I 

108TH CONGRESS 

1ST SESSION H. R. 2738

To implement the United States-Chile Free Trade Agreement. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 15, 2003

Mr. DELAY (for himself and Mr. RANGEL) (both by request) introduced the 

following bill; which was referred to the Committee on Ways and Means, 

and in addition to the Committee on the Judiciary, for a period to be 

subsequently determined by the Speaker, in each case for consideration 

of such provisions as fall within the jurisdiction of the committee concerned 

A BILL

To implement the United States-Chile Free Trade 

Agreement.

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘United States-Chile Free Trade Agreement Implementa6 tion Act’’. 

7 (b) TABLE OF CONTENTS.—

Sec. 1. Short title; table of contents. 

Sec. 2. Purposes. 

Sec. 3. Definitions. 
2

•HR 2738 IH 

TITLE I—APPROVAL OF, AND GENERAL PROVISIONS RELATING 

TO, THE AGREEMENT 

Sec. 101. Approval and entry into force of the agreement. 

Sec. 102. Relationship of the agreement to United States and State law. 

Sec. 103. Consultation and layover provisions for, and effective date of, proclaimed actions. 

Sec. 104. Implementing actions in anticipation of entry into force and initial 

regulations. 

Sec. 105. Administration of dispute settlement proceedings. 

Sec. 106. Arbitration of claims. 

Sec. 107. Effective dates; effect of termination. 

TITLE II—CUSTOMS PROVISIONS 

Sec. 201. Tariff modifications. 

Sec. 202. Rules of origin. 

Sec. 203. Drawback. 

Sec. 204. Customs user fees. 

Sec. 205. Disclosure of incorrect information; denial of preferential tariff treatment; false certificates of origin. 

Sec. 206. Reliquidation of entries. 

Sec. 207. Recordkeeping requirements. 

Sec. 208. Enforcement of textile and apparel rules of origin. 

Sec. 209. Conforming amendments. 

Sec. 210. Regulations. 

TITLE III—RELIEF FROM IMPORTS 

Sec. 301. Definitions. 

Subtitle A—Relief From Imports Benefiting From the Agreement 

Sec. 311. Commencing of action for relief. 

Sec. 312. Commission action on petition. 

Sec. 313. Provision of relief. 

Sec. 314. Termination of relief authority. 

Sec. 315. Compensation authority. 

Sec. 316. Confidential business information. 

Subtitle B—Textile and Apparel Safeguard Measures 

Sec. 321. Commencement of action for relief. 

Sec. 322. Determination and provision of relief. 

Sec. 323. Period of relief. 

Sec. 324. Articles exempt from relief. 

Sec. 325. Rate after termination of import relief. 

Sec. 326. Termination of relief authority. 

Sec. 327. Compensation authority. 

Sec. 328. Business confidential information. 

TITLE IV—TEMPORARY ENTRY OF BUSINESS PERSONS 

Sec. 401. Nonimmigrant traders and investors. 

Sec. 402. Nonimmigrant professionals; labor attestation. 

Sec. 403. Labor disputes. 

Sec. 404. Conforming amendments.
3

•HR 2738 IH 

1 SEC. 2. PURPOSES. 

2 The purposes of this Act are—

3 (1) to approve and implement the Free Trade 

4 Agreement between the United States and the Re5 public of Chile entered into under the authority of 

6 section 2103(b) of the Bipartisan Trade Promotion 

7 Authority Act of 2002; 

8 (2) to strengthen and develop economic rela9 tions between the United States and Chile for their 

10 mutual benefit; 

11 (3) to establish free trade between the two na12 tions through the reduction and elimination of bar13 riers to trade in goods and services and to invest14 ment; and 

15 (4) to lay the foundation for further coopera16 tion to expand and enhance the benefits of such 

17 Agreement. 

18 SEC. 3. DEFINITIONS. 

19 In this Act: 

20 (1) AGREEMENT.—The term ‘‘Agreement’’ 

21 means the United States-Chile Free Trade Agree22 ment approved by the Congress under section 

23 101(a)(1). 

24 (2) HTS.—The term ‘‘HTS’’ means the Har25 monized Tariff Schedule of the United States.
4

•HR 2738 IH 

1 (3) TEXTILE OR APPAREL GOOD.—The term 

2 ‘‘textile or apparel good’’ means a good listed in the 

3 Annex to the Agreement on Textiles and Clothing 

4 referred to in section 101(d)(4) of the Uruguay 

5 Round Agreements Act (19 U.S.C. 3511(d)(4)). 

6 TITLE I—APPROVAL OF, AND 

7 GENERAL PROVISIONS RE8 LATING TO, THE AGREEMENT 

9 SEC. 101. APPROVAL AND ENTRY INTO FORCE OF THE 

10 AGREEMENT. 

11 (a) APPROVAL OF AGREEMENT AND STATEMENT OF

12 ADMINISTRATIVE ACTION.—Pursuant to section 2105 of 

13 the Bipartisan Trade Promotion Authority Act of 2002 

14 (19 U.S.C. 3805) and section 151 of the Trade Act of 

15 1974 (19 U.S.C. 2191), the Congress approves—

16 (1) the United States-Chile Free Trade Agree17 ment entered into on June 6, 2003, with the Gov18 ernment of Chile and submitted to the Congress on 

19 July 15, 2003; and 

20 (2) the statement of administrative action pro21 posed to implement the Agreement that was sub22 mitted to the Congress on July 15, 2003. 

23 (b) CONDITIONS FOR ENTRY INTO FORCE OF THE

24 AGREEMENT.—At such time as the President determines 

25 that Chile has taken measures necessary to bring it into 
5

•HR 2738 IH 

1 compliance with the provisions of the Agreement that take 

2 effect on the date on which the Agreement enters into 

3 force, the President is authorized to exchange notes with 

4 the Government of Chile providing for the entry into force, 

5 on or after January 1, 2004, of the Agreement for the 

6 United States. 

7 SEC. 102. RELATIONSHIP OF THE AGREEMENT TO UNITED 

8 STATES AND STATE LAW. 

9 (a) RELATIONSHIP TO UNITED STATES LAW.—

10 (1) UNITED STATES LAW TO PREVAIL IN CON11 FLICT.—No provision of the Agreement, nor the ap12 plication of any such provision to any person or cir13 cumstance, which is inconsistent with any law of the 

14 United States shall have effect. 

15 (2) CONSTRUCTION.—Nothing in this Act shall 

16 be construed—

17 (A) to amend or modify any law of the 

18 United States, or 

19 (B) to limit any authority conferred under 

20 any law of the United States, 

21 unless specifically provided for in this Act. 

22 (b) RELATIONSHIP OF AGREEMENT TO STATE

23 LAW.—

24 (1) LEGAL CHALLENGE.—No State law, or the 

25 application thereof, may be declared invalid as to 
6

•HR 2738 IH 

1 any person or circumstance on the ground that the 

2 provision or application is inconsistent with the 

3 Agreement, except in an action brought by the 

4 United States for the purpose of declaring such law 

5 or application invalid. 

6 (2) DEFINITION OF STATE LAW.—For purposes 

7 of this subsection, the term ‘‘State law’’ includes—

8 (A) any law of a political subdivision of a 

9 State; and 

10 (B) any State law regulating or taxing the 

11 business of insurance. 

12 (c) EFFECT OF AGREEMENT WITH RESPECT TO PRI13 VATE REMEDIES.—No person other than the United 

14 States—

15 (1) shall have any cause of action or defense 

16 under the Agreement or by virtue of Congressional 

17 approval thereof; or 

18 (2) may challenge, in any action brought under 

19 any provision of law, any action or inaction by any 

20 department, agency, or other instrumentality of the 

21 United States, any State, or any political subdivision 

22 of a State on the ground that such action or inaction 

23 is inconsistent with the Agreement. 
7

•HR 2738 IH 

1 SEC. 103. CONSULTATION AND LAYOVER PROVISIONS FOR, 

2 AND EFFECTIVE DATE OF, PROCLAIMED AC3 TIONS. 

4 (a) CONSULTATION AND LAYOVER REQUIRE5 MENTS.—If a provision of this Act provides that the imple6 mentation of an action by the President by proclamation 

7 is subject to the consultation and layover requirements of 

8 this section, such action may be proclaimed only if—

9 (1) the President has obtained advice regarding 

10 the proposed action from—

11 (A) the appropriate advisory committees 

12 established under section 135 of the Trade Act 

13 of 1974 (19 U.S.C. 2155); and 

14 (B) the United States International Trade 

15 Commission; 

16 (2) the President has submitted a report to the 

17 Committee on Ways and Means of the House of 

18 Representatives and the Committee on Finance of 

19 the Senate that sets forth—

20 (A) the action proposed to be proclaimed 

21 and the reasons therefor; and 

22 (B) the advice obtained under paragraph 

23 (1); 

24 (3) a period of 60 calendar days, beginning on 

25 the first day on which the requirements set forth in 
8

•HR 2738 IH 

1 paragraphs (1) and (2) have been met has expired; 

2 and 

3 (4) the President has consulted with such Com4 mittees regarding the proposed action during the pe5 riod referred to in paragraph (3). 

6 (b) EFFECTIVE DATE OF CERTAIN PROCLAIMED AC7 TIONS.—Any action proclaimed by the President under the 

8 authority of this Act that is not subject to the consultation 

9 and layover provisions under subsection (a) may not take 

10 effect before the 15th day after the date on which the text 

11 of the proclamation is published in the Federal Register.

12 SEC. 104. IMPLEMENTING ACTIONS IN ANTICIPATION OF 

13 ENTRY INTO FORCE AND INITIAL REGULA14 TIONS. 

15 (a) IMPLEMENTING ACTIONS.—

16 (1) PROCLAMATION AUTHORITY.—After the 

17 date of enactment of this Act—

18 (A) the President may proclaim such ac19 tions, and 

20 (B) other appropriate officers of the 

21 United States Government may issue such reg22 ulations, 

23 as may be necessary to ensure that any provision of 

24 this Act, or amendment made by this Act, that takes 

25 effect on the date the Agreement enters into force
9

•HR 2738 IH 

1 is appropriately implemented on such date, but no 

2 such proclamation or regulation may have an effec3 tive date earlier than the date of entry into force. 

4 (2) WAIVER OF 15-DAY RESTRICTION.—The 15-

5 day restriction contained in section 103(b) on the 

6 taking effect of proclaimed actions is waived to the 

7 extent that the application of such restriction would 

8 prevent the taking effect on the date the Agreement 

9 enters into force of any action proclaimed under this 

10 section. 

11 (b) INITIAL REGULATIONS.—Initial regulations nec12 essary or appropriate to carry out the actions required by 

13 or authorized under this Act or proposed in the statement 

14 of administrative action referred to in section 101(a)(2) 

15 to implement the Agreement shall, to the maximum extent 

16 feasible, be issued within 1 year after the date of entry 

17 into force of the Agreement. In the case of any imple18 menting action that takes effect on a date after the date 

19 of entry into force of the Agreement, initial regulations 

20 to carry out that action shall, to the maximum extent fea21 sible, be issued within 1 year after such effective date. 

22 SEC. 105. ADMINISTRATION OF DISPUTE SETTLEMENT PRO23 CEEDINGS. 

24 (a) ESTABLISHMENT OR DESIGNATION OF OFFICE.—

25 The President is authorized to establish or designate with-
10

•HR 2738 IH 

1 in the Department of Commerce an office that shall be 

2 responsible for providing administrative assistance to pan3 els established under chapter 22 of the Agreement. The 

4 office may not be considered to be an agency for purposes 

5 of section 552 of title 5, United States Code. 

6 (b) AUTHORIZATION OF APPROPRIATIONS.—There 

7 are authorized to be appropriated for each fiscal year after 

8 fiscal year 2003 to the Department of Commerce such 

9 sums as may be necessary for the establishment and oper10 ations of the office under subsection (a) and for the pay11 ment of the United States share of the expenses of panels 

12 established under chapter 22 of the Agreement. 

13 SEC. 106. ARBITRATION OF CLAIMS. 

14 (a) SUBMISSION OF CERTAIN CLAIMS.—The United 

15 States is authorized to resolve any claim against the 

16 United States covered by article 10.15(1)(a)(i)(C) or 

17 10.15(1)(b)(i)(C) of the Agreement, pursuant to the In18 vestor-State Dispute Settlement procedures set forth in 

19 section B of chapter 10 of the Agreement. 

20 (b) CONTRACT CLAUSES.—All contracts executed by 

21 any agency of the United States on or after the date of 

22 entry into force of the Agreement shall contain a clause 

23 specifying the law that will apply to resolve any breach 

24 of contract claim.
11

•HR 2738 IH 

1 SEC. 107. EFFECTIVE DATES; EFFECT OF TERMINATION. 

2 (a) EFFECTIVE DATES.—Except as provided in sub3 section (b), the provisions of this Act and the amendments 

4 made by this Act take effect on the date the Agreement 

5 enters into force. 

6 (b) EXCEPTIONS.—Sections 1 through 3 and this 

7 title take effect on the date of the enactment of this Act. 

8 (c) TERMINATION OF THE AGREEMENT.—On the 

9 date on which the Agreement ceases to be in force, the 

10 provisions of this Act (other than this subsection) and the 

11 amendments made by this Act shall cease to be effective. 

12 TITLE II—CUSTOMS PROVISIONS 

13 SEC. 201. TARIFF MODIFICATIONS. 

14 (a) TARIFF MODIFICATIONS PROVIDED FOR IN THE

15 AGREEMENT.—

16 (1) PROCLAMATION AUTHORITY.—The Presi17 dent may proclaim—

18 (A) such modifications or continuation of 

19 any duty, 

20 (B) such continuation of duty-free or ex21 cise treatment, or 

22 (C) such additional duties, 

23 as the President determines to be necessary or ap24 propriate to carry out or apply articles 3.3, 3.7, 3.9, 

25 article 3.20 (8), (9), (10), and (11), and Annex 3.3 

26 of the Agreement. 
12

•HR 2738 IH 

1 (2) EFFECT ON CHILEAN GSP STATUS.—Not2 withstanding section 502(a)(1) of the Trade Act of 

3 1974 (19 U.S.C. 2462(a)(1)), the President shall 

4 terminate the designation of Chile as a beneficiary 

5 developing country for purposes of title V of the 

6 Trade Act of 1974 on the date of entry into force 

7 of the Agreement. 

8 (b) OTHER TARIFF MODIFICATIONS.—Subject to the 

9 consultation and layover provisions of section 103(a), the 

10 President may proclaim—

11 (1) such modifications or continuation of any 

12 duty, 

13 (2) such modifications as the United States 

14 may agree to with Chile regarding the staging of any 

15 duty treatment set forth in Annex 3.3 of the Agree16 ment, 

17 (3) such continuation of duty-free or excise 

18 treatment, or 

19 (4) such additional duties, 

20 as the President determines to be necessary or appropriate 

21 to maintain the general level of reciprocal and mutually 

22 advantageous concessions with respect to Chile provided 

23 for by the Agreement. 

