 of the African Growth and Opportunity Act 
        that the President has determined is eligible under 
        subsection (a) of this section.
          (2) the term ``former beneficiary sub-Saharan African 
        country'' means a country that, after being designated 
        as a beneficiary sub-Saharan African country under the 
        African Growth and Opportunity Act, ceased to be 
        designated as such a country by reason of its entering 
        into a free trade agreement with the United States.

SEC. 506B. TERMINATION OF BENEFITS FOR SUB-SAHARAN AFRICAN COUNTRIES.

  In the case of a beneficiary sub-Saharan African country, as 
defined in section 506A(c), duty-free treatment provided under 
this title shall remain in effect through September 30, 2015.

           *       *       *       *       *       *       *

                              ----------                              


                   AFRICAN GROWTH AND OPPORTUNITY ACT



           *       *       *       *       *       *       *
   TITLE I--EXTENSION OF CERTAIN TRADE BENEFITS TO SUB-SAHARAN AFRICA

Subtitle A--Trade Policy for Sub-Saharan Africa

           *       *       *       *       *       *       *


SEC. 104. ELIGIBILITY REQUIREMENTS.

  (a) In General.--The President is authorized to designate a 
sub-Saharan African country as an eligible sub-Saharan African 
country if the President determines that the country--
          (1) has established, or is making continual progress 
        toward establishing--
                  (A) a market-based economy that protects 
                private property rights, incorporates an open 
                rules-based trading system, and minimizes 
                government interference in the economy through 
                measures such as price controls, subsidies, and 
                government ownership of economic assets;
                  (B) the rule of law, political pluralism, and 
                the right to due process, a fair trial, and 
                equal protection under the law;
                  (C) the elimination of barriers to United 
                States trade and investment, including by--
                          (i) the provision of national 
                        treatment and measures to create an 
                        environment conducive to domestic and 
                        foreign investment;
                          (ii) the protection of intellectual 
                        property; and
                          (iii) the resolution of bilateral 
                        trade and investment disputes;
                  (D) economic policies to reduce poverty, 
                increase the availability of health care and 
                educational opportunities, expand physical 
                infrastructure, promote the development of 
                private enterprise, and encourage the formation 
                of capital markets through micro-credit or 
                other programs;
                  (E) a system to combat corruption and 
                bribery, such as signing and implementing the 
                Convention on Combating Bribery of Foreign 
                Public Officials in International Business 
                Transactions; and
                  (F) protection of internationally recognized 
                worker rights, including the right of 
                association, the right to organize and bargain 
                collectively, a prohibition on the use of any 
                form of forced or compulsory labor, a minimum 
                age for the employment of children, and 
                acceptable conditions of work with respect to 
                minimum wages, hours of work, and occupational 
                safety and health;
          (2) does not engage in activities that undermine 
        United States national security or foreign policy 
        interests; and
          (3) does not engage in gross violations of 
        internationally recognized human rights or provide 
        support for acts of international terrorism and 
        cooperates in international efforts to eliminate human 
        rights violations and terrorist activities.
  (b) Continuing Compliance.--If the President determines that 
an eligible sub-Saharan African country is not making continual 
progress in meeting the requirements described in subsection 
(a)(1), the President shall terminate the designation of the 
country made pursuant to subsection (a).

           *       *       *       *       *       *       *


Subtitle B--Trade Benefits

           *       *       *       *       *       *       *


SEC. 112. TREATMENT OF CERTAIN TEXTILES AND APPAREL.

  (a) Preferential Treatment.--Textile and apparel articles 
described in subsection (b) that are imported directly into the 
customs territory of the United States from a beneficiary sub-
Saharan African country described in section 506A(c) of the 
Trade Act of 1974, shall enter the United States free of duty 
and free of any quantitative limitations in accordance with the 
provisions set forth in subsection (b), if the country has 
satisfied the requirements set forth in section 113.
  (b) Products Covered.--Subject to subsection (c), the 
preferential treatment described in subsection (a) shall apply 
only to the following textile and apparel products:
          (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, or both (including fabrics not 
        formed from yarns, if such fabrics are classifiable 
        under heading 5602 or 5603 of the Harmonized Tariff 
        Schedule of the United States and are wholly formed and 
        cut in the United States) that are--
                  (A) entered under subheading 9802.00.80 of 
                the Harmonized Tariff Schedule of the United 
                States; or
                  (B) entered under chapter 61 or 62 of the 
                Harmonized Tariff Schedule of the United 
                States, if, after such assembly, the articles 
                would have qualified for entry under subheading 
                9802.00.80 of the Harmonized Tariff Schedule of 
                the United States but for the fact that the 
                articles were embroidered or subjected to 
                stone-washing, enzyme-washing, acid washing, 
                perma-pressing, oven-baking, bleaching, 
                garment-dyeing, screen printing, or other 
                similar processes.
          (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 Harmonized Tariff Schedule 
        of the United States and are wholly formed in the 
        United States).
          (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 in the United 
        States or one or more beneficiary sub-Saharan African 
        countries or former beneficiary sub-Saharan African 
        countries, or both (including fabrics not formed from 
        yarns, if such fabrics are classified under heading 
        5602 or 5603 of the Harmonized Tariff Schedule of the 
        United States 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 in 
        the United States or one or more beneficiary sub-
        Saharan African countries or former beneficiary sub-
        Saharan African countries, or both, or apparel articles 
        wholly formed on seamless knitting machines in a 
        beneficiary sub-Saharan African country from yarns 
        originating in the United States or one or more 
        beneficiary sub-Saharan African countries or former 
        beneficiary sub-Saharan African countries, or both, 
        whether or not the apparel articles are also made from 
        any of the fabrics, fabric components formed, or 
        components knit-to-shape described in paragraph (1) or 
        (2) (unless the apparel articles are made exclusively 
        from any of the fabrics, fabric components formed, or 
        components knit-to-shape described in paragraph (1) or 
        (2)), subject to the following:
                  (A) Limitations on benefits.--
                          (i) In general.--Preferential 
                        treatment under this paragraph shall be 
                        extended in the 1-year period beginning 
                        October 1, 2003, and in each of the 11 
                        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.
                          (ii) Applicable percentage.--For 
                        purposes of this subparagraph, the term 
                        ``applicable percentage'' means--
                                  (I) 4.747 percent for the 1-
                                year period beginning October 
                                1, 2003, increased in each of 
                                the 5 succeeding 1-year periods 
                                by equal increments, so that 
                                for the 1-year period beginning 
                                October 1, 2007, the applicable 
                                percentage does not exceed 7 
                                percent; and
                                  (II) for each succeeding 1-
                                year period until September 30, 
                                2015, not to exceed 7 percent.
                  (B) Surge mechanism.--
                          (i) Import monitoring.--The Secretary 
                        of Commerce shall monitor imports of 
                        articles described in this paragraph on 
                        a monthly basis to determine if there 
                        has been a surge in imports of such 
                        articles. In order to permit public 
                        access to preliminary international 
                        trade data and to facilitate the early 
                        identification of potentially 
                        disruptive import surges, the Director 
                        of the Office of Management and Budget 
                        may grant an exception to the 
                        publication dates established for the 
                        release of data on United States 
                        international trade in covered 
                        articles, if the Director notifies 
                        Congress of the early release of the 
                        data.
                          (ii) Determination of damage or 
                        threat thereof.--Whenever the Secretary 
                        of Commerce determines, based on the 
                        data described in clause (i), or 
                        pursuant to a written request made by 
                        an interested party, that there has 
                        been a surge in imports of an article 
                        described in this paragraph from a 
                        beneficiary sub-Saharan African 
                        country, the Secretary shall determine 
                        whether such article from such country 
                        is being imported in such increased 
                        quantities as to cause serious damage, 
                        or threat thereof, to the domestic 
                        industry producing a like or directly 
                        competitive article. If the Secretary's 
                        determination is affirmative, the 
                        President shall suspend the duty-free 
                        treatment provided for such article 
                        under this paragraph. If the inquiry is 
                        initiated at the request of an 
                        interested party, the Secretary shall 
                        make the determination within 60 days 
                        after the date of the request.
                          (iii) Factors to consider.--In 
                        determining whether a domestic industry 
                        has been seriously damaged, or is 
                        threatened with serious damage, the 
                        Secretary shall examine the effect of 
                        the imports on relevant economic 
                        indicators such as domestic production, 
                        sales, market share, capacity 
                        utilization, inventories, employment, 
                        profits, exports, prices, and 
                        investment.
                          (iv) Procedure.--
                                  (I) Initiation.--The 
                                Secretary of Commerce shall 
                                initiate an inquiry within 10 
                                days after receiving a written 
                                request and supporting 
                                information for an inquiry from 
                                an interested party. Notice of 
                                initiation of an inquiry shall 
                                be published in the Federal 
                                Register.
                                  (II) Participation by 
                                interested parties.--The 
                                Secretary of Commerce shall 
                                establish procedures to ensure 
                                participation in the inquiry by 
                                interested parties.
                                  (III) Notice of 
                                determination.--The Secretary 
                                shall publish the determination 
                                described in clause (ii) in the 
                                Federal Register.
                                  (IV) Information available.--
                                If relevant information is not 
                                available on the record or any 
                                party withholds information 
                                that has been requested by the 
                                Secretary, the Secretary shall 
                                make the determination on the 
                                basis of the facts available. 
                                When the Secretary relies on 
                                information submitted in the 
                                inquiry as facts available, the 
                                Secretary shall, to the extent 
                                practicable, corroborate the 
                                information from independent 
                                sources that are reasonably 
                                available to the Secretary.
                          (v) Interested party.--For purposes 
                        of this subparagraph, the term 
                        ``interested party'' means any producer 
                        of a like or directly competitive 
                        article, a certified union or 
                        recognized union or group of workers 
                        which is representative of an industry 
                        engaged in the manufacture, production, 
                        or sale in the United States of a like 
                        or directly competitive article, a 
                        trade or business association 
                        representing producers or sellers of 
                        like or directly competitive articles, 
                        producers engaged in the production of 
                        essential inputs for like or directly 
                        competitive articles, a certified union 
                        or group of workers which is 
                        representative of an industry engaged 
                        in the manufacture, production, or sale 
                        of essential inputs for the like or 
                        directly competitive article, or a 
                        trade or business association 
                        representing companies engaged in the 
                        manufacture, production, or sale of 
                        such essential inputs.
          (4) Sweaters knit-to-shape from cashmere or merino 
        wool.--
                  (A) Cashmere.--Sweaters, in chief weight of 
                cashmere, knit-to-shape in one or more 
                beneficiary sub-Saharan African countries and 
                classifiable under subheading 6110.10 of the 
                Harmonized Tariff Schedule of the United 
                States.
                  (B) Merino wool.--Sweaters, 50 percent or 
                more by weight of wool measuring 21.5 microns 
                in diameter or finer, knit-to-shape in one or 
                more beneficiary sub-Saharan African countries.
          (5) Apparel articles wholly assembled from fabric or 
        yarn not available in commercial quantities in the 
        united states.--
                  (A) In general.--Apparel articles that are 
                both cut (or knit-to-shape) and sewn or 
                otherwise assembled in one or more beneficiary 
                sub-Saharan African countries, to the extent 
                that apparel articles of such fabrics or yarns 
                would be eligible for preferential treatment, 
                without regard to the source of the fabrics or 
                yarns, under Annex 401 to the NAFTA.
                  (B) Additional apparel articles.--At the 
                request of any interested party and subject to 
                the following requirements, the President is 
                authorized to proclaim the treatment provided 
                under subparagraph (A) for yarns or fabrics not 
                described in subparagraph (A) if--
                          (i) the President determines that 
                        such yarns or fabrics 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 calendar 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--
                                  (I) the action proposed to be 
                                proclaimed and the reasons for 
                                such action; and
                                  (II) the advice obtained 
                                under clause (ii);
                          (iv) a period of 60 calendar days, 
                        beginning with the first day on which 
                        the President has met the requirements 
                        of subclauses (I) and (II) of clause 
                        (iii), has expired; and
                          (v) the President has consulted with 
                        such committees regarding the proposed 
                        action during the period referred to in 
                        clause (iii).
                  (C) Removal of designation of fabrics or 
                yarns not available in commercial quantities.--
                If the President determines that any fabric or 
                yarn was determined to be eligible for 
                preferential treatment under subparagraph (A) 
                on the basis of fraud, the President is 
                authorized to remove that designation from that 
                fabric or yarn with respect to articles entered 
                after such removal.
          (6) Handloomed, handmade, folklore articles and 
        ethnic printed fabrics.--
                  (A) In general.--A handloomed, handmade, 
                folklore article or an ethnic printed fabric of 
                a beneficiary sub-Saharan African country or 
                countries that is certified as such by the 
                competent authority of such beneficiary country 
                or countries. For purposes of this section, the 
                President, after consultation with the 
                beneficiary sub-Saharan African country or 
                countries concerned, shall determine which, if 
                any, particular textile and apparel goods of 
                the country (or countries) shall be treated as 
                being handloomed, handmade, or folklore 
                articles or an ethnic printed fabric.
                  (B) Requirements for ethnic printed fabric.--
                Ethnic printed fabrics qualified under this 
                paragraph are--
                          (i) fabrics containing a selvedge on 
                        both edges, having a width of less than 
                        50 inches, classifiable under 
                        subheading 5208.52.30 or 5208.52.40 of 
                        the Harmonized Tariff Schedule of the 
                        United States;
                          (ii) of the type that contains 
                        designs, symbols, and other 
                        characteristics of African prints--
                                  (I) normally produced for and 
                                sold on the indigenous African 
                                market; and
                                  (II) normally sold in Africa 
                                by the piece as opposed to 
                                being tailored into garments 
                                before being sold in indigenous 
                                African markets;
                          (iii) printed, including waxed, in 
                        one or more eligible beneficiary sub-
                        Saharan countries; and
                          (iv) fabrics formed in the United 
                        States, from yarns formed in the United 
                        States, or from fabric formed in one or 
                        more beneficiary sub-Saharan African 
                        country from yarn originating in either 
                        the United States or one or more 
                        beneficiary sub-Saharan African 
                        countries.
          (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 or 
        former 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 or former 
        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 
        Harmonized Tariff Schedule of the United States).
          (8) Textile articles originating entirely in one or 
        more lesser developed beneficiary sub-saharan african 
        countries.--Textile and textile articles classifiable 
        under chapters 50 through 60 or chapter 63 of the 
        Harmonized Tariff Schedule of the United States that 
        are products of a lesser developed beneficiary sub-
        Saharan African country and are wholly formed in one or 
        more such countries from fibers, yarns, fabrics, fabric 
        components, or components knit-to-shape that are the 
        product of one or more such countries.
  (c) Lesser Developed Countries.--
          (1) Preferential treatment of products through 
        september 30, 2015.--
                  (A) Products covered.--In addition to the 
                products described in subsection (b) the 
                preferential treatment described in subsection 
                (a) shall apply through September 30, 2015, to 
                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, 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.
                  (B) Applicable percentage.--For purposes of 
                subparagraph (A), the term ``applicable 
                percentage'' means--
                          (i) 2.9285 percent for the 1-year 
                        period beginning on October 1, 2005; 
                        and
                          (ii) 3.5 percent for the 1-year 
                        period beginning on October 1, 2006, 
                        and each 1-year period thereafter 
                        through September 30, 2015.
          (2) Applicability of other provisions.--Subsection 
        (b)(3)(B) applies to apparel articles eligible for 
        preferential treatment under this subsection to the 
        same extent as that subsection applies to apparel 
        articles eligible for preferential treatment under 
        subsection (b)(3).
          (3) Definition.--In this subsection, the term 
        ``lesser developed beneficiary sub-Saharan African 
        country'' means--
                  (A) 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;
                  (B) Botswana;
                  (C) Namibia; and
                  (D) Mauritius.
  (d) Treatment of Quotas on Textile and Apparel Imports from 
Kenya and Mauritius.--The President shall eliminate the 
existing quotas on textile and apparel articles imported into 
the United States--
          (1) from Kenya within 30 days after that country 
        adopts an effective visa system to prevent unlawful 
        transshipment of textile and apparel articles and the 
        use of counterfeit documents relating to the 
        importation of the articles into the United States; and
          (2) from Mauritius within 30 days after that country 
        adopts such a visa system.
The Customs Service shall provide the necessary technical 
assistance to Kenya and Mauritius in the development and 
implementation of the visa systems.
  (e) Special Rules.--
          (1) Findings and trimmings.--
                  (A) General rule.--An article otherwise 
                eligible for preferential treatment under this 
                section shall not be ineligible for such 
                treatment because the article contains findings 
                or trimmings of foreign origin, if the value of 
                such findings and trimmings do not exceed 25 
                percent of the cost of the components of the 
                assembled article. Examples of findings and 
                trimmings are sewing thread, hooks and eyes, 
                snaps, buttons, ``bow buds'', decorative lace 
                trim, elastic strips, and zippers, including 
                zipper tapes and labels. Elastic strips are 
                considered findings or trimmings only if they 
                are each less than 1 inch in width and used in 
                the production of brassieres.
                  (B) Certain interlinings.--
                          (i) General rule.--An article 
                        otherwise eligible for preferential 
                        treatment under this section 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.
                          (ii) Interlinings described.--
                        Interlinings eligible for the treatment 
                        described in clause (i) include only a 
                        chest type plate, a ``hymo'' piece, or 
                        ``sleeve header'', of woven or weft-
                        inserted warp knit construction and of 
                        coarse animal hair or man-made 
                        filaments.
                          (iii) Termination of treatment.--The 
                        treatment described in this 
                        subparagraph shall terminate if the 
                        President makes a determination that 
                        United States manufacturers are 
                        producing such interlinings in the 
                        United States in commercial quantities.
                  (C) Exception.--In the case of an article 
                described in subsection (b)(2), sewing thread 
                shall not be treated as findings or trimmings 
                under subparagraph (A).
          (2) De minimis rule.--An article otherwise eligible 
        for preferential treatment under this section shall not 
        be ineligible for such treatment because the article 
        contains fibers or yarns not wholly formed in the 
        United States or one or more beneficiary sub-Saharan 
        African countries or former beneficiary sub-Saharan 
        African countries if the total weight of all such 
        fibers and yarns is not more than 10 percent of the 
        total weight of the article.
          (3) Certain components.--An article otherwise 
        eligible for preferential treatment under this section 
        will not be ineligible for such treatment because the 
        article contains--
                  (A) any collars or cuffs (cut or knit-to-
                shape),
                  (B) drawstrings,
                  (C) shoulder pads or other padding,
                  (D) waistbands,
                  (E) belt attached to the article,
                  (F) straps containing elastic, or
                  (G) elbow patches,
        that do not meet the requirements set forth in 
        subsections (b) and (c), regardless of the country of 
        origin of the item referred to in the applicable 
        subparagraph of this paragraph.
  (f) Definitions.--In this section and section 113:
          (1) Agreement on textiles and clothing.--The term 
        ``Agreement on Textiles and Clothing'' means the 
        Agreement on Textiles and Clothing referred to in 
        section 101(d)(4) of the Uruguay Round Agreements Act 
        (19 U.S.C. 3511(d)(4)).
          (2) Beneficiary sub-saharan african country, etc.--
        The terms ``beneficiary sub-Saharan African country'' 
        and ``beneficiary sub-Saharan African countries'' have 
        the same meaning as such terms have under section 
        506A(c) of the Trade Act of 1974.
          (3) NAFTA.--The term ``NAFTA'' means the North 
        American Free Trade Agreement entered into between the 
        United States, Mexico, and Canada on December 17, 1992.
          (4) Former sub-saharan african country.--The term 
        ``former sub-Saharan African country'' means a country 
        that, after being designated as a beneficiary sub-
        Saharan African country under this Act, ceased to be 
        designated as such a beneficiary sub-Saharan country by 
        reason of its entering into a free trade agreement with 
        the United States.
          (5) Enter; entered.--The terms ``enter'' and 
        ``entered'' refer to the entry, or withdrawal from 
        warehouse for consumption, in the customs territory of 
        the United States.
  (g) Effective Date.--This section takes effect on October 1, 
2000, and shall remain in effect through September 30, 2015.

           *       *       *       *       *       *       *

                              ----------                              


                 CARIBBEAN BASIN ECONOMIC RECOVERY ACT



           *       *       *       *       *       *       *
TITLE II--CARIBBEAN BASIN INITIATIVE

           *       *       *       *       *       *       *


Subtitle A--Duty-Free Treatment

           *       *       *       *       *       *       *


SEC. 213A. SPECIAL RULES FOR HAITI.

  (a) Definitions.--In this section:
          (1) Initial applicable 1-year period.--The term 
        ``initial applicable 1-year period'' means the 1-year 
        period beginning on December 20, 2006.
          (2) Appropriate congressional committees.--.\5\ The 
        term ``appropriate congressional committees'' means the 
        Committee on Finance of the Senate and the Committee on 
        Ways and Means of the House of Representatives.
---------------------------------------------------------------------------
    \5\The period following the point dash in paragraph (2) is so in 
law. See section 15403(1)(C) of Public Law 110-246.
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          (3) Core labor standards.--The term ``core labor 
        standards'' means--
                  (A) freedom of association;
                  (B) the effective recognition of the right to 
                bargain collectively;
                  (C) the elimination of all forms of 
                compulsory or forced labor;
                  (D) the effective abolition of child labor 
                and a prohibition on the worst forms of child 
                labor; and
                  (E) the elimination of discrimination in 
                respect of employment and occupation.
          (4) Enter; entry.--The terms ``enter'' and ``entry'' 
        refer to the entry, or withdrawal from warehouse for 
        consumption, in the customs territory of the United 
        States.
          (5) Imported directly from haiti or the dominican 
        republic.--Articles are ``imported directly from Haiti 
        or the Dominican Republic'' if--
                  (A) the articles are shipped directly from 
                Haiti or the Dominican Republic into the United 
                States without passing through the territory of 
                any intermediate country; or
                  (B) the articles are shipped from Haiti or 
                the Dominican Republic into the United States 
                through the territory of an intermediate 
                country, and--
                          (i) the articles in the shipment do 
                        not enter into the commerce of any 
                        intermediate country, and the invoices, 
                        bills of lading, and other shipping 
                        documents specify the United States as 
                        the final destination; or
                          (ii) the invoices and other documents 
                        do not specify the United States as the 
                        final destination, but the articles in 
                        the shipment--
                                  (I) remain under the control 
                                of the customs authority in the 
                                intermediate country;
                                  (II) do not enter into the 
                                commerce of the intermediate 
                                country except for the purpose 
                                of a sale other than at retail; 
                                and
                                  (III) have not been subjected 
                                to operations in the 
                                intermediate country other than 
                                loading, unloading, or other 
                                activities necessary to 
                                preserve the articles in good 
                                condition.
          (6) Knit-to-shape.--A good is ``knit-to-shape'' if 50 
        percent or more of the exterior surface area of the 
        good is formed by major parts that have been knitted or 
        crocheted directly to the shape used in the good, with 
        no consideration being given to patch pockets, 
        appliquees, or the like. Minor cutting, trimming, or 
        sewing of those major parts shall not affect the 
        determination of whether a good is ``knit-to-
        shape.''\6\
---------------------------------------------------------------------------
    \6\So in law. The closing quotes should appear before the closing 
period.
---------------------------------------------------------------------------
          (7) TAICNAR program.--The term ``TAICNAR Program'' 
        means the Technical Assistance Improvement and 
        Compliance Needs Assessment and Remediation Program 
        established pursuant to subsection (e).
          (8) Wholly assembled.--A good is ``wholly assembled'' 
        in Haiti if all components, of which there must be at 
        least two, pre-existed in essentially the same 
        condition as found in the finished good and were 
        combined to form the finished good in Haiti. Minor 
        attachments and minor embellishments (for example, 
        appliquees, beads, spangles, embroidery, and buttons) 
        not appreciably affecting the identity of the good, and 
        minor subassemblies (for example, collars, cuffs, 
        plackets, and pockets), shall not affect the 
        determination of whether a good is ``wholly assembled'' 
        in Haiti.
  (b) Apparel and Other Textile Articles.--
          (1) Value-added rule for apparel articles.--
                  (A) In general.--Apparel articles described 
                in subparagraph (B) of a producer or entity 
                controlling production that are imported 
                directly from Haiti or the Dominican Republic 
                shall enter the United States free of duty 
                during the initial applicable 1-year period and 
                any 1-year period thereafter, subject to the 
                limitations set forth in subparagraphs (B) and 
                (C), and subject to subparagraph (D).
                  (B) Apparel articles described.--
                          (i) In general.--In the initial 
                        applicable 1-year period and any 1-year 
                        period thereafter, apparel articles 
                        described in this paragraph are apparel 
                        articles that are wholly assembled, or 
                        are knit-to-shape, in Haiti from any 
                        combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        and yarns, only if, for each entry in 
                        that 1-year period, the sum of--
                                  (I) the cost or value of the 
                                materials produced in Haiti or 
                                one or more countries described 
                                in clause (iii), or any 
                                combination thereof, plus
                                  (II) the direct costs of 
                                processing operations (as 
                                defined in section 213(a)(3)) 
                                performed in Haiti or one or 
                                more countries described in 
                                clause (iii), or any 
                                combination thereof,
                        is not less than the applicable 
                        percentage (as defined in clause 
                        (v)(I)\7\) of the declared customs 
                        value of such apparel articles.
---------------------------------------------------------------------------
    \7\The amendment made by section 15402(a)(3)(A)(iv) of Public Law 
110-246 was carried out to reflect the probable intent of Congress. 
Such amendment states to strike ``subparagraph (E)(I)'' and insert 
``clause (v)(I)'', which probably should have been made to strike 
``subparagraph (E)(i)''.
---------------------------------------------------------------------------
                          (ii) Deductions.--In calculating cost 
                        or value under clause (i)(I), there 
                        shall be deducted the cost or value 
                        of--
                                  (I) any foreign materials 
                                that are used in the production 
                                of the apparel articles in 
                                Haiti; and
                                  (II) any foreign materials 
                                that are used in the production 
                                of the materials described in 
                                clause (i)(I).
                          (iii) Countries described.--The 
                        countries referred to in clause (i) are 
                        the following:
                                  (I) The United States.
                                  (II) Any country that is a 
                                party to a free trade agreement 
                                with the United States that is 
                                in effect on the date of the 
                                enactment of the Haitian 
                                Hemispheric Opportunity through 
                                Partnership Encouragement Act 
                                of 2006, or that enters into 
                                force thereafter.
                                  (III) Any country designated 
                                as a beneficiary country under 
                                section 213(b)(5)(B) of this 
                                Act.
                                  (IV) Any country designated 
                                as a beneficiary country under 
                                section 506A(a)(1) of the Trade 
                                Act of 1974 (19 U.S.C. 
                                2466a(a)(1)), if a finding has 
                                been made by the President or 
                                the President's designee, and 
                                published in the Federal 
                                Register, that the country has 
                                satisfied the requirements of 
                                section 113 of the African 
                                Growth and Opportunity Act (19 
                                U.S.C. 3722).
                                  (V) Any country designated as 
                                a beneficiary country under 
                                section 204(b)(6)(B) of the 
                                Andean Trade Preference Act (19 
                                U.S.C. 3203(b)(6)(B)).
                          (iv) Annual aggregation.--
                                  (I) Initial applicable 1-year 
                                period.--In the initial 
                                applicable 1-year period, the 
                                requirements under clause (i) 
                                relating to applicable 
                                percentage may also be met for 
                                articles of a producer or an 
                                entity controlling production 
                                that enter during the initial 
                                applicable 1-year period by 
                                aggregating--
                                          (aa) the cost or 
                                        value of materials 
                                        under subclause (I) of 
                                        clause (i), and
                                          (bb) the direct costs 
                                        of processing 
                                        operations under 
                                        subclause (II) of 
                                        clause (i),
                                of all apparel articles of that 
                                producer or entity controlling 
                                production that are wholly 
                                assembled, or are knit-to-
                                shape, in Haiti and are entered 
                                during the initial applicable 
                                1-year period.
                                  (II) Other 1-year periods.--
                                In any 1-year period after the 
                                initial applicable 1-year 
                                period, the requirements under 
                                clause (i) relating to 
                                applicable percentage may also 
                                be met for articles of a 
                                producer or an entity 
                                controlling production that 
                                enter during the 1-year period 
                                by aggregating--
                                          (aa) the cost or 
                                        value of materials 
                                        under subclause (I) of 
                                        clause (i), and
                                          (bb) the direct costs 
                                        of processing 
                                        operations under 
                                        subclause (II) of 
                                        clause (i),
                                of all apparel articles of that 
                                producer or entity controlling 
                                production that are wholly 
                                assembled, or are knit-to-
                                shape, in Haiti and are entered 
                                during the preceding 1-year 
                                period.
                                  (III) Deductions.--In 
                                calculating cost or value under 
                                subclause (I)(aa) or (II)(aa), 
                                there shall be deducted the 
                                cost or value of--
                                          (aa) any foreign 
                                        materials that are used 
                                        in the production of 
                                        the apparel articles in 
                                        Haiti; and
                                          (bb) any foreign 
                                        materials that are used 
                                        in the production of 
                                        the materials described 
                                        in subclause (I)(aa) or 
                                        (II)(aa) (as the case 
                                        may be).
                                  (IV) Inclusion in calculation 
                                of other articles receiving 
                                preferential treatment.--
                                Entries of apparel articles 
                                that receive preferential 
                                treatment under any provision 
                                of law other than this 
                                subparagraph or are subject to 
                                the ``General'' column 1 rate 
                                of duty under the HTS are not 
                                included in the annual 
                                aggregation under subclause (I) 
                                or (II) unless the producer or 
                                entity controlling production 
                                elects, at the time the annual 
                                aggregation calculation is 
                                made, to include such entries 
                                in such aggregation.
                          (v) Definitions.--In this paragraph:
                                  (I) Applicable percentage.--
                                The term ``applicable 
                                percentage'' means--
                                          (aa) 50 percent or 
                                        more during the initial 
                                        applicable 1-year 
                                        period and the 
                                        succeeding 8 1-year 
                                        periods;
                                          (bb) 55 percent or 
                                        more during the 1-year 
                                        period beginning on 
                                        December 20, 2015, and 
                                        the 1-year period 
                                        beginning on December 
                                        20, 2016; and
                                          (cc) 60 percent or 
                                        more during the 1-year 
                                        period beginning on 
                                        December 20, 2017.
                                  (II) Foreign material.--The 
                                term ``foreign material'' means 
                                a material produced in a 
                                country other than Haiti or any 
                                country described in clause 
                                (iii).
                          (vi) Development of procedure to 
                        ensure compliance.--
                                  (I) In general.--U.S. Customs 
                                and Border Protection of the 
                                Department of Homeland Security 
                                shall develop and implement 
                                methods and procedures to 
                                ensure ongoing compliance with 
                                the requirements set forth in 
                                clauses (i) and (iv).
                                  (II) Noncompliance.--If U.S. 
                                Customs and Border Protection 
                                finds that a producer or an 
                                entity controlling production 
                                has not satisfied such 
                                requirements in the initial 
                                applicable 1-year period or any 
                                1-year period thereafter, 
                                either for individual entries 
                                entered pursuant to clause (i) 
                                or for entries entered in 
                                aggregate pursuant to clause 
                                (iv), then apparel articles 
                                described in clause (i) of that 
                                producer or entity shall be 
                                ineligible for preferential 
                                treatment under paragraph (1) 
                                during any succeeding 1-year 
                                period until--
                                          (aa) the cost or 
                                        value of materials 
                                        under subclause (I) of 
                                        clause (i), plus
                                          (bb) the direct costs 
                                        of processing 
                                        operations under 
                                        subclause (II) of 
                                        clause (i),
                                of that producer or entity 
                                controlling production, is not 
                                less than the applicable 
                                percentage under clause (v)(I), 
                                plus 10 percent, of the 
                                aggregate declared customs 
                                value of all apparel articles 
                                of that producer or entity 
                                controlling production that are 
                                wholly assembled, or are knit-
                                to-shape, in Haiti and are 
                                entered during the preceding 1-
                                year period.
                                  (III) Retroactive application 
                                of duty-free treatment.--If--
                                          (aa) a producer or an 
                                        entity controlling 
                                        production is 
                                        ineligible for 
                                        preferential treatment 
                                        under subparagraph (A) 
                                        in the initial 
                                        applicable 1-year 
                                        period or any 1-year 
                                        period thereafter 
                                        because that producer 
                                        or entity controlling 
                                        production did not 
                                        satisfy the 
                                        requirements of clause 
                                        (i) or (iv), and
                                          (bb) that producer or 
                                        entity controlling 
                                        production satisfies 
                                        the requirements of 
                                        subclause (II) of this 
                                        clause in that 1-year 
                                        period,
                                then, notwithstanding section 
                                514 of the Tariff Act of 1930 
                                (19 U.S.C. 1514) or any other 
                                provision of law, upon proper 
                                request filed with U.S. Customs 
                                and Border Protection before 
                                the 90th day after U.S. Customs 
                                and Border Protection 
                                determines that item (bb) 
                                applies, the entry of any 
                                articles--
                                          (AA) that was made 
                                        during that 1-year 
                                        period, and
                                          (BB) with respect to 
                                        which there would have 
                                        been preferential 
                                        treatment under 
                                        subparagraph (A) if the 
                                        producer or entity 
                                        controlling production 
                                        had satisfied the 
                                        requirements in clause 
                                        (i) or (iv) (as the 
                                        case may be),
                                shall be liquidated or 
                                reliquidated as though such 
                                preferential treatment under 
                                subparagraph (A) applied to 
                                such entry.
                          (vii) Fabrics not available in 
                        commercial quantities.--
                                  (I) In general.--For purposes 
                                of determining the applicable 
                                percentage under clause (i) or 
                                (iv), there may be included in 
                                that percentage--
                                          (aa) the cost of 
                                        fabrics or yarns to the 
                                        extent that apparel 
                                        articles of such 
                                        fabrics or yarns would 
                                        be eligible for 
                                        preferential treatment, 
                                        without regard to the 
                                        source of the fabrics 
                                        or yarns, under Annex 
                                        401 of the NAFTA; and
                                          (bb) the cost of 
                                        fabrics or yarns that 
                                        are designated as not 
                                        being available in 
                                        commercial quantities 
                                        for purposes of--
                                          (AA) section 
                                        213(b)(2)(A)(v) of this 
                                        Act,
                                          (BB) section 
                                        112(b)(5) of the 
                                        African Growth and 
                                        Opportunity Act,
                                          (CC) section 
                                        204(b)(3)(B)(i)(III) or 
                                        (ii) of the Andean 
                                        Trade Preference Act, 
                                        or
                                          (DD) any other 
                                        provision, relating to 
                                        determining whether a 
                                        textile or apparel 
                                        article is an 
                                        originating good 
                                        eligible for 
                                        preferential treatment, 
                                        of a law that 
                                        implements a free trade 
                                        agreement that enters 
                                        into force with respect 
                                        to the United States,
                                without regard to the source of 
                                the fabrics or yarns.
                                  (II) Removal of designation 
                                of fabrics or yarns not 
                                available in commercial 
                                quantities.--If the President 
                                determines that--
                                          (aa) any fabric or 
                                        yarn described in 
                                        subclause (I)(aa) was 
                                        determined to be 
                                        eligible for 
                                        preferential treatment, 
                                        or
                                          (bb) any fabric or 
                                        yarn described in 
                                        subclause (I)(bb) was 
                                        designated as not being 
                                        available in commercial 
                                        quantities,
                                on the basis of fraud, the 
                                President is authorized to 
                                remove the eligibility or 
                                designation (as the case may 
                                be) of that fabric or yarn with 
                                respect to articles entered 
                                after such removal.
                  (C) Quantitative limitations.--The 
                preferential treatment described in 
                subparagraph (A) shall be extended, during each 
                of the 1-year periods set forth in the 
                following table, to not more than the 
                corresponding percentage of the aggregate 
                square meter equivalents of all apparel 
                articles imported into the United States in the 
                most recent 12-month period for which data are 
                available:


 
 
 
During:                                              the corresponding percentage is:
the initial applicable 1-year period...............  1 percent.
each of the succeeding 11 1-year periods...........  1.25 percent.
 

