II

106TH CONGRESS

1ST SESSION S. 1099

To establish a mechanism for using the duties imposed on products of countries that fail to comply with WTO dispute resolution decisions to provide

relief to injured domestic producers.

IN THE SENATE OF THE UNITED STATES

MAY 20, 1999

Mr. BAUCUS (for himself, Mr. BINGAMAN, Mr. DORGAN, Mr. KERREY, Mr.

JOHNSON, and Mr. DASCHLE) introduced the following bill; which was

read twice and referred to the Committee on Finance

A BILL

To establish a mechanism for using the duties imposed on

products of countries that fail to comply with WTO

dispute resolution decisions to provide relief to injured

domestic producers.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Trade Injury Com5 pensation Act of 1999’’.

6 SEC. 2. FINDINGS.

7 Congress makes the following findings:
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1 (1) United States goods and services compete in

2 global markets and it is necessary for trade agree3 ments to promote such competition.

4 (2) The current dispute resolution mechanism

5 of the World Trade Organization is designed to re6 solve disputes in a manner that brings stability and

7 predictability to world trade.

8 (3) When foreign countries refuse to comply

9 with a panel or Appellate Body report of the World

10 Trade Organization and violate any of the Uruguay

11 Round Agreements, it has a deleterious effect on the

12 United States economy.

13 (4) A WTO member can retaliate against a

14 country that refuses to implement a panel or Appel15 late Body report by imposing additional duties of up

16 to 100 percent on goods imported from the noncom17 plying country.

18 (5) In cases where additional duties are im19 posed on imported goods, the duties should be used

20 to provide relief to the industry that is injured by

21 the noncompliance.

22 SEC. 3. DEFINITIONS.

23 In this Act:

24 (1) AGRICULTURAL COMMODITY.—The term

25 ‘‘agricultural commodity’’ has the meaning given the
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1 term by section 102 (1) of the Agricultural Trade

2 Act of 1978 (7 U.S.C. 5602(1)).

3 (2) INJURED AGRICULTURAL COMMODITY PRO4 DUCER.—The term ‘‘injured agricultural commodity

5 producer’’ means a domestic producer of an agricul6 tural commodity with respect to which a dispute res7 olution proceeding has been brought before the

8 World Trade Organization, if the dispute resolution

9 is resolved in favor of the agricultural commodity

10 producer, and the foreign country against which the

11 proceeding has been brought has failed to comply

12 with the report of the panel or Appellate Body of the

13 WTO.

14 (3) INJURED PRODUCER.—The term ‘‘injured

15 producer’’ means a domestic producer of a product

16 (other than an agricultural product) with respect to

17 which a dispute resolution proceeding has been

18 brought before the World Trade Organization, if the

19 dispute resolution is resolved in favor of the pro20 ducer, and the foreign country against which the

21 proceeding has been brought has failed to comply

22 with the report of the panel or Appellate Body of the

23 WTO.

24 (4) RETALIATION LIST.—The term ‘‘retaliation

25 list’’ means the list of products of a foreign country
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1 that has failed to comply with the report of the

2 panel or Appellate Body of the WTO and with re3 spect to which the United States Trade Representa4 tive is imposing duties above the level that would

5 otherwise be imposed under the Harmonized Tariff

6 Schedule of the United States.

7 (5) URUGUAY ROUND AGREEMENTS.—The term

8 ‘‘Uruguay Round Agreements’’ has the meaning

9 given such term in section 2(7) of the Uruguay

10 Round Agreements Act (19 U.S.C. 3501(7)).

11 (6) WORLD TRADE ORGANIZATION.—The term

12 ‘‘World Trade Organization’’ means the organization

13 established pursuant to the WTO Agreement.

14 (7) WTO AGREEMENT.—The term ‘‘WTO

15 Agreement’’ means the Agreement Establishing The

16 World Trade Organization entered into on April 15,

17 1994.

18 (8) WTO AND WTO MEMBER.—The terms

19 ‘‘WTO’’ and ‘‘WTO member’’ have the meanings

20 given those terms in section 2 of the Uruguay

21 Round Agreements Act (19 U.S.C. 3501).

22 SEC. 4. TRADE INJURY COMPENSATION TRUST FUND.

23 (a) ESTABLISHMENT.—There is established in the

24 Treasury of the United States a fund to be known as the

25 ‘‘Trade Injury Compensation Trust Fund’’ (referred to in
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1 this Act as the ‘‘Fund’’) consisting of such amounts as

2 may be appropriated to the Fund under subsection (b) and

3 any amounts credited to the Fund under subsection (c)(2).