24 (c) ADDITIONAL TARIFFS ON AGRICULTURAL SAFE25 GUARD GOODS.—
13

•HR 2738 IH 

1 (1) IN GENERAL.—In addition to any duty pro2 claimed under subsection (a) or (b), and subject to 

3 paragraphs (3) through (5), the Secretary of the 

4 Treasury shall assess a duty, in the amount pre5 scribed under paragraph (2), on an agricultural safe6 guard good if the Secretary of the Treasury deter7 mines that the unit import price of the good when 

8 it enters the United States, determined on an 

9 F.O.B. basis, is less than the trigger price indicated 

10 for that good in Annex 3.18 of the Agreement or 

11 any amendment thereto. 

12 (2) CALCULATION OF ADDITIONAL DUTY.—The 

13 amount of the additional duty assessed under this 

14 subsection shall be determined as follows: 

15 (A) If the difference between the unit im16 port price and the trigger price is less than, or 

17 equal to, 10 percent of the trigger price, no ad18 ditional duty shall be imposed. 

19 (B) If the difference between the unit im20 port price and the trigger price is greater than 

21 10 percent, but less than or equal to 40 per22 cent, of the trigger price, the additional duty 

23 shall be equal to 30 percent of the difference 

24 between the preferential tariff rate and the col25 umn 1 general rate of duty imposed under the
14

•HR 2738 IH 

1 HTS on like articles at the time the additional 

2 duty is imposed. 

3 (C) If the difference between the unit im4 port price and the trigger price is greater than 

5 40 percent, but less than or equal to 60 per6 cent, of the trigger price, the additional duty 

7 shall be equal to 50 percent of the difference 

8 between the preferential tariff rate and the col9 umn 1 general rate of duty imposed under the 

10 HTS on like articles at the time the additional 

11 duty is imposed. 

12 (D) If the difference between the unit im13 port price and the trigger price is greater than 

14 60 percent, but less than or equal to 75 per15 cent, of the trigger price, the additional duty 

16 shall be equal to 70 percent of the difference 

17 between the preferential tariff rate and the col18 umn 1 general rate of duty imposed under the 

19 HTS on like articles at the time the additional 

20 duty is imposed. 

21 (E) If the difference between the unit im22 port price and the trigger price is greater than 

23 75 percent of the trigger price, the additional 

24 duty shall be equal to 100 percent of the dif25 ference between the preferential tariff rate and 
15

•HR 2738 IH 

1 the column 1 general rate of duty imposed 

2 under the HTS on like articles at the time the 

3 additional duty is imposed. 

4 (3) EXCEPTIONS.—No additional duty under 

5 this subsection shall be assessed on an agricultural 

6 safeguard good if, at the time of entry, the good is 

7 subject to import relief under—

8 (A) subtitle A of title III of this Act; or 

9 (B) chapter 1 of title II of the Trade Act 

10 of 1974 (19 U.S.C. 2251 et seq.). 

11 (4) TERMINATION.—This subsection shall cease 

12 to apply on the date that is 12 years after the date 

13 on which the Agreement enters into force. 

14 (5) TARIFF-RATE QUOTAS.—If an agricultural 

15 safeguard good is subject to a tariff-rate quota, and 

16 the in-quota duty rate for the good proclaimed pur17 suant to subsection (a) or (b) is zero, any additional 

18 duty assessed under this subsection shall be applied 

19 only to over-quota imports of the good. 

20 (6) NOTICE.—Not later than 60 days after the 

21 Secretary of the Treasury first assesses additional 

22 duties on an agricultural safeguard good under this 

23 subsection, the Secretary shall notify the Govern24 ment of Chile in writing of such action and shall 
16

•HR 2738 IH 

1 provide to the Government of Chile data supporting 

2 the assessment of additional duties. 

3 (7) MODIFICATION OF TRIGGER PRICES.—Not 

4 later than 60 calendar days before agreeing with the 

5 Government of Chile pursuant to article 3.18(2)(b) 

6 of the Agreement on a modification to a trigger 

7 price for a good listed in Annex 3.18 of the Agree8 ment, the President shall notify the Committees on 

9 Ways and Means and Agriculture of the House of 

10 Representatives and the Committees on Finance and 

11 Agriculture of the Senate of the proposed modifica12 tion and the reasons therefor. 

13 (8) DEFINITIONS.—In this subsection: 

14 (A) AGRICULTURAL SAFEGUARD GOOD.—

15 The term ‘‘agricultural safeguard good’’ means 

16 a good—

17 (i) that qualifies as an originating 

18 good under section 202; 

19 (ii) that is included in the United 

20 States Agricultural Safeguard Product List 

21 set forth in Annex 3.18 of the Agreement; 

22 and 

23 (iii) for which a claim for preferential 

24 tariff treatment under the Agreement has 

25 been made. 
17

•HR 2738 IH 

1 (B) F.O.B.—The term ‘‘F.O.B.’’ means 

2 free on board, regardless of the mode of trans3 portation, at the point of direct shipment by the 

4 seller to the buyer. 

5 (C) UNIT IMPORT PRICE.—The term ‘‘unit 

6 import price’’ means the price expressed in dol7 lars per kilogram.

8 (d) CONVERSION TO AD VALOREM RATES.—For pur9 poses of subsections (a) and (b), with respect to any good 

10 for which the base rate in the Schedule of the United 

11 States to Annex 3.3 of the Agreement is a specific or com12 pound rate of duty, the President may substitute for the 

13 base rate an ad valorem rate that the President deter14 mines to be equivalent to the base rate. 

15 SEC. 202. RULES OF ORIGIN. 

16 (a) ORIGINATING GOODS.—

17 (1) IN GENERAL.—For purposes of this Act 

18 and for purposes of implementing the tariff treat19 ment provided for under the Agreement, except as 

20 otherwise provided in this section, a good is an origi21 nating good if—

22 (A) the good is wholly obtained or pro23 duced entirely in the territory of Chile, the 

24 United States, or both; 

25 (B) the good—
18

•HR 2738 IH 

1 (i) is produced entirely in the territory 

2 of Chile, the United States, or both, and 

3 (I) each of the nonoriginating 

4 materials used in the production of 

5 the good undergoes an applicable 

6 change in tariff classification specified 

7 in Annex 4.1 of the Agreement, or 

8 (II) the good otherwise satisfies 

9 any applicable regional value-content 

10 or other requirements specified in 

11 Annex 4.1 of the Agreement; and 

12 (ii) satisfies all other applicable re13 quirements of this section; or 

14 (C) the good is produced entirely in the 

15 territory of Chile, the United States, or both, 

16 exclusively from materials described in subpara17 graph (A) or (B). 

18 (2) SIMPLE COMBINATION OR MERE DILU19 TION.—A good shall not be considered to be an orig20 inating good and a material shall not be considered 

21 to be an originating material by virtue of having un22 dergone—

23 (A) simple combining or packaging oper24 ations; or
19

•HR 2738 IH 

1 (B) mere dilution with water or another 

2 substance that does not materially alter the 

3 characteristics of the good or material. 

4 (b) DE MINIMIS AMOUNTS OF NONORIGINATING MA5 TERIALS.—

6 (1) IN GENERAL.—Except as provided in para7 graphs (2) and (3), a good that does not undergo a 

8 change in tariff classification pursuant to Annex 4.1 

9 of the Agreement is an originating good if—

10 (A) the value of all nonoriginating mate11 rials that are used in the production of the good 

12 and do not undergo the applicable change in 

13 tariff classification does not exceed 10 percent 

14 of the adjusted value of the good; 

15 (B) the value of such nonoriginating mate16 rials is included in the value of nonoriginating 

17 materials for any applicable regional value-con18 tent requirement; and 

19 (C) the good meets all other applicable re20 quirements of this section. 

21 (2) EXCEPTIONS.—Paragraph (1) does not 

22 apply to the following: 

23 (A) A nonoriginating material provided for 

24 in chapter 4 of the HTS, or a nonoriginating 

25 dairy preparation containing over 10 percent by 
20

•HR 2738 IH 

1 weight of milk solids provided for in subheading 

2 1901.90 or 2106.90 of the HTS, that is used 

3 in the production of a good provided for in 

4 chapter 4 of the HTS. 

5 (B) A nonoriginating material provided for 

6 in chapter 4 of the HTS, or nonoriginating 

7 dairy preparations containing over 10 percent 

8 by weight of milk solids provided for in sub9 heading 1901.90 of the HTS, that are used in 

10 the production of the following goods: 

11 (i) Infant preparations containing 

12 over 10 percent in weight of milk solids 

13 provided for in subheading 1901.10 of the 

14 HTS. 

15 (ii) Mixes and doughs, containing over 

16 25 percent by weight of butterfat, not put 

17 up for retail sale, provided for in sub18 heading 1901.20 of the HTS. 

19 (iii) Dairy preparations containing 

20 over 10 percent by weight of milk solids 

21 provided for in subheading 1901.90 or 

22 2106.90 of the HTS. 

23 (iv) Goods provided for in heading 

24 2105 of the HTS. 
21

•HR 2738 IH 

1 (v) Beverages containing milk pro2 vided for in subheading 2202.90 of the 

3 HTS. 

4 (vi) Animal feeds containing over 10 

5 percent by weight of milk solids provided 

6 for in subheading 2309.90 of the HTS. 

7 (C) A nonoriginating material provided for 

8 in heading 0805 of the HTS, or any of sub9 headings 2009.11.00 through 2009.39 of the 

10 HTS, that is used in the production of a good 

11 provided for in any of subheadings 2009.11.00 

12 through 2009.39 of the HTS, or in fruit or veg13 etable juice of any single fruit or vegetable, for14 tified with minerals or vitamins, concentrated 

15 or unconcentrated, provided for in subheading 

16 2106.90 or 2202.90 of the HTS. 

17 (D) A nonoriginating material provided for 

18 in chapter 15 of the HTS that is used in the 

19 production of a good provided for in any of 

20 headings 1501.00.00 through 1508, 1512, 

21 1514, and 1515 of the HTS. 

22 (E) A nonoriginating material provided for 

23 in heading 1701 of the HTS that is used in the 

24 production of a good provided for in any of 

25 headings 1701 through 1703 of the HTS.
22

•HR 2738 IH 

1 (F) A nonoriginating material provided for 

2 in chapter 17 of the HTS or in heading 

3 1805.00.00 of the HTS that is used in the pro4 duction of a good provided for in subheading 

5 1806.10 of the HTS. 

6 (G) A nonoriginating material provided for 

7 in any of headings 2203 through 2208 of the 

8 HTS that is used in the production of a good 

9 provided for in heading 2207 or 2208 of the 

10 HTS. 

11 (H) A nonoriginating material used in the 

12 production of a good provided for in any of 

13 chapters 1 through 21 of the HTS, unless the 

14 nonoriginating material is provided for in a dif15 ferent subheading than the good for which ori16 gin is being determined under this section. 

17 (3) GOODS PROVIDED FOR IN CHAPTERS 50

18 THROUGH 63 OF THE HTS.—

19 (A) IN GENERAL.—Except as provided in 

20 subparagraph (B), a good provided for in any 

21 of chapters 50 through 63 of the HTS that is 

22 not an originating good because certain fibers 

23 or yarns used in the production of the compo24 nent of the good that determines the tariff clas25 sification of the good do not undergo an appli-
23

•HR 2738 IH 

1 cable change in tariff classification set out in 

2 Annex 4.1 of the Agreement, shall be consid3 ered to be an originating good if the total 

4 weight of all such fibers or yarns in that com5 ponent is not more than 7 percent of the total 

6 weight of that component. 

7 (B) CERTAIN TEXTILE OR APPAREL

8 GOODS.—A textile or apparel good containing 

9 elastomeric yarns in the component of the good 

10 that determines the tariff classification of the 

11 good shall be considered to be an originating 

12 good only if such yarns are wholly formed in 

13 the territory of Chile or the United States. 

14 (c) ACCUMULATION.—

15 (1) ORIGINATING GOODS INCORPORATED IN

16 GOODS OF OTHER COUNTRY.—Originating goods or 

17 materials of Chile or the United States that are in18 corporated into a good in the territory of the other 

19 country shall be considered to originate in the terri20 tory of the other country. 

21 (2) MULTIPLE PROCEDURES.—A good that is 

22 produced in the territory of Chile, the United States, 

23 or both, by 1 or more producers, is an originating 

24 good if the good satisfies the requirements of sub-
24

•HR 2738 IH 

1 section (a) and all other applicable requirements of 

2 this section. 

3 (d) REGIONAL VALUE-CONTENT.—

4 (1) IN GENERAL.—For purposes of subsection 

5 (a)(2), the regional value-content of a good referred 

6 to in Annex 4.1 of the Agreement shall be cal7 culated, at the choice of the person claiming pref8 erential tariff treatment for the good, on the basis 

9 of the build-down method described in paragraph (2) 

10 or the build-up method described in paragraph (3), 

11 unless otherwise provided in Annex 4.1 of the Agree12 ment. 

13 (2) BUILD-DOWN METHOD.—

14 (A) IN GENERAL.—The regional value-con15 tent of a good may be calculated on the basis 

16 of the following build-down method:

RVC =

AV - VNM 

× 100

AV 

17 (B) DEFINITIONS.—For purposes of sub18 paragraph (A): 

19 (i) The term ‘‘RVC’’ means the re20 gional value-content, expressed as a per21 centage. 

22 (ii) The term ‘‘AV’’ means the ad23 justed value. 
25

•HR 2738 IH 

1 (iii) The term ‘‘VNM’’ means the 

2 value of nonoriginating materials used by 

3 the producer in the production of the good. 

4 (3) BUILD-UP METHOD.—

5 (A) IN GENERAL.—The regional value-con6 tent of a good may be calculated on the basis 

7 of the following build-up method:

RVC =

VOM 

× 100

AV 

8 (B) DEFINITIONS.—For purposes of sub9 paragraph (A): 

10 (i) The term ‘‘RVC’’ means the re11 gional value-content, expressed as a per12 centage. 

13 (ii) The term ‘‘AV’’ means the ad14 justed value. 

15 (iii) The term ‘‘VOM’’ means the 

16 value of originating materials used by the 

17 producer in the production of the good. 

18 (e) VALUE OF MATERIALS.—

19 (1) IN GENERAL.—For purposes of calculating 

20 the regional value-content of a good under sub21 section (d), and for purposes of applying the de 

22 minimis rules under subsection (b), the value of a 

23 material is—
26

•HR 2738 IH 

1 (A) in the case of a material that is im2 ported by the producer of the good, the ad3 justed value of the material with respect to that 

4 importation; 

5 (B) in the case of a material acquired in 

6 the territory in which the good is produced, ex7 cept for a material to which subparagraph (C) 

8 applies, the producer’s price actually paid or 

9 payable for the material; 

10 (C) in the case of a material provided to 

11 the producer without charge, or at a price re12 flecting a discount or similar reduction, the sum 

13 of—

14 (i) all expenses incurred in the 

15 growth, production, or manufacture of the 

16 material, including general expenses; and 

17 (ii) an amount for profit; or 

18 (D) in the case of a material that is self19 produced, the sum of—

20 (i) all expenses incurred in the pro21 duction of the material, including general 

22 expenses; and 

23 (ii) an amount for profit. 