                No preferential treatment shall be provided 
                under subparagraph (A) after December 19, 2018.
                  (D) Other preferential treatment not affected 
                by quantitative limitations.--Any apparel 
                article that qualifies for preferential 
                treatment under paragraph (2), (3), (4), or (5) 
                or any other provision of this title shall not 
                be subject to, or included in the calculation 
                of, the quantitative limitations under 
                subparagraph (C).
          (2) Special rule for woven articles and certain knit 
        articles.--
                  (A) Special rule for articles of chapter 62 
                of the hts.--
                          (i) General rule.--Any apparel 
                        article classifiable under chapter 62 
                        of the HTS that is wholly assembled, or 
                        knit-to-shape, in Haiti from any 
                        combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        or yarns and is imported directly from 
                        Haiti or the Dominican Republic shall 
                        enter the United States free of duty, 
                        subject to clauses (ii) and (iii), 
                        without regard to the source of the 
                        fabric, fabric components, components 
                        knit-to-shape, or yarns from which the 
                        article is made.
                          (ii) Limitation.--Except as provided 
                        in paragraph (2A), the preferential 
                        treatment described in clause (i) shall 
                        be extended, in the 1-year period 
                        beginning October 1, 2008, and in each 
                        of the 11 succeeding 1-year periods, to 
                        not more than 70,000,000 square meter 
                        equivalents of apparel articles 
                        described in such clause.
                          (iii) Other preferential treatment 
                        not affected by quantitative 
                        limitation.--Any apparel article that 
                        qualifies for preferential treatment 
                        under paragraph (1), (3), (4), or (5) 
                        or subparagraph (B) of this paragraph 
                        or any other provision of this title 
                        shall not be subject to, or included in 
                        the calculation of, the quantitative 
                        limitation under clause (ii).
                  (B) Special rule for certain articles of 
                chapter 61 of the hts.--
                          (i) General rule.--Any apparel 
                        article classifiable under chapter 61 
                        of the HTS that is wholly assembled, or 
                        knit-to-shape, in Haiti from any 
                        combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        or yarns and is imported directly from 
                        Haiti or the Dominican Republic shall 
                        enter the United States free of duty, 
                        subject to clauses (ii), (iii), and 
                        (iv), without regard to the source of 
                        the fabric, fabric components, 
                        components knit-to-shape, or yarns from 
                        which the article is made.
                          (ii) Exclusions.--The preferential 
                        treatment described in clause (i) shall 
                        not apply to the following:
                                  (I) The following apparel 
                                articles of cotton, for men or 
                                boys, that are classifiable 
                                under subheading 6109.10.00 of 
                                the HTS:
                                          (aa) All white T-
                                        shirts, with short 
                                        hemmed sleeves and 
                                        hemmed bottom, with 
                                        crew or round neckline 
                                        or with V-neck and with 
                                        a mitered seam at the 
                                        center of the V, and 
                                        without pockets, trim, 
                                        or embroidery.
                                          (bb) All white 
                                        singlets, without 
                                        pockets, trim, or 
                                        embroidery.
                                          (cc) Other T-shirts, 
                                        but not including 
                                        thermal undershirts.
                                  (II) T-shirts for men or boys 
                                that are classifiable under 
                                subheading 6109.90.10.
                                  (III) The following apparel 
                                articles of cotton, for men or 
                                boys, that are classifiable 
                                under subheading 6110.20.20 of 
                                the HTS:
                                          (aa) Sweatshirts.
                                          (bb) Pullovers, other 
                                        than sweaters, vests, 
                                        or garments imported as 
                                        part of playsuits.
                                  (IV) Sweatshirts for men or 
                                boys, of man-made fibers and 
                                containing less than 65 percent 
                                by weight of man-made fibers, 
                                that are classifiable under 
                                subheading 6110.30.30 of the 
                                HTS.
                          (iii) Limitation.--Except as provided 
                        in paragraph (2A), the preferential 
                        treatment described in clause (i) shall 
                        be extended, in the 1-year period 
                        beginning October 1, 2008, and in each 
                        of the 11 succeeding 1-year periods, to 
                        not more than 70,000,000 square meter 
                        equivalents of apparel articles 
                        described in such clause.
                          (iv) Other preferential treatment not 
                        affected by quantitative limitation.--
                        Any apparel article that qualifies for 
                        preferential treatment under paragraph 
                        (1), (3), (4), or (5) or subparagraph 
                        (A) of this paragraph or any other 
                        provision of this title shall not be 
                        subject to, or included in the 
                        calculation of, the quantitative 
                        limitation under clause (iii).
          (2A) Special rule for certain woven articles and 
        certain knit articles entered during fiscal year 2010 
        and succeeding 1-year periods.--
                  (A) In general.--Except as provided in 
                subparagraphs (B) and (C) and subject to 
                subparagraph (D), if 52,000,000 square meter 
                equivalents of apparel articles described in 
                paragraph (2)(A)(i) or (2)(B)(i) enter the 
                United States during the 1-year period 
                beginning October 1, 2009, or any of the 
                succeeding 1-year periods, the President shall 
                extend the preferential treatment described in 
                paragraph (2)(A)(i) or (2)(B)(i) (as the case 
                may be) to not more than 200,000,000 square 
                meter equivalents of apparel articles described 
                in paragraph (2)(A)(i) or (2)(B)(i) (as the 
                case may be) during that 1-year period, and 
                shall publish notice of the extension in the 
                Federal Register.
                  (B) Exception for certain woven articles.--
                          (i) In general.--In the case of 
                        apparel articles described in clause 
                        (ii), subparagraph (A) shall be applied 
                        by substituting ``70,000,000'' for 
                        ``200,000,000''.
                          (ii) Apparel articles described.--
                        Apparel articles described in this 
                        clause are apparel articles described 
                        in paragraph (2)(A)(i) that are the 
                        following:
                                  (I) Category 347.--Apparel 
                                articles in category 347 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6203.19.1020..........................  6203.42.4011.................  6203.42.4061
 6203.19.9020.........................  6203.42.4016.................  6203.49.8020
 6203.22.3020.........................  6203.42.4026.................  6210.40.9033
 6203.22.3030.........................  6203.42.4036.................  6211.20.1520
 6203.42.4003.........................  6203.42.4046.................  6211.20.3810
 6203.42.4006.........................  6203.42.4051.................  6211.32.0040
 

                                  (II) Category 348.--Apparel 
                                articles in category 348 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6204.12.0030..........................  6204.62.4011.................  6204.69.9010
 6204.19.8030.........................   6204.62.4021................  6210.50.9060
 6204.22.3040.........................   6204.62.4031................  6211.20.1550
 6204.22.3050.........................   6204.62.4041................  6211.20.6810
  6204.29.4034........................   6204.62.4051................  6211.42.0030
  6204.62.3000........................   6204.62.4056................  6217.90.9050
  6204.62.4003........................   6204.62.4066................  .........................................
  6204.62.4006........................  6204.69.6010.................  .........................................
 

                                  (III) Category 647.--Apparel 
                                articles in category 647 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6203.23.0060..........................  6203.43.4020.................  6203.49.8030
  6203.23.0070........................   6203.43.4030................  6210.40.5031
  6203.29.2030........................   6203.43.4040................  6210.40.5039
  6203.29.2035........................   6203.49.1500................  6211.20.1525
 6203.43.2500.........................   6203.49.2015................  6211.20.3820
  6203.43.3510........................   6203.49.2030................  6211.33.0030
  6203.43.3590........................   6203.49.2045................  .........................................
 6203.43.4010.........................  6203.49.2060.................  .........................................
 

                                  (IV) Category 648.--Apparel 
                                articles in category 648 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6204.23.0040..........................  6204.63.3510.................  6204.69.6030
 6204.23.0045.........................   6204.63.3530................  6204.69.9030
  6204.29.2020........................  6204.63.3532.................  6210.50.5031
 6204.29.2025.........................   6204.63.3540................  6210.50.5039
 6204.29.4038.........................  6204.69.2510.................  6211.20.1555
  6204.63.2000........................   6204.69.2530................  6211.20.6820
  6204.63.3010........................   6204.69.2540................  6211.43.0040
  6204.63.3090........................   6204.69.2560................  6217.90.9060
 

                  (C) Exception for certain knit articles.--
                          (i) In general.--In the case of 
                        apparel articles described in clause 
                        (ii), subparagraph (A) shall be applied 
                        by substituting ``85,000,000'' for 
                        ``200,000,000''.
                          (ii) Apparel articles described.--
                        Apparel articles described in this 
                        clause are apparel articles described 
                        in paragraph (2)(B)(i) that fall within 
                        the following statistical reporting 
                        numbers of the HTS (as in effect on the 
                        day before the date of the enactment of 
                        this paragraph), other than shirts with 
                        plackets and pointed collars:


6105.10.0010..........................  6109.10.0040.................  6110.30.3053
 6109.10.0018.........................  6109.10.0045.................  6110.30.3059
 6109.10.0027.........................  6110.20.2079.................  .........................................
 

                  (D) Verification with respect to 
                transshipment for certain apparel articles.--
                          (i) In general.--Not later than April 
                        1, July 1, October 1, and January 1 of 
                        each year, the Commissioner responsible 
                        for United States Customs and Border 
                        Protection shall verify that apparel 
                        articles imported into the United 
                        States under this paragraph are not 
                        being unlawfully transshipped (within 
                        the meaning of subsection (f)) into the 
                        United States.
                          (ii) Report to president.--If the 
                        Commissioner determines pursuant to 
                        clause (i) that apparel articles 
                        imported into the United States under 
                        this paragraph are being unlawfully 
                        transshipped into the United States, 
                        the Commissioner shall report that 
                        determination to the President.
                          (iii) Authority to reduce 
                        quantitative limitation.--If, in any 1-
                        year period with respect to which the 
                        President extends preferential 
                        treatment as described in this 
                        paragraph, the Commissioner reports to 
                        the President pursuant to clause (ii) 
                        regarding unlawful transshipments, the 
                        President--
                                  (I) may modify the 
                                quantitative limitation under 
                                this paragraph as the President 
                                considers appropriate to 
                                account for such 
                                transshipments; and
                                  (II) if the President 
                                modifies the limitation under 
                                subclause (I), shall publish 
                                notice of the modification in 
                                the Federal Register.
                  (E) Category defined.--In this paragraph, the 
                term ``category'' means the number assigned 
                under the U.S. Textile and Apparel Category 
                System of the Office of Textiles and Apparel of 
                the Department of Commerce, as listed in the 
                HTS under the applicable heading or subheading 
                (as in effect on the day before the date of the 
                enactment of this paragraph).
          (3) Apparel and other articles subject to certain 
        assembly rules.--
                  (A) Brassieres.--Any apparel article 
                classifiable under subheading 6212.10 of the 
                HTS that is wholly assembled, or knit-to-shape, 
                in Haiti from any combination of fabrics, 
                fabric components, components knit-to-shape, or 
                yarns and is imported directly from Haiti or 
                the Dominican Republic shall enter the United 
                States free of duty, without regard to the 
                source of the fabric, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made.
                  (B) Other apparel articles.--Any of the 
                following apparel articles that is wholly 
                assembled, or knit-to-shape, in Haiti from any 
                combination of fabrics, fabric components, 
                components knit-to-shape, or yarns and is 
                imported directly from Haiti or the Dominican 
                Republic shall enter the United States free of 
                duty, without regard to the source of the 
                fabric, fabric components, components knit-to-
                shape, or yarns from which the article is made:
                          (i) Any apparel article that is of a 
                        type listed in chapter rule 3, 4, or 5 
                        for chapter 61 of the HTS (as such 
                        chapter rules are contained in section 
                        A of the Annex to Proclamation 8213 of 
                        the President of December 20, 2007) as 
                        being excluded from the scope of such 
                        chapter rule, when such chapter rule is 
                        applied to determine whether an apparel 
                        article is an originating good for 
                        purposes of general note 29(n) to the 
                        HTS, except that, for purposes of this 
                        clause, reference in such chapter rules 
                        to ``6104.12.00'' shall be deemed to be 
                        a reference to ``6104.19.60''.
                          (ii)(I) Subject to subclause (II), 
                        any apparel article that is of a type 
                        listed in chapter rule 3(a), 4(a), or 
                        5(a) for chapter 62 of the HTS, as such 
                        chapter rules are contained in 
                        paragraph 9 of section A of the Annex 
                        to Proclamation 8213 of the President 
                        of December 20, 2007.
                          (II) Subclause (I) shall not include 
                        any apparel article to which 
                        subparagraph (A) of this paragraph 
                        applies.
                  (C) Luggage and similar items.--Any article 
                classifiable under subheading 4202.12, 4202.22, 
                4202.32 or 4202.92 of the HTS that is wholly 
                assembled in Haiti and is imported directly 
                from Haiti or the Dominican Republic shall 
                enter the United States free of duty, without 
                regard to the source of the fabric, components, 
                or materials from which the article is made.
                  (D) Headgear.--Any article classifiable under 
                heading 6501, 6502, or 6504 of the HTS, or 
                under subheading 6505.90 of the HTS, that is 
                wholly assembled, knit-to-shape, or formed in 
                Haiti from any combination of fabrics, fabric 
                components, components knit-to-shape, or yarns 
                and is imported directly from Haiti or the 
                Dominican Republic shall enter the United 
                States free of duty, without regard to the 
                source of the fabric, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made.
                  (E) Certain sleepwear.--Any of the following 
                apparel articles that is wholly assembled, or 
                knit-to-shape, in Haiti from any combination of 
                fabrics, fabric components, components knit-to-
                shape, or yarns and is imported directly from 
                Haiti or the Dominican Republic shall enter the 
                United States free of duty, without regard to 
                the source of the fabric, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made:
                          (i) Pajama bottoms and other 
                        sleepwear for women and girls, of 
                        cotton, that are classifiable under 
                        subheading 6208.91.30, or of man-made 
                        fibers, that are classifiable under 
                        subheading 6208.92.00.
                          (ii) Pajama bottoms and other 
                        sleepwear for girls, of other textile 
                        materials, that are classifiable under 
                        subheading 6208.99.20.
                  (F) Certain other apparel articles.--
                          (i) In general.--Any of the apparel 
                        articles described in clause (ii) that 
                        is wholly assembled, or knit-to-shape, 
                        in Haiti from any combination of 
                        fabrics, fabric components, components 
                        knit-to-shape, or yarns and is imported 
                        directly from Haiti or the Dominican 
                        Republic shall enter the United States 
                        free of duty, without regard to the 
                        source of the fabric, fabric 
                        components, components knit-to-shape, 
                        or yarns from which the article is 
                        made.
                          (ii) Articles described.--Apparel 
                        articles described in this clause are 
                        apparel articles in the following 
                        category numbers that fall within the 
                        following statistical reporting numbers 
                        of the HTS (as in effect on the day 
                        before the date of the enactment of 
                        this subparagraph):


 
 
----------------------------------------------------------------------------------------------------------------
Category Number                                                                                  HTS Statistical
                                                                                                Reporting Number
----------------------------------------------------------------------------------------------------------------
334                                                                                                 6101.90.9010
                                                                                                    6112.11.0010
                                                                                                    6103.22.0010
                                                                                                    6113.00.9015
----------------------------------------------------------------------------------------------------------------
335                                                                                                 6104.22.0010
                                                                                                    6104.29.2010
                                                                                                    6112.11.0020
----------------------------------------------------------------------------------------------------------------
336                                                                                                 6104.49.9010
----------------------------------------------------------------------------------------------------------------
338                                                                                                 6103.22.0050
                                                                                                    6105.90.8010
                                                                                                    6112.11.0030
----------------------------------------------------------------------------------------------------------------
339                                                                                                 6104.22.0060
                                                                                                    6104.29.2049
                                                                                                    6106.90.2510
                                                                                                    6106.90.3010
                                                                                                    6110.20.1031
                                                                                                    6110.20.1033
                                                                                                    6112.11.0040
----------------------------------------------------------------------------------------------------------------
342                                                                                                 6104.22.0030
                                                                                                    6104.29.2022
                                                                                                    6104.52.0010
                                                                                                    6104.52.0020
                                                                                                    6104.59.8010
----------------------------------------------------------------------------------------------------------------
350                                                                                                 6107.91.0040
                                                                                                    6107.91.0090
----------------------------------------------------------------------------------------------------------------
351                                                                                                 6107.21.0010
                                                                                                    6107.21.0020
                                                                                                    6107.91.0030
                                                                                                    6108.31.0010
                                                                                                    6108.31.0020
----------------------------------------------------------------------------------------------------------------
433                                                                                                 6103.23.0007
                                                                                                    6103.29.0520
                                                                                                    6103.31.0000
                                                                                                    6103.33.1000
                                                                                                    6103.39.8020
----------------------------------------------------------------------------------------------------------------
434                                                                                                 6101.30.1500
                                                                                                    6101.90.0500
                                                                                                    6101.90.9020
                                                                                                    6103.23.0005
                                                                                                    6103.29.0510
----------------------------------------------------------------------------------------------------------------
435                                                                                                 6102.30.1000
                                                                                                    6102.90.9010
                                                                                                    6104.23.0010
                                                                                                    6104.29.0510
                                                                                                    6104.29.2012
                                                                                                    6104.33.1000
                                                                                                    6104.39.2020
----------------------------------------------------------------------------------------------------------------
438                                                                                                 6103.23.0025
                                                                                                    6103.29.0550
                                                                                                    6104.23.0020
                                                                                                    6104.29.0560
                                                                                                    6104.29.2051
                                                                                                    6105.90.1000
                                                                                                    6105.90.8020
                                                                                                    6106.20.1020
                                                                                                    6106.90.1010
                                                                                                    6106.90.1020
                                                                                                    6106.90.2520
                                                                                                    6106.90.3020
                                                                                                    6110.11.0070
                                                                                                    6110.12.2070
                                                                                                    6110.12.2080
                                                                                                    6110.19.0070
                                                                                                    6110.19.0080
                                                                                                    6110.30.1550
                                                                                                    6110.30.1560
----------------------------------------------------------------------------------------------------------------
633                                                                                                 6103.23.0037
                                                                                                    6103.29.1015
                                                                                                    6103.33.2000
                                                                                                    6103.39.1000
                                                                                                    6103.39.8030
----------------------------------------------------------------------------------------------------------------
634                                                                                                 6101.30.1000
                                                                                                    6101.90.9030
                                                                                                    6103.23.0036
                                                                                                    6103.29.1010
                                                                                                    6112.12.0010
                                                                                                    6112.19.1010
                                                                                                    6112.20.1010
                                                                                                    6112.20.1030
                                                                                                    6113.00.9025
----------------------------------------------------------------------------------------------------------------
635                                                                                                 6102.30.0500
                                                                                                    6102.90.9015
                                                                                                    6104.23.0026
                                                                                                    6104.29.1010
                                                                                                    6104.29.2014
                                                                                                    6104.39.2030
                                                                                                    6112.12.0020
                                                                                                    6112.19.1020
                                                                                                    6112.20.1020
                                                                                                    6112.20.1040
                                                                                                    6113.00.9030
----------------------------------------------------------------------------------------------------------------
636                                                                                                 6104.49.9030
                                                                                                    6104.44.2020
----------------------------------------------------------------------------------------------------------------
638                                                                                                 6103.23.0075
                                                                                                    6103.29.1050
                                                                                                    6105.90.8030
                                                                                                    6110.30.1050
                                                                                                    6110.30.2051
                                                                                                    6110.30.2053
                                                                                                    6112.12.0030
                                                                                                    6112.19.1030
----------------------------------------------------------------------------------------------------------------
639                                                                                                 6104.23.0036
                                                                                                    6104.29.1050
                                                                                                    6104.29.2055
                                                                                                    6106.90.2530
                                                                                                    6106.90.3030
                                                                                                    6110.30.1060
                                                                                                    6110.30.2061
                                                                                                    6110.30.2063
                                                                                                    6112.12.0040
                                                                                                    6112.19.1040
----------------------------------------------------------------------------------------------------------------
651                                                                                                 6107.22.0010
                                                                                                    6107.22.0015
                                                                                                    6107.22.0025
                                                                                                    6107.99.1030
                                                                                                    6108.32.0015
----------------------------------------------------------------------------------------------------------------

                          (iii) Category defined.--In this 
                        subparagraph, the term ``category'' has 
                        the meaning given that term in 
                        paragraph (2A)(E) of this subsection.
                  (G) Made-up textile articles.--
                          (i) In general.--Any of the made-up 
                        textile articles described in clauses 
                        (ii) and (iii) that is wholly 
                        assembled, or knit-to-shape, in Haiti 
                        from any combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        or yarns and is imported directly from 
                        Haiti or the Dominican Republic shall 
                        enter the United States free of duty, 
                        without regard to the source of the 
                        fabric, fabric components, components 
                        knit-to-shape, or yarns from which the 
                        article is made.
                          (ii) Articles described.--Made-up 
                        textile articles described in this 
                        clause are articles in the following 
                        category numbers that fall within the 
                        following statistical reporting numbers 
                        of the HTS (as in effect on the day 
                        before the date of the enactment of 
                        this subparagraph):


 
 
----------------------------------------------------------------------------------------------------------------
Category Number                                                                                  HTS Statistical
                                                                                                Reporting Number
----------------------------------------------------------------------------------------------------------------
363                                                                                                 6302.60.0020
                                                                                                    6302.91.0015
                                                                                                    6302.91.0035
                                                                                                    6307.90.8940
----------------------------------------------------------------------------------------------------------------
369                                                                                                 6304.91.0020
                                                                                                    6304.92.0000
                                                                                                    6302.60.0010
                                                                                                    6302.60.0030
                                                                                                    6302.91.0005
                                                                                                    6302.91.0050
                                                                                                    6307.90.8910
                                                                                                    6307.90.8945
                                                                                                    5701.90.2020
                                                                                                    5702.39.2010
                                                                                                    5702.50.5600
                                                                                                    5702.99.0500
                                                                                                    5702.99.1500
                                                                                                    5705.00.2020
                                                                                                    5807.10.0510
                                                                                                    5807.90.0510
                                                                                                    6307.90.3010
                                                                                                    6301.30.0010
                                                                                                    6305.20.0000
                                                                                                    6307.10.1020
                                                                                                    6307.10.1090
                                                                                                    6406.10.7700
                                                                                                    9404.90.1000
                                                                                                    9404.90.9505
                                                                                                    6301.30.0020
                                                                                                    6302.91.0045
----------------------------------------------------------------------------------------------------------------
465                                                                                                 5701.10.9000
                                                                                                    5702.50.2000
                                                                                                    5702.50.4000
                                                                                                    5702.91.3000
                                                                                                    5702.91.4000
                                                                                                    5703.10.2000
                                                                                                    5703.10.8000
                                                                                                    5704.10.0010
                                                                                                    5705.00.2005
                                                                                                    5705.00.2015
                                                                                                    5702.31.1000
                                                                                                    5702.31.2000
----------------------------------------------------------------------------------------------------------------
469                                                                                                 6304.19.3040
                                                                                                    6304.91.0050
                                                                                                    6304.99.1500
                                                                                                    6304.99.6010
                                                                                                    5601.29.0020
                                                                                                    6302.39.0010
                                                                                                    6406.10.9020
----------------------------------------------------------------------------------------------------------------
665                                                                                                 5701.90.1030
                                                                                                    5701.90.2030
                                                                                                    5702.32.1000
                                                                                                    5702.32.2000
                                                                                                    5702.42.2090
                                                                                                    5702.50.5200
                                                                                                    5702.92.1000
                                                                                                    5702.92.9000
                                                                                                    5703.20.1000
                                                                                                    5703.30.2000
                                                                                                    5703.30.8030
                                                                                                    5703.30.8080
                                                                                                    5704.10.0090
                                                                                                    5705.00.2030
                                                                                                    5703.20.2010
                                                                                                    5703.20.2090
----------------------------------------------------------------------------------------------------------------
666                                                                                                 6304.11.2000
                                                                                                    6304.91.0040
                                                                                                    6304.93.0000
                                                                                                    6304.99.6020
                                                                                                    6301.40.0010
                                                                                                    6301.40.0020
                                                                                                    6301.90.0010
----------------------------------------------------------------------------------------------------------------
669                                                                                                 5601.10.2000
                                                                                                    5601.22.0090
                                                                                                    5807.10.0520
                                                                                                    5807.90.0520
                                                                                                    6307.90.3020
                                                                                                    6305.32.0010
                                                                                                    6305.32.0020
                                                                                                    6305.32.0050
                                                                                                    6305.32.0060
                                                                                                    6305.39.0000
                                                                                                    6406.10.9040
                                                                                                    6308.00.0020
----------------------------------------------------------------------------------------------------------------
899                                                                                                 6304.11.3000
                                                                                                    6304.19.3060
                                                                                                    6304.91.0070
                                                                                                    6304.99.3500
                                                                                                    6304.99.6040
                                                                                                    5601.29.0090
                                                                                                    6301.90.0030
                                                                                                    6305.90.0000
                                                                                                    6406.10.9060
----------------------------------------------------------------------------------------------------------------
900                                                                                                 5601.29.0010
                                                                                                    5701.90.2010
                                                                                                    6301.90.0020
----------------------------------------------------------------------------------------------------------------

