I 

109TH CONGRESS 

1ST SESSION H. R. 3157 

To require certain actions to be taken against countries that manipulate 

their currencies, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 30, 2005 

Mr. DINGELL introduced the following bill; which was referred to the 

Committee on Ways and Means 

A BILL 

To require certain actions to be taken against countries 

that manipulate their currencies, and for other purposes. 

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 ‘‘Currency Manipulation 

5 Prevention Act’’. 

6 SEC. 2. FINDINGS. 

7 The Congress finds as follows: 

8 (1) Products produced in a foreign country can 

9 be produced or assembled with lower input costs 

10 through the intervention by the government of that 
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1 country in international currency markets, in order 

2 to maintain its own currency at artificially low valu3 ations. 

4 (2) This practice, in effect, subsidizes the ex5 ports of such a country while erecting a cost barrier 

6 to goods imported into that country. 

7 (3) The United States has the authority under 

8 current law to redress practices by other countries 

9 that decrease market opportunities for United States 

10 exports or otherwise distort trade, including cur11 rency manipulation. 

12 (4) Misalignments in currency caused by gov13 ernment policies intended to maintain an unfair 

14 trade advantage nullify and impair trade conces15 sions. 

16 (5) A country is considered to be manipulating 

17 its currency to obtain an unfair trade advantage if— 

18 (A) its currency manipulation has a sub19 sidy-like effect; 

20 (B) its currency manipulation constitutes a 

21 nullification and impairment of the benefits of 

22 the GATT 1994; or 

23 (C) its currency manipulation results in a 

24 contravention of the intention of the GATT 

25 1994. 
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1 (6) The International Monetary Fund also pro2 hibits the use of currency manipulation as a method 

3 of gaining unfair trade advantage. The International 

4 Monetary Fund defines such manipulation as large5 scale and protracted intervention in one direction to 

6 gain an unfair trade advantage. 

7 (7) Article XV of the GATT 1994 and the 

8 Agreement on Subsidies and Countervailing Meas9 ures both suggest that currency manipulation in 

10 order to gain an unfair trading advantage would vio11 late the intent of those agreements. 

12 (8) Sections 301 through 309 of the Trade Act 

13 of 1974 provide the authority under United States 

14 law to take retaliatory action, including import re15 strictions, to enforce the rights of the United States 

16 against any unjustifiable, unreasonable, or discrimi17 natory practice or policy of a country that burdens 

18 or restricts United States commerce. 

19 (9) Section 3004 of the Omnibus Trade and 

20 Competitiveness Act of 1988 (22 U.S.C. 5304) re21 quires the Secretary of the Treasury to undertake 

22 multilateral or bilateral negotiations if it is found 

23 that a country is manipulating its currency, and Ar24 ticle IV of the Articles of Agreement of the Inter-
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1 national Monetary Fund prohibits currency manipu2 lation. 

3 SEC. 3. TRADE NEGOTIATING OBJECTIVE. 

4 Section 2102(b) of the Trade Act of 2002 (19 U.S.C. 

5 3802(b)) is amended by adding at the end the following: 

6 ‘‘(18) EXCHANGE RATE POLICY.—The principal 

7 negotiating objective of the United States with re8 spect to currency exchange rates is to ensure that 

9 governmental intervention in currency markets to 

10 stabilize short-term disruptive market conditions is 

11 of limited duration and is carried out in consultation 

12 with countries with major trading partners.’’. 

13 SEC. 4. REPORT ON CURRENCY MANIPULATION. 

14 The Secretary of Commerce shall, not later than 6 

15 months after the date of the enactment of this Act, and 

16 not later than the end of each 6-month period thereafter, 

17 submit to the Congress, the President, the United States 

18 Trade Representative, and the Secretary of the Treasury, 

19 a report— 

20 (1) describing actions by foreign governments 

21 to manipulate the currencies of their countries in 

22 order to increase exports from those countries to the 

23 United States or to limit imports of United States 

24 products into those countries, and describing the ex25 tent of such currency manipulation; 
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1 (2) analyzing whether, and to what extent— 

2 (A) currency manipulation described under 

3 paragraph (1) affects the manufacturing sector 

4 in the United States; and 

5 (B) reduction of the manipulation and of 

6 the accumulation of United States dollars by 

7 foreign governments might affect United States 

8 monetary policy; and 

9 (3) setting forth all remedies against such cur10 rency manipulation that are available under applica11 ble trade agreements and international institutions 

12 such as the World Trade Organization and the 

13 International Monetary Fund. 

14 SEC. 5. PROCEEDINGS. 

15 (a) ACTION BY THE PRESIDENT.—In any case in 

16 which the Secretary of Commerce, in a report under sec17 tion 3, identities a government of a foreign country that 

18 is manipulating the currency of that country, the Presi19 dent, within 45 days after the report is issued, shall ini20 tiate negotiations with that country for the purpose of 

21 ending the currency manipulation. If the President, within 

22 90 days after the report under section 3 is issued, is un23 able to reach an agreement with that country to end the 

24 currency manipulation, the President shall take the nec25 essary steps to initiate proceedings under the applicable 
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1 trade agreements or under the auspices of the World 

2 Trade Organization or other applicable international insti3 tutions, and under applicable United States law, including 

4 section 301 of the Trade Act of 1974, against that country 

5 on account of that currency manipulation. 

6 (b) COMPENSATION.— 

7 (1) IN GENERAL.—In the course of, or in addi8 tion to, action taken under subsection (a) with re9 spect to a country, the President shall seek com10 pensation from that country equivalent to the dam11 ages incurred by United States manufacturers and 

12 other adversely affected parties in the United States 

13 on account of the currency manipulation of that 

14 country. The President is not required to seek such 

15 compensation if he determines that to do so would 

16 not be in the national interests of the United States. 

17 (2) REPORT IF COMPENSATION NOT SOUGHT.— 

18 In any case in which the President does not seek 

19 compensation under paragraph (1), the President 

20 shall transmit to the Committee on Energy and 

21 Commerce and the Committee on Ways and Means 

22 of the House of Representatives, and to the Com23 mittee on Commerce, Science and Transportation 

24 and the Committee on Finance of the Senate, a de-
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1 tailed explanation of the President’s determination 

2 of national interest. 

3 SEC. 6. DEFINITIONS. 

4 In this Act—— 

5 (1) CURRENCY MANIPULATION.—The term 

6 ‘‘currency manipulation’’ means— 

7 (A) manipulation of exchange rates by a 

8 country in order to gain an unfair competitive 

9 advantage as stated in Article IV of the Articles 

10 of Agreement of the International Monetary 

11 Fund; 

12 (B) sustained currency intervention by a 

13 country in one direction, through mandatory 

14 foreign exchange sales at a country’s central 

15 bank at a fixed exchange rate; 

16 (C) protracted, large scale intervention in 

17 global currency markets in one direction, by 

18 buying or selling United States dollars, to 

19 weaken or strengthen a currency; or 

20 (D) other mechanisms used by a country 

21 to maintain its currency at at fixed exchange 

22 rate relative to the currency of another country. 

23 (2) GATT 1994.—The term ‘‘GATT 1994’’ has 

24 the meaning given that term in section 2 of the Uru25 guay Round Agreements Act (19 U.S.C. 3501). 
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1 (3) AGREEMENT ON SUBSIDIES AND COUNTER2 VAILING MEASURES.—The term ‘‘Agreement on Sub3 sidies and Countervailing Measures’’ means the 

4 Agreement on Subsidies and Countervailing Meas5 ures referred to in section 101(d)(12) of the Uru6 guay Round Agreements Act (19 U.S.C. 3511(12)). 

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