24 (2) FURTHER ADJUSTMENTS TO THE VALUE OF

25 MATERIALS.—
27

•HR 2738 IH 

1 (A) ORIGINATING MATERIALS.—The fol2 lowing expenses, if not included in the value of 

3 an originating material calculated under para4 graph (1), may be added to the value of the 

5 originating material: 

6 (i) The costs of freight, insurance, 

7 packing, and all other costs incurred in 

8 transporting the material to the location of 

9 the producer. 

10 (ii) Duties, taxes, and customs broker11 age fees on the material paid in the terri12 tory of Chile, the United States, or both, 

13 other than duties and taxes that are 

14 waived, refunded, refundable, or otherwise 

15 recoverable, including credit against duty 

16 or tax paid or payable. 

17 (iii) The cost of waste and spoilage re18 sulting from the use of the material in the 

19 production of the good, less the value of 

20 renewable scrap or byproduct. 

21 (B) NONORIGINATING MATERIALS.—The 

22 following expenses, if included in the value of a 

23 nonoriginating material calculated under para24 graph (1), may be deducted from the value of 

25 the nonoriginating material: 
28

•HR 2738 IH 

1 (i) The costs of freight, insurance, 

2 packing, and all other costs incurred in 

3 transporting the material to the location of 

4 the producer. 

5 (ii) Duties, taxes, and customs broker6 age fees on the material paid in the terri7 tory of Chile, the United States, or both, 

8 other than duties and taxes that are 

9 waived, refunded, refundable, or otherwise 

10 recoverable, including credit against duty 

11 or tax paid or payable. 

12 (iii) The cost of waste and spoilage re13 sulting from the use of the material in the 

14 production of the good, less the value of 

15 renewable scrap or byproducts. 

16 (iv) The cost of originating materials 

17 used in the production of the nonorigi18 nating material in the territory of Chile or 

19 the United States. 

20 (f) ACCESSORIES, SPARE PARTS, OR TOOLS.—Acces21 sories, spare parts, or tools delivered with a good that 

22 form part of the good’s standard accessories, spare parts, 

23 or tools shall be regarded as a material used in the produc24 tion of the good, if—
29

•HR 2738 IH 

1 (1) the accessories, spare parts, or tools are 

2 classified with and not invoiced separately from the 

3 good; and 

4 (2) the quantities and value of the accessories, 

5 spare parts, or tools are customary for the good. 

6 (g) FUNGIBLE GOODS AND MATERIALS.—

7 (1) IN GENERAL.—

8 (A) CLAIM FOR PREFERENTIAL TREAT9 MENT.—A person claiming preferential tariff 

10 treatment for a good may claim that a fungible 

11 good or material is originating either based on 

12 the physical segregation of each fungible good 

13 or material or by using an inventory manage14 ment method. 

15 (B) INVENTORY MANAGEMENT METHOD.—

16 In this subsection, the term ‘‘inventory manage17 ment method’’ means—

18 (i) averaging; 

19 (ii) ‘‘last-in, first-out’’; 

20 (iii)‘‘first-in, first-out’’; or 

21 (iv) any other method—

22 (I) recognized in the generally 

23 accepted accounting principles of the 

24 country in which the production is 
30

•HR 2738 IH 

1 performed (whether Chile or the 

2 United States); or 

3 (II) otherwise accepted by that 

4 country. 

5 (2) ELECTION OF INVENTORY METHOD.—A 

6 person selecting an inventory management method 

7 under paragraph (1) for particular fungible goods or 

8 materials shall continue to use that method for those 

9 goods or materials throughout the fiscal year of that 

10 person. 

11 (h) PACKAGING MATERIALS AND CONTAINERS FOR

12 RETAIL SALE.—Packaging materials and containers in 

13 which a good is packaged for retail sale, if classified with 

14 the good, shall be disregarded in determining whether all 

15 nonoriginating materials used in the production of the 

16 good undergo the applicable change in tariff classification 

17 set out in Annex 4.1 of the Agreement, and, if the good 

18 is subject to a regional value-content requirement, the 

19 value of such packaging materials and containers shall be 

20 taken into account as originating or nonoriginating mate21 rials, as the case may be, in calculating the regional value22 content of the good.

23 (i) PACKING MATERIALS AND CONTAINERS FOR

24 SHIPMENT.—Packing materials and containers for ship25 ment shall be disregarded in determining whether—
31

•HR 2738 IH 

1 (1) the nonoriginating materials used in the 

2 production of the good undergo an applicable change 

3 in tariff classification set out in Annex 4.1 of the 

4 Agreement; and 

5 (2) the good satisfies a regional value-content 

6 requirement. 

7 (j) INDIRECT MATERIALS.—An indirect material 

8 shall be considered to be an originating material without 

9 regard to where it is produced. 

10 (k) TRANSIT AND TRANSSHIPMENT.—A good that 

11 has undergone production necessary to qualify as an origi12 nating good under subsection (a) shall not be considered 

13 to be an originating good if, subsequent to that produc14 tion, the good undergoes further production or any other 

15 operation outside the territory of Chile or the United 

16 States, other than unloading, reloading, or any other proc17 ess necessary to preserve the good in good condition or 

18 to transport the good to the territory of Chile or the 

19 United States.

20 (l) TEXTILE AND APPAREL GOODS CLASSIFIABLE AS

21 GOODS PUT UP IN SETS.—Notwithstanding the rules set 

22 forth in Annex 4.1 of the Agreement, textile and apparel 

23 goods classifiable as goods put up in sets for retail sale 

24 as provided for in General Rule of Interpretation 3 of the 

25 Harmonized System shall not be considered to be origi-
32

•HR 2738 IH 

1 nating goods unless each of the goods in the set is an origi2 nating good or the total value of the nonoriginating goods 

3 in the set does not exceed 10 percent of the value of the 

4 set determined for purposes of assessing customs duties. 

5 (m) APPLICATION AND INTERPRETATION.—In this 

6 section: 

7 (1) The basis for any tariff classification is the 

8 HTS.

9 (2) Any cost or value referred to in this section 

10 shall be recorded and maintained in accordance with 

11 the generally accepted accounting principles applica12 ble in the territory of the country in which the good 

13 is produced (whether Chile or the United States). 

14 (n) DEFINITIONS.—In this section: 

15 (1) ADJUSTED VALUE.—The term ‘‘adjusted 

16 value’’ means the value determined in accordance 

17 with articles 1 through 8, article 15, and the cor18 responding interpretive notes of the Agreement on 

19 Implementation of Article VII of the General Agree20 ment on Tariffs and Trade 1994 referred to in sec21 tion 101(d)(8) of the Uruguay Round Agreements 

22 Act, except that such value may be adjusted to ex23 clude any costs, charges, or expenses incurred for 

24 transportation, insurance, and related services inci25 dent to the international shipment of the merchan-
33

•HR 2738 IH 

1 dise from the country of exportation to the place of 

2 importation. 

3 (2) FUNGIBLE GOODS OR FUNGIBLE MATE4 RIALS.—The terms ‘‘fungible goods’’ and ‘‘fungible 

5 materials’’ mean goods or materials, as the case may 

6 be, that are interchangeable for commercial purposes 

7 and the properties of which are essentially identical. 

8 (3) GENERALLY ACCEPTED ACCOUNTING PRIN9 CIPLES.—The term ‘‘generally accepted accounting 

10 principles’’ means the principles, rules, and proce11 dures, including both broad and specific guidelines, 

12 that define the accounting practices accepted in the 

13 territory of Chile or the United States, as the case 

14 may be.

15 (4) GOODS WHOLLY OBTAINED OR PRODUCED

16 ENTIRELY IN THE TERRITORY OF CHILE, THE

17 UNITED STATES, OR BOTH.—The term ‘‘goods whol18 ly obtained or produced entirely in the territory of 

19 Chile, the United States, or both’’ means—

20 (A) mineral goods extracted in the terri21 tory of Chile, the United States, or both; 

22 (B) vegetable goods, as such goods are de23 fined in the Harmonized System, harvested in 

24 the territory of Chile, the United States, or 

25 both; 
34

•HR 2738 IH 

1 (C) live animals born and raised in the ter2 ritory of Chile, the United States, or both; 

3 (D) goods obtained from hunting, trap4 ping, or fishing in the territory of Chile, the 

5 United States, or both; 

6 (E) goods (fish, shellfish, and other marine 

7 life) taken from the sea by vessels registered or 

8 recorded with Chile or the United States and 

9 flying the flag of that country; 

10 (F) goods produced on board factory ships 

11 from the goods referred to in subparagraph 

12 (E), if such factory ships are registered or re13 corded with Chile or the United States and fly 

14 the flag of that country; 

15 (G) goods taken by Chile or the United 

16 States or a person of Chile or the United States 

17 from the seabed or beneath the seabed outside 

18 territorial waters, if Chile or the United States 

19 has rights to exploit such seabed; 

20 (H) goods taken from outer space, if the 

21 goods are obtained by Chile or the United 

22 States or a person of Chile or the United States 

23 and not processed in the territory of a country 

24 other than Chile or the United States; 

25 (I) waste and scrap derived from—
35

•HR 2738 IH 

1 (i) production in the territory of Chile, 

2 the United States, or both; or 

3 (ii) used goods collected in the terri4 tory of Chile, the United States, or both, 

5 if such goods are fit only for the recovery 

6 of raw materials; 

7 (J) recovered goods derived in the territory 

8 of Chile or the United States from used goods, 

9 and used in the territory of that country in the 

10 production of remanufactured goods; and 

11 (K) goods produced in the territory of 

12 Chile, the United States, or both, exclusively—

13 (i) from goods referred to in any of 

14 subparagraphs (A) through (I), or 

15 (ii) from the derivatives of goods re16 ferred to in clause (i), 

17 at any stage of production. 

18 (5) HARMONIZED SYSTEM.—The term ‘‘Har19 monized System’’ means the Harmonized Com20 modity Description and Coding System.

21 (6) INDIRECT MATERIAL.—The term ‘‘indirect 

22 material’’ means a good used in the production, test23 ing, or inspection of a good but not physically incor24 porated into the good, or a good used in the mainte-
36

•HR 2738 IH 

1 nance of buildings or the operation of equipment as2 sociated with the production of a good, including—

3 (A) fuel and energy; 

4 (B) tools, dies, and molds; 

5 (C) spare parts and materials used in the 

6 maintenance of equipment or buildings; 

7 (D) lubricants, greases, compounding ma8 terials, and other materials used in production 

9 or used to operate equipment or buildings; 

10 (E) gloves, glasses, footwear, clothing, 

11 safety equipment, and supplies; 

12 (F) equipment, devices, and supplies used 

13 for testing or inspecting the good; 

14 (G) catalysts and solvents; and 

15 (H) any other goods that are not incor16 porated into the good but the use of which in 

17 the production of the good can reasonably be 

18 demonstrated to be a part of that production. 

19 (7) MATERIAL.—The term ‘‘material’’ means a 

20 good that is used in the production of another good, 

21 including a part, ingredient, or indirect material. 

22 (8) MATERIAL THAT IS SELF-PRODUCED.—The 

23 term ‘‘material that is self-produced’’ means a mate24 rial that is an originating good produced by a pro-
37

•HR 2738 IH 

1 ducer of a good and used in the production of that 

2 good. 

3 (9) NONORIGINATING GOOD OR NONORIGI4 NATING MATERIAL.—The terms ‘‘nonoriginating 

5 good’’ and ‘‘nonoriginating material’’ mean a good 

6 or material, as the case may be, that does not qual7 ify as an originating good under this section. 

8 (10) PACKING MATERIALS AND CONTAINERS

9 FOR SHIPMENT.—The term ‘‘packing materials and 

10 containers for shipment’’ means the goods used to 

11 protect a good during its transportation, and does 

12 not include the packaging materials and containers 

13 in which a good is packaged for retail sale. 

14 (11) PREFERENTIAL TARIFF TREATMENT.—

15 The term ‘‘preferential tariff treatment’’ means the 

16 customs duty rate that is applicable to an origi17 nating good pursuant to chapter 3 of the Agree18 ment. 

19 (12) PRODUCER.—The term ‘‘producer’’ means 

20 a person who engages in the production of a good 

21 in the territory of Chile or the United States. 

22 (13) PRODUCTION.—The term ‘‘production’’ 

23 means growing, mining, harvesting, fishing, raising, 

24 trapping, hunting, manufacturing, processing, as25 sembling, or disassembling a good. 
38

•HR 2738 IH 

1 (14) RECOVERED GOODS.—

2 (A) IN GENERAL.—The term ‘‘recovered 

3 goods’’ means materials in the form of indi4 vidual parts that are the result of—

5 (i) the complete disassembly of used 

6 goods into individual parts; and 

7 (ii) the cleaning, inspecting, testing, 

8 or other processing of those parts as nec9 essary for improvement to sound working 

10 condition by one or more of the processes 

11 described in subparagraph (B), in order 

12 for such parts to be assembled with other 

13 parts, including other parts that have un14 dergone the processes described in this 

15 paragraph, in the production of a remanu16 factured good. 

17 (B) PROCESSES.—The processes referred 

18 to in subparagraph (A)(ii) are welding, flame 

19 spraying, surface machining, knurling, plating, 

20 sleeving, and rewinding. 

21 (15) REMANUFACTURED GOOD.—The term ‘‘re22 manufactured good’’ means an industrial good as23 sembled in the territory of Chile or the United 

24 States, that is listed in Annex 4.18 of the Agree25 ment, and— 
39

•HR 2738 IH 

1 (A) is entirely or partially comprised of re2 covered goods; 

3 (B) has the same life expectancy and 

4 meets the same performance standards as a 

5 new good; and 

6 (C) enjoys the same factory warranty as 

7 such a new good.

8 (o) PRESIDENTIAL PROCLAMATION AUTHORITY.—

9 (1) IN GENERAL.—The President is authorized 

10 to proclaim, as part of the HTS—

11 (A) the provisions set out in Annex 4.1 of 

12 the Agreement; and 

13 (B) any additional subordinate category 

14 necessary to carry out this title consistent with 

15 the Agreement. 

16 (2) MODIFICATIONS.—

17 (A) IN GENERAL.—Subject to the consulta18 tion and layover provisions of section 103(a), 

19 the President may proclaim modifications to the 

20 provisions proclaimed under the authority of 

21 paragraph (1)(A), other than provisions of 

22 chapters 50 through 63 of the HTS, as in23 cluded in Annex 4.1 of the Agreement. 