                          (iii) Other articles described.--
                        Made-up textile articles described in 
                        this clause are articles that fall 
                        within statistical reporting number 
                        6406.10.9090 of the HTS (as in effect 
                        on the day before the date of the 
                        enactment of this subparagraph).
                          (iv) Category defined.--In this 
                        subparagraph, the term ``category'' has 
                        the meaning given that term in 
                        paragraph (2A)(E) of this subsection.
          (4) Earned import allowance rule.--
                  (A) In general.--Apparel articles wholly 
                assembled, or knit-to-shape, in Haiti from any 
                combination of fabrics, fabric components, 
                components knit-to-shape, or yarns and imported 
                directly from Haiti or the Dominican Republic 
                shall enter the United States free of duty, 
                without regard to the source of the fabric, 
                fabric components, components knit-to-shape, or 
                yarns from which the articles are made, if such 
                apparel articles are accompanied by an earned 
                import allowance certificate that reflects the 
                amount of credits equal to the total square 
                meter equivalents of such apparel articles, in 
                accordance with the program established under 
                subparagraph (B). For purposes of determining 
                the quantity of square meter equivalents under 
                this subparagraph, the conversion factors 
                listed in ``Correlation: U.S. Textile and 
                Apparel Industry Category System with the 
                Harmonized Tariff Schedule of the United States 
                of America, 2008'', or its successor 
                publications, of the United States Department 
                of Commerce, shall apply.
                  (B) Earned import allowance program.--
                          (i) Establishment.--The Secretary of 
                        Commerce shall establish a program to 
                        provide earned import allowance 
                        certificates to any producer or entity 
                        controlling production for purposes of 
                        subparagraph (A), based on the elements 
                        described in clause (ii).
                          (ii) Elements.--The elements referred 
                        to in clause (i) are the following:
                                  (I) One credit shall be 
                                issued to a producer or an 
                                entity controlling production 
                                for every two square meter 
                                equivalents of qualifying woven 
                                fabric or qualifying knit 
                                fabric that the producer or 
                                entity controlling production 
                                can demonstrate that it 
                                purchased for the manufacture 
                                in Haiti of articles like or 
                                similar to any article eligible 
                                for preferential treatment 
                                under subparagraph (A). The 
                                Secretary of Commerce shall, if 
                                requested by a producer or 
                                entity controlling production, 
                                create and maintain an account 
                                for such producer or entity 
                                controlling production, into 
                                which such credits shall be 
                                deposited.
                                  (II) Such producer or entity 
                                controlling production may 
                                redeem credits issued under 
                                subclause (I) for earned import 
                                allowance certificates 
                                reflecting such number of 
                                earned credits as the producer 
                                or entity may request and has 
                                available.
                                  (III) The Secretary of 
                                Commerce may require any 
                                textile mill or other entity 
                                located in the United States 
                                that exports to Haiti 
                                qualifying woven fabric or 
                                qualifying knit fabric to 
                                submit, upon such export or 
                                upon request, documentation, 
                                such as a Shipper's Export 
                                Declaration, to the Secretary 
                                of Commerce--
                                          (aa) verifying that 
                                        the qualifying woven 
                                        fabric or qualifying 
                                        knit fabric was 
                                        exported to a producer 
                                        in Haiti or to an 
                                        entity controlling 
                                        production; and
                                          (bb) identifying such 
                                        producer or entity 
                                        controlling production, 
                                        and the quantity and 
                                        description of 
                                        qualifying woven fabric 
                                        or qualifying knit 
                                        fabric exported to such 
                                        producer or entity 
                                        controlling production.
                                  (IV) The Secretary of 
                                Commerce may require that a 
                                producer or entity controlling 
                                production submit documentation 
                                to verify purchases of 
                                qualifying woven fabric or 
                                qualifying knit fabric.
                                  (V) The Secretary of Commerce 
                                may make available to each 
                                person or entity identified in 
                                documentation submitted under 
                                subclause (III) or (IV) 
                                information contained in such 
                                documentation that relates to 
                                the purchase of qualifying 
                                woven fabric or qualifying knit 
                                fabric involving such person or 
                                entity.
                                  (VI) The program under this 
                                subparagraph shall be 
                                established so as to allow, to 
                                the extent feasible, the 
                                submission, storage, retrieval, 
                                and disclosure of information 
                                in electronic format, including 
                                information with respect to the 
                                earned import allowance 
                                certificates required under 
                                subparagraph (A)(i).
                                  (VII) The Secretary of 
                                Commerce may reconcile 
                                discrepancies in information 
                                provided under subclause (III) 
                                or (IV) and verify the accuracy 
                                of such information.
                                  (VIII) The Secretary of 
                                Commerce shall establish 
                                procedures to carry out the 
                                program under this subparagraph 
                                and may establish additional 
                                requirements to carry out this 
                                subparagraph. Such additional 
                                requirements may include--
                                          (aa) submissions by 
                                        textile mills or other 
                                        entities in the United 
                                        States documenting 
                                        exports of yarns wholly 
                                        formed in the United 
                                        States to countries 
                                        described in paragraph 
                                        (1)(B)(iii) for the 
                                        manufacture of 
                                        qualifying knit fabric; 
                                        and
                                          (bb) procedures 
                                        imposed on producers or 
                                        entities controlling 
                                        production to allow the 
                                        Secretary of Commerce 
                                        to obtain and verify 
                                        information relating to 
                                        the production of 
                                        qualifying knit fabric.
                          (iii) Qualifying woven fabric 
                        defined.--For purposes of this 
                        subparagraph, the term ``qualifying 
                        woven fabric'' means fabric wholly 
                        formed in the United States from yarns 
                        wholly formed in the United States, 
                        except that--
                                  (I) fabric otherwise eligible 
                                as qualifying woven fabric 
                                shall not be ineligible as 
                                qualifying woven fabric because 
                                the fabric contains nylon 
                                filament yarn to which section 
                                213(b)(2)(A)(vii)(IV) applies;
                                  (II) fabric that would 
                                otherwise be ineligible as 
                                qualifying woven fabric because 
                                the fabric contains yarns not 
                                wholly formed in the United 
                                States shall not be ineligible 
                                as qualifying woven fabric if 
                                the total weight of all such 
                                yarns is not more than 10 
                                percent of the total weight of 
                                the fabric; and
                                  (III) fabric otherwise 
                                eligible as qualifying woven 
                                fabric shall not be ineligible 
                                as qualifying fabric because 
                                the fabric contains yarns 
                                covered by clause (i) or (ii) 
                                of paragraph (5)(A).
                          (iv) Qualifying knit fabric 
                        defined.--For purposes of this 
                        subparagraph, the term ``qualifying 
                        knit fabric'' means fabric or knit-to-
                        shape components wholly formed or knit-
                        to-shape in any country or any 
                        combination of countries described in 
                        paragraph (1)(B)(iii), from yarns 
                        wholly formed in the United States, 
                        except that--
                                  (I) fabric or knit-to-shape 
                                components otherwise eligible 
                                as qualifying knit fabric shall 
                                not be ineligible as qualifying 
                                knit fabric because the fabric 
                                or knit-to-shape components 
                                contain nylon filament yarn to 
                                which section 
                                213(b)(2)(A)(vii)(IV) applies;
                                  (II) fabric or knit-to-shape 
                                components that would otherwise 
                                be ineligible as qualifying 
                                knit fabric because the fabric 
                                or knit-to-shape components 
                                contain yarns not wholly formed 
                                in the United States shall not 
                                be ineligible as qualifying 
                                knit fabric if the total weight 
                                of all such yarns is not more 
                                than 10 percent of the total 
                                weight of the fabric or knit-
                                to-shape components; and
                                  (III) fabric or knit-to-shape 
                                components otherwise eligible 
                                as qualifying knit fabric shall 
                                not be ineligible as qualifying 
                                knit fabric because the fabric 
                                or knit-to-shape components 
                                contain yarns covered by clause 
                                (i) or (ii) of paragraph 
                                (5)(A).
                  (C)\8\ Enforcement provisions.--
---------------------------------------------------------------------------
    \8\Section 2(f) of Public Law 112-234 amends section 231A(b)(4) by 
striking subparagraph (C) and redesignating subparagraph (D) as 
subparagraph (C). The amendment was executed to section 213A since the 
Act does not contain a section 231A in order to reflect the probable 
intent of Congress.
---------------------------------------------------------------------------
                          (i) Fraudulent claims of 
                        preference.--Any person who makes a 
                        false claim for preference under the 
                        program established under subparagraph 
                        (B) shall be subject to any applicable 
                        civil or criminal penalty that may be 
                        imposed under the customs laws of the 
                        United States or under title 18, United 
                        States Code.
                          (ii) Penalties for other fraudulent 
                        information.--The Secretary of Commerce 
                        may establish and impose penalties for 
                        the submission to the Secretary of 
                        Commerce of fraudulent information 
                        under the program established under 
                        subparagraph (B), other than a claim 
                        described in clause (i).
          (5) Short supply provision.--
                  (A) In general.--Any apparel article that is 
                wholly assembled, or knit-to-shape, in Haiti 
                from any combination of fabrics, fabric 
                components, components knit-to-shape, or yarns 
                and is imported directly from Haiti or the 
                Dominican Republic shall enter the United 
                States free of duty, without regard to the 
                source of the fabrics, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made, if the fabrics, fabric 
                components, components knit-to-shape, or yarns 
                comprising the component that determines the 
                tariff classification of the article are of any 
                of the following:
                          (i) Fabrics or yarns, to the extent 
                        that apparel articles of such fabrics 
                        or yarns would be eligible for 
                        preferential treatment, without regard 
                        to the source of the fabrics or yarns, 
                        under Annex 401 of the NAFTA.
                          (ii) Fabrics or yarns, to the extent 
                        that such fabrics or yarns are 
                        designated as not being available in 
                        commercial quantities for purposes of--
                                  (I) section 213(b)(2)(A)(v) 
                                of this Act;
                                  (II) section 112(b)(5) of the 
                                African Growth and Opportunity 
                                Act;
                                  (III) clause (i)(III) or (ii) 
                                of section 204(b)(3)(B) of the 
                                Andean Trade Preference Act; or
                                  (IV) any other provision, 
                                relating to determining whether 
                                a textile or apparel article is 
                                an originating good eligible 
                                for preferential treatment, of 
                                a law that implements a free 
                                trade agreement entered into by 
                                the United States that is in 
                                effect at the time the claim 
                                for preferential treatment is 
                                made.
                  (B) Removal of designation of fabrics or 
                yarns not available in commercial quantities.--
                If the President determines that--
                          (i) any fabric or yarn described in 
                        clause (i) of subparagraph (A) was 
                        determined to be eligible for 
                        preferential treatment, or
                          (ii) any fabric or yarn described in 
                        clause (ii) of subparagraph (A) was 
                        designated as not being available in 
                        commercial quantities,
                on the basis of fraud, the President is 
                authorized to remove the eligibility or 
                designation (as the case may be) of that fabric 
                or yarn with respect to articles entered after 
                such removal.
          (6) Other preferential treatment not affected.--The 
        duty-free treatment provided under this subsection is 
        in addition to any other preferential treatment under 
        this title.
  (c) Special Rule for Certain Wire Harness Automotive 
Components.--
          (1) In general.--Any wire harness automotive 
        component that is the product or manufacture of Haiti 
        and is imported directly from Haiti into the customs 
        territory of the United States shall enter the United 
        States free of duty, during the 10-year period 
        beginning on the date of the enactment of the Haitian 
        Hemispheric Opportunity through Partnership 
        Encouragement Act of 2006, if Haiti has met the 
        requirements of subsection (d) and if the sum of--
                  (A) the cost or value of the materials 
                produced in Haiti or one or more countries 
                described in subsection (b)(2)(C), or any 
                combination thereof, plus
                  (B) the direct costs of processing operations 
                (as defined in section 213(a)(3)) performed in 
                Haiti or the United States, or both,
        is not less than 50 percent of the declared customs 
        value of such wire harness automotive component.
          (2) Wire harness automotive component.--For purposes 
        of this subsection, the term ``wire harness automotive 
        component'' means any article provided for in 
        subheading 8544.30.00 of the HTS, as in effect on the 
        date of the enactment of the Haitian Hemispheric 
        Opportunity through Partnership Encouragement Act of 
        2006.
  (d) Eligibility Requirements.--
          (1) In general.--Haiti shall be eligible for 
        preferential treatment under this section if the 
        President determines and certifies to Congress that 
        Haiti--
                  (A) has established, or is making continual 
                progress toward establishing--
                          (i) a market-based economy that 
                        protects private property rights, 
                        incorporates an open rules-based 
                        trading system, and minimizes 
                        government interference in the economy 
                        through measures such as price 
                        controls, subsidies, and government 
                        ownership of economic assets;
                          (ii) the rule of law, political 
                        pluralism, and the right to due 
                        process, a fair trial, and equal 
                        protection under the law;
                          (iii) the elimination of barriers to 
                        United States trade and investment, 
                        including by--
                                  (I) the provision of national 
                                treatment and measures to 
                                create an environment conducive 
                                to domestic and foreign 
                                investment;
                                  (II) the protection of 
                                intellectual property; and
                                  (III) the resolution of 
                                bilateral trade and investment 
                                disputes;
                          (iv) economic policies to reduce 
                        poverty, increase the availability of 
                        health care and educational 
                        opportunities, expand physical 
                        infrastructure, promote the development 
                        of private enterprise, and encourage 
                        the formation of capital markets 
                        through microcredit or other programs;
                          (v) a system to combat corruption and 
                        bribery, such as signing and 
                        implementing the Convention on 
                        Combating Bribery of Foreign Public 
                        Officials in International Business 
                        Transactions; and
                          (vi) protection of internationally 
                        recognized worker rights, including the 
                        right of association, the right to 
                        organize and bargain collectively, a 
                        prohibition on the use of any form of 
                        forced or compulsory labor, a minimum 
                        age for the employment of children, and 
                        acceptable conditions of work with 
                        respect to minimum wages, hours of 
                        work, and occupational safety and 
                        health;
                  (B) does not engage in activities that 
                undermine United States national security or 
                foreign policy interests; and
                  (C) does not engage in gross violations of 
                internationally recognized human rights or 
                provide support for acts of international 
                terrorism and cooperates in international 
                efforts to eliminate human rights violations 
                and terrorist activities.
          (2) Time limit for determination.--The President 
        shall determine whether Haiti meets the requirements of 
        paragraph (1) not later than 90 days after the date of 
        the enactment of the Haitian Hemispheric Opportunity 
        through Partnership Encouragement Act of 2006.
          (3) Continuing compliance.--If the President 
        determines that Haiti is not making continual progress 
        in meeting the requirements described in paragraph 
        (1)(A), the President shall terminate the preferential 
        treatment under this section.
          (4) Petition process.--Any interested party may file 
        a request to have the status of Haiti reviewed with 
        respect to the eligibility requirements listed in 
        paragraph (1), and the President shall provide for this 
        purpose the same procedures as those that are provided 
        for reviewing the status of eligible beneficiary 
        developing countries with respect to the designation 
        criteria listed in subsections (b) and (c) of section 
        502 of the Trade Act of 1974 (19 U.S.C. 2642 (b) and 
        (c)).
  (e) Technical Assistance Improvement and Compliance Needs 
Assessment and Remediation Program.--
          (1) Continued eligibility for preferences.--
                  (A) Presidential certification of compliance 
                by haiti with requirements.--Upon the 
                expiration of the 16-month period beginning on 
                the date of the enactment of the Haitian 
                Hemispheric Opportunity through Partnership 
                Encouragement Act of 2008, Haiti shall continue 
                to be eligible for the preferential treatment 
                provided under subsection (b) only if the 
                President determines and certifies to the 
                Congress that--
                          (i) Haiti has implemented the 
                        requirements set forth in paragraphs 
                        (2) and (3); and
                          (ii) Haiti has agreed to require 
                        producers of articles for which duty-
                        free treatment may be requested under 
                        subsection (b) to participate in the 
                        TAICNAR Program described in paragraph 
                        (3) and has developed a system to 
                        ensure participation in such program by 
                        such producers, including by developing 
                        and maintaining the registry described 
                        in paragraph (2)(B)(i).
                  (B) Extension.--The President may extend the 
                period for compliance by Haiti under 
                subparagraph (A) if the President--
                          (i) determines that Haiti has made a 
                        good faith effort toward such 
                        compliance and has agreed to take 
                        additional steps to come into full 
                        compliance that are satisfactory to the 
                        President; and
                          (ii) provides to the appropriate 
                        congressional committees, not later 
                        than 6 months after the last day of the 
                        16-month period specified in 
                        subparagraph (A), and every 6 months 
                        thereafter, a report identifying the 
                        steps that Haiti has agreed to take to 
                        come into full compliance and the 
                        progress made over the preceding 6-
                        month period in implementing such 
                        steps.
                  (C) Continuing compliance.--
                          (i) Termination of preferential 
                        treatment.--If, after making a 
                        certification under subparagraph (A), 
                        the President determines that Haiti is 
                        no longer meeting the requirements set 
                        forth in subparagraph (A), the 
                        President shall terminate the 
                        preferential treatment provided under 
                        subsection (b), unless the President 
                        determines, after consulting with the 
                        appropriate congressional committees, 
                        that meeting such requirements is not 
                        practicable because of extraordinary 
                        circumstances existing in Haiti when 
                        the determination is made.
                          (ii) Subsequent compliance.--If the 
                        President, after terminating 
                        preferential treatment under clause 
                        (i), determines that Haiti is meeting 
                        the requirements set forth in 
                        subparagraph (A), the President shall 
                        reinstate the application of 
                        preferential treatment under subsection 
                        (b).
          (2) Labor ombudsman.--
                  (A) In general.--The requirement under this 
                paragraph is that Haiti has established an 
                independent Labor Ombudsman's Office within the 
                national government that--
                          (i) reports directly to the President 
                        of Haiti;
                          (ii) is headed by a Labor Ombudsman 
                        chosen by the President of Haiti, in 
                        consultation with Haitian labor unions 
                        and industry associations; and
                          (iii) is vested with the authority to 
                        perform the functions described in 
                        subparagraph (B).
                  (B) Functions.--The functions of the Labor 
                Ombudsman's Office shall include--
                          (i) developing and maintaining a 
                        registry of producers of articles for 
                        which duty-free treatment may be 
                        requested under subsection (b), and 
                        developing, in consultation and 
                        coordination with any other appropriate 
                        officials of the Government of Haiti, a 
                        system to ensure participation by such 
                        producers in the TAICNAR Program 
                        described in paragraph (3);
                          (ii) overseeing the implementation of 
                        the TAICNAR Program described in 
                        paragraph (3);
                          (iii) receiving and investigating 
                        comments from any interested party 
                        regarding the conditions described in 
                        paragraph (3)(B) in facilities of 
                        producers listed in the registry 
                        described in clause (i) and, where 
                        appropriate, referring such comments or 
                        the result of such investigations to 
                        the appropriate Haitian authorities, or 
                        to the entity operating the TAICNAR 
                        Program described in paragraph (3);
                          (iv) assisting, in consultation and 
                        coordination with any other appropriate 
                        Haitian authorities, producers listed 
                        in the registry described in clause (i) 
                        in meeting the conditions set forth in 
                        paragraph (3)(B); and
                          (v) coordinating, with the assistance 
                        of the entity operating the TAICNAR 
                        Program described in paragraph (3), a 
                        tripartite committee comprised of 
                        appropriate representatives of 
                        government agencies, employers, and 
                        workers, as well as other relevant 
                        interested parties, for the purposes of 
                        evaluating progress in implementing the 
                        TAICNAR Program described in paragraph 
                        (3), and consulting on improving core 
                        labor standards and working conditions 
                        in the textile and apparel sector in 
                        Haiti, and on other matters of common 
                        concern relating to such core labor 
                        standards and working conditions.
          (3) Technical assistance improvement and compliance 
        needs assessment and remediation program.--
                  (A) In general.--The requirement under this 
                paragraph is that Haiti, in cooperation with 
                the International Labor Organization, has 
                established a Technical Assistance Improvement 
                and Compliance Needs Assessment and Remediation 
                Program meeting the requirements under 
                subparagraph (C)--
                          (i) to assess compliance by producers 
                        listed in the registry described in 
                        paragraph (2)(B)(i) with the conditions 
                        set forth in subparagraph (B) and to 
                        assist such producers in meeting such 
                        conditions; and
                          (ii) to provide assistance to improve 
                        the capacity of the Government of 
                        Haiti--
                                  (I) to inspect facilities of 
                                producers listed in the 
                                registry described in paragraph 
                                (2)(B)(i); and
                                  (II) to enforce national 
                                labor laws and resolve labor 
                                disputes, including through 
                                measures described in 
                                subparagraph (E).
                  (B) Conditions described.--The conditions 
                referred to in subparagraph (A) are--
                          (i) compliance with core labor 
                        standards; and
                          (ii) compliance with the labor laws 
                        of Haiti that relate directly to core 
                        labor standards and to ensuring 
                        acceptable conditions of work with 
                        respect to minimum wages, hours of 
                        work, and occupational health and 
                        safety.
                  (C) Requirements.--The requirements for the 
                TAICNAR Program are that the program--
                          (i) be operated by the International 
                        Labor Organization (or any subdivision, 
                        instrumentality, or designee thereof), 
                        which prepares the biannual reports 
                        described in subparagraph (D);
                          (ii) be developed through a 
                        participatory process that includes the 
                        Labor Ombudsman described in paragraph 
                        (2) and appropriate representatives of 
                        government agencies, employers, and 
                        workers;
                          (iii) assess compliance by each 
                        producer listed in the registry 
                        described in paragraph (2)(B)(i) with 
                        the conditions set forth in 
                        subparagraph (B) and identify any 
                        deficiencies by such producer with 
                        respect to meeting such conditions, 
                        including by--
                                  (I) conducting unannounced 
                                site visits to manufacturing 
                                facilities of the producer;
                                  (II) conducting confidential 
                                interviews separately with 
                                workers and management of the 
                                facilities of the producer;
                                  (III) providing to management 
                                and workers, and where 
                                applicable, worker 
                                organizations in the facilities 
                                of the producer, on a 
                                confidential basis--
                                          (aa) the results of 
                                        the assessment carried 
                                        out under this clause; 
                                        and
                                          (bb) specific 
                                        suggestions for 
                                        remediating any such 
                                        deficiencies;
                          (iv) assist the producer in 
                        remediating any deficiencies identified 
                        under clause (iii);
                          (v) conduct prompt follow-up site 
                        visits to the facilities of the 
                        producer to assess progress on 
                        remediation of any deficiencies 
                        identified under clause (iii); and
                          (vi) provide training to workers and 
                        management of the producer, and where 
                        appropriate, to other persons or 
                        entities, to promote compliance with 
                        subparagraph (B).
                  (D) Biannual report.--The biannual reports 
                referred to in subparagraph (C)(i) are a 
                report, by the entity operating the TAICNAR 
                Program, that is published (and available to 
                the public in a readily accessible manner) on a 
                biannual basis, beginning 6 months after Haiti 
                implements the TAICNAR Program under this 
                paragraph, covering the preceding 6-month 
                period, and that includes the following:
                          (i) The name of each producer listed 
                        in the registry described in paragraph 
                        (2)(B)(i) that has been identified as 
                        having met the conditions under 
                        subparagraph (B).
                          (ii) The name of each producer listed 
                        in the registry described in paragraph 
                        (2)(B)(i) that has been identified as 
                        having deficiencies with respect to the 
                        conditions under subparagraph (B), and 
                        has failed to remedy such deficiencies.
                          (iii) For each producer listed under 
                        clause (ii)--
                                  (I) a description of the 
                                deficiencies found to exist and 
                                the specific suggestions for 
                                remediating such deficiencies 
                                made by the entity operating 
                                the TAICNAR Program;
                                  (II) a description of the 
                                efforts by the producer to 
                                remediate the deficiencies, 
                                including a description of 
                                assistance provided by any 
                                entity to assist in such 
                                remediation; and
                                  (III) with respect to 
                                deficiencies that have not been 
                                remediated, the amount of time 
                                that has elapsed since the 
                                deficiencies were first 
                                identified in a report under 
                                this subparagraph.
                          (iv) For each producer identified as 
                        having deficiencies with respect to the 
                        conditions described under subparagraph 
                        (B) in a prior report under this 
                        subparagraph, a description of the 
                        progress made in remediating such 
                        deficiencies since the submission of 
                        the prior report, and an assessment of 
                        whether any aspect of such deficiencies 
                        persists.
                  (E) Capacity building.--The assistance to the 
                Government of Haiti referred to in subparagraph 
                (A)(ii) shall include programs--
                          (i) to review the labor laws and 
                        regulations of Haiti and to develop and 
                        implement strategies for bringing the 
                        laws and regulations into conformity 
                        with core labor standards;
                          (ii) to develop additional strategies 
                        for facilitating protection of core 
                        labor standards and providing 
                        acceptable conditions of work with 
                        respect to minimum wages, hours of 
                        work, and occupational safety and 
                        health, including through legal, 
                        regulatory, and institutional reform;
                          (iii) to increase awareness of worker 
                        rights, including under core labor 
                        standards and national labor laws;
                          (iv) to promote consultation and 
                        cooperation between government 
                        representatives, employers, worker 
                        representatives, and United States 
                        importers on matters relating to core 
                        labor standards and national labor 
                        laws;
                          (v) to assist the Labor Ombudsman 
                        appointed pursuant to paragraph (2) in 
                        establishing and coordinating operation 
                        of the committee described in paragraph 
                        (2)(B)(v);
                          (vi) to assist worker representatives 
                        in more fully and effectively 
                        advocating on behalf of their members; 
                        and
                          (vii) to provide on-the-job training 
                        and technical assistance to labor 
                        inspectors, judicial officers, and 
                        other relevant personnel to build their 
                        capacity to enforce national labor laws 
                        and resolve labor disputes.
          (4) Compliance with eligibility criteria.--
                  (A) Country compliance with worker rights 
                eligibility criteria.--In making a 
                determination of whether Haiti is meeting the 
                requirement set forth in subsection 
                (d)(1)(A)(vi) relating to internationally 
                recognized worker rights, the President shall 
                consider the reports produced under paragraph 
                (3)(D).
                  (B) Producer eligibility.--
                          (i) Identification of producers.--
                        Beginning in the second calendar year 
                        after the President makes the 
                        certification under paragraph (1)(A), 
                        the President shall identify on a 
                        biennial basis whether a producer 
                        listed in the registry described in 
                        paragraph (2)(B)(i) has failed to 
                        comply with core labor standards and 
                        with the labor laws of Haiti that 
                        directly relate to and are consistent 
                        with core labor standards.
                          (ii) Assistance to producers; 
                        withdrawal, etc., of preferential 
                        treatment.--For each producer that the 
                        President identifies under clause (i), 
                        the President shall seek to assist such 
                        producer in coming into compliance with 
                        core labor standards and with the labor 
                        laws of Haiti that directly relate to 
                        and are consistent with core labor 
                        standards. If such efforts fail, the 
                        President shall withdraw, suspend, or 
                        limit the application of preferential 
                        treatment under subsection (b) to 
                        articles of such producer.
                          (iii) Reinstating preferential 
                        treatment.--If the President, after 
                        withdrawing, suspending, or limiting 
                        the application of preferential 
                        treatment under clause (ii) to articles 
                        of a producer, determines that such 
                        producer is complying with core labor 
                        standards and with the labor laws of 
                        Haiti that directly relate to and are 
                        consistent with core labor standards, 
                        the President shall reinstate the 
                        application of preferential treatment 
                        under subsection (b) to the articles of 
                        the producer.
                          (iv) Consideration of reports.--In 
                        making the identification under clause 
                        (i) and the determination under clause 
                        (iii), the President shall consider the 
                        reports made available under paragraph 
                        (3)(D).
          (5) Reports by the president.--
                  (A) In general.--Not later than one year 
                after the date of the enactment of the Haitian 
                Hemispheric Opportunity through Partnership 
                Encouragement Act of 2008, and annually 
                thereafter, the President shall transmit to the 
                appropriate congressional committees a report 
                on the implementation of this subsection during 
                the preceding 1-year period.
                  (B) Matters to be included.--Each report 
                required by subparagraph (A) shall include the 
                following:
                          (i) An explanation of the efforts of 
                        Haiti, the President, and the 
                        International Labor Organization to 
                        carry out this subsection.
                          (ii) A summary of each report 
                        produced under paragraph (3)(D) during 
                        the preceding 1-year period and a 
                        summary of the findings contained in 
                        such report.
                          (iii) Identifications made under 
                        paragraph (4)(B)(i) and determinations 
                        made under paragraph (4)(B)(iii).
          (6) Authorization of appropriations.--There is 
        authorized to be appropriated to carry out this 
        subsection the sum of $10,000,000 for the period 
        beginning on October 1, 2008, and ending on September 
        30, 2013.
  (f) Conditions Regarding Enforcement of Circumvention.--
          (1) In general.--The preferential treatment under 
        subsection (b)(1) shall not apply unless the President 
        certifies to Congress that Haiti is meeting the 
        following conditions:
                  (A) Haiti has adopted an effective visa 
                system, domestic laws, and enforcement 
                procedures applicable to articles described in 
                subsection (b) to prevent unlawful 
                transshipment of the articles and the use of 
                counterfeit documents relating to the 
                importation of the articles into the United 
                States.
                  (B) Haiti has enacted legislation or 
                promulgated regulations that would permit U.S. 
                Customs and Border Protection verification 
                teams to have the access necessary to 
                investigate thoroughly allegations of 
                transshipment through such country.
                  (C) Haiti agrees to report, on a timely 
                basis, at the request of U.S. Customs and 
                Border Protection, on the total exports from 
                and imports into that country of articles 
                described in subsection (b), consistent with 
                the manner in which the records are kept by 
                Haiti.
                  (D) Haiti agrees to cooperate fully with the 
                United States to address and take action 
                necessary to prevent circumvention as provided 
                in Article 5 of the Agreement on Textiles and 
                Clothing.
                  (E) Haiti agrees to require all producers and 
                exporters of articles described in subsection 
                (b) in that country to maintain complete 
                records of the production and the export of 
                such articles, including materials used in the 
                production, for at least 5 years after the 
                production or export (as the case may be).
                  (F) Haiti agrees to report, on a timely 
                basis, at the request of U.S. Customs and 
                Border Protection, documentation establishing 
                the country of origin of articles described in 
                subsection (b) as used by that country in 
                implementing an effective visa system.
          (2) Definition of transshipment.--Transshipment 
        within the meaning of this subsection has occurred when 
        preferential treatment for a textile or apparel article 
        under this section has been claimed 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 
        paragraph, 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 this section.
          (3) Limitation on goods shipped from the dominican 
        republic.--
                  (A) Limitation.--Notwithstanding subsection 
                (a)(5), relating to the definition of 
                ``imported directly from Haiti or the Dominican 
                Republic'', articles described in subsection 
                (b) that are shipped from the Dominican 
                Republic, directly or through the territory of 
                an intermediate country, whether or not such 
                articles undergo processing in the Dominican 
                Republic, shall not be considered to be 
                ``imported directly from Haiti or the Dominican 
                Republic'' until the President certifies to the 
                Congress that Haiti and the Dominican Republic 
                have developed procedures to prevent unlawful 
                transshipment of the articles and the use of 
                counterfeit documents related to the 
                importation of the articles into the United 
                States.
                  (B) Technical and other assistance.--The 
                Commissioner responsible for U.S. Customs and 
                Border Protection shall provide technical and 
                other assistance to Haiti and the Dominican 
                Republic to develop expeditiously the 
                procedures described in subparagraph (A).
  (g) Regulations.--The President shall issue regulations to 
carry out this section not later than 180 days after the date 
of the enactment of the Haitian Hemispheric Opportunity through 
Partnership Encouragement Act of 2006. The President shall 
consult with the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate in 
preparing such regulations.
  (h) Termination.--Except as provided in subsection (b)(1), 
the duty-free treatment provided under this section shall 
remain in effect until September 30, 2020.

           *       *       *       *       *       *       *

                              ----------                              


         CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF 1985



           *       *       *       *       *       *       *
SEC. 13031. FEES FOR CERTAIN CUSTOMS SERVICES.

