United States-Canada Grain Trade Settlement Act of 1994

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States-Canada Grain Trade 
Settlement Act of 1994''.

SEC. 2. FINDINGS.

    The Congress makes the following findings:
            (1) As a result of unfair and incomplete provisions in the 
        United States-Canada Free-Trade Agreement (hereafter referred 
        to as the ``CFTA'') and the North American Free Trade Agreement 
        (hereafter referred to as the ``NAFTA'') affecting exports of 
        Canadian grain to the United States--
                    (A) Canadian exports of durum wheat, spring wheat, 
                and barley have increased beyond the level that such 
                exports can be absorbed into the United States market;
                    (B) these exports have depressed domestic grain 
                prices, causing severe financial losses to American 
                farmers and increasing the costs and difficulties of 
                implementing domestic farmer support programs; and
                    (C) Canadian grain exports continue to increase 
                without bounds, increasing the damage to United States 
                farmers each year.
            (2) The Congress approved the CFTA subject to--
                    (A) the statement in the Statement of 
                Administrative Action that the United States would 
                ``pursue consultations with Canada regarding the price 
                setting policy of the CWB (Canadian Wheat Board) as it 
                affects goods exported to the United States . . . 
                directed toward establishing a method to determine the 
                price at which the CWB is selling agricultural goods to 
                the United States and the CWB's acquisition price for 
                those goods''; and
                    (B) the provision of the implementing legislation 
                requiring that ``the President will enter into 
                immediate consultation with the Government of Canada to 
                obtain the exclusion from the transport rates 
                established under Canada's Western Grain Transportation 
                Act of agricultural goods that originate in Canada and 
                are shipped via east coast ports for consumption in the 
                United States,'',
        yet to date there has been no resolution of these 
        consultations.
            (3) United States trade negotiators agreed not to reexamine 
        the CFTA while negotiating the NAFTA based on the assumption 
        that the Uruguay Round talks of the General Agreement on 
        Tariffs and Trade would address the subsidy and dispute 
        resolution concerns and would be completed before the enactment 
        of the NAFTA.
            (4) The failure of the United States successfully to pursue 
        the consultations described in paragraph (2) led to a flawed 
        binational panel decision that renders meaningless the plain 
        language of Article 701(3) of the CFTA (which was incorporated 
        by reference in the NAFTA), which states that ``Neither Party, 
        including any public entity that it establishes or maintains, 
        shall sell agricultural goods for export to the territory of 
        the other Party at a price below the acquisition price of the 
        goods plus any storage, handling or other cost incurred by it 
        with respect to those goods.''.
            (5) Imports of wheat and barley have increased 
        significantly as a result of substantial changes in Canada's 
        support programs. Some of the changes were made with declared 
        intent to increase imports to the United States. The increases 
        in imports constitutes grounds under Article 705.5 of the CFTA 
        for use of import restrictions by the United States.

SEC. 3. TERMINATION OF AGREEMENTS AND IMPOSITION OF ADDITIONAL DUTIES.

    (a) In General.--
            (1) Termination of nafta and cfta.--Notwithstanding any 
        other provision of law, the President shall provide written 
        notification to the Government of Canada of the intent of the 
        United States to terminate the CFTA and the NAFTA, as such 
        agreement applies to Canada, unless the President provides the 
        Congress with a certification described in subsection (c). Such 
        notification shall be given not later than the date that is 6 
        months after the date of the enactment of this Act and shall 
        provide that the agreements shall terminate not later than 1 
        year after the date of the enactment of this Act in accordance 
        with the terms and conditions of the respective agreements.
            (2) Imposition of duty.--Notwithstanding any other 
        provision of law, the President shall immediately impose a duty 
        at the rate of 50 percent ad valorem or the specific rate 
        equivalent to articles imported from Canada described in the 
        following headings of the Harmonized Tariff Schedule of the 
        United States:
                    (A) heading 1001.10.00 (relating to durum wheat),
                    (B) heading 1001.90.10 (relating to seed wheat),
                    (C) heading 1001.90.20 (relating to other wheat),
                    (D) heading 1003.00.20 (relating to malting 
                barley), and
                    (E) heading 1003.00.40 (relating to other barley).
    (b) Negotiations.--The President shall immediately pursue 
negotiations with the Government of Canada to--
            (1) establish a method for determining the sale price of 
        Canadian grain exports to the United States and the Canadian 
        Wheat Board's acquisition price for such grain;
            (2) establish procedures for obtaining the data necessary 
        to implement the method described in paragraph (1);
            (3) eliminate all transportation subsidies on agricultural 
        goods that originate in Canada and are shipped for consumption 
        in the United States; and
            (4) clarify the meaning of the term ``acquisition price'' 
        in Article 701(3) of the CFTA (and any other provision 
        accompanying such agreement or the NAFTA) so that such term 
        includes--
                    (A) the value of any transportation subsidy applied 
                to grain entering the United States;
                    (B) all direct payments to producers made by the 
                Canadian Wheat Board or any government agency for grain 
                entering the United States; and
                    (C) any other payments or subsidy incurred by the 
                Canadian Wheat Board, any government agency, or any 
                private interest in the acquisition, handling, storage, 
                and transportation of the grain.
    (c) Certification by the President.--At such time as the President 
certifies to the Congress that the Government of Canada has entered 
into an agreement with the United States with respect to the 
requirements described in subsection (b), the President may terminate 
the duties imposed under subsection (a)(1) and take action to reinstate 
the CFTA and the NAFTA with respect to Canada. An agreement entered 
into under this Act shall supersede the corresponding provisions of the 
CFTA and the NAFTA and shall be incorporated in and become part of such 
agreements as reinstated.

Summary: United States-Canada Grain Trade Settlement Act of 1994 - Directs the President, by six months after enactment of this Act, to notify the Government of Canada of US intent to terminate the United States-Canada Free-Trade Agreement (CFTA) and the North American Free Trade Agreement (NAFTA), unless the President certifies to the Congress that Canada has agreed to: (1) establish a method for determining the sale price of Canadian grain exports to the United States and the Canadian Wheat Board's acquisition price for such grain. (2) establish procedures for obtaining the data necessary to implement such method. (3) eliminate all transportation subsidies on agricultural goods originating in Canada and shipped for consumption to the United States. And (4) clarify the CFTA meaning of acquisition price so that the term includes the value of any transportation subsidy applied to grain entering the United States, all direct payments to producers by the Canadian Wheat Board or any government agency for such grain, and any other payments or subsidy incurred by the Board, any government agency, or any private interest in the acquisition, handling, storage, and transportation of the grain. Directs the President immediately to pursue negotiations to reach such an agreement. Requires the President immediately to impose a 50 percent tariff on all imports from Canada of wheat, durum, and barley. Authorizes the President to terminate such tariff and take action to reinstate the CFTA and the NAFTA with respect to Canada whenever Canada has entered such an agreement. Declares that such agreement shall supersede the corresponding provisions of the CFTA and the NAFTA, and shall be incorporated in and become part of them as reinstated.