24 (B) ADDITIONAL PROCLAMATIONS.—Not25 withstanding subparagraph (A), and subject to
40

•HR 2738 IH 

1 the consultation and layover provisions of sec2 tion 103(a), the President may proclaim—

3 (i) modifications to the provisions pro4 claimed under the authority of paragraph 

5 (1)(A) that are necessary to implement an 

6 agreement with Chile pursuant to article 

7 3.20(5) of the Agreement; and 

8 (ii) before the 1st anniversary of the 

9 date of the enactment of this Act, modi10 fications to correct any typographical, cler11 ical, or other nonsubstantive technical 

12 error regarding the provisions of chapters 

13 50 through 63 of the HTS, as included in 

14 Annex 4.1 of the Agreement.

15 SEC. 203. DRAWBACK. 

16 (a) DEFINITION OF A GOOD SUBJECT TO CHILE FTA 

17 DRAWBACK.—For purposes of this Act and the amend18 ments made by subsection (b), the term ‘‘good subject to 

19 Chile FTA drawback’’ means any imported good other 

20 than the following: 

21 (1) A good entered under bond for transpor22 tation and exportation to Chile. 

23 (2)(A) A good exported to Chile in the same 

24 condition as when imported into the United States. 

25 (B) For purposes of subparagraph (A)—
41

•HR 2738 IH 

1 (i) processes such as testing, cleaning, re2 packing, inspecting, sorting, or marking a good, 

3 or preserving it in its same condition, shall not 

4 be considered to change the condition of the 

5 good; and 

6 (ii) if a good described in subparagraph 

7 (A) is commingled with fungible goods and ex8 ported in the same condition, the origin of the 

9 good for the purposes of subsection (j)(1) of 

10 section 313 of the Tariff Act of 1930 (19 

11 U.S.C. 1313(j)(1)) may be determined on the 

12 basis of the inventory methods provided for in 

13 the regulations implementing this title.

14 (3) A good—

15 (A) that is—

16 (i) deemed to be exported from the 

17 United States; 

18 (ii) used as a material in the produc19 tion of another good that is deemed to be 

20 exported to Chile; or 

21 (iii) substituted for by a good of the 

22 same kind and quality that is used as a 

23 material in the production of another good 

24 that is deemed to be exported to Chile; and 

25 (B) that is delivered—
42

•HR 2738 IH 

1 (i) to a duty-free shop; 

2 (ii) for ship’s stores or supplies for a 

3 ship or aircraft; or 

4 (iii) for use in a project undertaken 

5 jointly by the United States and Chile and 

6 destined to become the property of the 

7 United States. 

8 (4) A good exported to Chile for which a refund 

9 of customs duties is granted by reason of—

10 (A) the failure of the good to conform to 

11 sample or specification; or 

12 (B) the shipment of the good without the 

13 consent of the consignee. 

14 (5) A good that qualifies under the rules of ori15 gin set out in section 202 that is—

16 (A) exported to Chile; 

17 (B) used as a material in the production of 

18 another good that is exported to Chile; or 

19 (C) substituted for by a good of the same 

20 kind and quality that is used as a material in 

21 the production of another good that is exported 

22 to Chile. 

23 (b) CONSEQUENTIAL AMENDMENTS.—

24 (1) BONDED MANUFACTURING WAREHOUSES.—

25 Section 311 of the Tariff Act of 1930 (19 U.S.C. 
43

•HR 2738 IH 

1 1311) is amended by adding at the end the following 

2 new paragraph: 

3 ‘‘No article manufactured in a bonded warehouse 

4 from materials that are goods subject to Chile FTA draw5 back, as defined in section 203(a) of the United States6 Chile Free Trade Agreement Implementation Act, may be 

7 withdrawn from warehouse for exportation to Chile with8 out assessment of a duty on the materials in their condi9 tion and quantity, and at their weight, at the time of im10 portation into the United States. The duty shall be paid 

11 before the 61st day after the date of exportation, except 

12 that the duty may be waived or reduced by—

13 ‘‘(1) 100 percent during the 8-year period be14 ginning on January 1, 2004; 

15 ‘‘(2) 75 percent during the 1-year period begin16 ning on January 1, 2012; 

17 ‘‘(3) 50 percent during the 1-year period begin18 ning on January 1, 2013; and 

19 ‘‘(4) 25 percent during the 1-year period begin20 ning on January 1, 2014.’’.

21 (2) BONDED SMELTING AND REFINING WARE22 HOUSES.—Section 312 of the Tariff Act of 1930 (19 

23 U.S.C. 1312) is amended—

24 (A) in paragraph (1) of subsection (b), by 

25 striking ‘‘except that’’ and all that follows 
44

•HR 2738 IH 

1 through subparagraph (B) and inserting the 

2 following: ‘‘except that—

3 ‘‘(A) in the case of a withdrawal for expor4 tation of such a product to a NAFTA country, 

5 as defined in section 2(4) of the North Amer6 ican Free Trade Agreement Implementation 

7 Act, if any of the imported metal-bearing mate8 rials are goods subject to NAFTA drawback, as 

9 defined in section 203(a) of that Act, the duties 

10 on the materials shall be paid, and the charges 

11 against the bond canceled, before the 61st day 

12 after the date of exportation; but upon the pres13 entation, before such 61st day, of satisfactory 

14 evidence of the amount of any customs duties 

15 paid to the NAFTA country on the product, the 

16 duties on the materials may be waived or re17 duced (subject to section 508(b)(2)(B)) in an 

18 amount that does not exceed the lesser of—

19 ‘‘(i) the total amount of customs du20 ties owed on the materials on importation 

21 into the United States, or 

22 ‘‘(ii) the total amount of customs du23 ties paid to the NAFTA country on the 

24 product, and
45

•HR 2738 IH 

1 ‘‘(B) in the case of a withdrawal for expor2 tation of such a product to Chile, if any of the 

3 imported metal-bearing materials are goods 

4 subject to Chile FTA drawback, as defined in 

5 section 203(a) of the United States-Chile Free 

6 Trade Agreement Implementation Act, the du7 ties on the materials shall be paid, and the 

8 charges against the bond canceled, before the 

9 61st day after the date of exportation, except 

10 that the duties may be waived or reduced by—

11 ‘‘(i) 100 percent during the 8-year pe12 riod beginning on January 1, 2004, 

13 ‘‘(ii) 75 percent during the 1-year pe14 riod beginning on January 1, 2012, 

15 ‘‘(iii) 50 percent during the 1-year pe16 riod beginning on January 1, 2013, and 

17 ‘‘(iv) 25 percent during the 1-year pe18 riod beginning on January 1, 2014, or’’; 

19 (B) in paragraph (4) of subsection (b), by 

20 striking ‘‘except that’’ and all that follows 

21 through subparagraph (B) and inserting the 

22 following: ‘‘except that—

23 ‘‘(A) in the case of a withdrawal for expor24 tation of such a product to a NAFTA country, 

25 as defined in section 2(4) of the North Amer-
46

•HR 2738 IH 

1 ican Free Trade Agreement Implementation 

2 Act, if any of the imported metal-bearing mate3 rials are goods subject to NAFTA drawback, as 

4 defined in section 203(a) of that Act, the duties 

5 on the materials shall be paid, and the charges 

6 against the bond canceled, before the 61st day 

7 after the date of exportation; but upon the pres8 entation, before such 61st day, of satisfactory 

9 evidence of the amount of any customs duties 

10 paid to the NAFTA country on the product, the 

11 duties on the materials may be waived or re12 duced (subject to section 508(b)(2)(B)) in an 

13 amount that does not exceed the lesser of—

14 ‘‘(i) the total amount of customs du15 ties owed on the materials on importation 

16 into the United States, or 

17 ‘‘(ii) the total amount of customs du18 ties paid to the NAFTA country on the 

19 product, and

20 ‘‘(B) in the case of a withdrawal for expor21 tation of such a product to Chile, if any of the 

22 imported metal-bearing materials are goods 

23 subject to Chile FTA drawback, as defined in 

24 section 203(a) of the United States-Chile Free 

25 Trade Agreement Implementation Act, the du-
47

•HR 2738 IH 

1 ties on the materials shall be paid, and the 

2 charges against the bond canceled, before the 

3 61st day after the date of exportation, except 

4 that the duties may be waived or reduced by—

5 ‘‘(i) 100 percent during the 8-year pe6 riod beginning on January 1, 2004, 

7 ‘‘(ii) 75 percent during the 1-year pe8 riod beginning on January 1, 2012, 

9 ‘‘(iii) 50 percent during the 1-year pe10 riod beginning on January 1, 2013, and 

11 ‘‘(iv) 25 percent during the 1-year pe12 riod beginning on January 1, 2014, or’’; 

13 and 

14 (C) in subsection (d), in the matter pre15 ceding paragraph (1), by striking ‘‘except that’’ 

16 and all that follows through the end of para17 graph (2) and inserting the following: ‘‘except 

18 that—

19 ‘‘(1) in the case of a withdrawal for exportation 

20 to a NAFTA country, as defined in section 2(4) of 

21 the North American Free Trade Agreement Imple22 mentation Act, if any of the imported metal-bearing 

23 materials are goods subject to NAFTA drawback, as 

24 defined in section 203(a) of that Act, charges 

25 against the bond shall be paid before the 61st day 
48

•HR 2738 IH 

1 after the date of exportation; but upon the presen2 tation, before such 61st day, of satisfactory evidence 

3 of the amount of any customs duties paid to the 

4 NAFTA country on the product, the bond shall be 

5 credited (subject to section 508(b)(2)(B)) in an 

6 amount not to exceed the lesser of—

7 ‘‘(A) the total amount of customs duties 

8 paid or owed on the materials on importation 

9 into the United States, or 

10 ‘‘(B) the total amount of customs duties 

11 paid to the NAFTA country on the product; 

12 and

13 ‘‘(2) in the case of a withdrawal for exportation 

14 to Chile, if any of the imported metal-bearing mate15 rials are goods subject to Chile FTA drawback, as 

16 defined in section 203(a) of the United States-Chile 

17 Free Trade Agreement Implementation Act, charges 

18 against the bond shall be paid before the 61st day 

19 after the date of exportation, and the bond shall be 

20 credited in an amount equal to—

21 ‘‘(A) 100 percent of the total amount of 

22 customs duties paid or owed on the materials 

23 on importation into the United States during 

24 the 8-year period beginning on January 1, 

25 2004, 
49

•HR 2738 IH 

1 ‘‘(B) 75 percent of the total amount of 

2 customs duties paid or owed on the materials 

3 on importation into the United States during 

4 the 1-year period beginning on January 1, 

5 2012, 

6 ‘‘(C) 50 percent of the total amount of 

7 customs duties paid or owed on the materials 

8 on importation into the United States during 

9 the 1-year period beginning on January 1, 

10 2013, and 

11 ‘‘(D) 25 percent of the total amount of 

12 customs duties paid or owed on the materials 

13 on importation into the United States during 

14 the 1-year period beginning on January 1, 

15 2014.’’. 

16 (3) DRAWBACK.—Section 313 of the Tariff Act 

17 of 1930 (19 U.S.C. 1313) is amended—

18 (A) in paragraph (4) of subsection (j)—

19 (i) by striking ‘‘(4)’’ and inserting 

20 ‘‘(4)(A)’’; and 

21 (ii) by adding at the end the following 

22 new subparagraph: 

23 ‘‘(B) Beginning on January 1, 2015, the expor24 tation to Chile of merchandise that is fungible with 

25 and substituted for imported merchandise, other
50

•HR 2738 IH 

1 than merchandise described in paragraphs (1) 

2 through (5) of section 203(a) of the United States3 Chile Free Trade Agreement Implementation Act, 

4 shall not constitute an exportation for purposes of 

5 paragraph (2). The preceding sentence shall not be 

6 construed to permit the substitution of unused draw7 back under paragraph (2) of this subsection with re8 spect to merchandise described in paragraph (2) of 

9 section 203(a) of the United States-Chile Free 

10 Trade Agreement Implementation Act.’’; 

11 (B) in subsection (n)—

12 (i) by striking ‘‘(n)’’ and inserting the 

13 following: 

14 ‘‘(n) REFUNDS, WAIVERS, OR REDUCTIONS UNDER

15 CERTAIN FREE TRADE AGREEMENTS.—’’; 

16 (ii) in paragraph (1)—

17 (I) by striking ‘‘; and’’ at the end 

18 of subparagraph (B); 

19 (II) by striking the period at the 

20 end of subparagraph (C) and insert21 ing ‘‘; and’’; and 

22 (III) by adding at the end the 

23 following new subparagraph: 

24 ‘‘(D) the term ‘good subject to Chile FTA 

25 drawback’ has the meaning given that term in sec-
51

•HR 2738 IH 

1 tion 203(a) of the United States-Chile Free Trade 

2 Agreement Implementation Act.’’; and 

3 (iii) by adding the following new para4 graph at the end: 

5 ‘‘(4)(A) For purposes of subsections (a), (b), (f), (h), 

6 (j)(2), (p), and (q), if an article that is exported to Chile 

7 is a good subject to Chile FTA drawback, no customs du8 ties on the good may be refunded, waived, or reduced, ex9 cept as provided in subparagraph (B). 

10 ‘‘(B) The customs duties referred to in subparagraph 

11 (A) may be refunded, waived, or reduced by—

12 ‘‘(i) 100 percent during the 8-year period begin13 ning on January 1, 2004; 

14 ‘‘(ii) 75 percent during the 1-year period begin15 ning on January 1, 2012; 

16 ‘‘(iii) 50 percent during the 1-year period begin17 ning on January 1, 2013; and 

18 ‘‘(iv) 25 percent during the 1-year period begin19 ning on January 1, 2014.’’; and 

20 (C) in subsection (o)—

21 (i) by striking ‘‘(o)’’ and inserting the 

22 following: 

23 ‘‘(o) SPECIAL RULES FOR CERTAIN VESSELS AND

24 IMPORTED MATERIALS.—’’; and 
52

•HR 2738 IH 

1 (ii) by adding at the end the following 

2 new paragraphs: 

3 ‘‘(3) For purposes of subsection (g), if—

4 ‘‘(A) a vessel is built for the account and own5 ership of a resident of Chile or the Government of 

6 Chile, and 

7 ‘‘(B) imported materials that are used in the 

8 construction and equipment of the vessel are goods 

9 subject to Chile FTA drawback, as defined in sec10 tion 203(a) of the United States-Chile Free Trade 

11 Agreement Implementation Act, 

12 no customs duties on such materials may be refunded, 

13 waived, or reduced, except as provided in paragraph (4). 