  (a) Schedule of Fees.--In addition to any other fee 
authorized by law, the Secretary of the Treasury shall charge 
and collect the following fees for the provision of customs 
services in connection with the following:
          (1) For the arrival of a commercial vessel of 100 net 
        tons or more, $397.
          (2) For the arrival of a commercial truck, $5.
          (3) For the arrival of each railroad car carrying 
        passengers or commercial freight, $7.50.
          (4) For all arrivals made during a calendar year by a 
        private vessel or private aircraft, $25.
          (5)(A) Subject to subparagraph (B), for the arrival 
        of each passenger aboard a commercial vessel or 
        commercial aircraft from a place outside the United 
        States (other than a place referred to in subsection 
        (b)(1)(A)(i) of this section), $5.
          (B) For the arrival of each passenger aboard a 
        commercial vessel from a place referred to in 
        subsection (b)(1)(A)(i) of this section, $1.75.
          (6) For each item of dutiable mail for which a 
        document is prepared by a customs officer, $5.
          (7) For each customs broker permit held by an 
        individual, partnership, association, or corporate 
        customs broker, $125 per year.
          (8) For the arrival of a barge or other bulk carrier 
        from Canada or Mexico, $100.
          (9)(A) For the processing of merchandise that is 
        formally entered or released during any fiscal year, a 
        fee in an amount equal to 0.21 percent ad valorem, 
        unless adjusted under subparagraph (B).
          (B)(i) The Secretary of the Treasury may adjust the 
        ad valorem rate specified in subparagraph (A) to an ad 
        valorem rate (but not to a rate of more than 0.21 
        percent nor less than 0.15 percent) and the amounts 
        specified in subsection (b)(8)(A)(i) (but not to more 
        than $485 nor less than $21) to rates and amounts which 
        would, if charged, offset the salaries and expenses 
        that will likely be incurred by the Customs Service in 
        the processing of such entries and releases during the 
        fiscal year in which such costs are incurred.
          (ii) In determining the amount of any adjustment 
        under clause (i), the Secretary of the Treasury shall 
        take into account whether there is a surplus or deficit 
        in the fund established under subsection (f) with 
        respect to the provision of customs services for the 
        processing of formal entries and releases of 
        merchandise.
          (iii) An adjustment may not be made under clause (i) 
        with respect to the fee charged during any fiscal year 
        unless the Secretary of the Treasury--
                  (I) not later than 45 days after the date of 
                the enactment of the Act providing full-year 
                appropriations for the Customs Service for that 
                fiscal year, publishes in the Federal Register 
                a notice of intent to adjust the fee under this 
                paragraph and the amount of such adjustment;
                  (II) provides a period of not less than 30 
                days following publication of the notice 
                described in subclause (I) for public comment 
                and consultation with the Committee on Finance 
                of the Senate and the Committee on Ways and 
                Means of the House of Representatives regarding 
                the proposed adjustment and the methodology 
                used to determine such adjustment;
                  (III) upon the expiration of the period 
                provided under subclause (II), notifies such 
                committees in writing regarding the final 
                determination to adjust the fee, the amount of 
                such adjustment, and the methodology used to 
                determine such adjustment; and
                  (IV) upon the expiration of the 15-day period 
                following the written notification described in 
                subclause (III), submits for publication in the 
                Federal Register notice of the final 
                determination regarding the adjustment of the 
                fee.
          (iv) The 15-day period referred to in clause 
        (iii)(IV) shall be computed by excluding--
                  (I) the days on which either House is not in 
                session because of an adjournment of more than 
                3 days to a day certain or an adjournment of 
                the Congress sine die; and
                  (II) any Saturday and Sunday, not excluded 
                under subclause (I), when either House is not 
                in session.
          (v) An adjustment made under this subparagraph shall 
        become effective with respect to formal entries and 
        releases made on or after the 15th calendar day after 
        the date of publication of the notice described in 
        clause (iii)(IV) and shall remain in effect until 
        adjusted under this subparagraph.
          (C) Any fee charged under this paragraph, whether or 
        not adjusted under subparagraph (B), is subject to the 
        limitations in subsection (b)(8)(A).
          (10) For the processing of merchandise that is 
        informally entered or released, other than at--
                  (A) a centralized hub facility,
                  (B) an express consignment carrier facility, 
                or
                  (C) a small airport or other facility to 
                which section 236 of the Trade and Tariff Act 
                of 1984 applies, if more than 25,000 informal 
                entries were cleared through such airport or 
                facility during the fiscal year preceding such 
                entry or release, a fee of--
                          (i) $2 if the entry or release is 
                        automated and not prepared by customs 
                        personnel;
                          (ii) $6 if the entry or release is 
                        manual and not prepared by customs 
                        personnel; or
                          (iii) $9 if the entry or release, 
                        whether automated or manual, is 
                        prepared by customs personnel.
                For provisions relating to the informal entry 
                or release of merchandise at facilities 
                referred to in subparagraphs (A), (B), and (C), 
                see subsection (b)(9).
  (b) Limitations on Fees.--(1)(A) Except as provided in 
subsection (a)(5)(B) of this section, no fee may be charged 
under subsection (a) of this section for customs services 
provided in connection with--
          (i) the arrival of any passenger whose journey--
                  (I) originated in a territory or possession 
                of the United States; or
                  (II) originated in the United States and was 
                limited to territories and possessions of the 
                United States;
          (ii) the arrival of any railroad car the journey of 
        which originates and terminates in the same country, 
        but only if no passengers board or disembark from the 
        train and no cargo is loaded or unloaded from such car 
        while the car is within any country other than the 
        country in which such car originates and terminates;
          (iii) the arrival of a ferry, except for a ferry 
        whose operations begin on or after August 1, 1999, and 
        that operates south of 27 degrees latitude and east of 
        89 degrees longitude; or
          (iv) the arrival of any passenger on board a 
        commercial vessel traveling only between ports which 
        are within the customs territory of the United States.
  (B) The exemption provided for in subparagraph (A) shall not 
apply in the case of the arrival of any passenger on board a 
commercial vessel whose journey originates and terminates at 
the same place in the United States if there are no intervening 
stops.
  (C) The exemption provided for in subparagraph (A)(i) shall 
not apply to fiscal years 1994, 1995, 1996, and 1997.
  (2) No fee may be charged under subsection (a)(2) for the 
arrival of a commercial truck during any calendar year after a 
total of $100 in fees has been paid to the Secretary of the 
Treasury for the provision of customs services for all arrivals 
of such commercial truck during such calendar year.
  (3) No fee may be charged under subsection (a)(3) for the 
arrival of a railroad car whether passenger or freight during 
any calendar year after a total of $100 in fees has been paid 
to the Secretary of the Treasury for the provision of customs 
services for all arrivals of such passenger or freight rail car 
during such calendar year.
  (4)(A) No fee may be charged under subsection (a)(5) with 
respect to the arrival of any passenger--
          (i) who is in transit to a destination outside the 
        customs territory of the United States, and
          (ii) for whom customs inspectional services are not 
        provided.
  (B) In the case of a commercial vessel making a single voyage 
involving 2 or more United States ports with respect to which 
the passengers would otherwise be charged a fee pursuant to 
subsection (a)(5), such fee shall be charged only 1 time for 
each passenger.
  (5) No fee may be charged under subsection (a)(1) for the 
arrival of--
          (A) a vessel during a calendar year after a total of 
        $5,955 in fees charged under paragraph (1) or (8) of 
        subsection (a) has been paid to the Secretary of the 
        Treasury for the provision of customs services for all 
        arrivals of such vessel during such calendar year,
          (B) any vessel which, at the time of the arrival, is 
        being used solely as a tugboat, or
          (C) any barge or other bulk carrier from Canada or 
        Mexico.
  (6) No fee may be charged under subsection (a)(8) for the 
arrival of a barge or other bulk carrier during a calendar year 
after a total of $1,500 in fees charged under paragraph (1) or 
(8) of subsection (a) has been paid to the Secretary of the 
Treasury for the provision of customs services for all arrivals 
of such barge or other bulk carrier during such calendar year.
  (7) No fee may be charged under paragraph (2), (3), or (4) of 
subsection (a) for the arrival of any--
          (A) commercial truck,
          (B) railroad car, or
          (C) private vessel,
that is being transported, at the time of the arrival, by any 
vessel that is not a ferry.
  (8)(A)(i) Subject to clause (ii), the fee charged under 
subsection (a)(9) for the formal entry or release of 
merchandise may not exceed $485 or be less than $25, unless 
adjusted pursuant to subsection (a)(9)(B).
  (ii) A surcharge of $3 shall be added to the fee determined 
after application of clause (i) for any manual entry or release 
of merchandise.
  (B) No fee may be charged under subsection (a) (9) or (10) 
for the processing of any article that is--
          (i) provided for under any item in chapter 98 of the 
        Harmonized Tariff Schedule of the United States, except 
        subheading 9802.00.60 or 9802.00.80,
          (ii) a product of an insular possession of the United 
        States, or
          (iii) a product of any country listed in subdivision 
        (c)(ii)(B) or (c)(v) of general note 3 to such 
        Schedule.
  (C) For purposes of applying subsection (a) (9) or (10)--
          (i) expenses incurred by the Secretary of the 
        Treasury in the processing of merchandise do not 
        include costs incurred in--
                  (I) air passenger processing,
                  (II) export control, or
                  (III) international affairs, and
          (ii) any reference to a manual formal or informal 
        entry or release includes any entry or release filed by 
        a broker or importer that requires the inputting of 
        cargo selectivity data into the Automated Commercial 
        System by customs personnel, except when--
                  (I) the broker or importer is certified as an 
                ABI cargo release filer under the Automated 
                Commercial System at any port within the United 
                States, or
                  (II) the entry or release is filed at ports 
                prior to the full implementation of the cargo 
                selectivity data system by the Customs Service 
                at such ports.
  (D) The fee charged under subsection (a)(9) or (10) with 
respect to the processing of merchandise shall--
          (i) be paid by the importer of record of the 
        merchandise;
          (ii) except as otherwise provided in this paragraph, 
        be based on the value of the merchandise as determined 
        under section 402 of the Tariff Act of 1930;
          (iii) in the case of merchandise classified under 
        subheading 9802.00.60 of the Harmonized Tariff Schedule 
        of the United States, be applied to the value of the 
        foreign repairs or alterations to the merchandise;
          (iv) in the case of merchandise classified under 
        heading 9802.00.80 of such Schedule, be applied to the 
        full value of the merchandise, less the cost or value 
        of the component United States products;
          (v) in the case of agricultural products of the 
        United States that are processed and packed in a 
        foreign trade zone, be applied only to the value of 
        material used to make the container for such 
        merchandise, if such merchandise is subject to entry 
        and the container is of a kind normally used for 
        packing such merchandise; and
          (vi) in the case of merchandise entered from a 
        foreign trade zone (other than merchandise to which 
        clause (v) applies), be applied only to the value of 
        the privileged or nonprivileged foreign status 
        merchandise under section 3 of the Act of June 18, 1934 
        (commonly known as the Foreign Trade Zones Act, 19 
        U.S.C. 81c).
With respect to merchandise that is classified under subheading 
9802.00.60 or heading 9802.00.80 of such Schedule and is duty-
free, the Secretary may collect the fee charged on the 
processing of the merchandise under subsection (a) (9) or (10) 
on the basis of aggregate data derived from financial and 
manufacturing reports used by the importer in the normal course 
of business, rather than on the basis of entry-by-entry 
accounting.
  (E) For purposes of subsection (a) (9) and (10), merchandise 
is entered or released, as the case may be, if the merchandise 
is--
          (i) permitted or released under section 448(b) of the 
        Tariff Act of 1930,
          (ii) entered or released from customs custody under 
        section 484(a)(1)(A) of the Tariff Act of 1930, or
          (iii) withdrawn from warehouse for consumption.
  (9)(A) With respect to the processing of letters, documents, 
records, shipments, merchandise, or any other item that is 
valued at an amount that is $2,000 or less (or such higher 
amount as the Secretary of the Treasury may set by regulation 
pursuant to section 498 of the Tariff Act of 1930), except such 
items entered for transportation and exportation or immediate 
exportation at a centralized hub facility, an express 
consignment carrier facility, or a small airport or other 
facility, the following reimbursements and payments are 
required:
          (i) In the case of a small airport or other 
        facility--
                  (I) the reimbursement which such facility is 
                required to make during the fiscal year under 
                section 9701 of title 31, United States Code or 
                section 236 of the Trade and Tariff Act of 
                1984; and
                  (II) an annual payment by the facility to the 
                Secretary of the Treasury, which is in lieu of 
                the payment of fees under subsection (a)(10) 
                for such fiscal year, in an amount equal to the 
                reimbursement under subclause (I).
          (ii) Notwithstanding subsection (e)(6) and subject to 
        the provisions of subparagraph (B), in the case of an 
        express consignment carrier facility or centralized hub 
        facility--
                  (I) $.66 per individual airway bill or bill 
                of lading; and
                  (II) if the merchandise is formally entered, 
                the fee provided for in subsection (a)(9), if 
                applicable.
  (B)(i) Beginning in fiscal year 2004, the Secretary of the 
Treasury may adjust (not more than once per fiscal year) the 
amount described in subparagraph (A)(ii) to an amount that is 
not less than $.35 and 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) Notwithstanding section 451 of the 
                Tariff Act of 1930, the payment required by 
                subparagraph (A)(ii) (I) or (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 
                and for providing services at express 
                consignment carrier facilities or centralized 
                hub facilities, except that the Customs Service 
                may require such facilities 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) of this subparagraph 
                shall be paid on a quarterly basis by the 
                carrier using the facility 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) of this subparagraph shall, in accordance 
                with section 524 of the Tariff Act of 1930, be 
                deposited in the Customs User Fee Account and 
                shall be used to directly reimburse each 
                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) of this 
                subparagraph 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.
  (C) For purposes of this paragraph:
          (i) The terms ``centralized hub facility'' and 
        ``express consignment carrier facility'' have the 
        respective meanings that are applied to such terms in 
        part 128 of chapter I of title 19, Code of Federal 
        Regulations. Nothing in this paragraph shall be 
        construed as prohibiting the Secretary of the Treasury 
        from processing merchandise that is informally entered 
        or released at any centralized hub facility or express 
        consignment carrier facility during the normal 
        operating hours of the Customs Service, subject to 
        reimbursement and payment under subparagraph (A).
          (ii) The term ``small airport or other facility'' 
        means any airport or facility to which section 236 of 
        the Trade and Tariff Act of 1984 applies, if more than 
        25,000 informal entries were cleared through such 
        airport or facility during the preceding fiscal year.
  (10)(A) The fee charged under subsection (a) (9) or (10) with 
respect to goods of Canadian origin (as determined under 
section 202 of the United States-Canada Free-Trade Agreement 
Implementation Act of 1988) when the United States-Canada Free-
Trade Agreement is in force shall be in accordance with article 
403 of that Agreement.
  (B) For goods qualifying under the rules of origin set out in 
section 202 of the North American Free Trade Agreement 
Implementation Act, the fee under subsection (a) (9) or (10)--
          (i) may not be charged with respect to goods that 
        qualify to be marked as goods of Canada pursuant to 
        Annex 311 of the North American Free Trade Agreement, 
        for such time as Canada is a NAFTA country, as defined 
        in section 2(4) of such Implementation Act; and
          (ii) may not be increased after December 31, 1993, 
        and may not be charged after June 29, 1999, with 
        respect to goods that qualify to be marked as goods of 
        Mexico pursuant to such Annex 311, for such time as 
        Mexico is a NAFTA country.
Any service for which an exemption from such fee is provided by 
reason of this paragraph may not be funded with money contained 
in the Customs User Fee Account.
  (11) No fee may be charged under subsection (a) (9) or (10) 
with respect to products of Israel if an exemption with respect 
to the fee is implemented under section 112 of the Customs and 
Trade Act of 1990.
  (12) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Chile Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (13) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Singapore Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (14) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Australia Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (15) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the Dominican Republic-Central America-United 
States Free Trade Agreement Implementation Act. Any service for 
which an exemption from such fee is provided by reason of this 
paragraph may not be funded with money contained in the Customs 
User Fee Account.
  (16) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Bahrain Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (17) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Oman Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (18) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Peru Trade Promotion Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (19) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Korea Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (20) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Colombia Trade Promotion 
Agreement Implementation Act. Any service for which an 
exemption from such fee is provided by reason of this paragraph 
may not be funded with money contained in the Customs User Fee 
Account.
  (21) No fee may be charged under subsection (a)(9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Panama Trade Promotion 
Agreement Implementation Act. Any service for which an 
exemption from such fee is provided by reason of this paragraph 
may not be funded with money contained in the Customs User Fee 
Account.
  (c) Definitions.--For purposes of this section--
          (1) The term ``ferry'' means any vessel which is 
        being used--
                  (A) to provide transportation only between 
                places that are no more than 300 miles apart, 
                and
                  (B) to transport only--
                          (i) passengers, or
                          (ii) vehicles, or railroad cars, 
                        which are being used, or have been 
                        used, in transporting passengers or 
                        goods.
          (2) The term ``arrival'' means arrival at a port of 
        entry in the customs territory of the United States.
          (3) The term ``customs territory of the United 
        States'' has the meaning given to such term by general 
        note 2 of the Harmonized Tariff Schedule of the United 
        States.
          (4) The term ``customs broker permit'' means a permit 
        issued under section 641(c) of the Tariff Act of 1930 
        (19 U.S.C. 1641(c)).
          (5) The term ``barge or other bulk carrier'' means 
        any vessel which--
                  (A) is not self-propelled, or
                  (B) transports fungible goods that are not 
                packaged in any form.
  (d) Collection.--(1) Each person that issues a document or 
ticket to an individual for transportation by a commercial 
vessel or commercial aircraft into the customs territory of the 
United States shall--
          (A) collect from that individual the fee charged 
        under subsection (a)(5) at the time the document or 
        ticket is issued; and
          (B) separately identify on that document or ticket 
        the fee charged under subsection (a)(5) as a Federal 
        inspection fee.
  (2) If--
          (A) a document or ticket for transportation of a 
        passenger into the customs territory of the United 
        States is issued in a foreign country; and
          (B) the fee charged under subsection (a)(5) is not 
        collected at the time such document or ticket is 
        issued;
the person providing transportation to such passenger shall 
collect such fee at the time such passenger departs from the 
customs territory of the United States and shall provide such 
passenger a receipt for the payment of such fee.
  (3) The person who collects fees under paragraph (1) or (2) 
shall remit those fees to the Secretary of the Treasury at any 
time before the date that is 31 days after the close of the 
calendar quarter in which the fees are collected.
  (4)(A) Notice of the date on which payment of the fee imposed 
by subsection (a)(7) is due shall be published by the Secretary 
of the Treasury in the Federal Register by no later than the 
date that is 60 days before such due date.
  (B) A customs broker permit may be revoked or suspended for 
nonpayment of the fee imposed by subsection (a)(7) only if 
notice of the date on which payment of such fee is due was 
published in the Federal Register at least 60 days before such 
due date.
  (C) The customs broker's license issued under section 641(b) 
of the Tariff Act of 1930 (19 U.S.C. 1641(b)) may not be 
revoked or suspended merely by reason of nonpayment of the fee 
imposed under subsection (a)(7).
  (e) Provision of Customs Services.--
  (1) Notwithstanding section 451 of the Tariff Act of 1930 (19 
U.S.C. 1451) or any other provision of law (other than 
paragraph (2)), the customs services required to be provided to 
passengers upon arrival in the United States shall be 
adequately provided in connection with scheduled airline 
flights at customs serviced airports when needed and at no cost 
(other than the fees imposed under subsection (a)) to airlines 
and airline passengers.
  (2)(A) This subsection shall not apply with respect to any 
airport to which section 236 of the Trade and Tariff Act of 
1984 (19 U.S.C. 58b) applies.
  (B) Subparagraph (C) of paragraph (6) shall not apply with 
respect to any foreign trade zone or subzone that is located 
at, or in the vicinity of, an airport to which section 236 of 
the Trade and Tariff Act of 1984 applies.
  (3) Notwithstanding section 451 of the Tariff Act of 1930 (19 
U.S.C. 1451) or any other provision of law--
          (A) the customs services required to be provided to 
        passengers upon arrival in the United States shall be 
        adequately provided in connection with scheduled 
        airline flights when needed at places located outside 
        the customs territory of the United States at which a 
        customs officer is stationed for the purpose of 
        providing such customs services, and
          (B) other than the fees imposed under subsection (a), 
        the airlines and airline passengers shall not be 
        required to reimburse the Secretary of the Treasury for 
        the costs of providing overtime customs inspectional 
        services at such places.
  (4) Notwithstanding any other provision of law, all customs 
services (including, but not limited to, normal and overtime 
clearance and preclearance services) shall be adequately 
provided, when requested, for--
          (A) the clearance of any commercial vessel, vehicle, 
        or aircraft or its passengers, crew, stores, material, 
        or cargo arriving, departing, or transiting the United 
        States;
          (B) the preclearance at any customs facility outside 
        the United States of any commercial vessel, vehicle or 
        aircraft or its passengers, crew, stores, material, or 
        cargo; and
          (C) the inspection or release of commercial cargo or 
        other commercial shipments being entered into, or 
        withdrawn from, the customs territory of the United 
        States.
  (5) For purposes of this subsection, customs services shall 
be treated as being ``adequately provided'' if such of those 
services that are necessary to meet the needs of parties 
subject to customs inspection are provided in a timely manner 
taking into account factors such as--
          (A) the unavoidability of weather, mechanical, and 
        other delays;
          (B) the necessity for prompt and efficient passenger 
        and baggage clearance;
          (C) the perishability of cargo;
          (D) the desirability or unavoidability of late night 
        and early morning arrivals from various time zones;
          (E) the availability (in accordance with regulations 
        prescribed under subsection (g)(2)) of customs 
        personnel and resources; and
          (F) the need for specific enforcement checks.
  (6) Notwithstanding any other provision of law except 
paragraph (2), during any period when fees are authorized under 
subsection (a), no charges, other than such fees, may be 
collected--
          (A) for any--
                  (i) cargo inspection, clearance, or other 
                customs activity, expense, or service performed 
                (regardless whether performed outside of normal 
                business hours on an overtime basis), or
                  (ii) customs personnel provided,
        in connection with the arrival or departure of any 
        commercial vessel, vehicle, or aircraft, or its 
        passengers, crew, stores, material, or cargo, in the 
        United States;
          (B) for any preclearance or other customs activity, 
        expense, or service performed, and any customs 
        personnel provided, outside the United States in 
        connection with the departure of any commercial vessel, 
        vehicle, or aircraft, or its passengers, crew, stores, 
        material, or cargo, for the United States; or
          (C) in connection with--
                  (i) the activation or operation (including 
                Customs Service supervision) of any foreign 
                trade zone or subzone established under the Act 
                of June 18, 1934 (commonly known as the Foreign 
                Trade Zones Act, 19 U.S.C. 81a et seq.), or
                  (ii) the designation or operation (including 
                Customs Service supervision) of any bonded 
                warehouse under section 555 of the Tariff Act 
                of 1930 (19 U.S.C. 1555).
  (f) Disposition of Fees.--(1) There is established in the 
general fund of the Treasury a separate account which shall be 
known as the ``Customs User Fee Account''. Notwithstanding 
section 524 of the Tariff Act of 1930 (19 U.S.C. 1524), there 
shall be deposited as offsetting receipts into the Customs User 
Fee Account all fees collected under subsection (a) except--
          (A) the portion of such fees that is required under 
        paragraph (3) for the direct reimbursement of 
        appropriations, and
          (B) amounts deposited into the Customs Commercial and 
        Homeland Security Automation Account under paragraph 
        (4).
  (2) Except as otherwise provided in this subsection, all 
funds in the Customs User Fee Account shall be available, to 
the extent provided for in appropriations Acts, to pay the 
costs (other than costs for which direct reimbursement under 
paragraph (3) is required) incurred by the United States 
Customs Service in conducting customs revenue functions as 
defined in section 415 of the Homeland Security Act of 2002 
(other than functions performed by the Office of International 
Affairs referred to in section 415(8) of that Act), and for 
automation (including the Automation Commercial Environment 
computer system), and for no other purpose. To the extent that 
funds in the Customs User Fee Account are insufficient to pay 
the costs of such customs revenue functions, customs duties in 
an amount equal to the amount of such insufficiency shall be 
available, to the extent provided for in appropriations Acts, 
to pay the costs of such customs revenue functions in the 
amount of such insufficiency, and shall be available for no 
other purpose. The provisions of the first and second sentences 
of this paragraph specifying the purposes for which amounts in 
the Customs User Fee Account may be made available shall not be 
superseded except by a provision of law which specifically 
modifies or supersedes such provisions. So long as there is a 
surplus of funds in the Customs User Fee Account, the Secretary 
of the Treasury may not reduce personnel staffing levels for 
providing commercial clearance and preclearance services.
  (3)(A) The Secretary of the Treasury, in accordance with 
section 524 of the Tariff Act of 1930 and subject to 
subparagraph (B), shall directly reimburse, from the fees 
collected under subsection (a) (other than the fees under 
subsection (a) (9) and (10) and the excess fees determined by 
the Secretary under paragraph (4)), each appropriation for the 
amount paid out of that appropriation for the costs incurred by 
the Secretary--
          (i) in--
                  (I) paying overtime compensation under 
                section 5(a) of the Act of February 13, 1911,
                  (II) paying premium pay under section 5(b) of 
                the Act of February 13, 1911, but the amount 
                for which reimbursement may be made under this 
                subclause may not, for any fiscal year, exceed 
                the difference between the total cost of all 
                the premium pay for such year calculated under 
                section 5(b) and the cost of the night and 
                holiday premium pay that the Customs Service 
                would have incurred for the same inspectional 
                work on the day before the effective date of 
                section 13813 of the Omnibus Budget 
                Reconciliation Act of 1993,
                  (III) paying agency contributions to the 
                Civil Service Retirement and Disability Fund to 
                match deductions from the overtime compensation 
                paid under subclause (I),
                  (IV) providing all preclearance services for 
                which the recipients of such services are not 
                required to reimburse the Secretary of the 
                Treasury, and
                  (V) paying foreign language proficiency 
                awards under section 13812(b) of the Omnibus 
                Budget Reconciliation Act of 1993,
          (ii) to the extent funds remain available after 
        making reimbursements under clause (i), in providing 
        salaries for full-time and part-time inspectional 
        personnel and equipment that enhance customs services 
        for those persons or entities that are required to pay 
        fees under paragraphs (1) through (8) of subsection (a) 
        (distributed on a basis proportionate to the fees 
        collected under paragraphs (1) through (8) of 
        subsection (a), and
          (iii) to the extent funds remain available after 
        making reimbursements under clause (ii), in providing 
        salaries for up to 50 full-time equivalent inspectional 
        positions to provide preclearance services.
The transfer of funds required under subparagraph (C)(iii) has 
priority over reimbursements under this subparagraph to carry 
out subclauses (II), (III), (IV), and (V) of clause (i). Funds 
described in clause (ii) shall only be available to reimburse 
costs in excess of the highest amount appropriated for such 
costs during the period beginning with fiscal year 1990 and 
ending with the current fiscal year.
  (B) Reimbursement of appropriations under this paragraph--
          (i) shall be subject to apportionment or similar 
        administrative practices;
          (ii) shall be made at least quarterly; and
          (iii) to the extent necessary, may be made on the 
        basis of estimates made by the Secretary of the 
        Treasury and adjustments shall be made in subsequent 
        reimbursements to the extent that the estimates were in 
        excess of, or less than, the amounts required to be 
        reimbursed.
  (C)(i) For fiscal year 1991 and subsequent fiscal years, the 
amount required to reimburse costs described in subparagraph 
(A)(i) shall be projected from actual requirements, and only 
the excess of collections over such projected costs for such 
fiscal year shall be used as provided in subparagraph (A)(ii).
  (ii) The excess of collections over inspectional overtime and 
preclearance costs (under subparagraph (A)(i)) reimbursed for 
fiscal years 1989 and 1990 shall be available in fiscal year 
1991 and subsequent fiscal years for the purposes described in 
subparagraph (A)(ii), except that $30,000,000 of such excess 
shall remain without fiscal year limitation in a contingency 
fund and, in any fiscal year in which receipts are insufficient 
to cover the costs described in subparagraph (A) (i) and (ii), 
shall be used for--
          (I) the costs of providing the services described in 
        subparagraph (A)(i), and
          (II) after the costs described in subclause (I) are 
        paid, the costs of providing the personnel and 
        equipment described in subparagraph (A)(ii) at the 
        preceding fiscal year level.
  (iii) For each fiscal year, the Secretary of the Treasury 
shall calculate the difference between--
          (I) the estimated cost for overtime compensation that 
        would have been incurred during that fiscal year for 
        inspectional services if section 5 of the Act of 
        February 13, 1911 (19 U.S.C. 261 and 267), as in effect 
        before the enactment of section 13811 of the Omnibus 
        Budget Reconciliation Act of 1993, had governed such 
        costs, and
          (II) the actual cost for overtime compensation, 
        premium pay, and agency retirement contributions that 
        is incurred during that fiscal year in regard to 
        inspectional services under section 5 of the Act of 
        February 13, 1911, as amended by section 13811 of the 
        Omnibus Budget Reconciliation Act of 1993, and under 
        section 8331(3) of title 5, United States Code, as 
        amended by section 13812(a)(1) of such Act of 1993, 
        plus the actual cost that is incurred during that 
        fiscal year for foreign language proficiency awards 
        under section 13812(b) of such Act of 1993,
and shall transfer from the Customs User Fee Account to the 
General Fund of the Treasury an amount equal to the difference 
calculated under this clause, or $18,000,000, whichever amount 
is less. Transfers shall be made under this clause at least 
quarterly and on the basis of estimates to the same extent as 
are reimbursements under subparagraph (B)(iii).
  (D) Nothing in this paragraph shall be construed to preclude 
the use of appropriated funds, from sources other than the fees 
collected under subsection (a), to pay the costs set forth in 
clauses (i), (ii), and (iii) of subparagraph (A).
  (4)(A) There is created within the general fund of the 
Treasury a separate account that shall be known as the 
``Customs Commercial and Homeland Security Automation 
Account''. In each of fiscal years 2003, 2004, and 2005 there 
shall be deposited into the Account from fees collected under 
subsection (a)(9)(A), $350,000,000.
  (B) There is authorized to be appropriated from the Account 
in fiscal years 2003 through 2005 such amounts as are available 
in that Account for the development, establishment, and 
implementation of the Automated Commercial Environment computer 
system for the processing of merchandise that is entered or 
released and for other purposes related to the functions of the 
Department of Homeland Security. Amounts appropriated pursuant 
to this subparagraph are authorized to remain available until 
expended.
  (C) In adjusting the fee imposed by subsection (a)(9)(A) for 
fiscal year 2006, the Secretary of the Treasury shall reduce 
the amount estimated to be collected in fiscal year 2006 by the 
amount by which total fees deposited to the Account during 
fiscal years 2003, 2004, and 2005 exceed total appropriations 
from that Account.
  (5) Of the amounts collected in fiscal year 1999 under 
paragraphs (9) and (10) of subsection (a), $50,000,000 shall be 
available to the Customs Service, subject to appropriations 
Acts, for automated commercial systems. Amounts made available 
under this paragraph shall remain available until expended.
  (g) Regulations and Enforcement.--(1) The Secretary of the 
Treasury may prescribe such rules and regulations as may be 
necessary to carry out the provisions of this section. 
Regulations issued by the Secretary of the Treasury under this 
subsection with respect to the collection of the fees charged 
under subsection (a)(5) and the remittance of such fees to the 
Treasury of the United States shall be consistent with the 
regulations issued by the Secretary of the Treasury for the 
collection and remittance of the taxes imposed by subchapter C 
of chapter 33 of the Internal Revenue Code of 1954, but only to 
the extent the regulations issued with respect to such taxes do 
not conflict with the provisions of this section.
  (2) Except to the extent otherwise provided in regulations, 
all administrative and enforcement provisions of customs laws 
and regulations, other than those laws and regulations relating 
to drawback, shall apply with respect to any fee prescribed 
under subsection (a) of this section, and with respect to 
persons liable therefor, as if such fee is a customs duty. For 
purposes of the preceding sentence, any penalty expressed in 
terms of a relationship to the amount of the duty shall be 
treated as not less than the amount which bears a similar 
relationship to the amount of the fee assessed. For purposes of 
determining the jurisdiction of any court of the United States 
or any agency of the United States, any fee prescribed under 
subsection (a) of this section shall be treated as if such fee 
is a customs duty.
  (h) Conforming Amendments.--(1) Subsection (i) of section 305 
of the Rail Passenger Service Act (45 U.S.C. 545(i)) is amended 
by striking out the last sentence thereof.
  (2) Subsection (e) of section 53 of the Airport and Airway 
Development Act of 1970 (49 U.S.C. 1741(e)) is repealed.
  (i) Effect on Other Authority.--Except with respect to 
customs services for which fees are imposed under subsection 
(a), nothing in this section shall be construed as affecting 
the authority of the Secretary of the Treasury to charge fees 
under section 214(b) of the Customs Procedural Reform and 
Simplification Act of 1978 (19 U.S.C. 58a).
  (j) Effective Dates.--(1) Except as otherwise provided in 
this subsection, the provisions of this section, and the 
amendments and repeals made by this section, shall apply with 
respect to customs services rendered after the date that is 90 
days after the date of enactment of this Act.
  (2) Fees may be charged under subsection (a)(5) only with 
respect to customs services rendered in regard to arriving 
passengers using transportation for which documents or tickets 
were issued after the date that is 90 days after such date of 
enactment.
  (3)(A) Fees may not be charged under paragraphs (9) and (10) 
of subsection (a) after September 30, 2024.
  (B)(i) Subject to clause (ii), Fees may not be charged under 
paragraphs (1) through (8) of subsection (a) after September 
30, 2024.
  (ii) In fiscal year 2006 and in each succeeding fiscal year 
for which fees under paragraphs (1) through (8) of subsection 
(a) are authorized--
          (I) the Secretary of the Treasury shall charge fees 
        under each such paragraph in amounts that are 
        reasonably related to the costs of providing customs 
        services in connection with the activity or item for 
        which the fee is charged under such paragraph, except 
        that in no case may the fee charged under any such 
        paragraph exceed by more than 10 percent the amount 
        otherwise prescribed by such paragraph;
          (II) the amount of fees collected under such 
        paragraphs may not exceed, in the aggregate, the 
        amounts paid in that fiscal year for the costs 
        described in subsection (f)(3)(A) incurred in providing 
        customs services in connection with the activity or 
        item for which the fees are charged under such 
        paragraphs;
          (III) a fee may not be collected under any such 
        paragraph except to the extent such fee will be 
        expended to pay the costs described in subsection 
        (f)(3)(A) incurred in providing customs services in 
        connection with the activity or item for which the fee 
        is charged under such paragraph; and
          (IV) any fee collected under any such paragraph shall 
        be available for expenditure only to pay the costs 
        described in subsection (f)(3)(A) incurred in providing 
        customs services in connection with the activity or 
        item for which the fee is charged under such paragraph.
  (k) Advisory Committee.--The Commissioner of Customs shall 
establish an advisory committee whose membership shall consist 
of representatives from the airline, cruise ship, and other 
transportation industries who may be subject to fees under 
subsection (a). The advisory committee shall not be subject to 
termination under section 14 of the Federal Advisory Committee 
Act. The advisory committee shall meet on a periodic basis and 
shall advise the Commissioner on issues related to the 
performance of the inspectional services of the United States 
Customs Service. Such advice shall include, but not be limited 
to, such issues as the time periods during which such services 
should be performed, the proper number and deployment of 
inspection officers, the level of fees, and the appropriateness 
of any proposed fee. The Commissioner shall give consideration 
to the views of the advisory committee in the exercise of his 
or her duties.

           *       *       *       *       *       *       *

                              ----------                              


      SECTION 503 OF THE UNITED STATES-KOREA FREE TRADE AGREEMENT 
                           IMPLEMENTATION ACT

SEC. 503. RATE FOR MERCHANDISE PROCESSING FEES.

  For the period beginning on December 1, 2015, and ending on 
June 30, 2021, section 13031(a)(9) of the Consolidated Omnibus 
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(a)(9)) shall 
be applied and administered--
          (1) in subparagraph (A), by substituting ``0.3464'' 
        for ``0.21''; and
          (2) in subparagraph (B)(i), by substituting 
        ``0.3464'' for ``0.21''.

      B. Changes in Existing Law Proposed by the Bill, as Reported

    In compliance with clause 3(e)(1)(B) of rule XIII of the 
Rules of the House of Representatives, changes in existing law 
proposed by the bill, as reported, are shown as follows 
(existing law proposed to be omitted is enclosed in black 
brackets, new matter is printed in italic, existing law in 
which no change is proposed is shown in roman):

                           TRADE ACT OF 1974




           *       *       *       *       *       *       *
TITLE V--GENERALIZED SYSTEM OF PREFERENCES

           *       *       *       *       *       *       *


SEC. 503. DESIGNATION OF ELIGIBLE ARTICLES.

  (a) Eligible Articles.--
          (1) Designation.--
                  (A) In general.--Except as provided in 
                subsection (b), the President is authorized to 
                designate articles as eligible articles from 
                all beneficiary developing countries for 
                purposes of this title by Executive order or 
                Presidential proclamation after receiving the 
                advice of the International Trade Commission in 
                accordance with subsection (e).
                  (B) Least-developed beneficiary developing 
                countries.--Except for articles described in 
                subparagraphs (A), (B), and (E) of subsection 
                (b)(1) and articles described in paragraphs (2) 
                and (3) of subsection (b), the President may, 
                in carrying out section 502(d)(1) and 
                subsection (c)(1) of this section, designate 
                articles as eligible articles only for 
                countries designated as least-developed 
                beneficiary developing countries under section 
                502(a)(2) if, after receiving the advice of the 
                International Trade Commission in accordance 
                with subsection (e) of this section, the 
                President determines that such articles are not 
                import-sensitive in the context of imports from 
                least-developed beneficiary developing 
                countries.
                  (C) Three-year rule.--If, after receiving the 
                advice of the International Trade Commission 
                under subsection (e), an article has been 
                formally considered for designation as an 
                eligible article under this title and denied 
                such designation, such article may not be 
                reconsidered for such designation for a period 
                of 3 years after such denial.
          (2) Rule of origin.--
                  (A) General rule.--The duty-free treatment 
                provided under this title shall apply to any 
                eligible article which is the growth, product, 
                or manufacture of a beneficiary developing 
                country if--
                          (i) that article is imported directly 
                        from a beneficiary developing country 
                        into the customs territory of the 
                        United States; and
                          (ii) the sum of--
                                  (I) the cost or value of the 
                                materials produced in the 
                                beneficiary developing country 
                                or any two or more such 
                                countries that are members of 
                                the same association of 
                                countries and are treated as 
                                one country under section 
                                507(2), plus
                                  (II) the direct costs of 
                                processing operations performed 
                                in such beneficiary developing 
                                country or such member 
                                countries,
                        is not less than 35 percent of the 
                        appraised value of such article at the 
                        time it is entered.
                  (B) Exclusions.--An article shall not be 
                treated as the growth, product, or manufacture 
                of a beneficiary developing country by virtue 
                of having merely undergone--
                          (i) simple combining or packaging 
                        operations, or
                          (ii) mere dilution with water or mere 
                        dilution with another substance that 
                        does not materially alter the 
                        characteristics of the article.
          (3) Regulations.--The Secretary of the Treasury, 
        after consulting with the United States Trade 
        Representative, shall prescribe such regulations as may 
        be necessary to carry out paragraph (2), including, but 
        not limited to, regulations providing that, in order to 
        be eligible for duty-free treatment under this title, 
        an article--
                  (A) must be wholly the growth, product, or 
                manufacture of a beneficiary developing 
                country, or
                  (B) must be a new or different article of 
                commerce which has been grown, produced, or 
                manufactured in the beneficiary developing 
                country.
  (b) Articles That May Not Be Designated As Eligible 
Articles.--
          (1) Import sensitive articles.--The President may not 
        designate any article as an eligible article under 
        subsection (a) if such article is within one of the 
        following categories of import-sensitive articles:
                  (A) Except as provided in paragraph (4), 
                textile and apparel articles which were not 
                eligible articles for purposes of this title on 
                January 1, 1994, as this title was in effect on 
                such date.
                  (B) Watches, except those watches entered 
                after June 30, 1989, that the President 
                specifically determines, after public notice 
                and comment, will not cause material injury to 
                watch or watch band, strap, or bracelet 
                manufacturing and assembly operations in the 
                United States or the United States insular 
                possessions.
                  (C) Import-sensitive electronic articles.
                  (D) Import-sensitive steel articles.
                  (E) Footwear, handbags, luggage, flat goods, 
                work gloves, and leather wearing apparel which 
                were not eligible articles for purposes of this 
                title on January 1, 1995, as this title was in 
                effect on such date.
                  (F) Import-sensitive semimanufactured and 
                manufactured glass products.
                  (G) Any other articles which the President 
                determines to be import-sensitive in the 
                context of the Generalized System of 
                Preferences.
          (2) Articles against which other actions taken.--An 
        article shall not be an eligible article for purposes 
        of this title for any period during which such article 
        is the subject of any action proclaimed pursuant to 
        section 203 of this Act (19 U.S.C. 2253) or section 232 
        or 351 of the Trade Expansion Act of 1962 (19 U.S.C. 
        1862, 1981).
          (3) Agricultural products.--No quantity of an 
        agricultural product subject to a tariff-rate quota 
        that exceeds the in-quota quantity shall be eligible 
        for duty-free treatment under this title.
          (4) Certain hand-knotted or hand-woven carpets.--
        Notwithstanding paragraph (1)(A), the President may 
        designate as an eligible article or articles under 
        subsection (a) carpets or rugs which are hand-loomed, 
        hand-woven, hand-hooked, hand-tufted, or hand-knotted, 
        and classifiable under subheading 5701.10.16, 
        5701.10.40, 5701.90.10, 5701.90.20, 5702.10.90, 
        5702.42.20, 5702.49.10, 5702.51.20, 5702.91.30, 
        5702.92.00, 5702.99.10, 5703.10.00, 5703.20.10, or 
        5703.30.00 of the Harmonized Tariff Schedule of the 
        United States.
          (5) Certain cotton articles.--Notwithstanding 
        paragraph (3), the President may designate as an 
        eligible article or articles under subsection (a)(1)(B) 
        only for countries designated as least-developed 
        beneficiary developing countries under section 
        502(a)(2) cotton articles classifiable under subheading 
        5201.00.18, 5201.00.28, 5201.00.38, 5202.99.30, or 
        5203.00.30 of the Harmonized Tariff Schedule of the 
        United States.
  (c) Withdrawal, Suspension, or Limitation of Duty-Free 
Treatment; Competitive Need Limitation.--
          (1) In general.--The President may withdraw, suspend, 
        or limit the application of the duty-free treatment 
        accorded under this title with respect to any article, 
        except that no rate of duty may be established with 
        respect to any article pursuant to this subsection 
        other than the rate which would apply but for this 
        title. In taking any action under this subsection, the 
        President shall consider the factors set forth in 
        sections 501 and 502(c).
          (2) Competitive need limitation.--
                  (A) Basis for withdrawal of duty-free 
                treatment.--
                          (i) In general.--Except as provided 
                        in clause (ii) and subject to 
                        subsection (d), whenever the President 
                        determines that a beneficiary 
                        developing country has exported 
                        (directly or indirectly) to the United 
                        States during any calendar year 
                        beginning after December 31, 1995--
                                  (I) a quantity of an eligible 
                                article having an appraised 
                                value in excess of the 
                                applicable amount for the 
                                calendar year, or
                                  (II) a quantity of an 
                                eligible article equal to or 
                                exceeding 50 percent of the 
                                appraised value of the total 
                                imports of that article into 
                                the United States during any 
                                calendar year,
                        the President shall, not later than 
                        July 1 of the next calendar year, 
                        terminate the duty-free treatment for 
                        that article from that beneficiary 
                        developing country.
                          (ii) Annual adjustment of applicable 
                        amount.--For purposes of applying 
                        clause (i), the applicable amount is--
                                  (I) for 1996, $75,000,000, 
                                and
                                  (II) for each calendar year 
                                thereafter, an amount equal to 
                                the applicable amount in effect 
                                for the preceding calendar year 
                                plus $5,000,000.
                  (B) Country defined.--For purposes of this 
                paragraph, the term ``country'' does not 
                include an association of countries which is 
                treated as one country under section 507(2), 
                but does include a country which is a member of 
                any such association.
                  (C) Redesignations.--A country which is no 
                longer treated as a beneficiary developing 
                country with respect to an eligible article by 
                reason of subparagraph (A) may, subject to the 
                considerations set forth in sections 501 and 
                502, be redesignated a beneficiary developing 
                country with respect to such article if imports 
                of such article from such country did not 
                exceed the limitations in subparagraph (A) 
                during the preceding calendar year.
                  (D) Least-developed beneficiary developing 
                countries and beneficiary sub-saharan african 
                countries.--Subparagraph (A) shall not apply to 
                any least-developed beneficiary developing 
                country or any beneficiary sub-Saharan African 
                country.
                  (E) Articles not produced in the united 
                states excluded.--Subparagraph (A)(i)(II) shall 
                not apply with respect to any eligible article 
                if a like or directly competitive article was 
                not produced in the United States on January 1, 
                1995.
                  (F) De minimis waivers.--
                          (i) In general.--The President may 
                        disregard subparagraph (A)(i)(II) with 
                        respect to any eligible article from 
                        any beneficiary developing country if 
                        the aggregate appraised value of the 
                        imports of such article into the United 
                        States during the preceding calendar 
                        year does not exceed the applicable 
                        amount for such preceding calendar 
                        year.
                          (ii) Applicable amount.--For purposes 
                        of applying clause (i), the applicable 
                        amount is--
                                  (I) for calendar year 1996, 
                                $13,000,000, and
                                  (II) for each calendar year 
                                thereafter, an amount equal to 
                                the applicable amount in effect 
                                for the preceding calendar year 
                                plus $500,000.
  (d) Waiver of Competitive Need Limitation.--
          (1) In general.--The President may waive the 
        application of subsection (c)(2) with respect to any 
        eligible article of any beneficiary developing country 
        if, before July 1 of the calendar year beginning after 
        the calendar year for which a determination described 
        in subsection (c)(2)(A) was made with respect to such 
        eligible article, the President--
                  (A) receives the advice of the International 
                Trade Commission under section 332 of the 
                Tariff Act of 1930 on whether any industry in 
                the United States is likely to be adversely 
                affected by such waiver,
                  (B) determines, based on the considerations 
                described in sections 501 and 502(c) and the 
                advice described in subparagraph (A), that such 
                waiver is in the national economic interest of 
                the United States, and
                  (C) publishes the determination described in 
                subparagraph (B) in the Federal Register.
          (2) Considerations by the president.--In making any 
        determination under paragraph (1), the President shall 
        give great weight to--
                  (A) the extent to which the beneficiary 
                developing country has assured the United 
                States that such country will provide equitable 
                and reasonable access to the markets and basic 
                commodity resources of such country, and
                  (B) the extent to which such country provides 
                adequate and effective protection of 
                intellectual property rights.
          (3) Other bases for waiver.--The President may waive 
        the application of subsection (c)(2) if, before July 1 
        of the calendar year beginning after the calendar year 
        for which a determination described in subsection 
        (c)(2) was made with respect to a beneficiary 
        developing country, the President determines that--
                  (A) there has been a historical preferential 
                trade relationship between the United States 
                and such country,
                  (B) there is a treaty or trade agreement in 
                force covering economic relations between such 
                country and the United States, and
                  (C) such country does not discriminate 
                against, or impose unjustifiable or 
                unreasonable barriers to, United States 
                commerce,
        and the President publishes that determination in the 
        Federal Register.
          (4) Limitations on waivers.--
                  (A) In general.--The President may not 
                exercise the waiver authority under this 
                subsection with respect to a quantity of an 
                eligible article entered during any calendar 
                year beginning after 1995, the aggregate 
                appraised value of which equals or exceeds 30 
                percent of the aggregate appraised value of all 
                articles that entered duty-free under this 
                title during the preceding calendar year.
                  (B) Other waiver limits.--(i) The President 
                may not exercise the waiver authority provided 
                under this subsection with respect to a 
                quantity of an eligible article entered during 
                any calendar year beginning after 1995, the 
                aggregate appraised value of which exceeds 15 
                percent of the aggregate appraised value of all 
                articles that have entered duty-free under this 
                title during the preceding calendar year from 
                those beneficiary developing countries which 
                for the preceding calendar year--
                          (I) had a per capita gross national 
                        product (calculated on the basis of the 
                        best available information, including 
                        that of the International Bank for 
                        Reconstruction and Development) of 
                        $5,000 or more; or
                          (II) had exported (either directly or 
                        indirectly) to the United States a 
                        quantity of articles that was duty-free 
                        under this title that had an aggregate 
                        appraised value of more than 10 percent 
                        of the aggregate appraised value of all 
                        articles that entered duty-free under 
                        this title during that year.
                  (ii) Not later than July 1 of each year, the 
                President should revoke any waiver that has 
                then been in effect with respect to an article 
                for 5 years or more if the beneficiary 
                developing country has exported to the United 
                States (directly or indirectly) during the 
                preceding calendar year a quantity of the 
                article--
                          (I) having an appraised value in 
                        excess of 1.5 times the applicable 
                        amount set forth in subsection 
                        (c)(2)(A)(ii) for that calendar year; 
                        or
                          (II) exceeding 75 percent of the 
                        appraised value of the total imports of 
                        that article into the United States 
                        during that calendar year.
                  (C) Calculation of limitations.--There shall 
                be counted against the limitations imposed 
                under subparagraphs (A) and (B) for any 
                calendar year only that value of any eligible 
                article of any country that--
                          (i) entered duty-free under this 
                        title during such calendar year; and
                          (ii) is in excess of the value of 
                        that article that would have been so 
                        entered during such calendar year if 
                        the limitations under subsection 
                        (c)(2)(A) applied.
          (5) Effective period of waiver.--Any waiver granted 
        under this subsection shall remain in effect until the 
        President determines that such waiver is no longer 
        warranted due to changed circumstances.
  (e) International Trade Commission Advice.--Before 
designating articles as eligible articles under subsection 
(a)(1), the President shall publish and furnish the 
International Trade Commission with lists of articles which may 
be considered 
for designation as eligible articles for purposes of this 
title. The provisions of sections 131, 132, 133, and 134 shall 
be complied with as though action under section 501 and this 
section were action under section 123 to carry out a trade 
agreement entered into under section 123.
  (f) Special Rule Concerning Puerto Rico.--No action under 
this title may affect any tariff duty imposed by the 
Legislature of Puerto Rico pursuant to section 319 of the 
Tariff Act of 1930 on coffee imported into Puerto Rico.

