Emergency Safeguard Act of 1996

Summary: Emergency Safeguard Act of 1996 - Declares that:  (1) no more than 50 percent of the total square meter equivalents of wool apparel assembled in Canada and eligible for preferential duty treatment under the North American Free Trade Agreement (NAFTA)  and entered, or withdrawn from warehouse, for consumption during any year shall be tailored wool; and (2) no more than 50 percent of such sublimit shall be men's and boys' wool suits, wool sport coats, or wool slacks. 
Grants nondiscriminatory (most-favored-nation) treatment of Canadian tailored wool apparel that is eligible for preferential duty treatment under NAFTA.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Emergency Safeguard Act of 1996''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) men's and boys' wool suits (of United States category 
        443), sport coats (of United States category 433) and slacks 
        (of United States category 447) (collectively, ``tailored wool 
        apparel'') from Canada are being imported into the United 
        States in such increased quantities as to cause serious damage 
        to the domestic tailored wool apparel industry;
            (2) the provision of safeguard procedures in international 
        trade agreements to deal with surges of injurious imports has 
        been a fundamental policy of the United States Government for 
        over sixty years;
            (3) in a departure from this fundamental policy, the North 
        American Free Trade Agreement (``NAFTA'') deprives United 
        States tailored wool apparel manufacturers and their workers of 
        any remedy to address surges of injurious imports from Canada, 
        while all other United States, Canadian, and Mexican industries 
        and their workers can seek some form of safeguard from 
        injurious import surges under NAFTA;
            (4) United States tailored wool apparel manufacturers and 
        their workers should be provided an appropriate safeguard like 
        all other United States industries and their workers;
            (5) since 1988, United States production of men's and boys' 
        wool suits has declined by over 40 percent and employment in 
        the industry declined by nearly 50 percent;
            (6) four major and numerous smaller United States producers 
        of tailored wool apparel recently went out of business, 
        announced their intention to go out of business, or declared 
        bankruptcy;
            (7) plants in States such as Alabama, Delaware, Florida, 
        Georgia, Maryland, Massachusetts, New York, Pennsylvania, 
        Tennessee, West Virginia and Virginia have either been closed 
        or are laying off workers;
            (8) the surging tailored wool apparel imports are assembled 
        in Canada from fabric produced in Italy, Korea, Turkey and 
        other countries and exported at a preferential rate of duty 
        under a program known as a Tariff Preference Level (TPL) for 
        nonoriginating goods that was first established as a tariff 
        preference in the United States-Canada Free Trade Agreement 
        (``CFTA'') for Canadian exports of wool apparel items;
            (9) the tariff preference was designed for a limited 
        purpose--to ensure that Canadian producers of wool apparel 
        traditionally exported to the United States (which included 
only a small amount of tailored wool apparel) had access to an adequate 
supply of wool fabric, not for the wholesale circumvention of the rule 
of origin contained in the agreement;
            (10) high-quality wool fabrics are readily available to 
        apparel producers in Canada in sufficient quantities from 
        Canadian and United States producers;
            (11) in recognition of the tariff preference's short supply 
        purpose, the CFTA provided for monitoring of wool apparel 
        imports ``with a view to adjusting the annual quality 
        limitations at the request of either Party based on the ability 
        of apparel producers to obtain supplies of particular fabrics 
        originating within the territories of the Parties'';
            (12) the CFTA also required renegotiation of the tariff 
        preference before January 1, 1998, ``to reflect current 
        conditions in the textile and apparel industries located within 
        the territories of the Parties, including the ability of such 
        apparel producers to obtain supplies of particular fabrics 
        originating within the territories of the Parties'';
            (13) the NAFTA deleted the CFTA's monitoring and 
        renegotiation provisions and excluded tailored wool apparel 
        from the safeguard mechanisms established to deal with surges 
        of injurious imports;
            (14) prior to implementation of the CFTA, Canada accounted 
        for no more than 5 percent of United States imports of men's 
        and boys' wool suits; by 1995, as a result of the TPL, Canada 
        had become the largest exporter of men's and boys' wool suits 
        to the United States, accounting for 24 percent of imports;
            (15) since 1988, imports of men's and boys' wool suits from 
        Canada have increased over 1,000 percent (i.e., from 100,000 
        units in 1988 to over 1.1 million units in 1995);
            (16) the imports from Canada, made of fabric that is not of 
        North American origin, have also harmed United States wool 
        fabric, yarn, and fiber producers and their workers in states 
        such as Georgia, Maine, Massachusetts, New Hampshire, North 
        Carolina, Oregon, Pennsylvania, Rhode Island, West Virginia, 
        South Carolina, and Virginia;
            (17) the Congress never intended for the NAFTA to result in 
        such serious injury to United States tailored wool apparel 
        manufacturers and their workers and for the NAFTA to single out 
        that United States industry and its workers by denying them 
        access to an adequate and effective safeguard; and
            (18) the following safeguard proposals are intended to 
        rectify these oversights.

SEC. 3. PHASED SAFEGUARDS MEASURES.

    (a) Revision in Sub-Limits.--Notwithstanding any other provision of 
law, not more than 50 percent of the total square meter equivalents of 
wool apparel assembled in Canada and eligible for preferential duty 
treatment under Appendix 6.B.1 to Annex 300-B of the North American 
Free Trade Agreement (``the Appendix'') and entered, or withdrawn from 
warehouse, for consumption during any year shall be tailored wool 
apparel and not more than 50 percent of such sublimit shall be men's 
and boys' wool suits of United States category 443, or men's and boys' 
wool sport coats of category 433, or men's and boys' wool slacks of 
category 447, respectively.
    (b) Duty Snap-Back.--Notwithstanding any other provision of law, 
tailored wool apparel assembled in Canada and eligible for preferential 
duty treatment under the Appendix shall be subject to duty at the 
nondiscriminatory (most-favored-nation) rate in effect at the time of 
entry.
    (c) Effective Dates.--
            (1) November 1, 1996.--Subsection (a) shall apply to 
        merchandise entered, or withdrawn from warehouse, for 
        consumption after August 31, 1996.
            (2) March 1, 1997.--Subsection (c) shall apply to 
        merchandise entered, or withdrawn from warehouse, for 
        consumption after February 28, 1997.
            (3) Waiver.--The President may delay the effective date 
        under this subsection for subsection (b), and may suspend the 
        application of such subsection if it has taken effect, for such 
        period as he considers appropriate, if he determines that 
        Canada has entered into an agreement with the United States 
        which provides for sub-limits required under subsection (a).