14 ‘‘(4) The customs duties referred to in paragraph (3) 

15 may be refunded, waived or reduced by—

16 ‘‘(A) 100 percent during the 8-year period be17 ginning on January 1, 2004; 

18 ‘‘(B) 75 percent during the 1-year period begin19 ning on January 1, 2012; 

20 ‘‘(C) 50 percent during the 1-year period begin21 ning on January 1, 2013; and 

22 ‘‘(D) 25 percent during the 1-year period begin23 ning on January 1, 2014.’’. 
53

•HR 2738 IH 

1 (4) MANIPULATION IN WAREHOUSE.—Section 

2 562 of the Tariff Act of 1930 (19 U.S.C. 1562) is 

3 amended—

4 (A) in paragraph (3), by striking ‘‘to a 

5 NAFTA country’’ and inserting ‘‘to Chile, to a 

6 NAFTA country,’’; 

7 (B) by striking ‘‘; and’’ at the end of para8 graph (4)(B); 

9 (C) by striking the period at the end of 

10 paragraph (5) and inserting ‘‘; and’’; and 

11 (D) by inserting after paragraph (5) the 

12 following: 

13 ‘‘(6)(A) without payment of duties for expor14 tation to Chile, if the merchandise is of a kind de15 scribed in any of paragraphs (1) through (5) of sec16 tion 203(a) of the United States-Chile Free Trade 

17 Agreement Implementation Act; and 

18 ‘‘(B) for exportation to Chile if the merchandise 

19 consists of goods subject to Chile FTA drawback, as 

20 defined in section 203(a) of the United States-Chile 

21 Free Trade Agreement Implementation Act, except 

22 that—

23 ‘‘(i) the merchandise may not be with24 drawn from warehouse without assessment of a 

25 duty on the merchandise in its condition and 
54

•HR 2738 IH 

1 quantity, and at its weight, at the time of with2 drawal from the warehouse with such additions 

3 to, or deductions from, the final appraised value 

4 as may be necessary by reason of a change in 

5 condition, and 

6 ‘‘(ii) duty shall be paid on the merchandise 

7 before the 61st day after the date of expor8 tation, except that such duties may be waived 

9 or reduced by—

10 ‘‘(I) 100 percent during the 8-year pe11 riod beginning on January 1, 2004, 

12 ‘‘(II) 75 percent during the 1-year pe13 riod beginning on January 1, 2012, 

14 ‘‘(III) 50 percent during the 1-year 

15 period beginning on January 1, 2013, and 

16 ‘‘(IV) 25 percent during the 1-year 

17 period beginning on January 1, 2014.’’. 

18 (5) FOREIGN TRADE ZONES.—Section 3(a) of 

19 the Act of June 18, 1934 (commonly known as the 

20 ‘‘Foreign Trade Zones Act’’; 19 U.S.C. 81c(a)) is 

21 amended by striking the end period and inserting 

22 the following: ‘‘: Provided further, That no merchan23 dise that consists of goods subject to Chile FTA 

24 drawback, as defined in section 203(a) of the United 

25 States-Chile Free Trade Agreement Implementation
55

•HR 2738 IH 

1 Act, that is manufactured or otherwise changed in 

2 condition shall be exported to Chile without an as3 sessment of a duty on the merchandise in its condi4 tion and quantity, and at its weight, at the time of 

5 its exportation (or if the privilege in the first proviso 

6 to this subsection was requested, an assessment of 

7 a duty on the merchandise in its condition and 

8 quantity, and at its weight, at the time of its admis9 sion into the zone) and the payment of the assessed 

10 duty before the 61st day after the date of expor11 tation of the article, except that the customs duty 

12 may be waived or reduced by (1) 100 percent during 

13 the 8-year period beginning on January 1, 2004; (2) 

14 75 percent during the 1-year period beginning on 

15 January 1, 2012; (3) 50 percent during the 1-year 

16 period beginning on January 1, 2013; and (4) 25 

17 percent during the 1-year period beginning on Janu18 ary 1, 2014.’’. 

19 (c) INAPPLICABILITY TO COUNTERVAILING AND

20 ANTIDUMPING DUTIES.—Nothing in this section or the 

21 amendments made by this section shall be considered to 

22 authorize the refund, waiver, or reduction of counter23 vailing duties or antidumping duties imposed on an im24 ported good. 
56

•HR 2738 IH 

1 SEC. 204. CUSTOMS USER FEES. 

2 Section 13031(b) of the Consolidated Omnibus Budg3 et Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is 

4 amended by inserting after paragraph (11) the following: 

5 ‘‘(12) No fee may be charged under subsection (a) 

6 (9) or (10) with respect to goods that qualify as origi7 nating goods under section 202 of the United States-Chile 

8 Free Trade Agreement Implementation Act. Any service 

9 for which an exemption from such fee is provided by rea10 son of this paragraph may not be funded with money con11 tained in the Customs User Fee Account.’’. 

12 SEC. 205. DISCLOSURE OF INCORRECT INFORMATION; DE13 NIAL OF PREFERENTIAL TARIFF TREAT14 MENT; FALSE CERTIFICATES OF ORIGIN. 

15 (a) DISCLOSURE OF INCORRECT INFORMATION.—

16 Section 592 of the Tariff Act of 1930 (19 U.S.C. 1592) 

17 is amended—

18 (1) in subsection (c)—

19 (A) by redesignating paragraph (6) as 

20 paragraph (7); and 

21 (B) by inserting after paragraph (5) the 

22 following new paragraph: 

23 ‘‘(6) PRIOR DISCLOSURE REGARDING CLAIMS

24 UNDER THE UNITED STATES-CHILE FREE TRADE

25 AGREEMENT.—An importer shall not be subject to 

26 penalties under subsection (a) for making an incor-
57

•HR 2738 IH 

1 rect claim that a good qualifies as an originating 

2 good under section 202 of the United States-Chile 

3 Free Trade Agreement Implementation Act if the 

4 importer, in accordance with regulations issued by 

5 the Secretary of the Treasury, voluntarily makes a 

6 corrected declaration and pays any duties owing.’’; 

7 and 

8 (2) by adding at the end the following new sub9 section: 

10 ‘‘(g) FALSE CERTIFICATIONS OF ORIGIN UNDER THE

11 UNITED STATES-CHILE FREE TRADE AGREEMENT.—

12 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

13 it is unlawful for any person to certify falsely, by 

14 fraud, gross negligence, or negligence, in a Chile 

15 FTA Certificate of Origin (as defined in section 

16 508(f)(1)(B) of this Act that a good exported from 

17 the United States qualifies as an originating good 

18 under the rules of origin set out in section 202 of 

19 the United States-Chile Free Trade Agreement Im20 plementation Act. The procedures and penalties of 

21 this section that apply to a violation of subsection 

22 (a) also apply to a violation of this subsection. 

23 ‘‘(2) IMMEDIATE AND VOLUNTARY DISCLOSURE

24 OF INCORRECT INFORMATION.—No penalty shall be 

25 imposed under this subsection if, immediately after 
58

•HR 2738 IH 

1 an exporter or producer that issued a Chile FTA 

2 Certificate of Origin has reason to believe that such 

3 certificate contains or is based on incorrect informa4 tion, the exporter or producer voluntarily provides 

5 written notice of such incorrect information to every 

6 person to whom the certificate was issued. 

7 ‘‘(3) EXCEPTION.—A person may not be consid8 ered to have violated paragraph (1) if—

9 ‘‘(A) the information was correct at the 

10 time it was provided in a Chile FTA Certificate 

11 of Origin but was later rendered incorrect due 

12 to a change in circumstances; and 

13 ‘‘(B) the person immediately and volun14 tarily provides written notice of the change in 

15 circumstances to all persons to whom the per16 son provided the certificate.’’. 

17 (b) DENIAL OF PREFERENTIAL TARIFF TREAT18 MENT.—Section 514 of the Tariff Act of 1930 (19 U.S.C. 

19 1514) is amended by adding at the end the following new 

20 subsection: 

21 ‘‘(g) DENIAL OF PREFERENTIAL TARIFF TREAT22 MENT UNDER UNITED STATES-CHILE FREE TRADE

23 AGREEMENT.—If the Bureau of Customs and Border Pro24 tection or the Bureau of Immigration and Customs En25 forcement finds indications of a pattern of conduct by an 
59

•HR 2738 IH 

1 importer of false or unsupported representations that 

2 goods qualify under the rules of origin set out in section 

3 202 of the United States-Chile Free Trade Agreement Im4 plementation Act, the Bureau of Customs and Border Pro5 tection, in accordance with regulations issued by the Sec6 retary of the Treasury, may deny preferential tariff treat7 ment under the United States-Chile Free Trade Agree8 ment to entries of identical goods imported by that person 

9 until the person establishes to the satisfaction of the Bu10 reau of Customs and Border Protection that representa11 tions of that person are in conformity with such section 

12 202.’’. 

13 SEC. 206. RELIQUIDATION OF ENTRIES. 

14 Subsection (d) of section 520 of the Tariff Act of 

15 1930 (19 U.S.C. 1520(d)) is amended—

16 (1) by striking ‘‘(d)’’ and inserting the fol17 lowing: 

18 ‘‘(d) GOODS QUALIFYING UNDER FREE TRADE

19 AGREEMENT RULES OF ORIGIN.—’’; 

20 (2) in the matter preceding paragraph (1), by 

21 inserting ‘‘or section 202 of the United States-Chile 

22 Free Trade Agreement Implementation Act’’ after 

23 ‘‘Act’’; 

24 (3) in paragraph (1), by striking ‘‘those’’ and 

25 inserting ‘‘the applicable’’; and
60

•HR 2738 IH 

1 (4) in paragraph (2), by inserting before the 

2 semicolon ‘‘, or other certificates of origin, as the 

3 case may be’’. 

4 SEC. 207. RECORDKEEPING REQUIREMENTS. 

5 Section 508 of the Tariff Act of 1930 (19 U.S.C. 

6 1508) is amended—

7 (1) by striking the heading of subsection (b) 

8 and inserting the following: ‘‘EXPORTATIONS TO

9 NAFTA COUNTRIES.—’’; and 

10 (2) by adding at the end the following: 

11 ‘‘(f) CERTIFICATES OF ORIGIN FOR GOODS EX12 PORTED UNDER THE UNITED STATES-CHILE FREE

13 TRADE AGREEMENT.—

14 ‘‘(1) DEFINITIONS.—In this subsection: 

15 ‘‘(A) RECORDS AND SUPPORTING DOCU16 MENTS.—The term ‘records and supporting 

17 documents’ means, with respect to an exported 

18 good under paragraph (2), records and docu19 ments related to the origin of the good, includ20 ing—

21 ‘‘(i) the purchase, cost, and value of, 

22 and payment for, the good; 

23 ‘‘(ii) if applicable, the purchase, cost, 

24 and value of, and payment for, all mate-
61

•HR 2738 IH 

1 rials, including recovered goods, used in 

2 the production of the good; and 

3 ‘‘(iii) if applicable, the production of 

4 the good in the form in which it was ex5 ported. 

6 ‘‘(B) CHILE FTA CERTIFICATE OF ORI7 GIN.—The term ‘Chile FTA Certificate of Ori8 gin’ means the certification, established under 

9 article 4.13 of the United States-Chile Free 

10 Trade Agreement, that a good qualifies as an 

11 originating good under such Agreement. 

12 ‘‘(2) EXPORTS TO CHILE.—Any person who 

13 completes and issues a Chile FTA Certificate of Ori14 gin for a good exported from the United States shall 

15 make, keep, and, pursuant to rules and regulations 

16 promulgated by the Secretary of the Treasury, 

17 render for examination and inspection all records 

18 and supporting documents related to the origin of 

19 the good (including the Certificate or copies thereof).

20 ‘‘(3) RETENTION PERIOD.—Records and sup21 porting documents shall be kept by the person who 

22 issued a Chile FTA Certificate of Origin for at least 

23 5 years after the date on which the certificate was 

24 issued. 
62

•HR 2738 IH 

1 ‘‘(g) PENALTIES.—Any person who fails to retain 

2 records and supporting documents required by subsection 

3 (f) or the regulations issued to implement that subsection 

4 shall be liable for the greater of—

5 ‘‘(1) a civil penalty not to exceed $10,000; or 

6 ‘‘(2) the general record keeping penalty that ap7 plies under the customs laws of the United States.’’. 

8 SEC. 208. ENFORCEMENT OF TEXTILE AND APPAREL RULES 

9 OF ORIGIN. 

10 (a) ACTION DURING VERIFICATION.—If the Sec11 retary of the Treasury requests the Government of Chile 

12 to conduct a verification pursuant to article 3.21 of the 

13 Agreement for purposes of determining that—

14 (1) an exporter or producer in Chile is com15 plying with applicable customs laws, regulations, and 

16 procedures regarding trade in textile and apparel 

17 goods, or 

18 (2) claims that textile or apparel goods exported 

19 or produced by such exporter or producer—

20 (A) qualify as originating goods under sec21 tion 202 of this Act, or 

22 (B) are goods of Chile, 

23 are accurate, 
63

•HR 2738 IH 

1 the President may direct the Secretary to take appropriate 

2 action described in subsection (b) while the verification is 

3 being conducted. 

4 (b) APPROPRIATE ACTION DESCRIBED.—Appropriate 

5 action under subsection (a) includes—

6 (1) suspension of liquidation of entries of textile 

7 and apparel goods exported or produced by the per8 son that is the subject of the verification, in a case 

9 in which the request for verification was based on a 

10 reasonable suspicion of unlawful activity related to 

11 such goods; and 

12 (2) publication of the name of the person that 

13 is the subject of the verification. 

14 (c) ACTION WHEN INFORMATION IS INSUFFI15 CIENT.—If the Secretary of the Treasury determines that 

16 the information obtained within 12 months after making 

17 a request for a verification under subsection (a) is insuffi18 cient to make a determination under subsection (a), the 

19 President may direct the Secretary to take appropriate ac20 tion described in subsection (d) until such time as the Sec21 retary receives information sufficient to make a deter22 mination under subsection (a) or until such earlier date 

23 as the President may direct. 

24 (d) APPROPRIATE ACTION DESCRIBED.—Appro25 priate action under subsection (c) includes—
64

•HR 2738 IH 

1 (1) publication of the identity of the person 

2 that is the subject of the verification; 

3 (2) denial of preferential tariff treatment under 

4 the Agreement to any textile or apparel goods ex5 ported or produced by the person that is the subject 

6 of the verification; and 

7 (3) denial of entry into the United States of 

8 any textile or apparel goods exported or produced by 

9 the person that is the subject of the verification. 

10 SEC. 209. CONFORMING AMENDMENTS. 

11 Section 508(b)(2)(B)(i)(I) of the Tariff Act of 1930 

12 (19 U.S.C. 1508(b)(2)(B)(i)(I)) is amended—

13 (1) by striking ‘‘the last paragraph of section 

14 311’’ and inserting ‘‘the eleventh paragraph of sec15 tion 311’’; and 

16 (2) by striking ‘‘the last proviso to section 

17 3(a)’’ and inserting ‘‘the proviso preceding the last 

18 proviso to section 3(a)’’.

19 SEC. 210. REGULATIONS. 

20 The Secretary of the Treasury shall prescribe such 

21 regulations as may be necessary to carry out—

22 (1) subsections (a) through (n) of section 202, 

23 and sections 203 and 204; 

24 (2) amendments made by the sections referred 

25 to in paragraph (1); and
65

•HR 2738 IH 

1 (3) proclamations issued under section 202(o). 