4 (b) TRANSFER OF AMOUNTS EQUIVALENT TO CER5 TAIN DUTIES.—

6 (1) IN GENERAL.—There are hereby appro7 priated and transferred to the Fund an amount

8 equal to the amount received in the Treasury as a

9 result of the imposition of additional duties imposed

10 on the products on a retaliation list.

11 (2) TRANSFERS BASED ON ESTIMATES.—The

12 amounts required to be transferred under paragraph

13 (1) shall be transferred at least quarterly from the

14 general fund of the Treasury to the Fund on the

15 basis of estimates made by the Secretary of the

16 Treasury. Proper adjustment shall be made in

17 amounts subsequently transferred to the extent prior

18 estimates were in excess of or less than the amounts

19 required to be transferred.

20 (c) INVESTMENT OF TRUST FUND.—

21 (1) IN GENERAL.—The Secretary of the Treas22 ury shall invest such portion of the Fund as is not,

23 in the Secretary’s judgment, required to meet cur24 rent withdrawals. Such investments may be made

25 only in interest-bearing obligations of the United
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1 States or in obligations guaranteed as to both prin2 cipal and interest by the United States.

3 (2) CREDITS TO FUND.—The interest on, and

4 the proceeds from the sale or redemption of, any ob5 ligations held in the Fund shall be credited to and

6 form a part of the Fund.

7 (d) DISTRIBUTIONS FROM FUND.—Amounts in the

8 Fund shall be available as provided in appropriations Acts,

9 for making distributions in accordance with subsections

10 (e) and (f).

11 (e) CRITERIA FOR DETERMINING INJURED PRO12 DUCERS AND AMOUNT TO BE PAID.—Not later than 30

13 days after the implementation of a retaliation list, the Sec14 retary of the Treasury, in consultation with the Secre15 taries of Agriculture and Commerce, shall promulgate

16 such regulations as may be necessary to carry out the pro17 visions of this Act. The regulations shall include the fol18 lowing:

19 (1) Procedures for identifying injured producers

20 and injured producers of agricultural commodities.

21 (2) Standards for determining the eligibility of

22 injured producers and injured producers of agricul23 tural commodities to participate in the distribution

24 of any money from the Fund.
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1 (3) Procedures for determining the amount of

2 the distribution each injured producer and injured

3 producers of agricultural commodities should be

4 paid.

5 (4) Procedures for establishing separate ac6 counts for duties collected with respect to each retal7 iation list and for making distributions to the group

8 of injured producers and injured producers of agri9 cultural commodities with respect to each such retal10 iation list.

11 (f) DISTRIBUTION TO INJURED PRODUCERS.—

12 (1) DISTRIBUTION TO AGRICULTURAL PRO13 DUCERS.—The Secretary of the Treasury shall

14 transfer to the Secretary of Agriculture such sums

15 as may be transferred or credited to the Fund as the

16 result of items on a retaliation list because of injury

17 to producers of agricultural commodities. The Sec18 retary of Agriculture shall distribute to each injured

19 producer of an agricultural commodity that the Sec20 retary determines is eligible a portion of the amount

21 so transferred. The distribution shall be made in ac22 cordance with the subsection (e) and shall be used

23 by the producers for the promotion and development

24 of products of the injured producers.
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1 (2) DISTRIBUTION TO OTHER INJURED PRO2 DUCERS.—The Secretary of the Treasury shall

3 transfer to the Secretary of Commerce such sums as

4 may be transferred or credited to the Fund as the

5 result of items on a retaliation list because of injury

6 to producers (other than producers of agricultural

7 commodities). The Secretary of Commerce shall dis8 tribute to each injured producer (other than a pro9 ducer described in paragraph (1)) that the Secretary

10 determines is eligible a portion of the amount so

11 transferred. The distribution shall be made in ac12 cordance with subsection (e) and in accordance with

13 the procedures applicable to the provision of assist14 ance under chapter 3 of title II of the Trade Act of

15 1974 (19 U.S.C. 2341 et seq.).

16 (g) REPORT TO CONGRESS.—The Secretary of the

17 Treasury shall, after consultation with the Secretaries of

18 Agriculture and Commerce, submit a report to the Con19 gress each year on—

20 (1) the financial condition and the results of

21 the operations of the Fund during the preceding fis22 cal year; and

23 (2) the expected condition and operations of the

24 Fund during the fiscal year following the fiscal year

25 that is the subject of the report.
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1 SEC. 5. PROHIBITION ON REDUCING SERVICES OR FUNDS.

2 No payment made to an injured producer or an in3 jured agricultural commodity producer under this Act

4 shall result in the reduction or denial of any service or

5 assistance with respect to which the injured producer or

6 injured agricultural commodity producer would otherwise

7 be entitled.

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