           *       *       *       *       *       *       *


SEC. 505. DATE OF TERMINATION.

  No duty-free treatment provided under this title shall remain 
in effect after [July 31, 2013] December 31, 2017.

           *       *       *       *       *       *       *


SEC. 506A. DESIGNATION OF SUB-SAHARAN AFRICAN COUNTRIES FOR CERTAIN 
                    BENEFITS.

  (a) Authority To Designate.--
          (1) In general.--Notwithstanding any other provision 
        of law, the President is authorized to designate a 
        country listed in section 107 of the African Growth and 
        Opportunity Act as a beneficiary sub-Saharan African 
        country eligible for the benefits described in 
        subsection (b)--
                  (A) if the President determines that the 
                country meets the eligibility requirements set 
                forth in section 104 of that Act, as such 
                requirements are in effect on the date of the 
                enactment of that Act; and
                  (B) subject to the authority granted to the 
                President under subsections (a), (d), and (e) 
                of section 502, if the country otherwise meets 
                the eligibility criteria set forth in section 
                502.
          (2) Monitoring and review of certain countries.--The 
        President shall monitor, review, and report to Congress 
        annually on the progress of each country listed in 
        section 107 of the African Growth and Opportunity Act 
        in meeting the requirements described in paragraph (1) 
        in order to determine the current or potential 
        eligibility of each country to be designated as a 
        beneficiary sub-Saharan African country for purposes of 
        this section. The President's determinations, and 
        explanations of such determinations, with specific 
        analysis of the eligibility requirements described in 
        paragraph (1)(A), shall be included in the annual 
        report required by section 106 of the African Growth 
        and Opportunity Act.
          (3) Continuing compliance.--[If the President]
          (A) In general._If the President determines that a 
        beneficiary sub-Saharan African country is not making 
        continual progress in meeting the requirements 
        described in paragraph (1), the President shall 
        terminate the designation of that country as a 
        beneficiary sub-Saharan African country for purposes of 
        this section, effective on January 1 of the year 
        following the year in which such determination is made.
                  (B) Notification.--The President may not 
                terminate the designation of a country as a 
                beneficiary sub-Saharan African country under 
                subparagraph (A) unless, at least 60 days 
                before the termination of such designation, the 
                President notifies Congress and notifies the 
                country of the President's intention to 
                terminate such designation, together with the 
                considerations entering into the decision to 
                terminate such designation.
  (b) Preferential Tariff Treatment for Certain Articles.--
          (1) In general.--The President may provide duty-free 
        treatment for any article described in section 
        503(b)(1)(B) through (G) that is the growth, product, 
        or manufacture of a beneficiary sub-Saharan African 
        country described in subsection (a), if, after 
        receiving the advice of the International Trade 
        Commission in accordance with section 503(e), the 
        President determines that such article is not import-
        sensitive in the context of imports from beneficiary 
        sub-Saharan African countries.
          (2) Rules of origin.--The duty-free treatment 
        provided under paragraph (1) shall apply to any article 
        described in that paragraph that meets the requirements 
        of section 503(a)(2), except that--
                  (A) if the cost or value of materials 
                produced in the customs territory of the United 
                States is included with respect to that 
                article, an amount not to exceed 15 percent of 
                the appraised value of the article at the time 
                it is entered that is attributed to such United 
                States cost or value may be applied toward 
                determining the percentage referred to in 
                subparagraph (A) of section 503(a)(2); [and]
                  (B) the cost or value of the materials 
                included with respect to that article that are 
                produced in one or more beneficiary sub-Saharan 
                African countries or former beneficiary sub-
                Saharan African countries shall be applied in 
                determining such percentage[.]; and
                  (C) the direct costs of processing operations 
                performed in one or more such beneficiary sub-
                Saharan African countries or former beneficiary 
                sub-Saharan African countries shall be applied 
                in determining such percentage.
          (3) Rules of origin under this title.--The exceptions 
        set forth in subparagraphs (A), (B), and (C) of 
        paragraph (2) shall also apply to any article described 
        in section 503(a)(1) that is the growth, product, or 
        manufacture of a beneficiary sub-Saharan African 
        country for purposes of any determination to provide 
        duty-free treatment with respect to such article.
  (c) Withdrawal, Suspension, or Limitation of Preferential 
Tariff Treatment.--
          (1) In general.--The President may withdraw, suspend, 
        or limit the application of duty-free treatment 
        provided for any article described in subsection (b)(1) 
        of this section or section 112 of the African Growth 
        and Opportunity Act with respect to a beneficiary sub-
        Saharan African country if the President determines 
        that withdrawing, suspending, or limiting such duty-
        free treatment would be more effective in promoting 
        compliance by the country with the requirements 
        described in subsection (a)(1) than terminating the 
        designation of the country as a beneficiary sub-Saharan 
        African country for purposes of this section.
          (2) Notification.--The President may not withdraw, 
        suspend, or limit the application of duty-free 
        treatment under paragraph (1) unless, at least 60 days 
        before such withdrawal, suspension, or limitation, the 
        President notifies Congress and notifies the country of 
        the President's intention to withdraw, suspend, or 
        limit such duty-free treatment, together with the 
        considerations entering into the decision to terminate 
        such designation.
   (d) Review and Public Comments on Eligibility 
Requirements.--
          (1) In general.--In carrying out subsection (a)(2), 
        the President shall publish annually in the Federal 
        Register a notice of review and request for public 
        comments on whether beneficiary sub-Saharan African 
        countries are meeting the eligibility requirements set 
        forth in section 104 of the African Growth and 
        Opportunity Act and the eligibility criteria set forth 
        in section 502 of this Act.
          (2) Public hearing.--The United States Trade 
        Representative shall, not later than 30 days after the 
        date on which the President publishes the notice of 
        review and request for public comments under paragraph 
        (1)--
                  (A) hold a public hearing on such review and 
                request for public comments; and
                  (B) publish in the Federal Register, before 
                such hearing is held, notice of--
                          (i) the time and place of such 
                        hearing; and
                          (ii) the time and place at which such 
                        public comments will be accepted.
          (3) Petition process.--
                  (A) In general.--Not later than 60 days after 
                the date of the enactment of this subsection, 
                the President shall establish a process to 
                allow any interested person, at any time, to 
                file a petition with the Office of the United 
                States Trade Representative with respect to the 
                compliance of any country listed in section 107 
                of the African Growth and Opportunity Act with 
                the eligibility requirements set forth in 
                section 104 of such Act and the eligibility 
                criteria set forth in section 502 of this Act.
                  (B) Use of petitions.--The President shall 
                take into account all petitions filed pursuant 
                to subparagraph (A) in making determinations of 
                compliance under subsections (a)(3)(A) and (c) 
                and in preparing any reports required by this 
                title as such reports apply with respect to 
                beneficiary sub-Saharan African countries.
          (4) Out-of-cycle reviews.--
                  (A) In general.--The President may, at any 
                time, initiate an out-of-cycle review of 
                whether a beneficiary sub-Saharan African 
                country is making continual progress in meeting 
                the requirements described in paragraph (1). 
                The President shall give due consideration to 
                petitions received under paragraph (3) in 
                determining whether to initiate an out-of-cycle 
                review under this subparagraph.
                  (B) Congressional notification.--Before 
                initiating an out-of-cycle review under 
                subparagraph (A), the President shall notify 
                and consult with Congress.
                  (C) Consequences of review.--If, pursuant to 
                an out-of-cycle review conducted under 
                subparagraph (A), the President determines that 
                a beneficiary sub-Saharan African country does 
                not meet the requirements set forth in section 
                104(a) of the African Growth and Opportunity 
                Act (19 U.S.C. 3703(a)), the President shall, 
                subject to the requirements of subsections 
                (a)(3)(B) and (c)(2), terminate the designation 
                of the country as a beneficiary sub-Saharan 
                African country or withdraw, suspend, or limit 
                the application of duty-free treatment with 
                respect to articles from the country.
                  (D) Reports.--After each out-of-cycle review 
                conducted under subparagraph (A) with respect 
                to a country, the President shall submit to the 
                Committee on Finance of the Senate and the 
                Committee on Ways and Means of the House of 
                Representatives a report on the review and any 
                determination of the President to terminate the 
                designation of the country as a beneficiary 
                sub-Saharan African country or withdraw, 
                suspend, or limit the application of duty-free 
                treatment with respect to articles from the 
                country under subparagraph (C).
                  (E) Sense of congress.--Recognizing that 
                concerns have been raised about the compliance 
                with section 104(a) of the African Growth and 
                Opportunity Act (19 U.S.C. 3703(a)) of some 
                beneficiary sub-Saharan African countries, the 
                President should initiate an out-of-cycle 
                review under subparagraph (A) with respect to 
                South Africa, the most developed of the 
                beneficiary sub-Saharan African countries, and 
                other beneficiary countries as appropriate, not 
                later than 30 days after the date of the 
                enactment of this subsection.
  [(c)] (e) Beneficiary Sub-Saharan African Countries, Etc.--
For purposes of this title--
          (1) the terms ``beneficiary sub-Saharan African 
        country'' and ``beneficiary sub-Saharan African 
        countries'' mean a country or countries listed in 
        section 107 of the African Growth and Opportunity Act 
        that the President has determined is eligible under 
        subsection (a) of this section.
          (2) the term ``former beneficiary sub-Saharan African 
        country'' means a country that, after being designated 
        as a beneficiary sub-Saharan African country under the 
        African Growth and Opportunity Act, ceased to be 
        designated as such a country by reason of its entering 
        into a free trade agreement with the United States.

SEC. 506B. TERMINATION OF BENEFITS FOR SUB-SAHARAN AFRICAN COUNTRIES.

  In the case of a beneficiary sub-Saharan African country, as 
defined in section 506A(c), duty-free treatment provided under 
this title shall remain in effect through [September 30, 2015] 
September 30, 2025.

           *       *       *       *       *       *       *

                              ----------                              


                   AFRICAN GROWTH AND OPPORTUNITY ACT



           *       *       *       *       *       *       *
   TITLE I--EXTENSION OF CERTAIN TRADE BENEFITS TO SUB-SAHARAN AFRICA

Subtitle A--Trade Policy for Sub-Saharan Africa

           *       *       *       *       *       *       *


SEC. 104. ELIGIBILITY REQUIREMENTS.

  [(a) In General.--] The President is authorized to designate 
a sub-Saharan African country as an eligible sub-Saharan 
African country if the President determines that the country--
          (1) has established, or is making continual progress 
        toward establishing--
                  (A) a market-based economy that protects 
                private property rights, incorporates an open 
                rules-based trading system, and minimizes 
                government interference in the economy through 
                measures such as price controls, subsidies, and 
                government ownership of economic assets;
                  (B) the rule of law, political pluralism, and 
                the right to due process, a fair trial, and 
                equal protection under the law;
                  (C) the elimination of barriers to United 
                States trade and investment, including by--
                          (i) the provision of national 
                        treatment and measures to create an 
                        environment conducive to domestic and 
                        foreign investment;
                          (ii) the protection of intellectual 
                        property; and
                          (iii) the resolution of bilateral 
                        trade and investment disputes;
                  (D) economic policies to reduce poverty, 
                increase the availability of health care and 
                educational opportunities, expand physical 
                infrastructure, promote the development of 
                private enterprise, and encourage the formation 
                of capital markets through micro-credit or 
                other programs;
                  (E) a system to combat corruption and 
                bribery, such as signing and implementing the 
                Convention on Combating Bribery of Foreign 
                Public Officials in International Business 
                Transactions; and
                  (F) protection of internationally recognized 
                worker rights, including the right of 
                association, the right to organize and bargain 
                collectively, a prohibition on the use of any 
                form of forced or compulsory labor, a minimum 
                age for the employment of children, and 
                acceptable conditions of work with respect to 
                minimum wages, hours of work, and occupational 
                safety and health;
          (2) does not engage in activities that undermine 
        United States national security or foreign policy 
        interests; and
          (3) does not engage in gross violations of 
        internationally recognized human rights or provide 
        support for acts of international terrorism and 
        cooperates in international efforts to eliminate human 
        rights violations and terrorist activities.
  [(b) Continuing Compliance.--If the President determines that 
an eligible sub-Saharan African country is not making continual 
progress in meeting the requirements described in subsection 
(a)(1), the President shall terminate the designation of the 
country made pursuant to subsection (a).]

           *       *       *       *       *       *       *


Subtitle B--Trade Benefits

           *       *       *       *       *       *       *


SEC. 112. TREATMENT OF CERTAIN TEXTILES AND APPAREL.

  (a) Preferential Treatment.--Textile and apparel articles 
described in subsection (b) that are imported directly into the 
customs territory of the United States from a beneficiary sub-
Saharan African country described in section 506A(c) of the 
Trade Act of 1974, shall enter the United States free of duty 
and free of any quantitative limitations in accordance with the 
provisions set forth in subsection (b), if the country has 
satisfied the requirements set forth in section 113.
  (b) Products Covered.--Subject to subsection (c), the 
preferential treatment described in subsection (a) shall apply 
only to the following textile and apparel products:
          (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, or both (including fabrics not 
        formed from yarns, if such fabrics are classifiable 
        under heading 5602 or 5603 of the Harmonized Tariff 
        Schedule of the United States and are wholly formed and 
        cut in the United States) that are--
                  (A) entered under subheading 9802.00.80 of 
                the Harmonized Tariff Schedule of the United 
                States; or
                  (B) entered under chapter 61 or 62 of the 
                Harmonized Tariff Schedule of the United 
                States, if, after such assembly, the articles 
                would have qualified for entry under subheading 
                9802.00.80 of the Harmonized Tariff Schedule of 
                the United States but for the fact that the 
                articles were embroidered or subjected to 
                stone-washing, enzyme-washing, acid washing, 
                perma-pressing, oven-baking, bleaching, 
                garment-dyeing, screen printing, or other 
                similar processes.
          (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 Harmonized Tariff Schedule 
        of the United States and are wholly formed in the 
        United States).
          (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 in the United 
        States or one or more beneficiary sub-Saharan African 
        countries or former beneficiary sub-Saharan African 
        countries, or both (including fabrics not formed from 
        yarns, if such fabrics are classified under heading 
        5602 or 5603 of the Harmonized Tariff Schedule of the 
        United States 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 in 
        the United States or one or more beneficiary sub-
        Saharan African countries or former beneficiary sub-
        Saharan African countries, or both, or apparel articles 
        wholly formed on seamless knitting machines in a 
        beneficiary sub-Saharan African country from yarns 
        originating in the United States or one or more 
        beneficiary sub-Saharan African countries or former 
        beneficiary sub-Saharan African countries, or both, 
        whether or not the apparel articles are also made from 
        any of the fabrics, fabric components formed, or 
        components knit-to-shape described in paragraph (1) or 
        (2) (unless the apparel articles are made exclusively 
        from any of the fabrics, fabric components formed, or 
        components knit-to-shape described in paragraph (1) or 
        (2)), subject to the following:
                  (A) Limitations on benefits.--
                          (i) In general.--Preferential 
                        treatment under this paragraph shall be 
                        extended in the 1-year period beginning 
                        October 1, 2003, and in each of the [11 
                        succeeding] 21 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.
                          (ii) Applicable percentage.--For 
                        purposes of this subparagraph, the term 
                        ``applicable percentage'' means--
                                  (I) 4.747 percent for the 1-
                                year period beginning October 
                                1, 2003, increased in each of 
                                the 5 succeeding 1-year periods 
                                by equal increments, so that 
                                for the 1-year period beginning 
                                October 1, 2007, the applicable 
                                percentage does not exceed 7 
                                percent; and
                                  (II) for each succeeding 1-
                                year period until [September 
                                30, 2015] September 30, 2025, 
                                not to exceed 7 percent.
                  (B) Surge mechanism.--
                          (i) Import monitoring.--The Secretary 
                        of Commerce shall monitor imports of 
                        articles described in this paragraph on 
                        a monthly basis to determine if there 
                        has been a surge in imports of such 
                        articles. In order to permit public 
                        access to preliminary international 
                        trade data and to facilitate the early 
                        identification of potentially 
                        disruptive import surges, the Director 
                        of the Office of Management and Budget 
                        may grant an exception to the 
                        publication dates established for the 
                        release of data on United States 
                        international trade in covered 
                        articles, if the Director notifies 
                        Congress of the early release of the 
                        data.
                          (ii) Determination of damage or 
                        threat thereof.--Whenever the Secretary 
                        of Commerce determines, based on the 
                        data described in clause (i), or 
                        pursuant to a written request made by 
                        an interested party, that there has 
                        been a surge in imports of an article 
                        described in this paragraph from a 
                        beneficiary sub-Saharan African 
                        country, the Secretary shall determine 
                        whether such article from such country 
                        is being imported in such increased 
                        quantities as to cause serious damage, 
                        or threat thereof, to the domestic 
                        industry producing a like or directly 
                        competitive article. If the Secretary's 
                        determination is affirmative, the 
                        President shall suspend the duty-free 
                        treatment provided for such article 
                        under this paragraph. If the inquiry is 
                        initiated at the request of an 
                        interested party, the Secretary shall 
                        make the determination within 60 days 
                        after the date of the request.
                          (iii) Factors to consider.--In 
                        determining whether a domestic industry 
                        has been seriously damaged, or is 
                        threatened with serious damage, the 
                        Secretary shall examine the effect of 
                        the imports on relevant economic 
                        indicators such as domestic production, 
                        sales, market share, capacity 
                        utilization, inventories, employment, 
                        profits, exports, prices, and 
                        investment.
                          (iv) Procedure.--
                                  (I) Initiation.--The 
                                Secretary of Commerce shall 
                                initiate an inquiry within 10 
                                days after receiving a written 
                                request and supporting 
                                information for an inquiry from 
                                an interested party. Notice of 
                                initiation of an inquiry shall 
                                be published in the Federal 
                                Register.
                                  (II) Participation by 
                                interested parties.--The 
                                Secretary of Commerce shall 
                                establish procedures to ensure 
                                participation in the inquiry by 
                                interested parties.
                                  (III) Notice of 
                                determination.--The Secretary 
                                shall publish the determination 
                                described in clause (ii) in the 
                                Federal Register.
                                  (IV) Information available.--
                                If relevant information is not 
                                available on the record or any 
                                party withholds information 
                                that has been requested by the 
                                Secretary, the Secretary shall 
                                make the determination on the 
                                basis of the facts available. 
                                When the Secretary relies on 
                                information submitted in the 
                                inquiry as facts available, the 
                                Secretary shall, to the extent 
                                practicable, corroborate the 
                                information from independent 
                                sources that are reasonably 
                                available to the Secretary.
                          (v) Interested party.--For purposes 
                        of this subparagraph, the term 
                        ``interested party'' means any producer 
                        of a like or directly competitive 
                        article, a certified union or 
                        recognized union or group of workers 
                        which is representative of an industry 
                        engaged in the manufacture, production, 
                        or sale in the United States of a like 
                        or directly competitive article, a 
                        trade or business association 
                        representing producers or sellers of 
                        like or directly competitive articles, 
                        producers engaged in the production of 
                        essential inputs for like or directly 
                        competitive articles, a certified union 
                        or group of workers which is 
                        representative of an industry engaged 
                        in the manufacture, production, or sale 
                        of essential inputs for the like or 
                        directly competitive article, or a 
                        trade or business association 
                        representing companies engaged in the 
                        manufacture, production, or sale of 
                        such essential inputs.
          (4) Sweaters knit-to-shape from cashmere or merino 
        wool.--
                  (A) Cashmere.--Sweaters, in chief weight of 
                cashmere, knit-to-shape in one or more 
                beneficiary sub-Saharan African countries and 
                classifiable under subheading 6110.10 of the 
                Harmonized Tariff Schedule of the United 
                States.
                  (B) Merino wool.--Sweaters, 50 percent or 
                more by weight of wool measuring 21.5 microns 
                in diameter or finer, knit-to-shape in one or 
                more beneficiary sub-Saharan African countries.
          (5) Apparel articles wholly assembled from fabric or 
        yarn not available in commercial quantities in the 
        united states.--
                  (A) In general.--Apparel articles that are 
                both cut (or knit-to-shape) and sewn or 
                otherwise assembled in one or more beneficiary 
                sub-Saharan African countries, to the extent 
                that apparel articles of such fabrics or yarns 
                would be eligible for preferential treatment, 
                without regard to the source of the fabrics or 
                yarns, under Annex 401 to the NAFTA.
                  (B) Additional apparel articles.--At the 
                request of any interested party and subject to 
                the following requirements, the President is 
                authorized to proclaim the treatment provided 
                under subparagraph (A) for yarns or fabrics not 
                described in subparagraph (A) if--
                          (i) the President determines that 
                        such yarns or fabrics 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 calendar 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--
                                  (I) the action proposed to be 
                                proclaimed and the reasons for 
                                such action; and
                                  (II) the advice obtained 
                                under clause (ii);
                          (iv) a period of 60 calendar days, 
                        beginning with the first day on which 
                        the President has met the requirements 
                        of subclauses (I) and (II) of clause 
                        (iii), has expired; and
                          (v) the President has consulted with 
                        such committees regarding the proposed 
                        action during the period referred to in 
                        clause (iii).
                  (C) Removal of designation of fabrics or 
                yarns not available in commercial quantities.--
                If the President determines that any fabric or 
                yarn was determined to be eligible for 
                preferential treatment under subparagraph (A) 
                on the basis of fraud, the President is 
                authorized to remove that designation from that 
                fabric or yarn with respect to articles entered 
                after such removal.
          (6) Handloomed, handmade, folklore articles and 
        ethnic printed fabrics.--
                  (A) In general.--A handloomed, handmade, 
                folklore article or an ethnic printed fabric of 
                a beneficiary sub-Saharan African country or 
                countries that is certified as such by the 
                competent authority of such beneficiary country 
                or countries. For purposes of this section, the 
                President, after consultation with the 
                beneficiary sub-Saharan African country or 
                countries concerned, shall determine which, if 
                any, particular textile and apparel goods of 
                the country (or countries) shall be treated as 
                being handloomed, handmade, or folklore 
                articles or an ethnic printed fabric.
                  (B) Requirements for ethnic printed fabric.--
                Ethnic printed fabrics qualified under this 
                paragraph are--
                          (i) fabrics containing a selvedge on 
                        both edges, having a width of less than 
                        50 inches, classifiable under 
                        subheading 5208.52.30 or 5208.52.40 of 
                        the Harmonized Tariff Schedule of the 
                        United States;
                          (ii) of the type that contains 
                        designs, symbols, and other 
                        characteristics of African prints--
                                  (I) normally produced for and 
                                sold on the indigenous African 
                                market; and
                                  (II) normally sold in Africa 
                                by the piece as opposed to 
                                being tailored into garments 
                                before being sold in indigenous 
                                African markets;
                          (iii) printed, including waxed, in 
                        one or more eligible beneficiary sub-
                        Saharan countries; and
                          (iv) fabrics formed in the United 
                        States, from yarns formed in the United 
                        States, or from fabric formed in one or 
                        more beneficiary sub-Saharan African 
                        country from yarn originating in either 
                        the United States or one or more 
                        beneficiary sub-Saharan African 
                        countries.
          (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 or 
        former 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 or former 
        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 
        Harmonized Tariff Schedule of the United States).
          (8) Textile articles originating entirely in one or 
        more lesser developed beneficiary sub-saharan african 
        countries.--Textile and textile articles classifiable 
        under chapters 50 through 60 or chapter 63 of the 
        Harmonized Tariff Schedule of the United States that 
        are products of a lesser developed beneficiary sub-
        Saharan African country and are wholly formed in one or 
        more such countries from fibers, yarns, fabrics, fabric 
        components, or components knit-to-shape that are the 
        product of one or more such countries.
  (c) Lesser Developed Countries.--
          (1) Preferential treatment of products through 
        [september 30, 2015]  september 30, 2025.--
                  (A) Products covered.--In addition to the 
                products described in subsection (b) the 
                preferential treatment described in subsection 
                (a) shall apply through [September 30, 2015] 
                September 30, 2025, to 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, 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.
                  (B) Applicable percentage.--For purposes of 
                subparagraph (A), the term ``applicable 
                percentage'' means--
                          (i) 2.9285 percent for the 1-year 
                        period beginning on October 1, 2005; 
                        and
                          (ii) 3.5 percent for the 1-year 
                        period beginning on October 1, 2006, 
                        and each 1-year period thereafter 
                        through [September 30, 2015] September 
                        30, 2025.
          (2) Applicability of other provisions.--Subsection 
        (b)(3)(B) applies to apparel articles eligible for 
        preferential treatment under this subsection to the 
        same extent as that subsection applies to apparel 
        articles eligible for preferential treatment under 
        subsection (b)(3).
          (3) Definition.--In this subsection, the term 
        ``lesser developed beneficiary sub-Saharan African 
        country'' means--
                  (A) 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;
                  (B) Botswana;
                  (C) Namibia; and
                  (D) Mauritius.
  (d) Treatment of Quotas on Textile and Apparel Imports from 
Kenya and Mauritius.--The President shall eliminate the 
existing quotas on textile and apparel articles imported into 
the United States--
          (1) from Kenya within 30 days after that country 
        adopts an effective visa system to prevent unlawful 
        transshipment of textile and apparel articles and the 
        use of counterfeit documents relating to the 
        importation of the articles into the United States; and
          (2) from Mauritius within 30 days after that country 
        adopts such a visa system.
The Customs Service shall provide the necessary technical 
assistance to Kenya and Mauritius in the development and 
implementation of the visa systems.
  (e) Special Rules.--
          (1) Findings and trimmings.--
                  (A) General rule.--An article otherwise 
                eligible for preferential treatment under this 
                section shall not be ineligible for such 
                treatment because the article contains findings 
                or trimmings of foreign origin, if the value of 
                such findings and trimmings do not exceed 25 
                percent of the cost of the components of the 
                assembled article. Examples of findings and 
                trimmings are sewing thread, hooks and eyes, 
                snaps, buttons, ``bow buds'', decorative lace 
                trim, elastic strips, and zippers, including 
                zipper tapes and labels. Elastic strips are 
                considered findings or trimmings only if they 
                are each less than 1 inch in width and used in 
                the production of brassieres.
                  (B) Certain interlinings.--
                          (i) General rule.--An article 
                        otherwise eligible for preferential 
                        treatment under this section 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.
                          (ii) Interlinings described.--
                        Interlinings eligible for the treatment 
                        described in clause (i) include only a 
                        chest type plate, a ``hymo'' piece, or 
                        ``sleeve header'', of woven or weft-
                        inserted warp knit construction and of 
                        coarse animal hair or man-made 
                        filaments.
                          (iii) Termination of treatment.--The 
                        treatment described in this 
                        subparagraph shall terminate if the 
                        President makes a determination that 
                        United States manufacturers are 
                        producing such interlinings in the 
                        United States in commercial quantities.
                  (C) Exception.--In the case of an article 
                described in subsection (b)(2), sewing thread 
                shall not be treated as findings or trimmings 
                under subparagraph (A).
          (2) De minimis rule.--An article otherwise eligible 
        for preferential treatment under this section shall not 
        be ineligible for such treatment because the article 
        contains fibers or yarns not wholly formed in the 
        United States or one or more beneficiary sub-Saharan 
        African countries or former beneficiary sub-Saharan 
        African countries if the total weight of all such 
        fibers and yarns is not more than 10 percent of the 
        total weight of the article.
          (3) Certain components.--An article otherwise 
        eligible for preferential treatment under this section 
        will not be ineligible for such treatment because the 
        article contains--
                  (A) any collars or cuffs (cut or knit-to-
                shape),
                  (B) drawstrings,
                  (C) shoulder pads or other padding,
                  (D) waistbands,
                  (E) belt attached to the article,
                  (F) straps containing elastic, or
                  (G) elbow patches,
        that do not meet the requirements set forth in 
        subsections (b) and (c), regardless of the country of 
        origin of the item referred to in the applicable 
        subparagraph of this paragraph.
  (f) Definitions.--In this section and section 113:
          (1) Agreement on textiles and clothing.--The term 
        ``Agreement on Textiles and Clothing'' means the 
        Agreement on Textiles and Clothing referred to in 
        section 101(d)(4) of the Uruguay Round Agreements Act 
        (19 U.S.C. 3511(d)(4)).
          (2) Beneficiary sub-saharan african country, etc.--
        The terms ``beneficiary sub-Saharan African country'' 
        and ``beneficiary sub-Saharan African countries'' have 
        the same meaning as such terms have under section 
        506A(c) of the Trade Act of 1974.
          (3) NAFTA.--The term ``NAFTA'' means the North 
        American Free Trade Agreement entered into between the 
        United States, Mexico, and Canada on December 17, 1992.
          (4) Former sub-saharan african country.--The term 
        ``former sub-Saharan African country'' means a country 
        that, after being designated as a beneficiary sub-
        Saharan African country under this Act, ceased to be 
        designated as such a beneficiary sub-Saharan country by 
        reason of its entering into a free trade agreement with 
        the United States.
          (5) Enter; entered.--The terms ``enter'' and 
        ``entered'' refer to the entry, or withdrawal from 
        warehouse for consumption, in the customs territory of 
        the United States.
  (g) Effective Date.--This section takes effect on October 1, 
2000, and shall remain in effect through [September 30, 2015] 
September 30, 2025.

           *       *       *       *       *       *       *

                              ----------                              


                 CARIBBEAN BASIN ECONOMIC RECOVERY ACT



           *       *       *       *       *       *       *
TITLE II--CARIBBEAN BASIN INITIATIVE

           *       *       *       *       *       *       *


Subtitle A--Duty-Free Treatment

           *       *       *       *       *       *       *


SEC. 213A. SPECIAL RULES FOR HAITI.

