Fair Competition in Foreign Commerce Act of 1999

Summary: Prohibits the use of funds for nonhumanitarian foreign assistance programs (including Agency for International Development (AID) activities) unless each recipient country and each international financial institution has demonstrated that significant progress is being made toward institutionalizing: (1) procurement practices that are open, transparent, and free of corruption, fraud, inefficiency, and other misuse; and (2) independent third-party procurement monitoring of government procurement in countries that lack necessary organization, resources, and expertise.
Specifies national security, emergency humanitarian, and other exceptions to the requirements of this Act.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Competition in Foreign Commerce 
Act of 1999''.

SEC. 2. FINDINGS AND STATEMENT OF PURPOSE.

    (a) Findings.--The Congress finds the following:
            (1) The United States makes substantial contributions and 
        provides significant funding for major international 
        development projects through international financial 
        institutions and bilateral nonhumanitarian assistance.
            (2) These international development projects are often 
        plagued with fraud, corruption, waste, inefficiency, and misuse 
        of funding.
            (3) Fraud, corruption, waste, inefficiency, misuse, and 
        abuse are major impediments to competition in foreign commerce 
        throughout the world.
            (4) Identifying these impediments after they occur is 
        inadequate and meaningless.
            (5) Detection of impediments before they occur helps to 
        ensure that valuable United States resources contributed to 
        important international development projects are used 
        appropriately.
            (6) Independent third-party procurement monitoring is an 
        important tool for detecting and preventing such impediments.
            (7) Third-party procurement monitoring includes evaluations 
        of each stage of the procurement process and assures the 
        openness and transparency of the process.
            (8) Improving transparency and openness in the procurement 
        process helps to minimize fraud, corruption, waste, 
        inefficiency, and other misuse of funding, and promotes 
        competition, thereby strengthening international trade and 
        foreign commerce.
    (b) Purpose.--The purpose of this Act is to build on the excellent 
progress associated with the Organization on Economic Development and 
Cooperation Agreement on Bribery and Corruption by promoting the use of 
independent third-party procurement monitoring as part of United States 
participation in the international financial institutions and in the 
disbursement by the United States of bilateral nonhumanitarian foreign 
assistance funds, so as to ensure open, efficient, and transparent 
government procurement practices.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Appropriate committees.--The term ``appropriate 
        committees'' means the Committees on Finance and on Commerce, 
        Science, and Technology of the Senate and the Committees on 
        Ways and Means and on Commerce of the House of Representatives.
            (2) Independent third-party procurement monitoring.--The 
        term ``independent third-party procurement monitoring'' means a 
        program to--
                    (A) eliminate bias,
                    (B) promote transparency and open competition, and
                    (C) minimize fraud, corruption, waste, 
                inefficiency, and other misuse of funds,
        in international procurement through independent evaluation of 
        the technical, financial, economic, and legal aspects of the 
        procurement process.
            (3) Independent.--The term ``independent'' means that 
        monitoring the procurement process does not pose a conflict of 
        interest for the person doing so.
            (4) Each stage of procurement.--The term ``each stage of 
        procurement'' means the development and issuance of technical 
        specifications, bidding documents, evaluation reports, contract 
        preparation, and the delivery of goods and services.
            (5) International financial institution.--The term 
        ``international financial institution'' has the meaning given 
        in section 1701(c)(2) of the International Financial 
        Institutions Act.

SEC. 4. REQUIREMENTS FOR FAIR COMPETITION IN FOREIGN COMMERCE.

    (a) In General.--Not later than 180 days after the date of 
enactment of this Act, the Secretary of the Treasury shall transmit to 
the President and to the appropriate committees a plan for promoting 
international government procurement reforms relating to the United 
States participation in international financial institutions, including 
the use of third party procurement monitoring where appropriate.
    (b) Plan.--The plan shall include an instruction by the Secretary 
of the Treasury to the United States Executive Director of each 
international financial institution to use the voice and vote of the 
United States to oppose the use of funds appropriated or made available 
by the United States for any non-humanitarian assistance, until--
            (1) the institution has adopted an anticorruption plan that 
        requires the use of independent third-party procurement 
        monitoring services in any case in which the country receiving 
        such assistance lacks the necessary organization, resources, 
        and expertise to ensure openness, efficiency, and transparency 
        in government procurement; and
            (2) each country receiving such assistance institutes 
        specific strategies for minimizing corruption and maximizing 
        transparency in each stage of the procurement process.
    (c) Annual Reports.--Not later than June 29 of each year, the 
Secretary of the Treasury shall report to the appropriate committees on 
the progress in implementing procurement reforms made by each 
international financial institution and each country that received non-
humanitarian assistance from such an institution during the preceding 
year.
    (d) Restrictions on Assistance.--Notwithstanding any other 
provision of law, no funds appropriated or made available for non-
humanitarian foreign assistance programs, including the activities of 
the Agency for International Development, may be expended for a 
government procurement program unless each country eligible to receive 
assistance under such programs and each international financial 
institution involved has demonstrated that significant progess is being 
made toward institutionalizing--
            (1) procurement practices which are open, transparent, and 
        free of corruption, fraud, inefficiency, and other misuse; and
            (2) independent third-party monitoring of government 
        procurement, in the case of such countries that lack necessary 
        organization, resources, and expertise.

SEC. 5. EXCEPTIONS.

    (a) National Security.--Section 4 shall not apply with respect to a 
country if the President determines with respect to such country that 
making funds available is in the national security interests of the 
United States. Any such determination shall cease to be effective 6 
months after being made unless the President determines that its 
continuation is in the national security interests of the United 
States.
    (b) Other Exceptions.--Section 4 shall not apply with respect to 
assistance to--
            (1) meet urgent humanitarian needs (including providing 
        food, medicine, disaster, and refugee relief);
            (2) facilitate democratic political reform and rule of law 
        activities;
            (3) create private sector and nongovernmental organizations 
        that are independent of government control; or
            (4) facilitate development of a free market economic 
        system.