2 TITLE III—RELIEF FROM 

3 IMPORTS 

4 SEC. 301. DEFINITIONS. 

5 In this title: 

6 (1) COMMISSION.—The term ‘‘Commission’’ 

7 means the United States International Trade Com8 mission. 

9 (2) CHILEAN ARTICLE.—The term ‘‘Chilean ar10 ticle’’ means an article that qualifies as an origi11 nating good under section 202(a) of this Act. 

12 (3) CHILEAN TEXTILE OR APPAREL ARTICLE.—

13 The term ‘‘Chilean textile or apparel article’’ means 

14 an article—

15 (A) that is listed in the Annex to the 

16 Agreement on Textiles and Clothing referred to 

17 in section 101(d)(4) of the Uruguay Round 

18 Agreements Act (19 U.S.C. 3511(d)(4)); and 

19 (B) that is a Chilean article. 

20 Subtitle A—Relief From Imports 

21 Benefiting From the Agreement 

22 SEC. 311. COMMENCING OF ACTION FOR RELIEF. 

23 (a) FILING OF PETITION.—A petition requesting ac24 tion under this subtitle for the purpose of adjusting to 

25 the obligations of the United States under the Agreement 
66

•HR 2738 IH 

1 may be filed with the Commission by an entity, including 

2 a trade association, firm, certified or recognized union, or 

3 group of workers, that is representative of an industry. 

4 The Commission shall transmit a copy of any petition filed 

5 under this subsection to the United States Trade Rep6 resentative. 

7 (b) INVESTIGATION AND DETERMINATION.—Upon 

8 the filing of a petition under subsection (a), the Commis9 sion, unless subsection (d) applies, shall promptly initiate 

10 an investigation to determine whether, as a result of the 

11 reduction or elimination of a duty provided for under the 

12 Agreement, a Chilean article is being imported into the 

13 United States in such increased quantities, in absolute 

14 terms or relative to domestic production, and under such 

15 conditions that imports of the Chilean article constitute 

16 a substantial cause of serious injury or threat thereof to 

17 the domestic industry producing an article that is like, or 

18 directly competitive with, the imported article. 

19 (c) APPLICABLE PROVISIONS.—The following provi20 sions of section 202 of the Trade Act of 1974 (19 U.S.C. 

21 2252) apply with respect to any investigation initiated 

22 under subsection (b): 

23 (1) Paragraphs (1)(B) and (3) of subsection 

24 (b). 

25 (2) Subsection (c). 
67

•HR 2738 IH 

1 (3) Subsection (i). 

2 (d) ARTICLES EXEMPT FROM INVESTIGATION.—No 

3 investigation may be initiated under this section with re4 spect to any Chilean article if, after the date that the 

5 Agreement enters into force, import relief has been pro6 vided with respect to that Chilean article under this sub7 title, or if, at the time the petition is filed, the article is 

8 subject to import relief under chapter 1 of title II of the 

9 Trade Act of 1974. 

10 SEC. 312. COMMISSION ACTION ON PETITION. 

11 (a) DETERMINATION.—Not later than 120 days after 

12 the date on which an investigation is initiated under sec13 tion 311(b) with respect to a petition, the Commission 

14 shall make the determination required under that section. 

15 (b) APPLICABLE PROVISIONS.—For purposes of this 

16 subtitle, the provisions of paragraphs (1), (2), and (3) of 

17 section 330(d) of the Tariff Act of 1930 (19 U.S.C. 

18 1330(d) (1), (2), and (3)) shall be applied with respect 

19 to determinations and findings made under this section 

20 as if such determinations and findings were made under 

21 section 202 of the Trade Act of 1974 (19 U.S.C. 2252). 

22 (c) ADDITIONAL FINDING AND RECOMMENDATION IF

23 DETERMINATION AFFIRMATIVE.—If the determination 

24 made by the Commission under subsection (a) with respect 

25 to imports of an article is affirmative, or if the President 
68

•HR 2738 IH 

1 may consider a determination of the Commission to be an 

2 affirmative determination as provided for under paragraph 

3 (1) of section 330(d) of the Tariff Act of 1930 (19 U.S.C. 

4 1330(d)), the Commission shall find, and recommend to 

5 the President in the report required under subsection (d), 

6 the amount of import relief that is necessary to remedy 

7 or prevent the injury found by the Commission in the de8 termination and to facilitate the efforts of the domestic 

9 industry to make a positive adjustment to import competi10 tion. The import relief recommended by the Commission 

11 under this subsection shall be limited to the relief de12 scribed in section 313(c). Only those members of the Com13 mission who voted in the affirmative under subsection (a) 

14 are eligible to vote on the proposed action to remedy or 

15 prevent the injury found by the Commission. Members of 

16 the Commission who did not vote in the affirmative may 

17 submit, in the report required under subsection (d), sepa18 rate views regarding what action, if any, should be taken 

19 to remedy or prevent the injury.

20 (d) REPORT TO PRESIDENT.—Not later than the 

21 date that is 30 days after the date on which a determina22 tion is made under subsection (a) with respect to an inves23 tigation, the Commission shall submit to the President a 

24 report that includes—
69

•HR 2738 IH 

1 (1) the determination made under subsection 

2 (a) and an explanation of the basis for the deter3 mination; 

4 (2) if the determination under subsection (a) is 

5 affirmative, any findings and recommendations for 

6 import relief made under subsection (c) and an ex7 planation of the basis for each recommendation; and 

8 (3) any dissenting or separate views by mem9 bers of the Commission regarding the determination 

10 and recommendation referred to in paragraphs (1) 

11 and (2). 

12 (e) PUBLIC NOTICE.—Upon submitting a report to 

13 the President under subsection (d), the Commission shall 

14 promptly make public such report (with the exception of 

15 information which the Commission determines to be con16 fidential) and shall cause a summary thereof to be pub17 lished in the Federal Register. 

18 SEC. 313. PROVISION OF RELIEF. 

19 (a) IN GENERAL.—Not later than the date that is 

20 30 days after the date on which the President receives the 

21 report of the Commission in which the Commission’s de22 termination under section 312(a) is affirmative, or which 

23 contains a determination under section 312(a) that the 

24 President considers to be affirmative under paragraph (1) 

25 of section 330(d) of the Tariff Act of 1930 (19 U.S.C.
70

•HR 2738 IH 

1 1330(d)(1), the President, subject to subsection (b), shall 

2 provide relief from imports of the article that is the subject 

3 of such determination to the extent that the President de4 termines necessary to remedy or prevent the injury found 

5 by the Commission and to facilitate the efforts of the do6 mestic industry to make a positive adjustment to import 

7 competition. 

8 (b) EXCEPTION.—The President is not required to 

9 provide import relief under this section if the President 

10 determines that the provision of the import relief will not 

11 provide greater economic and social benefits than costs. 

12 (c) NATURE OF RELIEF.—

13 (1) IN GENERAL.—The import relief that the 

14 President is authorized to provide under this section 

15 with respect to imports of an article is as follows: 

16 (A) The suspension of any further reduc17 tion provided for under Annex 3.3 of the Agree18 ment in the duty imposed on such article. 

19 (B) An increase in the rate of duty im20 posed on such article to a level that does not 

21 exceed the lesser of—

22 (i) the column 1 general rate of duty 

23 imposed under the HTS on like articles at 

24 the time the import relief is provided; or 
71

•HR 2738 IH 

1 (ii) the column 1 general rate of duty 

2 imposed under the HTS on like articles on 

3 the day before the date on which the 

4 Agreement enters into force. 

5 (2) PROGRESSIVE LIBERALIZATION.—If the pe6 riod for which import relief is provided under this 

7 section is greater than 1 year, the President shall 

8 provide for the progressive liberalization (described 

9 in article 8.2(2) of the Agreement) of such relief at 

10 regular intervals during the period of its application. 

11 (d) PERIOD OF RELIEF.—

12 (1) IN GENERAL.—Subject to paragraph (2), 

13 the import relief that the President is authorized to 

14 provide under this section, including any extensions 

15 thereof, may not, in the aggregate, exceed 3 years. 

16 (2) EXTENSION.—

17 (A) IN GENERAL.—If the initial period for 

18 any import relief provided under this section is 

19 less than 3 years, the President, after receiving 

20 an affirmative determination from the Commis21 sion under subparagraph (B), may extend the 

22 effective period of any import relief provided 

23 under this section, subject to the limitation 

24 under paragraph (1), if the President deter25 mines that—
72

•HR 2738 IH 

1 (i) the import relief continues to be 

2 necessary to remedy or prevent serious in3 jury and to facilitate adjustment; and 

4 (ii) there is evidence that the industry 

5 is making a positive adjustment to import 

6 competition. 

7 (B) ACTION BY COMMISSION.—(i) Upon a 

8 petition on behalf of the industry concerned, 

9 filed with the Commission not earlier than the 

10 date which is 9 months, and not later than the 

11 date which is 6 months, before the date on 

12 which any action taken under subsection (a) is 

13 to terminate, the Commission shall conduct an 

14 investigation to determine whether action under 

15 this section continues to be necessary to remedy 

16 or prevent serious injury and whether there is 

17 evidence that the industry is making a positive 

18 adjustment to import competition. 

19 (ii) The Commission shall publish notice of 

20 the commencement of any proceeding under 

21 this subparagraph in the Federal Register and 

22 shall, within a reasonable time thereafter, hold 

23 a public hearing at which the Commission shall 

24 afford interested parties and consumers an op25 portunity to be present, to present evidence, 
73

•HR 2738 IH 

1 and to respond to the presentations of other 

2 parties and consumers, and otherwise to be 

3 heard. 

4 (iii) The Commission shall transmit to the 

5 President a report on its investigation and de6 termination under this subparagraph not later 

7 than 60 days before the action under subsection 

8 (a) is to terminate, unless the President speci9 fies a different date. 

10 (e) RATE AFTER TERMINATION OF IMPORT RE11 LIEF.—When import relief under this section is termi12 nated with respect to an article—

13 (1) the rate of duty on that article after such 

14 termination and on or before December 31 of the 

15 year in which such termination occurs shall be the 

16 rate that, according to the Schedule of the United 

17 States in Annex 3.3 of the Agreement for the staged 

18 elimination of the tariff, would have been in effect 

19 1 year after the provision of relief under subsection 

20 (a); and 

21 (2) the rate of duty for that article after De22 cember 31 of the year in which termination occurs 

23 shall be, at the discretion of the President, either—
74

•HR 2738 IH 

1 (A) the applicable rate of duty for that ar2 ticle set out in the Schedule of the United 

3 States in Annex 3.3 of the Agreement; or 

4 (B) the rate of duty resulting from the 

5 elimination of the tariff in equal annual stages 

6 ending on the date set out in the United States 

7 Schedule in Annex 3.3 of the Agreement for the 

8 elimination of the tariff. 

9 (f) ARTICLES EXEMPT FROM RELIEF.—No import 

10 relief may be provided under this section on any article 

11 subject to import relief under chapter 1 of title II of the 

12 Trade Act of 1974.

13 SEC. 314. TERMINATION OF RELIEF AUTHORITY. 

14 (a) GENERAL RULE.—No import relief may be pro15 vided under this subtitle after the date that is 10 years 

16 after the date on which the Agreement enters into force. 

17 (b) EXCEPTION.—If an article for which relief is pro18 vided under this subtitle is an article for which the period 

19 for tariff elimination, set out in the Schedule of the United 

20 States to Annex 3.3 of the Agreement, is 12 years, no 

21 relief under this subtitle may be provided for that article 

22 after the date that is 12 years after the date on which 

23 the Agreement enters into force.
75

•HR 2738 IH 

1 SEC. 315. COMPENSATION AUTHORITY. 

2 For purposes of section 123 of the Trade Act of 1974 

3 (19 U.S.C. 2133), any import relief provided by the Presi4 dent under section 313 shall be treated as action taken 

5 under chapter 1 of title II of such Act. 

6 SEC. 316. CONFIDENTIAL BUSINESS INFORMATION. 

7 Section 202 (a)(8) of the Trade Act of 1974 (19 

8 U.S.C. 2252(a)(8)) is amended in the first sentence—

9 (1) by striking ‘‘and’’; and 

10 (2) by inserting before the period at the end ‘‘, 

11 and title III of the United States-Chile Free Trade 

12 Agreement Implementation Act’’. 

13 Subtitle B—Textile and Apparel 

14 Safeguard Measures 

15 SEC. 321. COMMENCEMENT OF ACTION FOR RELIEF. 

16 (a) IN GENERAL.—A request under this subtitle for 

17 the purpose of adjusting to the obligations of the United 

18 States under the Agreement may be filed with the Presi19 dent by an interested party. Upon the filing of a request, 

20 the President shall review the request to determine, from 

21 information presented in the request, whether to com22 mence consideration of the request. 

23 (b) PUBLICATION OF REQUEST.—If the President de24 termines that the request under subsection (a) provides 

25 the information necessary for the request to be considered, 

26 the President shall cause to be published in the Federal 
76

•HR 2738 IH 

1 Register a notice of commencement of consideration of the 

2 request, and notice seeking public comments regarding the 

3 request. The notice shall include the request and the dates 

4 by which comments and rebuttals must be received. 

5 SEC. 322. DETERMINATION AND PROVISION OF RELIEF. 

6 (a) DETERMINATION.—

7 (1) IN GENERAL.—If a positive determination is 

8 made under section 321(b), the President shall de9 termine whether, as a result of the elimination of a 

10 duty under the Agreement, a Chilean textile or ap11 parel article is being imported into the United States 

12 in such increased quantities, in absolute terms or 

13 relative to the domestic market for that article, and 

14 under such conditions as to cause serious damage, 

15 or actual threat thereof, to a domestic industry pro16 ducing an article that is like, or directly competitive 

17 with, the imported article. 

18 (2) SERIOUS DAMAGE.—In making a deter19 mination under paragraph (1), the President—

20 (A) shall examine the effect of increased 

21 imports on the domestic industry, as reflected 

22 in changes in such relevant economic factors as 

23 output, productivity, utilization of capacity, in24 ventories, market share, exports, wages, em-
77

•HR 2738 IH 

1 ployment, domestic prices, profits, and invest2 ment, none of which is necessarily decisive; and 

3 (B) shall not consider changes in tech4 nology or consumer preference as factors sup5 porting a determination of serious damage or 

6 actual threat thereof. 

7 (b) PROVISION OF RELIEF.—

8 (1) IN GENERAL.—If a determination under 

9 subsection (a) is affirmative, the President may pro10 vide relief from imports of the article that is the 

11 subject of such determination, as provided in para12 graph (2), to the extent that the President deter13 mines necessary to remedy or prevent the serious 

14 damage and to facilitate adjustment by the domestic 

15 industry. 