  (a) Definitions.--In this section:
          (1) Initial applicable 1-year period.--The term 
        ``initial applicable 1-year period'' means the 1-year 
        period beginning on December 20, 2006.
          (2) Appropriate congressional committees.--.--The 
        term ``appropriate congressional committees'' means the 
        Committee on Finance of the Senate and the Committee on 
        Ways and Means of the House of Representatives.
          (3) Core labor standards.--The term ``core labor 
        standards'' means--
                  (A) freedom of association;
                  (B) the effective recognition of the right to 
                bargain collectively;
                  (C) the elimination of all forms of 
                compulsory or forced labor;
                  (D) the effective abolition of child labor 
                and a prohibition on the worst forms of child 
                labor; and
                  (E) the elimination of discrimination in 
                respect of employment and occupation.
          (4) Enter; entry.--The terms ``enter'' and ``entry'' 
        refer to the entry, or withdrawal from warehouse for 
        consumption, in the customs territory of the United 
        States.
          (5) Imported directly from haiti or the dominican 
        republic.--Articles are ``imported directly from Haiti 
        or the Dominican Republic'' if--
                  (A) the articles are shipped directly from 
                Haiti or the Dominican Republic into the United 
                States without passing through the territory of 
                any intermediate country; or
                  (B) the articles are shipped from Haiti or 
                the Dominican Republic into the United States 
                through the territory of an intermediate 
                country, and--
                          (i) the articles in the shipment do 
                        not enter into the commerce of any 
                        intermediate country, and the invoices, 
                        bills of lading, and other shipping 
                        documents specify the United States as 
                        the final destination; or
                          (ii) the invoices and other documents 
                        do not specify the United States as the 
                        final destination, but the articles in 
                        the shipment--
                                  (I) remain under the control 
                                of the customs authority in the 
                                intermediate country;
                                  (II) do not enter into the 
                                commerce of the intermediate 
                                country except for the purpose 
                                of a sale other than at retail; 
                                and
                                  (III) have not been subjected 
                                to operations in the 
                                intermediate country other than 
                                loading, unloading, or other 
                                activities necessary to 
                                preserve the articles in good 
                                condition.
          (6) Knit-to-shape.--A good is ``knit-to-shape'' if 50 
        percent or more of the exterior surface area of the 
        good is formed by major parts that have been knitted or 
        crocheted directly to the shape used in the good, with 
        no consideration being given to patch pockets, 
        appliquees, or the like. Minor cutting, trimming, or 
        sewing of those major parts shall not affect the 
        determination of whether a good is ``knit-to-shape.''
          (7) TAICNAR program.--The term ``TAICNAR Program'' 
        means the Technical Assistance Improvement and 
        Compliance Needs Assessment and Remediation Program 
        established pursuant to subsection (e).
          (8) Wholly assembled.--A good is ``wholly assembled'' 
        in Haiti if all components, of which there must be at 
        least two, pre-existed in essentially the same 
        condition as found in the finished good and were 
        combined to form the finished good in Haiti. Minor 
        attachments and minor embellishments (for example, 
        appliquees, beads, spangles, embroidery, and buttons) 
        not appreciably affecting the identity of the good, and 
        minor subassemblies (for example, collars, cuffs, 
        plackets, and pockets), shall not affect the 
        determination of whether a good is ``wholly assembled'' 
        in Haiti.
  (b) Apparel and Other Textile Articles.--
          (1) Value-added rule for apparel articles.--
                  (A) In general.--Apparel articles described 
                in subparagraph (B) of a producer or entity 
                controlling production that are imported 
                directly from Haiti or the Dominican Republic 
                shall enter the United States free of duty 
                during the initial applicable 1-year period and 
                any 1-year period thereafter, subject to the 
                limitations set forth in subparagraphs (B) and 
                (C), and subject to subparagraph (D).
                  (B) Apparel articles described.--
                          (i) In general.--In the initial 
                        applicable 1-year period and any 1-year 
                        period thereafter, apparel articles 
                        described in this paragraph are apparel 
                        articles that are wholly assembled, or 
                        are knit-to-shape, in Haiti from any 
                        combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        and yarns, only if, for each entry in 
                        that 1-year period, the sum of--
                                  (I) the cost or value of the 
                                materials produced in Haiti or 
                                one or more countries described 
                                in clause (iii), or any 
                                combination thereof, plus
                                  (II) the direct costs of 
                                processing operations (as 
                                defined in section 213(a)(3)) 
                                performed in Haiti or one or 
                                more countries described in 
                                clause (iii), or any 
                                combination thereof,
                        is not less than the applicable 
                        percentage (as defined in clause 
                        (v)(I)) of the declared customs value 
                        of such apparel articles.
                          (ii) Deductions.--In calculating cost 
                        or value under clause (i)(I), there 
                        shall be deducted the cost or value 
                        of--
                                  (I) any foreign materials 
                                that are used in the production 
                                of the apparel articles in 
                                Haiti; and
                                  (II) any foreign materials 
                                that are used in the production 
                                of the materials described in 
                                clause (i)(I).
                          (iii) Countries described.--The 
                        countries referred to in clause (i) are 
                        the following:
                                  (I) The United States.
                                  (II) Any country that is a 
                                party to a free trade agreement 
                                with the United States that is 
                                in effect on the date of the 
                                enactment of the Haitian 
                                Hemispheric Opportunity through 
                                Partnership Encouragement Act 
                                of 2006, or that enters into 
                                force thereafter.
                                  (III) Any country designated 
                                as a beneficiary country under 
                                section 213(b)(5)(B) of this 
                                Act.
                                  (IV) Any country designated 
                                as a beneficiary country under 
                                section 506A(a)(1) of the Trade 
                                Act of 1974 (19 U.S.C. 
                                2466a(a)(1)), if a finding has 
                                been made by the President or 
                                the President's designee, and 
                                published in the Federal 
                                Register, that the country has 
                                satisfied the requirements of 
                                section 113 of the African 
                                Growth and Opportunity Act (19 
                                U.S.C. 3722).
                                  (V) Any country designated as 
                                a beneficiary country under 
                                section 204(b)(6)(B) of the 
                                Andean Trade Preference Act (19 
                                U.S.C. 3203(b)(6)(B)).
                          (iv) Annual aggregation.--
                                  (I) Initial applicable 1-year 
                                period.--In the initial 
                                applicable 1-year period, the 
                                requirements under clause (i) 
                                relating to applicable 
                                percentage may also be met for 
                                articles of a producer or an 
                                entity controlling production 
                                that enter during the initial 
                                applicable 1-year period by 
                                aggregating--
                                          (aa) the cost or 
                                        value of materials 
                                        under subclause (I) of 
                                        clause (i), and
                                          (bb) the direct costs 
                                        of processing 
                                        operations under 
                                        subclause (II) of 
                                        clause (i),
                                of all apparel articles of that 
                                producer or entity controlling 
                                production that are wholly 
                                assembled, or are knit-to-
                                shape, in Haiti and are entered 
                                during the initial applicable 
                                1-year period.
                                  (II) Other 1-year periods.--
                                In any 1-year period after the 
                                initial applicable 1-year 
                                period, the requirements under 
                                clause (i) relating to 
                                applicable percentage may also 
                                be met for articles of a 
                                producer or an entity 
                                controlling production that 
                                enter during the 1-year period 
                                by aggregating--
                                          (aa) the cost or 
                                        value of materials 
                                        under subclause (I) of 
                                        clause (i), and
                                          (bb) the direct costs 
                                        of processing 
                                        operations under 
                                        subclause (II) of 
                                        clause (i),
                                of all apparel articles of that 
                                producer or entity controlling 
                                production that are wholly 
                                assembled, or are knit-to-
                                shape, in Haiti and are entered 
                                during the preceding 1-year 
                                period.
                                  (III) Deductions.--In 
                                calculating cost or value under 
                                subclause (I)(aa) or (II)(aa), 
                                there shall be deducted the 
                                cost or value of--
                                          (aa) any foreign 
                                        materials that are used 
                                        in the production of 
                                        the apparel articles in 
                                        Haiti; and
                                          (bb) any foreign 
                                        materials that are used 
                                        in the production of 
                                        the materials described 
                                        in subclause (I)(aa) or 
                                        (II)(aa) (as the case 
                                        may be).
                                  (IV) Inclusion in calculation 
                                of other articles receiving 
                                preferential treatment.--
                                Entries of apparel articles 
                                that receive preferential 
                                treatment under any provision 
                                of law other than this 
                                subparagraph or are subject to 
                                the ``General'' column 1 rate 
                                of duty under the HTS are not 
                                included in the annual 
                                aggregation under subclause (I) 
                                or (II) unless the producer or 
                                entity controlling production 
                                elects, at the time the annual 
                                aggregation calculation is 
                                made, to include such entries 
                                in such aggregation.
                          (v) Definitions.--In this paragraph:
                                  (I) Applicable percentage.--
                                The term ``applicable 
                                percentage'' means--
                                          (aa) 50 percent or 
                                        more during the initial 
                                        applicable 1-year 
                                        period and the 
                                        succeeding 8 1-year 
                                        periods;
                                          (bb) 55 percent or 
                                        more during the 1-year 
                                        period beginning on 
                                        December 20, 2015, and 
                                        the 1-year period 
                                        beginning on December 
                                        20, 2016; and
                                          [(cc) 60 percent or 
                                        more during the 1-year 
                                        period beginning on 
                                        December 20, 2017.]
                                          (cc) 60 percent or 
                                        more during the 1-year 
                                        period beginning on 
                                        December 20, 2017, and 
                                        each of the 7 
                                        succeeding 1-year 
                                        periods.
                                  (II) Foreign material.--The 
                                term ``foreign material'' means 
                                a material produced in a 
                                country other than Haiti or any 
                                country described in clause 
                                (iii).
                          (vi) Development of procedure to 
                        ensure compliance.--
                                  (I) In general.--U.S. Customs 
                                and Border Protection of the 
                                Department of Homeland Security 
                                shall develop and implement 
                                methods and procedures to 
                                ensure ongoing compliance with 
                                the requirements set forth in 
                                clauses (i) and (iv).
                                  (II) Noncompliance.--If U.S. 
                                Customs and Border Protection 
                                finds that a producer or an 
                                entity controlling production 
                                has not satisfied such 
                                requirements in the initial 
                                applicable 1-year period or any 
                                1-year period thereafter, 
                                either for individual entries 
                                entered pursuant to clause (i) 
                                or for entries entered in 
                                aggregate pursuant to clause 
                                (iv), then apparel articles 
                                described in clause (i) of that 
                                producer or entity shall be 
                                ineligible for preferential 
                                treatment under paragraph (1) 
                                during any succeeding 1-year 
                                period until--
                                          (aa) the cost or 
                                        value of materials 
                                        under subclause (I) of 
                                        clause (i), plus
                                          (bb) the direct costs 
                                        of processing 
                                        operations under 
                                        subclause (II) of 
                                        clause (i),
                                of that producer or entity 
                                controlling production, is not 
                                less than the applicable 
                                percentage under clause (v)(I), 
                                plus 10 percent, of the 
                                aggregate declared customs 
                                value of all apparel articles 
                                of that producer or entity 
                                controlling production that are 
                                wholly assembled, or are knit-
                                to-shape, in Haiti and are 
                                entered during the preceding 1-
                                year period.
                                  (III) Retroactive application 
                                of duty-free treatment.--If--
                                          (aa) a producer or an 
                                        entity controlling 
                                        production is 
                                        ineligible for 
                                        preferential treatment 
                                        under subparagraph (A) 
                                        in the initial 
                                        applicable 1-year 
                                        period or any 1-year 
                                        period thereafter 
                                        because that producer 
                                        or entity controlling 
                                        production did not 
                                        satisfy the 
                                        requirements of clause 
                                        (i) or (iv), and
                                          (bb) that producer or 
                                        entity controlling 
                                        production satisfies 
                                        the requirements of 
                                        subclause (II) of this 
                                        clause in that 1-year 
                                        period,
                                then, notwithstanding section 
                                514 of the Tariff Act of 1930 
                                (19 U.S.C. 1514) or any other 
                                provision of law, upon proper 
                                request filed with U.S. Customs 
                                and Border Protection before 
                                the 90th day after U.S. Customs 
                                and Border Protection 
                                determines that item (bb) 
                                applies, the entry of any 
                                articles--
                                          (AA) that was made 
                                        during that 1-year 
                                        period, and
                                          (BB) with respect to 
                                        which there would have 
                                        been preferential 
                                        treatment under 
                                        subparagraph (A) if the 
                                        producer or entity 
                                        controlling production 
                                        had satisfied the 
                                        requirements in clause 
                                        (i) or (iv) (as the 
                                        case may be),
                                shall be liquidated or 
                                reliquidated as though such 
                                preferential treatment under 
                                subparagraph (A) applied to 
                                such entry.
                          (vii) Fabrics not available in 
                        commercial quantities.--
                                  (I) In general.--For purposes 
                                of determining the applicable 
                                percentage under clause (i) or 
                                (iv), there may be included in 
                                that percentage--
                                          (aa) the cost of 
                                        fabrics or yarns to the 
                                        extent that apparel 
                                        articles of such 
                                        fabrics or yarns would 
                                        be eligible for 
                                        preferential treatment, 
                                        without regard to the 
                                        source of the fabrics 
                                        or yarns, under Annex 
                                        401 of the NAFTA; and
                                          (bb) the cost of 
                                        fabrics or yarns that 
                                        are designated as not 
                                        being available in 
                                        commercial quantities 
                                        for purposes of--
                                          (AA) section 
                                        213(b)(2)(A)(v) of this 
                                        Act,
                                          (BB) section 
                                        112(b)(5) of the 
                                        African Growth and 
                                        Opportunity Act,
                                          (CC) section 
                                        204(b)(3)(B)(i)(III) or 
                                        (ii) of the Andean 
                                        Trade Preference Act, 
                                        or
                                          (DD) any other 
                                        provision, relating to 
                                        determining whether a 
                                        textile or apparel 
                                        article is an 
                                        originating good 
                                        eligible for 
                                        preferential treatment, 
                                        of a law that 
                                        implements a free trade 
                                        agreement that enters 
                                        into force with respect 
                                        to the United States,
                                without regard to the source of 
                                the fabrics or yarns.
                                  (II) Removal of designation 
                                of fabrics or yarns not 
                                available in commercial 
                                quantities.--If the President 
                                determines that--
                                          (aa) any fabric or 
                                        yarn described in 
                                        subclause (I)(aa) was 
                                        determined to be 
                                        eligible for 
                                        preferential treatment, 
                                        or
                                          (bb) any fabric or 
                                        yarn described in 
                                        subclause (I)(bb) was 
                                        designated as not being 
                                        available in commercial 
                                        quantities,
                                on the basis of fraud, the 
                                President is authorized to 
                                remove the eligibility or 
                                designation (as the case may 
                                be) of that fabric or yarn with 
                                respect to articles entered 
                                after such removal.
                  (C) Quantitative limitations.--The 
                preferential treatment described in 
                subparagraph (A) shall be extended, during each 
                of the 1-year periods set forth in the 
                following table, to not more than the 
                corresponding percentage of the aggregate 
                square meter equivalents of all apparel 
                articles imported into the United States in the 
                most recent 12-month period for which data are 
                available:


 
 
 
During:                                              the corresponding percentage is:
the initial applicable 1-year period...............  1 percent.
each of the succeeding 11 1-year periods...........  1.25 percent.
 

                No preferential treatment shall be provided 
                under subparagraph (A) after [December 19, 
                2018] December 19, 2025.
                  (D) Other preferential treatment not affected 
                by quantitative limitations.--Any apparel 
                article that qualifies for preferential 
                treatment under paragraph (2), (3), (4), or (5) 
                or any other provision of this title shall not 
                be subject to, or included in the calculation 
                of, the quantitative limitations under 
                subparagraph (C).
          (2) Special rule for woven articles and certain knit 
        articles.--
                  (A) Special rule for articles of chapter 62 
                of the hts.--
                          (i) General rule.--Any apparel 
                        article classifiable under chapter 62 
                        of the HTS that is wholly assembled, or 
                        knit-to-shape, in Haiti from any 
                        combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        or yarns and is imported directly from 
                        Haiti or the Dominican Republic shall 
                        enter the United States free of duty, 
                        subject to clauses (ii) and (iii), 
                        without regard to the source of the 
                        fabric, fabric components, components 
                        knit-to-shape, or yarns from which the 
                        article is made.
                          (ii) Limitation.--Except as provided 
                        in paragraph (2A), the preferential 
                        treatment described in clause (i) shall 
                        be extended, in the 1-year period 
                        beginning October 1, 2008, and in each 
                        of the [11 succeeding 1-year periods] 
                        16 succeeding 1-year periods, to not 
                        more than 70,000,000 square meter 
                        equivalents of apparel articles 
                        described in such clause.
                          (iii) Other preferential treatment 
                        not affected by quantitative 
                        limitation.--Any apparel article that 
                        qualifies for preferential treatment 
                        under paragraph (1), (3), (4), or (5) 
                        or subparagraph (B) of this paragraph 
                        or any other provision of this title 
                        shall not be subject to, or included in 
                        the calculation of, the quantitative 
                        limitation under clause (ii).
                  (B) Special rule for certain articles of 
                chapter 61 of the hts.--
                          (i) General rule.--Any apparel 
                        article classifiable under chapter 61 
                        of the HTS that is wholly assembled, or 
                        knit-to-shape, in Haiti from any 
                        combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        or yarns and is imported directly from 
                        Haiti or the Dominican Republic shall 
                        enter the United States free of duty, 
                        subject to clauses (ii), (iii), and 
                        (iv), without regard to the source of 
                        the fabric, fabric components, 
                        components knit-to-shape, or yarns from 
                        which the article is made.
                          (ii) Exclusions.--The preferential 
                        treatment described in clause (i) shall 
                        not apply to the following:
                                  (I) The following apparel 
                                articles of cotton, for men or 
                                boys, that are classifiable 
                                under subheading 6109.10.00 of 
                                the HTS:
                                          (aa) All white T-
                                        shirts, with short 
                                        hemmed sleeves and 
                                        hemmed bottom, with 
                                        crew or round neckline 
                                        or with V-neck and with 
                                        a mitered seam at the 
                                        center of the V, and 
                                        without pockets, trim, 
                                        or embroidery.
                                          (bb) All white 
                                        singlets, without 
                                        pockets, trim, or 
                                        embroidery.
                                          (cc) Other T-shirts, 
                                        but not including 
                                        thermal undershirts.
                                  (II) T-shirts for men or boys 
                                that are classifiable under 
                                subheading 6109.90.10.
                                  (III) The following apparel 
                                articles of cotton, for men or 
                                boys, that are classifiable 
                                under subheading 6110.20.20 of 
                                the HTS:
                                          (aa) Sweatshirts.
                                          (bb) Pullovers, other 
                                        than sweaters, vests, 
                                        or garments imported as 
                                        part of playsuits.
                                  (IV) Sweatshirts for men or 
                                boys, of man-made fibers and 
                                containing less than 65 percent 
                                by weight of man-made fibers, 
                                that are classifiable under 
                                subheading 6110.30.30 of the 
                                HTS.
                          (iii) Limitation.--Except as provided 
                        in paragraph (2A), the preferential 
                        treatment described in clause (i) shall 
                        be extended, in the 1-year period 
                        beginning October 1, 2008, and in each 
                        of the [11 succeeding 1-year periods] 
                        16 succeeding 1-year periods, to not 
                        more than 70,000,000 square meter 
                        equivalents of apparel articles 
                        described in such clause.
                          (iv) Other preferential treatment not 
                        affected by quantitative limitation.--
                        Any apparel article that qualifies for 
                        preferential treatment under paragraph 
                        (1), (3), (4), or (5) or subparagraph 
                        (A) of this paragraph or any other 
                        provision of this title shall not be 
                        subject to, or included in the 
                        calculation of, the quantitative 
                        limitation under clause (iii).
          (2A) Special rule for certain woven articles and 
        certain knit articles entered during fiscal year 2010 
        and succeeding 1-year periods.--
                  (A) In general.--Except as provided in 
                subparagraphs (B) and (C) and subject to 
                subparagraph (D), if 52,000,000 square meter 
                equivalents of apparel articles described in 
                paragraph (2)(A)(i) or (2)(B)(i) enter the 
                United States during the 1-year period 
                beginning October 1, 2009, or any of the 
                succeeding 1-year periods, the President shall 
                extend the preferential treatment described in 
                paragraph (2)(A)(i) or (2)(B)(i) (as the case 
                may be) to not more than 200,000,000 square 
                meter equivalents of apparel articles described 
                in paragraph (2)(A)(i) or (2)(B)(i) (as the 
                case may be) during that 1-year period, and 
                shall publish notice of the extension in the 
                Federal Register.
                  (B) Exception for certain woven articles.--
                          (i) In general.--In the case of 
                        apparel articles described in clause 
                        (ii), subparagraph (A) shall be applied 
                        by substituting ``70,000,000'' for 
                        ``200,000,000''.
                          (ii) Apparel articles described.--
                        Apparel articles described in this 
                        clause are apparel articles described 
                        in paragraph (2)(A)(i) that are the 
                        following:
                                  (I) Category 347.--Apparel 
                                articles in category 347 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6203.19.1020..........................  6203.42.4011.................  6203.42.4061
 6203.19.9020.........................  6203.42.4016.................  6203.49.8020
 6203.22.3020.........................  6203.42.4026.................  6210.40.9033
 6203.22.3030.........................  6203.42.4036.................  6211.20.1520
 6203.42.4003.........................  6203.42.4046.................  6211.20.3810
 6203.42.4006.........................  6203.42.4051.................  6211.32.0040
 

                                  (II) Category 348.--Apparel 
                                articles in category 348 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6204.12.0030..........................  6204.62.4011.................  6204.69.9010
 6204.19.8030.........................   6204.62.4021................  6210.50.9060
 6204.22.3040.........................   6204.62.4031................  6211.20.1550
 6204.22.3050.........................   6204.62.4041................  6211.20.6810
 6204.29.4034.........................   6204.62.4051................  6211.42.0030
 6204.62.3000.........................   6204.62.4056................  6217.90.9050
 6204.62.4003.........................   6204.62.4066................  .........................................
 6204.62.4006.........................  6204.69.6010.................  .........................................
 

                                  (III) Category 647.--Apparel 
                                articles in category 647 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6203.23.0060..........................  6203.43.4020.................  6203.49.8030
 6203.23.0070.........................   6203.43.4030................  6210.40.5031
 6203.29.2030.........................   6203.43.4040................  6210.40.5039
 6203.29.2035.........................   6203.49.1500................  6211.20.1525
 6203.43.2500.........................   6203.49.2015................  6211.20.3820
 6203.43.3510.........................   6203.49.2030................  6211.33.0030
 6203.43.3590.........................   6203.49.2045................  .........................................
 6203.43.4010.........................  6203.49.2060.................  .........................................
 

                                  (IV) Category 648.--Apparel 
                                articles in category 648 that 
                                fall within the following 
                                statistical reporting numbers 
                                of the HTS (as in effect on the 
                                day before the date of the 
                                enactment of this paragraph):


6204.23.0040..........................  6204.63.3510.................  6204.69.6030
 6204.23.0045.........................   6204.63.3530................  6204.69.9030
 6204.29.2020.........................  6204.63.3532.................  6210.50.5031
 6204.29.2025.........................   6204.63.3540................  6210.50.5039
 6204.29.4038.........................  6204.69.2510.................  6211.20.1555
 6204.63.2000.........................   6204.69.2530................  6211.20.6820
 6204.63.3010.........................   6204.69.2540................  6211.43.0040
 6204.63.3090.........................   6204.69.2560................  6217.90.9060
 

                  (C) Exception for certain knit articles.--
                          (i) In general.--In the case of 
                        apparel articles described in clause 
                        (ii), subparagraph (A) shall be applied 
                        by substituting ``85,000,000'' for 
                        ``200,000,000''.
                          (ii) Apparel articles described.--
                        Apparel articles described in this 
                        clause are apparel articles described 
                        in paragraph (2)(B)(i) that fall within 
                        the following statistical reporting 
                        numbers of the HTS (as in effect on the 
                        day before the date of the enactment of 
                        this paragraph), other than shirts with 
                        plackets and pointed collars:


6105.10.0010..........................  6109.10.0040.................  6110.30.3053
 6109.10.0018.........................  6109.10.0045.................  6110.30.3059
 6109.10.0027.........................  6110.20.2079.................  .........................................
 

                  (D) Verification with respect to 
                transshipment for certain apparel articles.--
                          (i) In general.--Not later than April 
                        1, July 1, October 1, and January 1 of 
                        each year, the Commissioner responsible 
                        for United States Customs and Border 
                        Protection shall verify that apparel 
                        articles imported into the United 
                        States under this paragraph are not 
                        being unlawfully transshipped (within 
                        the meaning of subsection (f)) into the 
                        United States.
                          (ii) Report to president.--If the 
                        Commissioner determines pursuant to 
                        clause (i) that apparel articles 
                        imported into the United States under 
                        this paragraph are being unlawfully 
                        transshipped into the United States, 
                        the Commissioner shall report that 
                        determination to the President.
                          (iii) Authority to reduce 
                        quantitative limitation.--If, in any 1-
                        year period with respect to which the 
                        President extends preferential 
                        treatment as described in this 
                        paragraph, the Commissioner reports to 
                        the President pursuant to clause (ii) 
                        regarding unlawful transshipments, the 
                        President--
                                  (I) may modify the 
                                quantitative limitation under 
                                this paragraph as the President 
                                considers appropriate to 
                                account for such 
                                transshipments; and
                                  (II) if the President 
                                modifies the limitation under 
                                subclause (I), shall publish 
                                notice of the modification in 
                                the Federal Register.
                  (E) Category defined.--In this paragraph, the 
                term ``category'' means the number assigned 
                under the U.S. Textile and Apparel Category 
                System of the Office of Textiles and Apparel of 
                the Department of Commerce, as listed in the 
                HTS under the applicable heading or subheading 
                (as in effect on the day before the date of the 
                enactment of this paragraph).
          (3) Apparel and other articles subject to certain 
        assembly rules.--
                  (A) Brassieres.--Any apparel article 
                classifiable under subheading 6212.10 of the 
                HTS that is wholly assembled, or knit-to-shape, 
                in Haiti from any combination of fabrics, 
                fabric components, components knit-to-shape, or 
                yarns and is imported directly from Haiti or 
                the Dominican Republic shall enter the United 
                States free of duty, without regard to the 
                source of the fabric, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made.
                  (B) Other apparel articles.--Any of the 
                following apparel articles that is wholly 
                assembled, or knit-to-shape, in Haiti from any 
                combination of fabrics, fabric components, 
                components knit-to-shape, or yarns and is 
                imported directly from Haiti or the Dominican 
                Republic shall enter the United States free of 
                duty, without regard to the source of the 
                fabric, fabric components, components knit-to-
                shape, or yarns from which the article is made:
                          (i) Any apparel article that is of a 
                        type listed in chapter rule 3, 4, or 5 
                        for chapter 61 of the HTS (as such 
                        chapter rules are contained in section 
                        A of the Annex to Proclamation 8213 of 
                        the President of December 20, 2007) as 
                        being excluded from the scope of such 
                        chapter rule, when such chapter rule is 
                        applied to determine whether an apparel 
                        article is an originating good for 
                        purposes of general note 29(n) to the 
                        HTS, except that, for purposes of this 
                        clause, reference in such chapter rules 
                        to ``6104.12.00'' shall be deemed to be 
                        a reference to ``6104.19.60''.
                          (ii)(I) Subject to subclause (II), 
                        any apparel article that is of a type 
                        listed in chapter rule 3(a), 4(a), or 
                        5(a) for chapter 62 of the HTS, as such 
                        chapter rules are contained in 
                        paragraph 9 of section A of the Annex 
                        to Proclamation 8213 of the President 
                        of December 20, 2007.
                          (II) Subclause (I) shall not include 
                        any apparel article to which 
                        subparagraph (A) of this paragraph 
                        applies.
                  (C) Luggage and similar items.--Any article 
                classifiable under subheading 4202.12, 4202.22, 
                4202.32 or 4202.92 of the HTS that is wholly 
                assembled in Haiti and is imported directly 
                from Haiti or the Dominican Republic shall 
                enter the United States free of duty, without 
                regard to the source of the fabric, components, 
                or materials from which the article is made.
                  (D) Headgear.--Any article classifiable under 
                heading 6501, 6502, or 6504 of the HTS, or 
                under subheading 6505.90 of the HTS, that is 
                wholly assembled, knit-to-shape, or formed in 
                Haiti from any combination of fabrics, fabric 
                components, components knit-to-shape, or yarns 
                and is imported directly from Haiti or the 
                Dominican Republic shall enter the United 
                States free of duty, without regard to the 
                source of the fabric, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made.
                  (E) Certain sleepwear.--Any of the following 
                apparel articles that is wholly assembled, or 
                knit-to-shape, in Haiti from any combination of 
                fabrics, fabric components, components knit-to-
                shape, or yarns and is imported directly from 
                Haiti or the Dominican Republic shall enter the 
                United States free of duty, without regard to 
                the source of the fabric, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made:
                          (i) Pajama bottoms and other 
                        sleepwear for women and girls, of 
                        cotton, that are classifiable under 
                        subheading 6208.91.30, or of man-made 
                        fibers, that are classifiable under 
                        subheading 6208.92.00.
                          (ii) Pajama bottoms and other 
                        sleepwear for girls, of other textile 
                        materials, that are classifiable under 
                        subheading 6208.99.20.
                  (F) Certain other apparel articles.--
                          (i) In general.--Any of the apparel 
                        articles described in clause (ii) that 
                        is wholly assembled, or knit-to-shape, 
                        in Haiti from any combination of 
                        fabrics, fabric components, components 
                        knit-to-shape, or yarns and is imported 
                        directly from Haiti or the Dominican 
                        Republic shall enter the United States 
                        free of duty, without regard to the 
                        source of the fabric, fabric 
                        components, components knit-to-shape, 
                        or yarns from which the article is 
                        made.
                          (ii) Articles described.--Apparel 
                        articles described in this clause are 
                        apparel articles in the following 
                        category numbers that fall within the 
                        following statistical reporting numbers 
                        of the HTS (as in effect on the day 
                        before the date of the enactment of 
                        this subparagraph):


 
 
----------------------------------------------------------------------------------------------------------------
Category Number                                                                                  HTS Statistical
                                                                                                Reporting Number
----------------------------------------------------------------------------------------------------------------
334                                                                                                 6101.90.9010
                                                                                                    6112.11.0010
                                                                                                    6103.22.0010
                                                                                                    6113.00.9015
----------------------------------------------------------------------------------------------------------------
335                                                                                                 6104.22.0010
                                                                                                    6104.29.2010
                                                                                                    6112.11.0020
----------------------------------------------------------------------------------------------------------------
336                                                                                                 6104.49.9010
----------------------------------------------------------------------------------------------------------------
338                                                                                                 6103.22.0050
                                                                                                    6105.90.8010
                                                                                                    6112.11.0030
----------------------------------------------------------------------------------------------------------------
339                                                                                                 6104.22.0060
                                                                                                    6104.29.2049
                                                                                                    6106.90.2510
                                                                                                    6106.90.3010
                                                                                                    6110.20.1031
                                                                                                    6110.20.1033
                                                                                                    6112.11.0040
----------------------------------------------------------------------------------------------------------------
342                                                                                                 6104.22.0030
                                                                                                    6104.29.2022
                                                                                                    6104.52.0010
                                                                                                    6104.52.0020
                                                                                                    6104.59.8010
----------------------------------------------------------------------------------------------------------------
350                                                                                                 6107.91.0040
                                                                                                    6107.91.0090
----------------------------------------------------------------------------------------------------------------
351                                                                                                 6107.21.0010
                                                                                                    6107.21.0020
                                                                                                    6107.91.0030
                                                                                                    6108.31.0010
                                                                                                    6108.31.0020
----------------------------------------------------------------------------------------------------------------
433                                                                                                 6103.23.0007
                                                                                                    6103.29.0520
                                                                                                    6103.31.0000
                                                                                                    6103.33.1000
                                                                                                    6103.39.8020
----------------------------------------------------------------------------------------------------------------
434                                                                                                 6101.30.1500
                                                                                                    6101.90.0500
                                                                                                    6101.90.9020
                                                                                                    6103.23.0005
                                                                                                    6103.29.0510
----------------------------------------------------------------------------------------------------------------
435                                                                                                 6102.30.1000
                                                                                                    6102.90.9010
                                                                                                    6104.23.0010
                                                                                                    6104.29.0510
                                                                                                    6104.29.2012
                                                                                                    6104.33.1000
                                                                                                    6104.39.2020
----------------------------------------------------------------------------------------------------------------
438                                                                                                 6103.23.0025
                                                                                                    6103.29.0550
                                                                                                    6104.23.0020
                                                                                                    6104.29.0560
                                                                                                    6104.29.2051
                                                                                                    6105.90.1000
                                                                                                    6105.90.8020
                                                                                                    6106.20.1020
                                                                                                    6106.90.1010
                                                                                                    6106.90.1020
                                                                                                    6106.90.2520
                                                                                                    6106.90.3020
                                                                                                    6110.11.0070
                                                                                                    6110.12.2070
                                                                                                    6110.12.2080
                                                                                                    6110.19.0070
                                                                                                    6110.19.0080
                                                                                                    6110.30.1550
                                                                                                    6110.30.1560
----------------------------------------------------------------------------------------------------------------
633                                                                                                 6103.23.0037
                                                                                                    6103.29.1015
                                                                                                    6103.33.2000
                                                                                                    6103.39.1000
                                                                                                    6103.39.8030
----------------------------------------------------------------------------------------------------------------
634                                                                                                 6101.30.1000
                                                                                                    6101.90.9030
                                                                                                    6103.23.0036
                                                                                                    6103.29.1010
                                                                                                    6112.12.0010
                                                                                                    6112.19.1010
                                                                                                    6112.20.1010
                                                                                                    6112.20.1030
                                                                                                    6113.00.9025
----------------------------------------------------------------------------------------------------------------
635                                                                                                 6102.30.0500
                                                                                                    6102.90.9015
                                                                                                    6104.23.0026
                                                                                                    6104.29.1010
                                                                                                    6104.29.2014
                                                                                                    6104.39.2030
                                                                                                    6112.12.0020
                                                                                                    6112.19.1020
                                                                                                    6112.20.1020
                                                                                                    6112.20.1040
                                                                                                    6113.00.9030
----------------------------------------------------------------------------------------------------------------
636                                                                                                 6104.49.9030
                                                                                                    6104.44.2020
----------------------------------------------------------------------------------------------------------------
638                                                                                                 6103.23.0075
                                                                                                    6103.29.1050
                                                                                                    6105.90.8030
                                                                                                    6110.30.1050
                                                                                                    6110.30.2051
                                                                                                    6110.30.2053
                                                                                                    6112.12.0030
                                                                                                    6112.19.1030
----------------------------------------------------------------------------------------------------------------
639                                                                                                 6104.23.0036
                                                                                                    6104.29.1050
                                                                                                    6104.29.2055
                                                                                                    6106.90.2530
                                                                                                    6106.90.3030
                                                                                                    6110.30.1060
                                                                                                    6110.30.2061
                                                                                                    6110.30.2063
                                                                                                    6112.12.0040
                                                                                                    6112.19.1040
----------------------------------------------------------------------------------------------------------------
651                                                                                                 6107.22.0010
                                                                                                    6107.22.0015
                                                                                                    6107.22.0025
                                                                                                    6107.99.1030
                                                                                                    6108.32.0015
----------------------------------------------------------------------------------------------------------------

                          (iii) Category defined.--In this 
                        subparagraph, the term ``category'' has 
                        the meaning given that term in 
                        paragraph (2A)(E) of this subsection.
                  (G) Made-up textile articles.--
                          (i) In general.--Any of the made-up 
                        textile articles described in clauses 
                        (ii) and (iii) that is wholly 
                        assembled, or knit-to-shape, in Haiti 
                        from any combination of fabrics, fabric 
                        components, components knit-to-shape, 
                        or yarns and is imported directly from 
                        Haiti or the Dominican Republic shall 
                        enter the United States free of duty, 
                        without regard to the source of the 
                        fabric, fabric components, components 
                        knit-to-shape, or yarns from which the 
                        article is made.
                          (ii) Articles described.--Made-up 
                        textile articles described in this 
                        clause are articles in the following 
                        category numbers that fall within the 
                        following statistical reporting numbers 
                        of the HTS (as in effect on the day 
                        before the date of the enactment of 
                        this subparagraph):


 
 