16 (2) NATURE OF RELIEF.—The relief that the 

17 President is authorized to provide under this sub18 section with respect to imports of an article is an in19 crease in the rate of duty imposed on the article to 

20 a level that does not exceed the lesser of—

21 (A) the column 1 general rate of duty im22 posed under the HTS on like articles at the 

23 time the import relief is provided; or 

24 (B) the column 1 general rate of duty im25 posed under the HTS on like articles on the 
78

•HR 2738 IH 

1 day before the date on which the Agreement en2 ters into force. 

3 SEC. 323. PERIOD OF RELIEF. 

4 (a) IN GENERAL.—The import relief that the Presi5 dent is authorized to provide under section 322, including 

6 any extensions thereof, may not, in the aggregate, exceed 

7 3 years. 

8 (b) EXTENSION.—If the initial period for any import 

9 relief provided under this section is less than 3 years, the 

10 President may extend the effective period of any import 

11 relief provided under this section, subject to the limitation 

12 set forth in subsection (a), if the President determines 

13 that—

14 (1) the import relief continues to be necessary 

15 to remedy or prevent serious damage and to facili16 tate adjustment; and 

17 (2) there is evidence that the industry is mak18 ing a positive adjustment to import competition. 

19 SEC. 324. ARTICLES EXEMPT FROM RELIEF. 

20 The President may not provide import relief under 

21 this subtitle with respect to any article if import relief pre22 viously has been provided under this subtitle with respect 

23 to that article. 
79

•HR 2738 IH 

1 SEC. 325. RATE AFTER TERMINATION OF IMPORT RELIEF. 

2 When import relief under this subtitle is terminated 

3 with respect to an article, the rate of duty on that article 

4 shall be duty-free. 

5 SEC. 326. TERMINATION OF RELIEF AUTHORITY. 

6 No import relief may be provided under this subtitle 

7 with respect to any article after the date that is 8 years 

8 after the date on which duties on the article are eliminated 

9 pursuant to the Agreement. 

10 SEC. 327. COMPENSATION AUTHORITY. 

11 For purposes of section 123 of the Trade Act of 1974 

12 (19 U.S.C. 2133), any import relief provided by the Presi13 dent under this subtitle shall be treated as action taken 

14 under chapter 1 of title II of that Act. 

15 SEC. 328. BUSINESS CONFIDENTIAL INFORMATION. 

16 The President may not release information which the 

17 President considers to be confidential business informa18 tion unless the party submitting the confidential business 

19 information had notice, at the time of submission, that 

20 such information would be released by the President, or 

21 such party subsequently consents to the release of the in22 formation. To the extent business confidential information 

23 is provided, a nonconfidential version of the information 

24 shall also be provided, in which the business confidential 

25 information is summarized or, if necessary, deleted.
80

•HR 2738 IH 

1 TITLE IV—TEMPORARY ENTRY 

2 OF BUSINESS PERSONS. 

3 SEC. 401. NONIMMIGRANT TRADERS AND INVESTORS. 

4 Upon a basis of reciprocity secured by the Agree5 ment, an alien who is a national of Chile (and any spouse 

6 or child (as defined in section 101(b)(1) of the Immigra7 tion and Nationality Act (8 U.S.C. 1101(b)(1)) of such 

8 alien, if accompanying or following to join the alien) may, 

9 if otherwise eligible for a visa and if otherwise admissible 

10 into the United States under the Immigration and Nation11 ality Act (8 U.S.C. 1101 et seq.), be considered to be clas12 sifiable as a nonimmigrant under section 101(a)(15)(E) 

13 of such Act (8 U.S.C. 1101(a)(15)(E)) if entering solely 

14 for a purpose specified in clause (i) or (ii) of such section 

15 101(a)(15)(E). For purposes of this section, the term ‘‘na16 tional’’ has the meaning given such term in article 14.9 

17 of the Agreement. 

18 SEC. 402. NONIMMIGRANT PROFESSIONALS; LABOR ATTES19 TATIONS. 

20 (a) NONIMMIGRANT PROFESSIONALS.—

21 (1) DEFINITIONS.—Section 101(a)(15)(H)(i)(b) 

22 of the Immigration and Nationality Act (8 U.S.C. 

23 1101(a)(15)(H)(i)(b)) is amended by striking 

24 ‘‘212(n)(1), or (c)’’ and inserting ‘‘212(n)(1), or 

25 (b1) who is entitled to enter the United States under 
81

•HR 2738 IH 

1 and in pursuance of the provisions of an agreement 

2 listed in section 214(g)(8)(A), who is engaged in a 

3 specialty occupation described in section 214(i)(3), 

4 and with respect to whom the Secretary of Labor de5 termines and certifies to the Secretary of Homeland 

6 Security and the Secretary of State that the intend7 ing employer has filed with the Secretary of Labor 

8 an attestation under section 212(t)(1), or (c)’’. 

9 (2) ADMISSION OF NONIMMIGRANTS.—Section 

10 214 of the Immigration and Nationality Act (8 

11 U.S.C. 1184) is amended—

12 (A) in subsection (i)—

13 (i) in paragraph (1), by striking ‘‘For 

14 purposes’’ and inserting ‘‘Except as pro15 vided in paragraph (3), for purposes’’; and 

16 (ii) by adding at the end the fol17 lowing: 

18 ‘‘(3) For purposes of section 101(a)(15)(H)(i)(b1), 

19 the term ‘specialty occupation’ means an occupation that 

20 requires—

21 ‘‘(A) theoretical and practical application of a 

22 body of specialized knowledge; and 

23 ‘‘(B) attainment of a bachelor’s or higher de24 gree in the specific specialty (or its equivalent) as a 
82

•HR 2738 IH 

1 minimum for entry into the occupation in the United 

2 States.’’; and 

3 (B) in subsection (g), by adding at the end 

4 the following: 

5 ‘‘(8)(A) The agreement referred to in section 

6 101(a)(15)(H)(i)(b1) is the United States-Chile Free 

7 Trade Agreement.

8 ‘‘(B)(i) The Secretary of Homeland Security shall es9 tablish annual numerical limitations on approvals of initial 

10 applications by aliens for admission under section 

11 101(a)(15)(H)(i)(b1). 

12 ‘‘(ii) The annual numerical limitations described in 

13 clause (i) shall not exceed 1,400 for nationals of Chile for 

14 any fiscal year. For purposes of this clause, the term ‘na15 tional’ has the meaning given such term in article 14.9 

16 of the United States-Chile Free Trade Agreement. 

17 ‘‘(iii) The annual numerical limitations described in 

18 clause (i) shall only apply to principal aliens and not to 

19 the spouses or children of such aliens. 

20 ‘‘(iv) The annual numerical limitation described in 

21 paragraph (1)(A) is reduced by the amount of the annual 

22 numerical limitations established under clause (i). How23 ever, if a numerical limitation established under clause (i) 

24 has not been exhausted at the end of a given fiscal year, 

25 the Secretary of Homeland Security shall adjust upwards 
83

•HR 2738 IH 

1 the numerical limitation in paragraph (1)(A) for that fis2 cal year by the amount remaining in the numerical limita3 tion under clause (i). Visas under section 

4 101(a)(15)(H)(i)(b) may be issued pursuant to such ad5 justment within the first 45 days of the next fiscal year 

6 to aliens who had applied for such visas during the fiscal 

7 year for which the adjustment was made. 

8 ‘‘(C) The period of authorized admission as a non9 immigrant under section 101(a)(15)(H)(i)(b1) shall be 1 

10 year, and may be extended, but only in 1-year increments. 

11 After every second extension, the next following extension 

12 shall not be granted unless the Secretary of Labor had 

13 determined and certified to the Secretary of Homeland Se14 curity and the Secretary of State that the intending em15 ployer has filed with the Secretary of Labor an attestation 

16 under section 212(t)(1) for the purpose of permitting the 

17 nonimmigrant to obtain such extension. 

18 ‘‘(D) The numerical limitation described in para19 graph (1)(A) for a fiscal year shall be reduced by one for 

20 each alien granted an extension under subparagraph (C) 

21 during such year who has obtained 5 or more consecutive 

22 prior extensions.’’. 

23 (b) LABOR ATTESTATIONS.—Section 212 of the Im24 migration and Nationality Act (8 U.S.C. 1182) is amend25 ed—
84

•HR 2738 IH 

1 (1) by redesignating the subsection (p) added 

2 by section 1505(f) of Public Law 106–386 (114 

3 Stat. 1526) as subsection (s); and 

4 (2) by adding at the end the following: 

5 ‘‘(t)(1) No alien may be admitted or provided status 

6 as a nonimmigrant under section 101(a)(15)(H)(i)(b1) in 

7 an occupational classification unless the employer has filed 

8 with the Secretary of Labor an attestation stating the fol9 lowing: 

10 ‘‘(A) The employer—

11 ‘‘(i) is offering and will offer during the 

12 period of authorized employment to aliens ad13 mitted or provided status under section 

14 101(a)(15)(H)(i)(b1) wages that are at least—

15 ‘‘(I) the actual wage level paid by the 

16 employer to all other individuals with simi17 lar experience and qualifications for the 

18 specific employment in question; or 

19 ‘‘(II) the prevailing wage level for the 

20 occupational classification in the area of 

21 employment, 

22 whichever is greater, based on the best informa23 tion available as of the time of filing the attes24 tation; and
85

•HR 2738 IH 

1 ‘‘(ii) will provide working conditions for 

2 such a nonimmigrant that will not adversely af3 fect the working conditions of workers similarly 

4 employed. 

5 ‘‘(B) There is not a strike or lockout in the 

6 course of a labor dispute in the occupational classi7 fication at the place of employment. 

8 ‘‘(C) The employer, at the time of filing the at9 testation—

10 ‘‘(i) has provided notice of the filing under 

11 this paragraph to the bargaining representative 

12 (if any) of the employer’s employees in the oc13 cupational classification and area for which 

14 aliens are sought; or 

15 ‘‘(ii) if there is no such bargaining rep16 resentative, has provided notice of filing in the 

17 occupational classification through such meth18 ods as physical posting in conspicuous locations 

19 at the place of employment or electronic notifi20 cation to employees in the occupational classi21 fication for which nonimmigrants under section 

22 101(a)(15)(H)(i)(b1) are sought. 

23 ‘‘(D) A specification of the number of workers 

24 sought, the occupational classification in which the 
86

•HR 2738 IH 

1 workers will be employed, and wage rate and condi2 tions under which they will be employed. 

3 ‘‘(2)(A) The employer shall make available for public 

4 examination, within one working day after the date on 

5 which an attestation under this subsection is filed, at the 

6 employer’s principal place of business or worksite, a copy 

7 of each such attestation (and such accompanying docu8 ments as are necessary). 

9 ‘‘(B)(i) The Secretary of Labor shall compile, on a 

10 current basis, a list (by employer and by occupational clas11 sification) of the attestations filed under this subsection. 

12 Such list shall include, with respect to each attestation, 

13 the wage rate, number of aliens sought, period of intended 

14 employment, and date of need. 

15 ‘‘(ii) The Secretary of Labor shall make such list 

16 available for public examination in Washington, D.C. 

17 ‘‘(C) The Secretary of Labor shall review an attesta18 tion filed under this subsection only for completeness and 

19 obvious inaccuracies. Unless the Secretary of Labor finds 

20 that an attestation is incomplete or obviously inaccurate, 

21 the Secretary of Labor shall provide the certification de22 scribed in section 101(a)(15)(H)(i)(b1) within 7 days of 

23 the date of the filing of the attestation. 

24 ‘‘(3)(A) The Secretary of Labor shall establish a 

25 process for the receipt, investigation, and disposition of 
87

•HR 2738 IH 

1 complaints respecting the failure of an employer to meet 

2 a condition specified in an attestation submitted under 

3 this subsection or misrepresentation by the employer of 

4 material facts in such an attestation. Complaints may be 

5 filed by any aggrieved person or organization (including 

6 bargaining representatives). No investigation or hearing 

7 shall be conducted on a complaint concerning such a fail8 ure or misrepresentation unless the complaint was filed 

9 not later than 12 months after the date of the failure or 

10 misrepresentation, respectively. The Secretary of Labor 

11 shall conduct an investigation under this paragraph if 

12 there is reasonable cause to believe that such a failure or 

13 misrepresentation has occurred. 

14 ‘‘(B) Under the process described in subparagraph 

15 (A), the Secretary of Labor shall provide, within 30 days 

16 after the date a complaint is filed, for a determination as 

17 to whether or not a reasonable basis exists to make a find18 ing described in subparagraph (C). If the Secretary of 

19 Labor determines that such a reasonable basis exists, the 

20 Secretary of Labor shall provide for notice of such deter21 mination to the interested parties and an opportunity for 

22 a hearing on the complaint, in accordance with section 556 

23 of title 5, United States Code, within 60 days after the 

24 date of the determination. If such a hearing is requested, 

25 the Secretary of Labor shall make a finding concerning 
88

•HR 2738 IH 

1 the matter by not later than 60 days after the date of 

2 the hearing. In the case of similar complaints respecting 

3 the same applicant, the Secretary of Labor may consoli4 date the hearings under this subparagraph on such com5 plaints. 

6 ‘‘(C)(i) If the Secretary of Labor finds, after notice 

7 and opportunity for a hearing, a failure to meet a condi8 tion of paragraph (1)(B), a substantial failure to meet a 

9 condition of paragraph (1)(C) or (1)(D), or a misrepresen10 tation of material fact in an attestation—

11 ‘‘(I) the Secretary of Labor shall notify the Sec12 retary of State and the Secretary of Homeland Secu13 rity of such finding and may, in addition, impose 

14 such other administrative remedies (including civil 

15 monetary penalties in an amount not to exceed 

16 $1,000 per violation) as the Secretary of Labor de17 termines to be appropriate; and 

18 ‘‘(II) the Secretary of State or the Secretary of 

19 Homeland Security, as appropriate, shall not ap20 prove petitions or applications filed with respect to 

21 that employer under section 204, 214(c), or 

22 101(a)(15)(H)(i)(b1) during a period of at least 1 

23 year for aliens to be employed by the employer. 

24 ‘‘(ii) If the Secretary of Labor finds, after notice and 

25 opportunity for a hearing, a willful failure to meet a condi-
89

•HR 2738 IH 

1 tion of paragraph (1), a willful misrepresentation of mate2 rial fact in an attestation, or a violation of clause (iv)—

3 ‘‘(I) the Secretary of Labor shall notify the Sec4 retary of State and the Secretary of Homeland Secu5 rity of such finding and may, in addition, impose 

6 such other administrative remedies (including civil 

7 monetary penalties in an amount not to exceed 

8 $5,000 per violation) as the Secretary of Labor de9 termines to be appropriate; and 

10 ‘‘(II) the Secretary of State or the Secretary of 

11 Homeland Security, as appropriate, shall not ap12 prove petitions or applications filed with respect to 

13 that employer under section 204, 214(c), or 

14 101(a)(15)(H)(i)(b1) during a period of at least 2 

15 years for aliens to be employed by the employer. 

16 ‘‘(iii) If the Secretary of Labor finds, after notice and 

17 opportunity for a hearing, a willful failure to meet a condi18 tion of paragraph (1) or a willful misrepresentation of ma19 terial fact in an attestation, in the course of which failure 

20 or misrepresentation the employer displaced a United 

21 States worker employed by the employer within the period 

22 beginning 90 days before and ending 90 days after the 

23 date of filing of any visa petition or application supported 

24 by the attestation—
90

•HR 2738 IH 

1 ‘‘(I) the Secretary of Labor shall notify the Sec2 retary of State and the Secretary of Homeland Secu3 rity of such finding and may, in addition, impose 

4 such other administrative remedies (including civil 

5 monetary penalties in an amount not to exceed 

6 $35,000 per violation) as the Secretary of Labor de7 termines to be appropriate; and 

8 ‘‘(II) the Secretary of State or the Secretary of 

9 Homeland Security, as appropriate, shall not ap10 prove petitions or applications filed with respect to 

11 that employer under section 204, 214(c), or 

12 101(a)(15)(H)(i)(b1) during a period of at least 3 

13 years for aliens to be employed by the employer. 

14 ‘‘(iv) It is a violation of this clause for an employer 

15 who has filed an attestation under this subsection to in16 timidate, threaten, restrain, coerce, blacklist, discharge, or 

17 in any other manner discriminate against an employee 

18 (which term, for purposes of this clause, includes a former 

19 employee and an applicant for employment) because the 

20 employee has disclosed information to the employer, or to 

21 any other person, that the employee reasonably believes 

22 evidences a violation of this subsection, or any rule or reg23 ulation pertaining to this subsection, or because the em24 ployee cooperates or seeks to cooperate in an investigation 

25 or other proceeding concerning the employer’s compliance 
91

•HR 2738 IH 

1 with the requirements of this subsection or any rule or 

2 regulation pertaining to this subsection. 

3 ‘‘(v) The Secretary of Labor and the Secretary of 

4 Homeland Security shall devise a process under which a 

5 nonimmigrant under section 101(a)(15)(H)(i)(b1) who 

6 files a complaint regarding a violation of clause (iv) and 

7 is otherwise eligible to remain and work in the United 

8 States may be allowed to seek other appropriate employ9 ment in the United States for a period not to exceed the 

10 maximum period of stay authorized for such non11 immigrant classification. 

12 ‘‘(vi)(I) It is a violation of this clause for an employer 

13 who has filed an attestation under this subsection to re14 quire a nonimmigrant under section 101(a)(15)(H)(i)(b1) 

15 to pay a penalty for ceasing employment with the employer 

16 prior to a date agreed to by the nonimmigrant and the 

17 employer. The Secretary of Labor shall determine whether 

18 a required payment is a penalty (and not liquidated dam19 ages) pursuant to relevant State law. 

20 ‘‘(II) If the Secretary of Labor finds, after notice and 

21 opportunity for a hearing, that an employer has committed 

22 a violation of this clause, the Secretary of Labor may im23 pose a civil monetary penalty of $1,000 for each such vio24 lation and issue an administrative order requiring the re25 turn to the nonimmigrant of any amount paid in violation 
92

•HR 2738 IH 

1 of this clause, or, if the nonimmigrant cannot be located, 

2 requiring payment of any such amount to the general fund 

3 of the Treasury. 

4 ‘‘(vii)(I) It is a failure to meet a condition of para5 graph (1)(A) for an employer who has filed an attestation 

6 under this subsection and who places a nonimmigrant 

7 under section 101(a)(15)(H)(i)(b1) designated as a full8 time employee in the attestation, after the nonimmigrant 

9 has entered into employment with the employer, in non10 productive status due to a decision by the employer (based 

11 on factors such as lack of work), or due to the non12 immigrant’s lack of a permit or license, to fail to pay the 

13 nonimmigrant full-time wages in accordance with para14 graph (1)(A) for all such nonproductive time. 

15 ‘‘(II) It is a failure to meet a condition of paragraph 

16 (1)(A) for an employer who has filed an attestation under 

17 this subsection and who places a nonimmigrant under sec18 tion 101(a)(15)(H)(i)(b1) designated as a part-time em19 ployee in the attestation, after the nonimmigrant has en20 tered into employment with the employer, in nonproduc21 tive status under circumstances described in subclause (I), 

22 to fail to pay such a nonimmigrant for such hours as are 

23 designated on the attestation consistent with the rate of 

24 pay identified on the attestation. 
93

•HR 2738 IH 

1 ‘‘(III) In the case of a nonimmigrant under section 

2 101(a)(15)(H)(i)(b1) who has not yet entered into employ3 ment with an employer who has had approved an attesta4 tion under this subsection with respect to the non5 immigrant, the provisions of subclauses (I) and (II) shall 

6 apply to the employer beginning 30 days after the date 

7 the nonimmigrant first is admitted into the United States, 

8 or 60 days after the date the nonimmigrant becomes eligi9 ble to work for the employer in the case of a nonimmigrant 

10 who is present in the United States on the date of the 

11 approval of the attestation filed with the Secretary of 

12 Labor. 

13 ‘‘(IV) This clause does not apply to a failure to pay 

14 wages to a nonimmigrant under section 

15 101(a)(15)(H)(i)(b1) for nonproductive time due to non16 work-related factors, such as the voluntary request of the 

17 nonimmigrant for an absence or circumstances rendering 

18 the nonimmigrant unable to work. 

19 ‘‘(V) This clause shall not be construed as prohibiting 

20 an employer that is a school or other educational institu21 tion from applying to a nonimmigrant under section 

22 101(a)(15)(H)(i)(b1) an established salary practice of the 

23 employer, under which the employer pays to non24 immigrants under section 101(a)(15)(H)(i)(b1) and 

25 United States workers in the same occupational classifica-
94

•HR 2738 IH 

1 tion an annual salary in disbursements over fewer than 

2 12 months, if—

3 ‘‘(aa) the nonimmigrant agrees to the com4 pressed annual salary payments prior to the com5 mencement of the employment; and 

6 ‘‘(bb) the application of the salary practice to 

7 the nonimmigrant does not otherwise cause the non8 immigrant to violate any condition of the non9 immigrant’s authorization under this Act to remain 

10 in the United States. 

11 ‘‘(VI) This clause shall not be construed as super12 seding clause (viii). 

13 ‘‘(viii) It is a failure to meet a condition of paragraph 

14 (1)(A) for an employer who has filed an attestation under 

15 this subsection to fail to offer to a nonimmigrant under 

16 section 101(a)(15)(H)(i)(b1), during the nonimmigrant’s 

17 period of authorized employment, benefits and eligibility 

18 for benefits (including the opportunity to participate in 

19 health, life, disability, and other insurance plans; the op20 portunity to participate in retirement and savings plans; 

21 and cash bonuses and non-cash compensation, such as 

22 stock options (whether or not based on performance)) on 

23 the same basis, and in accordance with the same criteria, 

24 as the employer offers to United States workers.
95

•HR 2738 IH 

1 ‘‘(D) If the Secretary of Labor finds, after notice and 

2 opportunity for a hearing, that an employer has not paid 

3 wages at the wage level specified in the attestation and 

4 required under paragraph (1), the Secretary of Labor 

5 shall order the employer to provide for payment of such 

6 amounts of back pay as may be required to comply with 

7 the requirements of paragraph (1), whether or not a pen8 alty under subparagraph (C) has been imposed. 

9 ‘‘(E) The Secretary of Labor may, on a case-by-case 

10 basis, subject an employer to random investigations for 

11 a period of up to 5 years, beginning on the date on which 

12 the employer is found by the Secretary of Labor to have 

13 committed a willful failure to meet a condition of para14 graph (1) or to have made a willful misrepresentation of 

15 material fact in an attestation. The authority of the Sec16 retary of Labor under this subparagraph shall not be con17 strued to be subject to, or limited by, the requirements 

18 of subparagraph (A). 

19 ‘‘(F) Nothing in this subsection shall be construed 

20 as superseding or preempting any other enforcement-re21 lated authority under this Act (such as the authorities 

22 under section 274B), or any other Act. 

23 ‘‘(4) For purposes of this subsection: 

24 ‘‘(A) The term ‘area of employment’ means the 

25 area within normal commuting distance of the work-
96

•HR 2738 IH 

1 site or physical location where the work of the non2 immigrant under section 101(a)(15)(H)(i)(b1) is or 

3 will be performed. If such worksite or location is 

4 within a Metropolitan Statistical Area, any place 

5 within such area is deemed to be within the area of 

6 employment. 

7 ‘‘(B) In the case of an attestation with respect 

8 to one or more nonimmigrants under section 

9 101(a)(15)(H)(i)(b1) by an employer, the employer 

10 is considered to ‘displace’ a United States worker 

11 from a job if the employer lays off the worker from 

12 a job that is essentially the equivalent of the job for 

13 which the nonimmigrant or nonimmigrants is or are 

14 sought. A job shall not be considered to be essen15 tially equivalent of another job unless it involves es16 sentially the same responsibilities, was held by a 

17 United States worker with substantially equivalent 

18 qualifications and experience, and is located in the 

19 same area of employment as the other job. 

20 ‘‘(C)(i) The term ‘lays off’, with respect to a 

21 worker—

22 ‘‘(I) means to cause the worker’s loss of 

23 employment, other than through a discharge for 

24 inadequate performance, violation of workplace 

25 rules, cause, voluntary departure, voluntary re-
97

•HR 2738 IH 

1 tirement, or the expiration of a grant or con2 tract; but 

3 ‘‘(II) does not include any situation in 

4 which the worker is offered, as an alternative to 

5 such loss of employment, a similar employment 

6 opportunity with the same employer at equiva7 lent or higher compensation and benefits than 

8 the position from which the employee was dis9 charged, regardless of whether or not the em10 ployee accepts the offer. 

11 ‘‘(ii) Nothing in this subparagraph is intended 

12 to limit an employee’s rights under a collective bar13 gaining agreement or other employment contract. 

14 ‘‘(D) The term ‘United States worker’ means 

15 an employee who—

16 ‘‘(i) is a citizen or national of the United 

17 States; or 

18 ‘‘(ii) is an alien who is lawfully admitted 

19 for permanent residence, is admitted as a ref20 ugee under section 207 of this title, is granted 

21 asylum under section 208, or is an immigrant 

22 otherwise authorized, by this Act or by the Sec23 retary of Homeland Security, to be employed.’’. 

24 (c) SPECIAL RULE FOR COMPUTATION OF PRE25 VAILING WAGE.—Section 212(p)(1) of the Immigration 
98

•HR 2738 IH 

1 and Nationality Act (8 U.S.C. 1182(p)(1)) is amended by 

2 striking ‘‘(n)(1)(A)(i)(II) and (a)(5)(A)’’ and inserting 

3 ‘‘(a)(5)(A), (n)(1)(A)(i)(II), and (t)(1)(A)(i)(II)’’.

4 (d) FEE.—

5 (1) IN GENERAL.—Section 214(c) of the Immi6 gration and Nationality Act (8 U.S.C. 1184(c)) is 

7 amended by adding at the end the following: 

8 ‘‘(11)(A) Subject to subparagraph (B), the Secretary 

9 of Homeland Security or the Secretary of State, as appro10 priate, shall impose a fee on an employer who has filed 

11 an attestation described in section 212(t)—

12 ‘‘(i) in order that an alien may be initially 

13 granted nonimmigrant status described in section 

14 101(a)(15)(H)(i)(b1); or 

15 ‘‘(ii) in order to satisfy the requirement of the 

16 second sentence of subsection (g)(8)(C) for an alien 

17 having such status to obtain certain extensions of 

18 stay. 

19 ‘‘(B) The amount of the fee shall be the same as the 

20 amount imposed by the Secretary of Homeland Security 

21 under paragraph (9), except that if such paragraph does 

22 not authorize such Secretary to impose any fee, no fee 

23 shall be imposed under this paragraph. 
99

•HR 2738 IH 

1 ‘‘(C) Fees collected under this paragraph shall be de2 posited in the Treasury in accordance with section 

3 286(s).’’. 

4 (2) USE OF FEE.—Section 286(s)(1) of the Im5 migration and Nationality Act (8 U.S.C. 1356(s)(1)) 

6 is amended by striking ‘‘section 214(c)(9).’’ and in7 serting ‘‘paragraphs (9) and (11) of section 

8 214(c).’’. 

9 SEC. 403. LABOR DISPUTES. 

10 Section 214(j) of the Immigration and Nationality 

11 Act (8 U.S.C. 1184(j)) is amended—

12 (1) by striking ‘‘(j)’’ and inserting ‘‘(j)(1)’’; 

13 (2) by striking ‘‘this subsection’’ each place 

14 such term appears and inserting ‘‘this paragraph’’; 

15 and 

16 (3) by adding at the end the following: 

17 ‘‘(2) Notwithstanding any other provision of this Act 

18 except section 212(t)(1), and subject to regulations pro19 mulgated by the Secretary of Homeland Security, an alien 

20 who seeks to enter the United States under and pursuant 

21 to the provisions of an agreement listed in subsection 

22 (g)(8)(A), and the spouse and children of such an alien 

23 if accompanying or following to join the alien, may be de24 nied admission as a nonimmigrant under subparagraph 

25 (E), (L), or (H)(i)(b1) of section 101(a)(15) if there is 
100

•HR 2738 IH 

1 in progress a labor dispute in the occupational classifica2 tion at the place or intended place of employment, unless 

3 such alien establishes, pursuant to regulations promul4 gated by the Secretary of Homeland Security after con5 sultation with the Secretary of Labor, that the alien’s 

6 entry will not affect adversely the settlement of the labor 

7 dispute or the employment of any person who is involved 

8 in the labor dispute. Notice of a determination under this 

9 paragraph shall be given as may be required by such 

10 agreement.’’. 

11 SEC. 404. CONFORMING AMENDMENTS. 

12 Section 214 of the Immigration and Nationality Act 

13 (8 U.S.C. 1184) is amended—

14 (1) in subsection (b), by striking ‘‘(other than 

15 a nonimmigrant described in subparagraph (H)(i), 

16 (L), or (V) of section 101(a)(15))’’ and inserting 

17 ‘‘(other than a nonimmigrant described in subpara18 graph (L) or (V) of section 101(a)(15), and other 

19 than a nonimmigrant described in any provision of 

20 section 101(a)(15)(H)(i) except subclause (b1) of 

21 such section)’’; 

22 (2) in subsection (c)(1), by striking ‘‘section 

23 101(a)(15)(H), (L), (O), or (P)(i)’’ and inserting 

24 ‘‘subparagraph (H), (L), (O), or (P)(i) of section 
101

•HR 2738 IH 

1 101(a)(15) (excluding nonimmigrants under section 

2 101(a)(15)(H)(i)(b1))’’; and 

3 (3) in subsection (h), by striking ‘‘(H)(i)’’ and 

4 inserting ‘‘(H)(i)(b) or (c)’’.

Æ