----------------------------------------------------------------------------------------------------------------
Category Number                                                                                  HTS Statistical
                                                                                                Reporting Number
----------------------------------------------------------------------------------------------------------------
363                                                                                                 6302.60.0020
                                                                                                    6302.91.0015
                                                                                                    6302.91.0035
                                                                                                    6307.90.8940
----------------------------------------------------------------------------------------------------------------
369                                                                                                 6304.91.0020
                                                                                                    6304.92.0000
                                                                                                    6302.60.0010
                                                                                                    6302.60.0030
                                                                                                    6302.91.0005
                                                                                                    6302.91.0050
                                                                                                    6307.90.8910
                                                                                                    6307.90.8945
                                                                                                    5701.90.2020
                                                                                                    5702.39.2010
                                                                                                    5702.50.5600
                                                                                                    5702.99.0500
                                                                                                    5702.99.1500
                                                                                                    5705.00.2020
                                                                                                    5807.10.0510
                                                                                                    5807.90.0510
                                                                                                    6307.90.3010
                                                                                                    6301.30.0010
                                                                                                    6305.20.0000
                                                                                                    6307.10.1020
                                                                                                    6307.10.1090
                                                                                                    6406.10.7700
                                                                                                    9404.90.1000
                                                                                                    9404.90.9505
                                                                                                    6301.30.0020
                                                                                                    6302.91.0045
----------------------------------------------------------------------------------------------------------------
465                                                                                                 5701.10.9000
                                                                                                    5702.50.2000
                                                                                                    5702.50.4000
                                                                                                    5702.91.3000
                                                                                                    5702.91.4000
                                                                                                    5703.10.2000
                                                                                                    5703.10.8000
                                                                                                    5704.10.0010
                                                                                                    5705.00.2005
                                                                                                    5705.00.2015
                                                                                                    5702.31.1000
                                                                                                    5702.31.2000
----------------------------------------------------------------------------------------------------------------
469                                                                                                 6304.19.3040
                                                                                                    6304.91.0050
                                                                                                    6304.99.1500
                                                                                                    6304.99.6010
                                                                                                    5601.29.0020
                                                                                                    6302.39.0010
                                                                                                    6406.10.9020
----------------------------------------------------------------------------------------------------------------
665                                                                                                 5701.90.1030
                                                                                                    5701.90.2030
                                                                                                    5702.32.1000
                                                                                                    5702.32.2000
                                                                                                    5702.42.2090
                                                                                                    5702.50.5200
                                                                                                    5702.92.1000
                                                                                                    5702.92.9000
                                                                                                    5703.20.1000
                                                                                                    5703.30.2000
                                                                                                    5703.30.8030
                                                                                                    5703.30.8080
                                                                                                    5704.10.0090
                                                                                                    5705.00.2030
                                                                                                    5703.20.2010
                                                                                                    5703.20.2090
----------------------------------------------------------------------------------------------------------------
666                                                                                                 6304.11.2000
                                                                                                    6304.91.0040
                                                                                                    6304.93.0000
                                                                                                    6304.99.6020
                                                                                                    6301.40.0010
                                                                                                    6301.40.0020
                                                                                                    6301.90.0010
----------------------------------------------------------------------------------------------------------------
669                                                                                                 5601.10.2000
                                                                                                    5601.22.0090
                                                                                                    5807.10.0520
                                                                                                    5807.90.0520
                                                                                                    6307.90.3020
                                                                                                    6305.32.0010
                                                                                                    6305.32.0020
                                                                                                    6305.32.0050
                                                                                                    6305.32.0060
                                                                                                    6305.39.0000
                                                                                                    6406.10.9040
                                                                                                    6308.00.0020
----------------------------------------------------------------------------------------------------------------
899                                                                                                 6304.11.3000
                                                                                                    6304.19.3060
                                                                                                    6304.91.0070
                                                                                                    6304.99.3500
                                                                                                    6304.99.6040
                                                                                                    5601.29.0090
                                                                                                    6301.90.0030
                                                                                                    6305.90.0000
                                                                                                    6406.10.9060
----------------------------------------------------------------------------------------------------------------
900                                                                                                 5601.29.0010
                                                                                                    5701.90.2010
                                                                                                    6301.90.0020
----------------------------------------------------------------------------------------------------------------

                          (iii) Other articles described.--
                        Made-up textile articles described in 
                        this clause are articles that fall 
                        within statistical reporting number 
                        6406.10.9090 of the HTS (as in effect 
                        on the day before the date of the 
                        enactment of this subparagraph).
                          (iv) Category defined.--In this 
                        subparagraph, the term ``category'' has 
                        the meaning given that term in 
                        paragraph (2A)(E) of this subsection.
          (4) Earned import allowance rule.--
                  (A) In general.--Apparel articles wholly 
                assembled, or knit-to-shape, in Haiti from any 
                combination of fabrics, fabric components, 
                components knit-to-shape, or yarns and imported 
                directly from Haiti or the Dominican Republic 
                shall enter the United States free of duty, 
                without regard to the source of the fabric, 
                fabric components, components knit-to-shape, or 
                yarns from which the articles are made, if such 
                apparel articles are accompanied by an earned 
                import allowance certificate that reflects the 
                amount of credits equal to the total square 
                meter equivalents of such apparel articles, in 
                accordance with the program established under 
                subparagraph (B). For purposes of determining 
                the quantity of square meter equivalents under 
                this subparagraph, the conversion factors 
                listed in ``Correlation: U.S. Textile and 
                Apparel Industry Category System with the 
                Harmonized Tariff Schedule of the United States 
                of America, 2008'', or its successor 
                publications, of the United States Department 
                of Commerce, shall apply.
                  (B) Earned import allowance program.--
                          (i) Establishment.--The Secretary of 
                        Commerce shall establish a program to 
                        provide earned import allowance 
                        certificates to any producer or entity 
                        controlling production for purposes of 
                        subparagraph (A), based on the elements 
                        described in clause (ii).
                          (ii) Elements.--The elements referred 
                        to in clause (i) are the following:
                                  (I) One credit shall be 
                                issued to a producer or an 
                                entity controlling production 
                                for every two square meter 
                                equivalents of qualifying woven 
                                fabric or qualifying knit 
                                fabric that the producer or 
                                entity controlling production 
                                can demonstrate that it 
                                purchased for the manufacture 
                                in Haiti of articles like or 
                                similar to any article eligible 
                                for preferential treatment 
                                under subparagraph (A). The 
                                Secretary of Commerce shall, if 
                                requested by a producer or 
                                entity controlling production, 
                                create and maintain an account 
                                for such producer or entity 
                                controlling production, into 
                                which such credits shall be 
                                deposited.
                                  (II) Such producer or entity 
                                controlling production may 
                                redeem credits issued under 
                                subclause (I) for earned import 
                                allowance certificates 
                                reflecting such number of 
                                earned credits as the producer 
                                or entity may request and has 
                                available.
                                  (III) The Secretary of 
                                Commerce may require any 
                                textile mill or other entity 
                                located in the United States 
                                that exports to Haiti 
                                qualifying woven fabric or 
                                qualifying knit fabric to 
                                submit, upon such export or 
                                upon request, documentation, 
                                such as a Shipper's Export 
                                Declaration, to the Secretary 
                                of Commerce--
                                          (aa) verifying that 
                                        the qualifying woven 
                                        fabric or qualifying 
                                        knit fabric was 
                                        exported to a producer 
                                        in Haiti or to an 
                                        entity controlling 
                                        production; and
                                          (bb) identifying such 
                                        producer or entity 
                                        controlling production, 
                                        and the quantity and 
                                        description of 
                                        qualifying woven fabric 
                                        or qualifying knit 
                                        fabric exported to such 
                                        producer or entity 
                                        controlling production.
                                  (IV) The Secretary of 
                                Commerce may require that a 
                                producer or entity controlling 
                                production submit documentation 
                                to verify purchases of 
                                qualifying woven fabric or 
                                qualifying knit fabric.
                                  (V) The Secretary of Commerce 
                                may make available to each 
                                person or entity identified in 
                                documentation submitted under 
                                subclause (III) or (IV) 
                                information contained in such 
                                documentation that relates to 
                                the purchase of qualifying 
                                woven fabric or qualifying knit 
                                fabric involving such person or 
                                entity.
                                  (VI) The program under this 
                                subparagraph shall be 
                                established so as to allow, to 
                                the extent feasible, the 
                                submission, storage, retrieval, 
                                and disclosure of information 
                                in electronic format, including 
                                information with respect to the 
                                earned import allowance 
                                certificates required under 
                                subparagraph (A)(i).
                                  (VII) The Secretary of 
                                Commerce may reconcile 
                                discrepancies in information 
                                provided under subclause (III) 
                                or (IV) and verify the accuracy 
                                of such information.
                                  (VIII) The Secretary of 
                                Commerce shall establish 
                                procedures to carry out the 
                                program under this subparagraph 
                                and may establish additional 
                                requirements to carry out this 
                                subparagraph. Such additional 
                                requirements may include--
                                          (aa) submissions by 
                                        textile mills or other 
                                        entities in the United 
                                        States documenting 
                                        exports of yarns wholly 
                                        formed in the United 
                                        States to countries 
                                        described in paragraph 
                                        (1)(B)(iii) for the 
                                        manufacture of 
                                        qualifying knit fabric; 
                                        and
                                          (bb) procedures 
                                        imposed on producers or 
                                        entities controlling 
                                        production to allow the 
                                        Secretary of Commerce 
                                        to obtain and verify 
                                        information relating to 
                                        the production of 
                                        qualifying knit fabric.
                          (iii) Qualifying woven fabric 
                        defined.--For purposes of this 
                        subparagraph, the term ``qualifying 
                        woven fabric'' means fabric wholly 
                        formed in the United States from yarns 
                        wholly formed in the United States, 
                        except that--
                                  (I) fabric otherwise eligible 
                                as qualifying woven fabric 
                                shall not be ineligible as 
                                qualifying woven fabric because 
                                the fabric contains nylon 
                                filament yarn to which section 
                                213(b)(2)(A)(vii)(IV) applies;
                                  (II) fabric that would 
                                otherwise be ineligible as 
                                qualifying woven fabric because 
                                the fabric contains yarns not 
                                wholly formed in the United 
                                States shall not be ineligible 
                                as qualifying woven fabric if 
                                the total weight of all such 
                                yarns is not more than 10 
                                percent of the total weight of 
                                the fabric; and
                                  (III) fabric otherwise 
                                eligible as qualifying woven 
                                fabric shall not be ineligible 
                                as qualifying fabric because 
                                the fabric contains yarns 
                                covered by clause (i) or (ii) 
                                of paragraph (5)(A).
                          (iv) Qualifying knit fabric 
                        defined.--For purposes of this 
                        subparagraph, the term ``qualifying 
                        knit fabric'' means fabric or knit-to-
                        shape components wholly formed or knit-
                        to-shape in any country or any 
                        combination of countries described in 
                        paragraph (1)(B)(iii), from yarns 
                        wholly formed in the United States, 
                        except that--
                                  (I) fabric or knit-to-shape 
                                components otherwise eligible 
                                as qualifying knit fabric shall 
                                not be ineligible as qualifying 
                                knit fabric because the fabric 
                                or knit-to-shape components 
                                contain nylon filament yarn to 
                                which section 
                                213(b)(2)(A)(vii)(IV) applies;
                                  (II) fabric or knit-to-shape 
                                components that would otherwise 
                                be ineligible as qualifying 
                                knit fabric because the fabric 
                                or knit-to-shape components 
                                contain yarns not wholly formed 
                                in the United States shall not 
                                be ineligible as qualifying 
                                knit fabric if the total weight 
                                of all such yarns is not more 
                                than 10 percent of the total 
                                weight of the fabric or knit-
                                to-shape components; and
                                  (III) fabric or knit-to-shape 
                                components otherwise eligible 
                                as qualifying knit fabric shall 
                                not be ineligible as qualifying 
                                knit fabric because the fabric 
                                or knit-to-shape components 
                                contain yarns covered by clause 
                                (i) or (ii) of paragraph 
                                (5)(A).
                  (C) Enforcement provisions.--
                          (i) Fraudulent claims of 
                        preference.--Any person who makes a 
                        false claim for preference under the 
                        program established under subparagraph 
                        (B) shall be subject to any applicable 
                        civil or criminal penalty that may be 
                        imposed under the customs laws of the 
                        United States or under title 18, United 
                        States Code.
                          (ii) Penalties for other fraudulent 
                        information.--The Secretary of Commerce 
                        may establish and impose penalties for 
                        the submission to the Secretary of 
                        Commerce of fraudulent information 
                        under the program established under 
                        subparagraph (B), other than a claim 
                        described in clause (i).
          (5) Short supply provision.--
                  (A) In general.--Any apparel article that is 
                wholly assembled, or knit-to-shape, in Haiti 
                from any combination of fabrics, fabric 
                components, components knit-to-shape, or yarns 
                and is imported directly from Haiti or the 
                Dominican Republic shall enter the United 
                States free of duty, without regard to the 
                source of the fabrics, fabric components, 
                components knit-to-shape, or yarns from which 
                the article is made, if the fabrics, fabric 
                components, components knit-to-shape, or yarns 
                comprising the component that determines the 
                tariff classification of the article are of any 
                of the following:
                          (i) Fabrics or yarns, to the extent 
                        that apparel articles of such fabrics 
                        or yarns would be eligible for 
                        preferential treatment, without regard 
                        to the source of the fabrics or yarns, 
                        under Annex 401 of the NAFTA.
                          (ii) Fabrics or yarns, to the extent 
                        that such fabrics or yarns are 
                        designated as not being available in 
                        commercial quantities for purposes of--
                                  (I) section 213(b)(2)(A)(v) 
                                of this Act;
                                  (II) section 112(b)(5) of the 
                                African Growth and Opportunity 
                                Act;
                                  (III) clause (i)(III) or (ii) 
                                of section 204(b)(3)(B) of the 
                                Andean Trade Preference Act; or
                                  (IV) any other provision, 
                                relating to determining whether 
                                a textile or apparel article is 
                                an originating good eligible 
                                for preferential treatment, of 
                                a law that implements a free 
                                trade agreement entered into by 
                                the United States that is in 
                                effect at the time the claim 
                                for preferential treatment is 
                                made.
                  (B) Removal of designation of fabrics or 
                yarns not available in commercial quantities.--
                If the President determines that--
                          (i) any fabric or yarn described in 
                        clause (i) of subparagraph (A) was 
                        determined to be eligible for 
                        preferential treatment, or
                          (ii) any fabric or yarn described in 
                        clause (ii) of subparagraph (A) was 
                        designated as not being available in 
                        commercial quantities,
                on the basis of fraud, the President is 
                authorized to remove the eligibility or 
                designation (as the case may be) of that fabric 
                or yarn with respect to articles entered after 
                such removal.
          (6) Other preferential treatment not affected.--The 
        duty-free treatment provided under this subsection is 
        in addition to any other preferential treatment under 
        this title.
  (c) Special Rule for Certain Wire Harness Automotive 
Components.--
          (1) In general.--Any wire harness automotive 
        component that is the product or manufacture of Haiti 
        and is imported directly from Haiti into the customs 
        territory of the United States shall enter the United 
        States free of duty, during the 10-year period 
        beginning on the date of the enactment of the Haitian 
        Hemispheric Opportunity through Partnership 
        Encouragement Act of 2006, if Haiti has met the 
        requirements of subsection (d) and if the sum of--
                  (A) the cost or value of the materials 
                produced in Haiti or one or more countries 
                described in subsection (b)(2)(C), or any 
                combination thereof, plus
                  (B) the direct costs of processing operations 
                (as defined in section 213(a)(3)) performed in 
                Haiti or the United States, or both,
        is not less than 50 percent of the declared customs 
        value of such wire harness automotive component.
          (2) Wire harness automotive component.--For purposes 
        of this subsection, the term ``wire harness automotive 
        component'' means any article provided for in 
        subheading 8544.30.00 of the HTS, as in effect on the 
        date of the enactment of the Haitian Hemispheric 
        Opportunity through Partnership Encouragement Act of 
        2006.
  (d) Eligibility Requirements.--
          (1) In general.--Haiti shall be eligible for 
        preferential treatment under this section if the 
        President determines and certifies to Congress that 
        Haiti--
                  (A) has established, or is making continual 
                progress toward establishing--
                          (i) a market-based economy that 
                        protects private property rights, 
                        incorporates an open rules-based 
                        trading system, and minimizes 
                        government interference in the economy 
                        through measures such as price 
                        controls, subsidies, and government 
                        ownership of economic assets;
                          (ii) the rule of law, political 
                        pluralism, and the right to due 
                        process, a fair trial, and equal 
                        protection under the law;
                          (iii) the elimination of barriers to 
                        United States trade and investment, 
                        including by--
                                  (I) the provision of national 
                                treatment and measures to 
                                create an environment conducive 
                                to domestic and foreign 
                                investment;
                                  (II) the protection of 
                                intellectual property; and
                                  (III) the resolution of 
                                bilateral trade and investment 
                                disputes;
                          (iv) economic policies to reduce 
                        poverty, increase the availability of 
                        health care and educational 
                        opportunities, expand physical 
                        infrastructure, promote the development 
                        of private enterprise, and encourage 
                        the formation of capital markets 
                        through microcredit or other programs;
                          (v) a system to combat corruption and 
                        bribery, such as signing and 
                        implementing the Convention on 
                        Combating Bribery of Foreign Public 
                        Officials in International Business 
                        Transactions; and
                          (vi) protection of internationally 
                        recognized worker rights, including the 
                        right of association, the right to 
                        organize and bargain collectively, a 
                        prohibition on the use of any form of 
                        forced or compulsory labor, a minimum 
                        age for the employment of children, and 
                        acceptable conditions of work with 
                        respect to minimum wages, hours of 
                        work, and occupational safety and 
                        health;
                  (B) does not engage in activities that 
                undermine United States national security or 
                foreign policy interests; and
                  (C) does not engage in gross violations of 
                internationally recognized human rights or 
                provide support for acts of international 
                terrorism and cooperates in international 
                efforts to eliminate human rights violations 
                and terrorist activities.
          (2) Time limit for determination.--The President 
        shall determine whether Haiti meets the requirements of 
        paragraph (1) not later than 90 days after the date of 
        the enactment of the Haitian Hemispheric Opportunity 
        through Partnership Encouragement Act of 2006.
          (3) Continuing compliance.--If the President 
        determines that Haiti is not making continual progress 
        in meeting the requirements described in paragraph 
        (1)(A), the President shall terminate the preferential 
        treatment under this section.
          (4) Petition process.--Any interested party may file 
        a request to have the status of Haiti reviewed with 
        respect to the eligibility requirements listed in 
        paragraph (1), and the President shall provide for this 
        purpose the same procedures as those that are provided 
        for reviewing the status of eligible beneficiary 
        developing countries with respect to the designation 
        criteria listed in subsections (b) and (c) of section 
        502 of the Trade Act of 1974 (19 U.S.C. 2642 (b) and 
        (c)).
  (e) Technical Assistance Improvement and Compliance Needs 
Assessment and Remediation Program.--
          (1) Continued eligibility for preferences.--
                  (A) Presidential certification of compliance 
                by haiti with requirements.--Upon the 
                expiration of the 16-month period beginning on 
                the date of the enactment of the Haitian 
                Hemispheric Opportunity through Partnership 
                Encouragement Act of 2008, Haiti shall continue 
                to be eligible for the preferential treatment 
                provided under subsection (b) only if the 
                President determines and certifies to the 
                Congress that--
                          (i) Haiti has implemented the 
                        requirements set forth in paragraphs 
                        (2) and (3); and
                          (ii) Haiti has agreed to require 
                        producers of articles for which duty-
                        free treatment may be requested under 
                        subsection (b) to participate in the 
                        TAICNAR Program described in paragraph 
                        (3) and has developed a system to 
                        ensure participation in such program by 
                        such producers, including by developing 
                        and maintaining the registry described 
                        in paragraph (2)(B)(i).
                  (B) Extension.--The President may extend the 
                period for compliance by Haiti under 
                subparagraph (A) if the President--
                          (i) determines that Haiti has made a 
                        good faith effort toward such 
                        compliance and has agreed to take 
                        additional steps to come into full 
                        compliance that are satisfactory to the 
                        President; and
                          (ii) provides to the appropriate 
                        congressional committees, not later 
                        than 6 months after the last day of the 
                        16-month period specified in 
                        subparagraph (A), and every 6 months 
                        thereafter, a report identifying the 
                        steps that Haiti has agreed to take to 
                        come into full compliance and the 
                        progress made over the preceding 6-
                        month period in implementing such 
                        steps.
                  (C) Continuing compliance.--
                          (i) Termination of preferential 
                        treatment.--If, after making a 
                        certification under subparagraph (A), 
                        the President determines that Haiti is 
                        no longer meeting the requirements set 
                        forth in subparagraph (A), the 
                        President shall terminate the 
                        preferential treatment provided under 
                        subsection (b), unless the President 
                        determines, after consulting with the 
                        appropriate congressional committees, 
                        that meeting such requirements is not 
                        practicable because of extraordinary 
                        circumstances existing in Haiti when 
                        the determination is made.
                          (ii) Subsequent compliance.--If the 
                        President, after terminating 
                        preferential treatment under clause 
                        (i), determines that Haiti is meeting 
                        the requirements set forth in 
                        subparagraph (A), the President shall 
                        reinstate the application of 
                        preferential treatment under subsection 
                        (b).
          (2) Labor ombudsman.--
                  (A) In general.--The requirement under this 
                paragraph is that Haiti has established an 
                independent Labor Ombudsman's Office within the 
                national government that--
                          (i) reports directly to the President 
                        of Haiti;
                          (ii) is headed by a Labor Ombudsman 
                        chosen by the President of Haiti, in 
                        consultation with Haitian labor unions 
                        and industry associations; and
                          (iii) is vested with the authority to 
                        perform the functions described in 
                        subparagraph (B).
                  (B) Functions.--The functions of the Labor 
                Ombudsman's Office shall include--
                          (i) developing and maintaining a 
                        registry of producers of articles for 
                        which duty-free treatment may be 
                        requested under subsection (b), and 
                        developing, in consultation and 
                        coordination with any other appropriate 
                        officials of the Government of Haiti, a 
                        system to ensure participation by such 
                        producers in the TAICNAR Program 
                        described in paragraph (3);
                          (ii) overseeing the implementation of 
                        the TAICNAR Program described in 
                        paragraph (3);
                          (iii) receiving and investigating 
                        comments from any interested party 
                        regarding the conditions described in 
                        paragraph (3)(B) in facilities of 
                        producers listed in the registry 
                        described in clause (i) and, where 
                        appropriate, referring such comments or 
                        the result of such investigations to 
                        the appropriate Haitian authorities, or 
                        to the entity operating the TAICNAR 
                        Program described in paragraph (3);
                          (iv) assisting, in consultation and 
                        coordination with any other appropriate 
                        Haitian authorities, producers listed 
                        in the registry described in clause (i) 
                        in meeting the conditions set forth in 
                        paragraph (3)(B); and
                          (v) coordinating, with the assistance 
                        of the entity operating the TAICNAR 
                        Program described in paragraph (3), a 
                        tripartite committee comprised of 
                        appropriate representatives of 
                        government agencies, employers, and 
                        workers, as well as other relevant 
                        interested parties, for the purposes of 
                        evaluating progress in implementing the 
                        TAICNAR Program described in paragraph 
                        (3), and consulting on improving core 
                        labor standards and working conditions 
                        in the textile and apparel sector in 
                        Haiti, and on other matters of common 
                        concern relating to such core labor 
                        standards and working conditions.
          (3) Technical assistance improvement and compliance 
        needs assessment and remediation program.--
                  (A) In general.--The requirement under this 
                paragraph is that Haiti, in cooperation with 
                the International Labor Organization, has 
                established a Technical Assistance Improvement 
                and Compliance Needs Assessment and Remediation 
                Program meeting the requirements under 
                subparagraph (C)--
                          (i) to assess compliance by producers 
                        listed in the registry described in 
                        paragraph (2)(B)(i) with the conditions 
                        set forth in subparagraph (B) and to 
                        assist such producers in meeting such 
                        conditions; and
                          (ii) to provide assistance to improve 
                        the capacity of the Government of 
                        Haiti--
                                  (I) to inspect facilities of 
                                producers listed in the 
                                registry described in paragraph 
                                (2)(B)(i); and
                                  (II) to enforce national 
                                labor laws and resolve labor 
                                disputes, including through 
                                measures described in 
                                subparagraph (E).
                  (B) Conditions described.--The conditions 
                referred to in subparagraph (A) are--
                          (i) compliance with core labor 
                        standards; and
                          (ii) compliance with the labor laws 
                        of Haiti that relate directly to core 
                        labor standards and to ensuring 
                        acceptable conditions of work with 
                        respect to minimum wages, hours of 
                        work, and occupational health and 
                        safety.
                  (C) Requirements.--The requirements for the 
                TAICNAR Program are that the program--
                          (i) be operated by the International 
                        Labor Organization (or any subdivision, 
                        instrumentality, or designee thereof), 
                        which prepares the biannual reports 
                        described in subparagraph (D);
                          (ii) be developed through a 
                        participatory process that includes the 
                        Labor Ombudsman described in paragraph 
                        (2) and appropriate representatives of 
                        government agencies, employers, and 
                        workers;
                          (iii) assess compliance by each 
                        producer listed in the registry 
                        described in paragraph (2)(B)(i) with 
                        the conditions set forth in 
                        subparagraph (B) and identify any 
                        deficiencies by such producer with 
                        respect to meeting such conditions, 
                        including by--
                                  (I) conducting unannounced 
                                site visits to manufacturing 
                                facilities of the producer;
                                  (II) conducting confidential 
                                interviews separately with 
                                workers and management of the 
                                facilities of the producer;
                                  (III) providing to management 
                                and workers, and where 
                                applicable, worker 
                                organizations in the facilities 
                                of the producer, on a 
                                confidential basis--
                                          (aa) the results of 
                                        the assessment carried 
                                        out under this clause; 
                                        and
                                          (bb) specific 
                                        suggestions for 
                                        remediating any such 
                                        deficiencies;
                          (iv) assist the producer in 
                        remediating any deficiencies identified 
                        under clause (iii);
                          (v) conduct prompt follow-up site 
                        visits to the facilities of the 
                        producer to assess progress on 
                        remediation of any deficiencies 
                        identified under clause (iii); and
                          (vi) provide training to workers and 
                        management of the producer, and where 
                        appropriate, to other persons or 
                        entities, to promote compliance with 
                        subparagraph (B).
                  (D) Biannual report.--The biannual reports 
                referred to in subparagraph (C)(i) are a 
                report, by the entity operating the TAICNAR 
                Program, that is published (and available to 
                the public in a readily accessible manner) on a 
                biannual basis, beginning 6 months after Haiti 
                implements the TAICNAR Program under this 
                paragraph, covering the preceding 6-month 
                period, and that includes the following:
                          (i) The name of each producer listed 
                        in the registry described in paragraph 
                        (2)(B)(i) that has been identified as 
                        having met the conditions under 
                        subparagraph (B).
                          (ii) The name of each producer listed 
                        in the registry described in paragraph 
                        (2)(B)(i) that has been identified as 
                        having deficiencies with respect to the 
                        conditions under subparagraph (B), and 
                        has failed to remedy such deficiencies.
                          (iii) For each producer listed under 
                        clause (ii)--
                                  (I) a description of the 
                                deficiencies found to exist and 
                                the specific suggestions for 
                                remediating such deficiencies 
                                made by the entity operating 
                                the TAICNAR Program;
                                  (II) a description of the 
                                efforts by the producer to 
                                remediate the deficiencies, 
                                including a description of 
                                assistance provided by any 
                                entity to assist in such 
                                remediation; and
                                  (III) with respect to 
                                deficiencies that have not been 
                                remediated, the amount of time 
                                that has elapsed since the 
                                deficiencies were first 
                                identified in a report under 
                                this subparagraph.
                          (iv) For each producer identified as 
                        having deficiencies with respect to the 
                        conditions described under subparagraph 
                        (B) in a prior report under this 
                        subparagraph, a description of the 
                        progress made in remediating such 
                        deficiencies since the submission of 
                        the prior report, and an assessment of 
                        whether any aspect of such deficiencies 
                        persists.
                  (E) Capacity building.--The assistance to the 
                Government of Haiti referred to in subparagraph 
                (A)(ii) shall include programs--
                          (i) to review the labor laws and 
                        regulations of Haiti and to develop and 
                        implement strategies for bringing the 
                        laws and regulations into conformity 
                        with core labor standards;
                          (ii) to develop additional strategies 
                        for facilitating protection of core 
                        labor standards and providing 
                        acceptable conditions of work with 
                        respect to minimum wages, hours of 
                        work, and occupational safety and 
                        health, including through legal, 
                        regulatory, and institutional reform;
                          (iii) to increase awareness of worker 
                        rights, including under core labor 
                        standards and national labor laws;
                          (iv) to promote consultation and 
                        cooperation between government 
                        representatives, employers, worker 
                        representatives, and United States 
                        importers on matters relating to core 
                        labor standards and national labor 
                        laws;
                          (v) to assist the Labor Ombudsman 
                        appointed pursuant to paragraph (2) in 
                        establishing and coordinating operation 
                        of the committee described in paragraph 
                        (2)(B)(v);
                          (vi) to assist worker representatives 
                        in more fully and effectively 
                        advocating on behalf of their members; 
                        and
                          (vii) to provide on-the-job training 
                        and technical assistance to labor 
                        inspectors, judicial officers, and 
                        other relevant personnel to build their 
                        capacity to enforce national labor laws 
                        and resolve labor disputes.
          (4) Compliance with eligibility criteria.--
                  (A) Country compliance with worker rights 
                eligibility criteria.--In making a 
                determination of whether Haiti is meeting the 
                requirement set forth in subsection 
                (d)(1)(A)(vi) relating to internationally 
                recognized worker rights, the President shall 
                consider the reports produced under paragraph 
                (3)(D).
                  (B) Producer eligibility.--
                          (i) Identification of producers.--
                        Beginning in the second calendar year 
                        after the President makes the 
                        certification under paragraph (1)(A), 
                        the President shall identify on a 
                        biennial basis whether a producer 
                        listed in the registry described in 
                        paragraph (2)(B)(i) has failed to 
                        comply with core labor standards and 
                        with the labor laws of Haiti that 
                        directly relate to and are consistent 
                        with core labor standards.
                          (ii) Assistance to producers; 
                        withdrawal, etc., of preferential 
                        treatment.--For each producer that the 
                        President identifies under clause (i), 
                        the President shall seek to assist such 
                        producer in coming into compliance with 
                        core labor standards and with the labor 
                        laws of Haiti that directly relate to 
                        and are consistent with core labor 
                        standards. If such efforts fail, the 
                        President shall withdraw, suspend, or 
                        limit the application of preferential 
                        treatment under subsection (b) to 
                        articles of such producer.
                          (iii) Reinstating preferential 
                        treatment.--If the President, after 
                        withdrawing, suspending, or limiting 
                        the application of preferential 
                        treatment under clause (ii) to articles 
                        of a producer, determines that such 
                        producer is complying with core labor 
                        standards and with the labor laws of 
                        Haiti that directly relate to and are 
                        consistent with core labor standards, 
                        the President shall reinstate the 
                        application of preferential treatment 
                        under subsection (b) to the articles of 
                        the producer.
                          (iv) Consideration of reports.--In 
                        making the identification under clause 
                        (i) and the determination under clause 
                        (iii), the President shall consider the 
                        reports made available under paragraph 
                        (3)(D).
          (5) Reports by the president.--
                  (A) In general.--Not later than one year 
                after the date of the enactment of the Haitian 
                Hemispheric Opportunity through Partnership 
                Encouragement Act of 2008, and annually 
                thereafter, the President shall transmit to the 
                appropriate congressional committees a report 
                on the implementation of this subsection during 
                the preceding 1-year period.
                  (B) Matters to be included.--Each report 
                required by subparagraph (A) shall include the 
                following:
                          (i) An explanation of the efforts of 
                        Haiti, the President, and the 
                        International Labor Organization to 
                        carry out this subsection.
                          (ii) A summary of each report 
                        produced under paragraph (3)(D) during 
                        the preceding 1-year period and a 
                        summary of the findings contained in 
                        such report.
                          (iii) Identifications made under 
                        paragraph (4)(B)(i) and determinations 
                        made under paragraph (4)(B)(iii).
          (6) Authorization of appropriations.--There is 
        authorized to be appropriated to carry out this 
        subsection the sum of $10,000,000 for the period 
        beginning on October 1, 2008, and ending on September 
        30, 2013.
  (f) Conditions Regarding Enforcement of Circumvention.--
          (1) In general.--The preferential treatment under 
        subsection (b)(1) shall not apply unless the President 
        certifies to Congress that Haiti is meeting the 
        following conditions:
                  (A) Haiti has adopted an effective visa 
                system, domestic laws, and enforcement 
                procedures applicable to articles described in 
                subsection (b) to prevent unlawful 
                transshipment of the articles and the use of 
                counterfeit documents relating to the 
                importation of the articles into the United 
                States.
                  (B) Haiti has enacted legislation or 
                promulgated regulations that would permit U.S. 
                Customs and Border Protection verification 
                teams to have the access necessary to 
                investigate thoroughly allegations of 
                transshipment through such country.
                  (C) Haiti agrees to report, on a timely 
                basis, at the request of U.S. Customs and 
                Border Protection, on the total exports from 
                and imports into that country of articles 
                described in subsection (b), consistent with 
                the manner in which the records are kept by 
                Haiti.
                  (D) Haiti agrees to cooperate fully with the 
                United States to address and take action 
                necessary to prevent circumvention as provided 
                in Article 5 of the Agreement on Textiles and 
                Clothing.
                  (E) Haiti agrees to require all producers and 
                exporters of articles described in subsection 
                (b) in that country to maintain complete 
                records of the production and the export of 
                such articles, including materials used in the 
                production, for at least 5 years after the 
                production or export (as the case may be).
                  (F) Haiti agrees to report, on a timely 
                basis, at the request of U.S. Customs and 
                Border Protection, documentation establishing 
                the country of origin of articles described in 
                subsection (b) as used by that country in 
                implementing an effective visa system.
          (2) Definition of transshipment.--Transshipment 
        within the meaning of this subsection has occurred when 
        preferential treatment for a textile or apparel article 
        under this section has been claimed 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 
        paragraph, 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 this section.
          (3) Limitation on goods shipped from the dominican 
        republic.--
                  (A) Limitation.--Notwithstanding subsection 
                (a)(5), relating to the definition of 
                ``imported directly from Haiti or the Dominican 
                Republic'', articles described in subsection 
                (b) that are shipped from the Dominican 
                Republic, directly or through the territory of 
                an intermediate country, whether or not such 
                articles undergo processing in the Dominican 
                Republic, shall not be considered to be 
                ``imported directly from Haiti or the Dominican 
                Republic'' until the President certifies to the 
                Congress that Haiti and the Dominican Republic 
                have developed procedures to prevent unlawful 
                transshipment of the articles and the use of 
                counterfeit documents related to the 
                importation of the articles into the United 
                States.
                  (B) Technical and other assistance.--The 
                Commissioner responsible for U.S. Customs and 
                Border Protection shall provide technical and 
                other assistance to Haiti and the Dominican 
                Republic to develop expeditiously the 
                procedures described in subparagraph (A).
  (g) Regulations.--The President shall issue regulations to 
carry out this section not later than 180 days after the date 
of the enactment of the Haitian Hemispheric Opportunity through 
Partnership Encouragement Act of 2006. The President shall 
consult with the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate in 
preparing such regulations.
  (h) Termination.--Except as provided in subsection (b)(1), 
the duty-free treatment provided under this section shall 
remain in effect until [September 30, 2020] September 30, 2025.

           *       *       *       *       *       *       *

                              ----------                              


         CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF 1985



           *       *       *       *       *       *       *
SEC. 13031. FEES FOR CERTAIN CUSTOMS SERVICES.

  (a) Schedule of Fees.--In addition to any other fee 
authorized by law, the Secretary of the Treasury shall charge 
and collect the following fees for the provision of customs 
services in connection with the following:
          (1) For the arrival of a commercial vessel of 100 net 
        tons or more, $397.
          (2) For the arrival of a commercial truck, $5.
          (3) For the arrival of each railroad car carrying 
        passengers or commercial freight, $7.50.
          (4) For all arrivals made during a calendar year by a 
        private vessel or private aircraft, $25.
          (5)(A) Subject to subparagraph (B), for the arrival 
        of each passenger aboard a commercial vessel or 
        commercial aircraft from a place outside the United 
        States (other than a place referred to in subsection 
        (b)(1)(A)(i) of this section), $5.
          (B) For the arrival of each passenger aboard a 
        commercial vessel from a place referred to in 
        subsection (b)(1)(A)(i) of this section, $1.75.
          (6) For each item of dutiable mail for which a 
        document is prepared by a customs officer, $5.
          (7) For each customs broker permit held by an 
        individual, partnership, association, or corporate 
        customs broker, $125 per year.
          (8) For the arrival of a barge or other bulk carrier 
        from Canada or Mexico, $100.
          (9)(A) For the processing of merchandise that is 
        formally entered or released during any fiscal year, a 
        fee in an amount equal to 0.21 percent ad valorem, 
        unless adjusted under subparagraph (B).
          (B)(i) The Secretary of the Treasury may adjust the 
        ad valorem rate specified in subparagraph (A) to an ad 
        valorem rate (but not to a rate of more than 0.21 
        percent nor less than 0.15 percent) and the amounts 
        specified in subsection (b)(8)(A)(i) (but not to more 
        than $485 nor less than $21) to rates and amounts which 
        would, if charged, offset the salaries and expenses 
        that will likely be incurred by the Customs Service in 
        the processing of such entries and releases during the 
        fiscal year in which such costs are incurred.
          (ii) In determining the amount of any adjustment 
        under clause (i), the Secretary of the Treasury shall 
        take into account whether there is a surplus or deficit 
        in the fund established under subsection (f) with 
        respect to the provision of customs services for the 
        processing of formal entries and releases of 
        merchandise.
          (iii) An adjustment may not be made under clause (i) 
        with respect to the fee charged during any fiscal year 
        unless the Secretary of the Treasury--
                  (I) not later than 45 days after the date of 
                the enactment of the Act providing full-year 
                appropriations for the Customs Service for that 
                fiscal year, publishes in the Federal Register 
                a notice of intent to adjust the fee under this 
                paragraph and the amount of such adjustment;
                  (II) provides a period of not less than 30 
                days following publication of the notice 
                described in subclause (I) for public comment 
                and consultation with the Committee on Finance 
                of the Senate and the Committee on Ways and 
                Means of the House of Representatives regarding 
                the proposed adjustment and the methodology 
                used to determine such adjustment;
                  (III) upon the expiration of the period 
                provided under subclause (II), notifies such 
                committees in writing regarding the final 
                determination to adjust the fee, the amount of 
                such adjustment, and the methodology used to 
                determine such adjustment; and
                  (IV) upon the expiration of the 15-day period 
                following the written notification described in 
                subclause (III), submits for publication in the 
                Federal Register notice of the final 
                determination regarding the adjustment of the 
                fee.
          (iv) The 15-day period referred to in clause 
        (iii)(IV) shall be computed by excluding--
                  (I) the days on which either House is not in 
                session because of an adjournment of more than 
                3 days to a day certain or an adjournment of 
                the Congress sine die; and
                  (II) any Saturday and Sunday, not excluded 
                under subclause (I), when either House is not 
                in session.
          (v) An adjustment made under this subparagraph shall 
        become effective with respect to formal entries and 
        releases made on or after the 15th calendar day after 
        the date of publication of the notice described in 
        clause (iii)(IV) and shall remain in effect until 
        adjusted under this subparagraph.
          (C) Any fee charged under this paragraph, whether or 
        not adjusted under subparagraph (B), is subject to the 
        limitations in subsection (b)(8)(A).
          (10) For the processing of merchandise that is 
        informally entered or released, other than at--
                  (A) a centralized hub facility,
                  (B) an express consignment carrier facility, 
                or
                  (C) a small airport or other facility to 
                which section 236 of the Trade and Tariff Act 
                of 1984 applies, if more than 25,000 informal 
                entries were cleared through such airport or 
                facility during the fiscal year preceding such 
                entry or release, a fee of--
                          (i) $2 if the entry or release is 
                        automated and not prepared by customs 
                        personnel;
                          (ii) $6 if the entry or release is 
                        manual and not prepared by customs 
                        personnel; or
                          (iii) $9 if the entry or release, 
                        whether automated or manual, is 
                        prepared by customs personnel.
                For provisions relating to the informal entry 
                or release of merchandise at facilities 
                referred to in subparagraphs (A), (B), and (C), 
                see subsection (b)(9).
  (b) Limitations on Fees.--(1)(A) Except as provided in 
subsection (a)(5)(B) of this section, no fee may be charged 
under subsection (a) of this section for customs services 
provided in connection with--
          (i) the arrival of any passenger whose journey--
                  (I) originated in a territory or possession 
                of the United States; or
                  (II) originated in the United States and was 
                limited to territories and possessions of the 
                United States;
          (ii) the arrival of any railroad car the journey of 
        which originates and terminates in the same country, 
        but only if no passengers board or disembark from the 
        train and no cargo is loaded or unloaded from such car 
        while the car is within any country other than the 
        country in which such car originates and terminates;
          (iii) the arrival of a ferry, except for a ferry 
        whose operations begin on or after August 1, 1999, and 
        that operates south of 27 degrees latitude and east of 
        89 degrees longitude; or
          (iv) the arrival of any passenger on board a 
        commercial vessel traveling only between ports which 
        are within the customs territory of the United States.
  (B) The exemption provided for in subparagraph (A) shall not 
apply in the case of the arrival of any passenger on board a 
commercial vessel whose journey originates and terminates at 
the same place in the United States if there are no intervening 
stops.
  (C) The exemption provided for in subparagraph (A)(i) shall 
not apply to fiscal years 1994, 1995, 1996, and 1997.
  (2) No fee may be charged under subsection (a)(2) for the 
arrival of a commercial truck during any calendar year after a 
total of $100 in fees has been paid to the Secretary of the 
Treasury for the provision of customs services for all arrivals 
of such commercial truck during such calendar year.
  (3) No fee may be charged under subsection (a)(3) for the 
arrival of a railroad car whether passenger or freight during 
any calendar year after a total of $100 in fees has been paid 
to the Secretary of the Treasury for the provision of customs 
services for all arrivals of such passenger or freight rail car 
during such calendar year.
  (4)(A) No fee may be charged under subsection (a)(5) with 
respect to the arrival of any passenger--
          (i) who is in transit to a destination outside the 
        customs territory of the United States, and
          (ii) for whom customs inspectional services are not 
        provided.
  (B) In the case of a commercial vessel making a single voyage 
involving 2 or more United States ports with respect to which 
the passengers would otherwise be charged a fee pursuant to 
subsection (a)(5), such fee shall be charged only 1 time for 
each passenger.
  (5) No fee may be charged under subsection (a)(1) for the 
arrival of--
          (A) a vessel during a calendar year after a total of 
        $5,955 in fees charged under paragraph (1) or (8) of 
        subsection (a) has been paid to the Secretary of the 
        Treasury for the provision of customs services for all 
        arrivals of such vessel during such calendar year,
          (B) any vessel which, at the time of the arrival, is 
        being used solely as a tugboat, or
          (C) any barge or other bulk carrier from Canada or 
        Mexico.
  (6) No fee may be charged under subsection (a)(8) for the 
arrival of a barge or other bulk carrier during a calendar year 
after a total of $1,500 in fees charged under paragraph (1) or 
(8) of subsection (a) has been paid to the Secretary of the 
Treasury for the provision of customs services for all arrivals 
of such barge or other bulk carrier during such calendar year.
  (7) No fee may be charged under paragraph (2), (3), or (4) of 
subsection (a) for the arrival of any--
          (A) commercial truck,
          (B) railroad car, or
          (C) private vessel,
that is being transported, at the time of the arrival, by any 
vessel that is not a ferry.
  (8)(A)(i) Subject to clause (ii), the fee charged under 
subsection (a)(9) for the formal entry or release of 
merchandise may not exceed $485 or be less than $25, unless 
adjusted pursuant to subsection (a)(9)(B).
  (ii) A surcharge of $3 shall be added to the fee determined 
after application of clause (i) for any manual entry or release 
of merchandise.
  (B) No fee may be charged under subsection (a) (9) or (10) 
for the processing of any article that is--
          (i) provided for under any item in chapter 98 of the 
        Harmonized Tariff Schedule of the United States, except 
        subheading 9802.00.60 or 9802.00.80,
          (ii) a product of an insular possession of the United 
        States, or
          (iii) a product of any country listed in subdivision 
        (c)(ii)(B) or (c)(v) of general note 3 to such 
        Schedule.
  (C) For purposes of applying subsection (a) (9) or (10)--
          (i) expenses incurred by the Secretary of the 
        Treasury in the processing of merchandise do not 
        include costs incurred in--
                  (I) air passenger processing,
                  (II) export control, or
                  (III) international affairs, and
          (ii) any reference to a manual formal or informal 
        entry or release includes any entry or release filed by 
        a broker or importer that requires the inputting of 
        cargo selectivity data into the Automated Commercial 
        System by customs personnel, except when--
                  (I) the broker or importer is certified as an 
                ABI cargo release filer under the Automated 
                Commercial System at any port within the United 
                States, or
                  (II) the entry or release is filed at ports 
                prior to the full implementation of the cargo 
                selectivity data system by the Customs Service 
                at such ports.
  (D) The fee charged under subsection (a)(9) or (10) with 
respect to the processing of merchandise shall--
          (i) be paid by the importer of record of the 
        merchandise;
          (ii) except as otherwise provided in this paragraph, 
        be based on the value of the merchandise as determined 
        under section 402 of the Tariff Act of 1930;
          (iii) in the case of merchandise classified under 
        subheading 9802.00.60 of the Harmonized Tariff Schedule 
        of the United States, be applied to the value of the 
        foreign repairs or alterations to the merchandise;
          (iv) in the case of merchandise classified under 
        heading 9802.00.80 of such Schedule, be applied to the 
        full value of the merchandise, less the cost or value 
        of the component United States products;
          (v) in the case of agricultural products of the 
        United States that are processed and packed in a 
        foreign trade zone, be applied only to the value of 
        material used to make the container for such 
        merchandise, if such merchandise is subject to entry 
        and the container is of a kind normally used for 
        packing such merchandise; and
          (vi) in the case of merchandise entered from a 
        foreign trade zone (other than merchandise to which 
        clause (v) applies), be applied only to the value of 
        the privileged or nonprivileged foreign status 
        merchandise under section 3 of the Act of June 18, 1934 
        (commonly known as the Foreign Trade Zones Act, 19 
        U.S.C. 81c).
With respect to merchandise that is classified under subheading 
9802.00.60 or heading 9802.00.80 of such Schedule and is duty-
free, the Secretary may collect the fee charged on the 
processing of the merchandise under subsection (a) (9) or (10) 
on the basis of aggregate data derived from financial and 
manufacturing reports used by the importer in the normal course 
of business, rather than on the basis of entry-by-entry 
accounting.
  (E) For purposes of subsection (a) (9) and (10), merchandise 
is entered or released, as the case may be, if the merchandise 
is--
          (i) permitted or released under section 448(b) of the 
        Tariff Act of 1930,
          (ii) entered or released from customs custody under 
        section 484(a)(1)(A) of the Tariff Act of 1930, or
          (iii) withdrawn from warehouse for consumption.
  (9)(A) With respect to the processing of letters, documents, 
records, shipments, merchandise, or any other item that is 
valued at an amount that is $2,000 or less (or such higher 
amount as the Secretary of the Treasury may set by regulation 
pursuant to section 498 of the Tariff Act of 1930), except such 
items entered for transportation and exportation or immediate 
exportation at a centralized hub facility, an express 
consignment carrier facility, or a small airport or other 
facility, the following reimbursements and payments are 
required:
          (i) In the case of a small airport or other 
        facility--
                  (I) the reimbursement which such facility is 
                required to make during the fiscal year under 
                section 9701 of title 31, United States Code or 
                section 236 of the Trade and Tariff Act of 
                1984; and
                  (II) an annual payment by the facility to the 
                Secretary of the Treasury, which is in lieu of 
                the payment of fees under subsection (a)(10) 
                for such fiscal year, in an amount equal to the 
                reimbursement under subclause (I).
          (ii) Notwithstanding subsection (e)(6) and subject to 
        the provisions of subparagraph (B), in the case of an 
        express consignment carrier facility or centralized hub 
        facility--
                  (I) $.66 per individual airway bill or bill 
                of lading; and
                  (II) if the merchandise is formally entered, 
                the fee provided for in subsection (a)(9), if 
                applicable.
  (B)(i) Beginning in fiscal year 2004, the Secretary of the 
Treasury may adjust (not more than once per fiscal year) the 
amount described in subparagraph (A)(ii) to an amount that is 
not less than $.35 and 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) Notwithstanding section 451 of the 
                Tariff Act of 1930, the payment required by 
                subparagraph (A)(ii) (I) or (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 
                and for providing services at express 
                consignment carrier facilities or centralized 
                hub facilities, except that the Customs Service 
                may require such facilities 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) of this subparagraph 
                shall be paid on a quarterly basis by the 
                carrier using the facility 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) of this subparagraph shall, in accordance 
                with section 524 of the Tariff Act of 1930, be 
                deposited in the Customs User Fee Account and 
                shall be used to directly reimburse each 
                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) of this 
                subparagraph 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.
  (C) For purposes of this paragraph:
          (i) The terms ``centralized hub facility'' and 
        ``express consignment carrier facility'' have the 
        respective meanings that are applied to such terms in 
        part 128 of chapter I of title 19, Code of Federal 
        Regulations. Nothing in this paragraph shall be 
        construed as prohibiting the Secretary of the Treasury 
        from processing merchandise that is informally entered 
        or released at any centralized hub facility or express 
        consignment carrier facility during the normal 
        operating hours of the Customs Service, subject to 
        reimbursement and payment under subparagraph (A).
          (ii) The term ``small airport or other facility'' 
        means any airport or facility to which section 236 of 
        the Trade and Tariff Act of 1984 applies, if more than 
        25,000 informal entries were cleared through such 
        airport or facility during the preceding fiscal year.
  (10)(A) The fee charged under subsection (a) (9) or (10) with 
respect to goods of Canadian origin (as determined under 
section 202 of the United States-Canada Free-Trade Agreement 
Implementation Act of 1988) when the United States-Canada Free-
Trade Agreement is in force shall be in accordance with article 
403 of that Agreement.
  (B) For goods qualifying under the rules of origin set out in 
section 202 of the North American Free Trade Agreement 
Implementation Act, the fee under subsection (a) (9) or (10)--
          (i) may not be charged with respect to goods that 
        qualify to be marked as goods of Canada pursuant to 
        Annex 311 of the North American Free Trade Agreement, 
        for such time as Canada is a NAFTA country, as defined 
        in section 2(4) of such Implementation Act; and
          (ii) may not be increased after December 31, 1993, 
        and may not be charged after June 29, 1999, with 
        respect to goods that qualify to be marked as goods of 
        Mexico pursuant to such Annex 311, for such time as 
        Mexico is a NAFTA country.
Any service for which an exemption from such fee is provided by 
reason of this paragraph may not be funded with money contained 
in the Customs User Fee Account.
  (11) No fee may be charged under subsection (a) (9) or (10) 
with respect to products of Israel if an exemption with respect 
to the fee is implemented under section 112 of the Customs and 
Trade Act of 1990.
  (12) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Chile Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (13) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Singapore Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (14) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Australia Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (15) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the Dominican Republic-Central America-United 
States Free Trade Agreement Implementation Act. Any service for 
which an exemption from such fee is provided by reason of this 
paragraph may not be funded with money contained in the Customs 
User Fee Account.
  (16) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Bahrain Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (17) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Oman Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (18) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Peru Trade Promotion Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (19) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 202 of the United States-Korea Free Trade Agreement 
Implementation Act. Any service for which an exemption from 
such fee is provided by reason of this paragraph may not be 
funded with money contained in the Customs User Fee Account.
  (20) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Colombia Trade Promotion 
Agreement Implementation Act. Any service for which an 
exemption from such fee is provided by reason of this paragraph 
may not be funded with money contained in the Customs User Fee 
Account.
  (21) No fee may be charged under subsection (a)(9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Panama Trade Promotion 
Agreement Implementation Act. Any service for which an 
exemption from such fee is provided by reason of this paragraph 
may not be funded with money contained in the Customs User Fee 
Account.
  (c) Definitions.--For purposes of this section--
          (1) The term ``ferry'' means any vessel which is 
        being used--
                  (A) to provide transportation only between 
                places that are no more than 300 miles apart, 
                and
                  (B) to transport only--
                          (i) passengers, or
                          (ii) vehicles, or railroad cars, 
                        which are being used, or have been 
                        used, in transporting passengers or 
                        goods.
          (2) The term ``arrival'' means arrival at a port of 
        entry in the customs territory of the United States.
          (3) The term ``customs territory of the United 
        States'' has the meaning given to such term by general 
        note 2 of the Harmonized Tariff Schedule of the United 
        States.
          (4) The term ``customs broker permit'' means a permit 
        issued under section 641(c) of the Tariff Act of 1930 
        (19 U.S.C. 1641(c)).
          (5) The term ``barge or other bulk carrier'' means 
        any vessel which--
                  (A) is not self-propelled, or
                  (B) transports fungible goods that are not 
                packaged in any form.
  (d) Collection.--(1) Each person that issues a document or 
ticket to an individual for transportation by a commercial 
vessel or commercial aircraft into the customs territory of the 
United States shall--
          (A) collect from that individual the fee charged 
        under subsection (a)(5) at the time the document or 
        ticket is issued; and
          (B) separately identify on that document or ticket 
        the fee charged under subsection (a)(5) as a Federal 
        inspection fee.
  (2) If--
          (A) a document or ticket for transportation of a 
        passenger into the customs territory of the United 
        States is issued in a foreign country; and
          (B) the fee charged under subsection (a)(5) is not 
        collected at the time such document or ticket is 
        issued;
the person providing transportation to such passenger shall 
collect such fee at the time such passenger departs from the 
customs territory of the United States and shall provide such 
passenger a receipt for the payment of such fee.
  (3) The person who collects fees under paragraph (1) or (2) 
shall remit those fees to the Secretary of the Treasury at any 
time before the date that is 31 days after the close of the 
calendar quarter in which the fees are collected.
  (4)(A) Notice of the date on which payment of the fee imposed 
by subsection (a)(7) is due shall be published by the Secretary 
of the Treasury in the Federal Register by no later than the 
date that is 60 days before such due date.
  (B) A customs broker permit may be revoked or suspended for 
nonpayment of the fee imposed by subsection (a)(7) only if 
notice of the date on which payment of such fee is due was 
published in the Federal Register at least 60 days before such 
due date.
  (C) The customs broker's license issued under section 641(b) 
of the Tariff Act of 1930 (19 U.S.C. 1641(b)) may not be 
revoked or suspended merely by reason of nonpayment of the fee 
imposed under subsection (a)(7).
  (e) Provision of Customs Services.--
  (1) Notwithstanding section 451 of the Tariff Act of 1930 (19 
U.S.C. 1451) or any other provision of law (other than 
paragraph (2)), the customs services required to be provided to 
passengers upon arrival in the United States shall be 
adequately provided in connection with scheduled airline 
flights at customs serviced airports when needed and at no cost 
(other than the fees imposed under subsection (a)) to airlines 
and airline passengers.
  (2)(A) This subsection shall not apply with respect to any 
airport to which section 236 of the Trade and Tariff Act of 
1984 (19 U.S.C. 58b) applies.
  (B) Subparagraph (C) of paragraph (6) shall not apply with 
respect to any foreign trade zone or subzone that is located 
at, or in the vicinity of, an airport to which section 236 of 
the Trade and Tariff Act of 1984 applies.
  (3) Notwithstanding section 451 of the Tariff Act of 1930 (19 
U.S.C. 1451) or any other provision of law--
          (A) the customs services required to be provided to 
        passengers upon arrival in the United States shall be 
        adequately provided in connection with scheduled 
        airline flights when needed at places located outside 
        the customs territory of the United States at which a 
        customs officer is stationed for the purpose of 
        providing such customs services, and
          (B) other than the fees imposed under subsection (a), 
        the airlines and airline passengers shall not be 
        required to reimburse the Secretary of the Treasury for 
        the costs of providing overtime customs inspectional 
        services at such places.
  (4) Notwithstanding any other provision of law, all customs 
services (including, but not limited to, normal and overtime 
clearance and preclearance services) shall be adequately 
provided, when requested, for--
          (A) the clearance of any commercial vessel, vehicle, 
        or aircraft or its passengers, crew, stores, material, 
        or cargo arriving, departing, or transiting the United 
        States;
          (B) the preclearance at any customs facility outside 
        the United States of any commercial vessel, vehicle or 
        aircraft or its passengers, crew, stores, material, or 
        cargo; and
          (C) the inspection or release of commercial cargo or 
        other commercial shipments being entered into, or 
        withdrawn from, the customs territory of the United 
        States.
  (5) For purposes of this subsection, customs services shall 
be treated as being ``adequately provided'' if such of those 
services that are necessary to meet the needs of parties 
subject to customs inspection are provided in a timely manner 
taking into account factors such as--
          (A) the unavoidability of weather, mechanical, and 
        other delays;
          (B) the necessity for prompt and efficient passenger 
        and baggage clearance;
          (C) the perishability of cargo;
          (D) the desirability or unavoidability of late night 
        and early morning arrivals from various time zones;
          (E) the availability (in accordance with regulations 
        prescribed under subsection (g)(2)) of customs 
        personnel and resources; and
          (F) the need for specific enforcement checks.
  (6) Notwithstanding any other provision of law except 
paragraph (2), during any period when fees are authorized under 
subsection (a), no charges, other than such fees, may be 
collected--
          (A) for any--
                  (i) cargo inspection, clearance, or other 
                customs activity, expense, or service performed 
                (regardless whether performed outside of normal 
                business hours on an overtime basis), or
                  (ii) customs personnel provided,
        in connection with the arrival or departure of any 
        commercial vessel, vehicle, or aircraft, or its 
        passengers, crew, stores, material, or cargo, in the 
        United States;
          (B) for any preclearance or other customs activity, 
        expense, or service performed, and any customs 
        personnel provided, outside the United States in 
        connection with the departure of any commercial vessel, 
        vehicle, or aircraft, or its passengers, crew, stores, 
        material, or cargo, for the United States; or
          (C) in connection with--
                  (i) the activation or operation (including 
                Customs Service supervision) of any foreign 
                trade zone or subzone established under the Act 
                of June 18, 1934 (commonly known as the Foreign 
                Trade Zones Act, 19 U.S.C. 81a et seq.), or
                  (ii) the designation or operation (including 
                Customs Service supervision) of any bonded 
                warehouse under section 555 of the Tariff Act 
                of 1930 (19 U.S.C. 1555).
  (f) Disposition of Fees.--(1) There is established in the 
general fund of the Treasury a separate account which shall be 
known as the ``Customs User Fee Account''. Notwithstanding 
section 524 of the Tariff Act of 1930 (19 U.S.C. 1524), there 
shall be deposited as offsetting receipts into the Customs User 
Fee Account all fees collected under subsection (a) except--
          (A) the portion of such fees that is required under 
        paragraph (3) for the direct reimbursement of 
        appropriations, and
          (B) amounts deposited into the Customs Commercial and 
        Homeland Security Automation Account under paragraph 
        (4).
  (2) Except as otherwise provided in this subsection, all 
funds in the Customs User Fee Account shall be available, to 
the extent provided for in appropriations Acts, to pay the 
costs (other than costs for which direct reimbursement under 
paragraph (3) is required) incurred by the United States 
Customs Service in conducting customs revenue functions as 
defined in section 415 of the Homeland Security Act of 2002 
(other than functions performed by the Office of International 
Affairs referred to in section 415(8) of that Act), and for 
automation (including the Automation Commercial Environment 
computer system), and for no other purpose. To the extent that 
funds in the Customs User Fee Account are insufficient to pay 
the costs of such customs revenue functions, customs duties in 
an amount equal to the amount of such insufficiency shall be 
available, to the extent provided for in appropriations Acts, 
to pay the costs of such customs revenue functions in the 
amount of such insufficiency, and shall be available for no 
other purpose. The provisions of the first and second sentences 
of this paragraph specifying the purposes for which amounts in 
the Customs User Fee Account may be made available shall not be 
superseded except by a provision of law which specifically 
modifies or supersedes such provisions. So long as there is a 
surplus of funds in the Customs User Fee Account, the Secretary 
of the Treasury may not reduce personnel staffing levels for 
providing commercial clearance and preclearance services.
  (3)(A) The Secretary of the Treasury, in accordance with 
section 524 of the Tariff Act of 1930 and subject to 
subparagraph (B), shall directly reimburse, from the fees 
collected under subsection (a) (other than the fees under 
subsection (a) (9) and (10) and the excess fees determined by 
the Secretary under paragraph (4)), each appropriation for the 
amount paid out of that appropriation for the costs incurred by 
the Secretary--
          (i) in--
                  (I) paying overtime compensation under 
                section 5(a) of the Act of February 13, 1911,
                  (II) paying premium pay under section 5(b) of 
                the Act of February 13, 1911, but the amount 
                for which reimbursement may be made under this 
                subclause may not, for any fiscal year, exceed 
                the difference between the total cost of all 
                the premium pay for such year calculated under 
                section 5(b) and the cost of the night and 
                holiday premium pay that the Customs Service 
                would have incurred for the same inspectional 
                work on the day before the effective date of 
                section 13813 of the Omnibus Budget 
                Reconciliation Act of 1993,
                  (III) paying agency contributions to the 
                Civil Service Retirement and Disability Fund to 
                match deductions from the overtime compensation 
                paid under subclause (I),
                  (IV) providing all preclearance services for 
                which the recipients of such services are not 
                required to reimburse the Secretary of the 
                Treasury, and
                  (V) paying foreign language proficiency 
                awards under section 13812(b) of the Omnibus 
                Budget Reconciliation Act of 1993,
          (ii) to the extent funds remain available after 
        making reimbursements under clause (i), in providing 
        salaries for full-time and part-time inspectional 
        personnel and equipment that enhance customs services 
        for those persons or entities that are required to pay 
        fees under paragraphs (1) through (8) of subsection (a) 
        (distributed on a basis proportionate to the fees 
        collected under paragraphs (1) through (8) of 
        subsection (a), and
          (iii) to the extent funds remain available after 
        making reimbursements under clause (ii), in providing 
        salaries for up to 50 full-time equivalent inspectional 
        positions to provide preclearance services.
The transfer of funds required under subparagraph (C)(iii) has 
priority over reimbursements under this subparagraph to carry 
out subclauses (II), (III), (IV), and (V) of clause (i). Funds 
described in clause (ii) shall only be available to reimburse 
costs in excess of the highest amount appropriated for such 
costs during the period beginning with fiscal year 1990 and 
ending with the current fiscal year.
  (B) Reimbursement of appropriations under this paragraph--
          (i) shall be subject to apportionment or similar 
        administrative practices;
          (ii) shall be made at least quarterly; and
          (iii) to the extent necessary, may be made on the 
        basis of estimates made by the Secretary of the 
        Treasury and adjustments shall be made in subsequent 
        reimbursements to the extent that the estimates were in 
        excess of, or less than, the amounts required to be 
        reimbursed.
  (C)(i) For fiscal year 1991 and subsequent fiscal years, the 
amount required to reimburse costs described in subparagraph 
(A)(i) shall be projected from actual requirements, and only 
the excess of collections over such projected costs for such 
fiscal year shall be used as provided in subparagraph (A)(ii).
  (ii) The excess of collections over inspectional overtime and 
preclearance costs (under subparagraph (A)(i)) reimbursed for 
fiscal years 1989 and 1990 shall be available in fiscal year 
1991 and subsequent fiscal years for the purposes described in 
subparagraph (A)(ii), except that $30,000,000 of such excess 
shall remain without fiscal year limitation in a contingency 
fund and, in any fiscal year in which receipts are insufficient 
to cover the costs described in subparagraph (A) (i) and (ii), 
shall be used for--
          (I) the costs of providing the services described in 
        subparagraph (A)(i), and
          (II) after the costs described in subclause (I) are 
        paid, the costs of providing the personnel and 
        equipment described in subparagraph (A)(ii) at the 
        preceding fiscal year level.
  (iii) For each fiscal year, the Secretary of the Treasury 
shall calculate the difference between--
          (I) the estimated cost for overtime compensation that 
        would have been incurred during that fiscal year for 
        inspectional services if section 5 of the Act of 
        February 13, 1911 (19 U.S.C. 261 and 267), as in effect 
        before the enactment of section 13811 of the Omnibus 
        Budget Reconciliation Act of 1993, had governed such 
        costs, and
          (II) the actual cost for overtime compensation, 
        premium pay, and agency retirement contributions that 
        is incurred during that fiscal year in regard to 
        inspectional services under section 5 of the Act of 
        February 13, 1911, as amended by section 13811 of the 
        Omnibus Budget Reconciliation Act of 1993, and under 
        section 8331(3) of title 5, United States Code, as 
        amended by section 13812(a)(1) of such Act of 1993, 
        plus the actual cost that is incurred during that 
        fiscal year for foreign language proficiency awards 
        under section 13812(b) of such Act of 1993,
and shall transfer from the Customs User Fee Account to the 
General Fund of the Treasury an amount equal to the difference 
calculated under this clause, or $18,000,000, whichever amount 
is less. Transfers shall be made under this clause at least 
quarterly and on the basis of estimates to the same extent as 
are reimbursements under subparagraph (B)(iii).
  (D) Nothing in this paragraph shall be construed to preclude 
the use of appropriated funds, from sources other than the fees 
collected under subsection (a), to pay the costs set forth in 
clauses (i), (ii), and (iii) of subparagraph (A).
  (4)(A) There is created within the general fund of the 
Treasury a separate account that shall be known as the 
``Customs Commercial and Homeland Security Automation 
Account''. In each of fiscal years 2003, 2004, and 2005 there 
shall be deposited into the Account from fees collected under 
subsection (a)(9)(A), $350,000,000.
  (B) There is authorized to be appropriated from the Account 
in fiscal years 2003 through 2005 such amounts as are available 
in that Account for the development, establishment, and 
implementation of the Automated Commercial Environment computer 
system for the processing of merchandise that is entered or 
released and for other purposes related to the functions of the 
Department of Homeland Security. Amounts appropriated pursuant 
to this subparagraph are authorized to remain available until 
expended.
  (C) In adjusting the fee imposed by subsection (a)(9)(A) for 
fiscal year 2006, the Secretary of the Treasury shall reduce 
the amount estimated to be collected in fiscal year 2006 by the 
amount by which total fees deposited to the Account during 
fiscal years 2003, 2004, and 2005 exceed total appropriations 
from that Account.
  (5) Of the amounts collected in fiscal year 1999 under 
paragraphs (9) and (10) of subsection (a), $50,000,000 shall be 
available to the Customs Service, subject to appropriations 
Acts, for automated commercial systems. Amounts made available 
under this paragraph shall remain available until expended.
  (g) Regulations and Enforcement.--(1) The Secretary of the 
Treasury may prescribe such rules and regulations as may be 
necessary to carry out the provisions of this section. 
Regulations issued by the Secretary of the Treasury under this 
subsection with respect to the collection of the fees charged 
under subsection (a)(5) and the remittance of such fees to the 
Treasury of the United States shall be consistent with the 
regulations issued by the Secretary of the Treasury for the 
collection and remittance of the taxes imposed by subchapter C 
of chapter 33 of the Internal Revenue Code of 1954, but only to 
the extent the regulations issued with respect to such taxes do 
not conflict with the provisions of this section.
  (2) Except to the extent otherwise provided in regulations, 
all administrative and enforcement provisions of customs laws 
and regulations, other than those laws and regulations relating 
to drawback, shall apply with respect to any fee prescribed 
under subsection (a) of this section, and with respect to 
persons liable therefor, as if such fee is a customs duty. For 
purposes of the preceding sentence, any penalty expressed in 
terms of a relationship to the amount of the duty shall be 
treated as not less than the amount which bears a similar 
relationship to the amount of the fee assessed. For purposes of 
determining the jurisdiction of any court of the United States 
or any agency of the United States, any fee prescribed under 
subsection (a) of this section shall be treated as if such fee 
is a customs duty.
  (h) Conforming Amendments.--(1) Subsection (i) of section 305 
of the Rail Passenger Service Act (45 U.S.C. 545(i)) is amended 
by striking out the last sentence thereof.
  (2) Subsection (e) of section 53 of the Airport and Airway 
Development Act of 1970 (49 U.S.C. 1741(e)) is repealed.
  (i) Effect on Other Authority.--Except with respect to 
customs services for which fees are imposed under subsection 
(a), nothing in this section shall be construed as affecting 
the authority of the Secretary of the Treasury to charge fees 
under section 214(b) of the Customs Procedural Reform and 
Simplification Act of 1978 (19 U.S.C. 58a).
  (j) Effective Dates.--(1) Except as otherwise provided in 
this subsection, the provisions of this section, and the 
amendments and repeals made by this section, shall apply with 
respect to customs services rendered after the date that is 90 
days after the date of enactment of this Act.
  (2) Fees may be charged under subsection (a)(5) only with 
respect to customs services rendered in regard to arriving 
passengers using transportation for which documents or tickets 
were issued after the date that is 90 days after such date of 
enactment.
  (3)(A) Fees may not be charged under paragraphs (9) and (10) 
of subsection (a) after [September 30, 2024] July 7, 2025.
  (B)(i) Subject to clause (ii), Fees may not be charged under 
paragraphs (1) through (8) of subsection (a) after September 
30, 2024.
  (ii) In fiscal year 2006 and in each succeeding fiscal year 
for which fees under paragraphs (1) through (8) of subsection 
(a) are authorized--
          (I) the Secretary of the Treasury shall charge fees 
        under each such paragraph in amounts that are 
        reasonably related to the costs of providing customs 
        services in connection with the activity or item for 
        which the fee is charged under such paragraph, except 
        that in no case may the fee charged under any such 
        paragraph exceed by more than 10 percent the amount 
        otherwise prescribed by such paragraph;
          (II) the amount of fees collected under such 
        paragraphs may not exceed, in the aggregate, the 
        amounts paid in that fiscal year for the costs 
        described in subsection (f)(3)(A) incurred in providing 
        customs services in connection with the activity or 
        item for which the fees are charged under such 
        paragraphs;
          (III) a fee may not be collected under any such 
        paragraph except to the extent such fee will be 
        expended to pay the costs described in subsection 
        (f)(3)(A) incurred in providing customs services in 
        connection with the activity or item for which the fee 
        is charged under such paragraph; and
          (IV) any fee collected under any such paragraph shall 
        be available for expenditure only to pay the costs 
        described in subsection (f)(3)(A) incurred in providing 
        customs services in connection with the activity or 
        item for which the fee is charged under such paragraph.
  (k) Advisory Committee.--The Commissioner of Customs shall 
establish an advisory committee whose membership shall consist 
of representatives from the airline, cruise ship, and other 
transportation industries who may be subject to fees under 
subsection (a). The advisory committee shall not be subject to 
termination under section 14 of the Federal Advisory Committee 
Act. The advisory committee shall meet on a periodic basis and 
shall advise the Commissioner on issues related to the 
performance of the inspectional services of the United States 
Customs Service. Such advice shall include, but not be limited 
to, such issues as the time periods during which such services 
should be performed, the proper number and deployment of 
inspection officers, the level of fees, and the appropriateness 
of any proposed fee. The Commissioner shall give consideration 
to the views of the advisory committee in the exercise of his 
or her duties.

           *       *       *       *       *       *       *

                              ----------                              


      SECTION 503 OF THE UNITED STATES-KOREA FREE TRADE AGREEMENT 
                           IMPLEMENTATION ACT

SEC. 503. RATE FOR MERCHANDISE PROCESSING FEES.

  For the period beginning on December 1, 2015, and ending on 
June 30, [2021] 2025, section 13031(a)(9) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(a)(9)) 
shall be applied and administered--
          (1) in subparagraph (A), by substituting ``0.3464'' 
        for ``0.21''; and
          (2) in subparagraph (B)(i), by substituting 
        ``0.3464'' for ``0.21''.

                                  [all]