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[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2738 Enrolled Bill (ENR)]

        H.R.2738

                       One Hundred Eighth Congress

                                 of the

                        United States of America

                          AT THE FIRST SESSION

          Begun and held at the City of Washington on Tuesday,
           the seventh day of January, two thousand and three

                                 An Act

 
       To implement the United States-Chile Free Trade Agreement.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``United States-
Chile Free Trade Agreement Implementation Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Purposes.
Sec. 3. Definitions.

 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.

SEC. 2. PURPOSES.

    The purposes of this Act are--
        (1) to approve and implement the Free Trade Agreement between 
    the United States and the Republic of Chile entered into under the 
    authority of section 2103(b) of the Bipartisan Trade Promotion 
    Authority Act of 2002;
        (2) to strengthen and develop economic relations between the 
    United States and Chile for their mutual benefit;
        (3) to establish free trade between the 2 nations through the 
    reduction and elimination of barriers to trade in goods and 
    services and to investment; and
        (4) to lay the foundation for further cooperation to expand and 
    enhance the benefits of such Agreement.

SEC. 3. DEFINITIONS.

    In this Act:
        (1) Agreement.--The term ``Agreement'' means the United States-
    Chile Free Trade Agreement approved by the Congress under section 
    101(a)(1).
        (2) HTS.--The term ``HTS'' means the Harmonized Tariff Schedule 
    of the United States.
        (3) Textile or apparel good.--The term ``textile or apparel 
    good'' means a good listed in the Annex to the Agreement on 
    Textiles and Clothing referred to in section 101(d)(4) of the 
    Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)).

TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT

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

    (a) Approval of Agreement and Statement of Administrative Action.--
Pursuant to section 2105 of the Bipartisan Trade Promotion Authority 
Act of 2002 (19 U.S.C. 3805) and section 151 of the Trade Act of 1974 
(19 U.S.C. 2191), the Congress approves--
        (1) the United States-Chile Free Trade Agreement entered into 
    on June 6, 2003, with the Government of Chile and submitted to the 
    Congress on July 15, 2003; and
        (2) the statement of administrative action proposed to 
    implement the Agreement that was submitted to the Congress on July 
    15, 2003.
    (b) Conditions for Entry Into Force of the Agreement.--At such time 
as the President determines that Chile has taken measures necessary to 
bring it into compliance with the provisions of the Agreement that take 
effect on the date on which the Agreement enters into force, the 
President is authorized to exchange notes with the Government of Chile 
providing for the entry into force, on or after January 1, 2004, of the 
Agreement for the United States.

SEC. 102. RELATIONSHIP OF THE AGREEMENT TO UNITED STATES AND STATE LAW.

    (a) Relationship to United States Law.--
        (1) United states law to prevail in conflict.--No provision of 
    the Agreement, nor the application of any such provision to any 
    person or circumstance, which is inconsistent with any law of the 
    United States shall have effect.
        (2) Construction.--Nothing in this Act shall be construed--
            (A) to amend or modify any law of the United States, or
            (B) to limit any authority conferred under any law of the 
        United States,
    unless specifically provided for in this Act.
    (b) Relationship of Agreement to State Law.--
        (1) Legal challenge.--No State law, or the application thereof, 
    may be declared invalid as to any person or circumstance on the 
    ground that the provision or application is inconsistent with the 
    Agreement, except in an action brought by the United States for the 
    purpose of declaring such law or application invalid.
        (2) Definition of state law.--For purposes of this subsection, 
    the term ``State law'' includes--
            (A) any law of a political subdivision of a State; and
            (B) any State law regulating or taxing the business of 
        insurance.
    (c) Effect of Agreement With Respect to Private Remedies.--No 
person other than the United States--
        (1) shall have any cause of action or defense under the 
    Agreement or by virtue of Congressional approval thereof; or
        (2) may challenge, in any action brought under any provision of 
    law, any action or inaction by any department, agency, or other 
    instrumentality of the United States, any State, or any political 
    subdivision of a State on the ground that such action or inaction 
    is inconsistent with the Agreement.

SEC. 103. CONSULTATION AND LAYOVER PROVISIONS FOR, AND EFFECTIVE DATE 
              OF, PROCLAIMED ACTIONS.

    (a) Consultation and Layover Requirements.--If a provision of this 
Act provides that the implementation of an action by the President by 
proclamation is subject to the consultation and layover requirements of 
this section, such action may be proclaimed only if--
        (1) the President has obtained advice regarding the proposed 
    action from--
            (A) the appropriate advisory committees established under 
        section 135 of the Trade Act of 1974 (19 U.S.C. 2155); and
            (B) the United States International Trade Commission;
        (2) the President has submitted a report to the Committee on 
    Ways and Means of the House of Representatives and the Committee on 
    Finance of the Senate that sets forth--
            (A) the action proposed to be proclaimed and the reasons 
        therefor; and
            (B) the advice obtained under paragraph (1);
        (3) a period of 60 calendar days, beginning on the first day on 
    which the requirements set forth in paragraphs (1) and (2) have 
    been met has expired; and
        (4) the President has consulted with such Committees regarding 
    the proposed action during the period referred to in paragraph (3).
    (b) Effective Date of Certain Proclaimed Actions.--Any action 
proclaimed by the President under the authority of this Act that is not 
subject to the consultation and layover provisions under subsection (a) 
may not take effect before the 15th day after the date on which the 
text of the proclamation is published in the Federal Register.

SEC. 104. IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO FORCE AND 
              INITIAL REGULATIONS.

    (a) Implementing Actions.--
        (1) Proclamation authority.--After the date of enactment of 
    this Act--
            (A) the President may proclaim such actions, and
            (B) other appropriate officers of the United States 
        Government may issue such regulations,
    as may be necessary to ensure that any provision of this Act, or 
    amendment made by this Act, that takes effect on the date the 
    Agreement enters into force is appropriately implemented on such 
    date, but no such proclamation or regulation may have an effective 
    date earlier than the date of entry into force.
        (2) Waiver of 15-day restriction.--The 15-day restriction 
    contained in section 103(b) on the taking effect of proclaimed 
    actions is waived to the extent that the application of such 
    restriction would prevent the taking effect on the date the 
    Agreement enters into force of any action proclaimed under this 
    section.
    (b) Initial Regulations.--Initial regulations necessary or 
appropriate to carry out the actions required by or authorized under 
this Act or proposed in the statement of administrative action referred 
to in section 101(a)(2) to implement the Agreement shall, to the 
maximum extent feasible, be issued within 1 year after the date of 
entry into force of the Agreement. In the case of any implementing 
action that takes effect on a date after the date of entry into force 
of the Agreement, initial regulations to carry out that action shall, 
to the maximum extent feasible, be issued within 1 year after such 
effective date.

SEC. 105. ADMINISTRATION OF DISPUTE SETTLEMENT PROCEEDINGS.

    (a) Establishment or Designation of Office.--The President is 
authorized to establish or designate within the Department of Commerce 
an office that shall be responsible for providing administrative 
assistance to panels established under chapter 22 of the Agreement. The 
office may not be considered to be an agency for purposes of section 
552 of title 5, United States Code.
    (b) Authorization of Appropriations.--There are authorized to be 
appropriated for each fiscal year after fiscal year 2003 to the 
Department of Commerce such sums as may be necessary for the 
establishment and operations of the office under subsection (a) and for 
the payment of the United States share of the expenses of panels 
established under chapter 22 of the Agreement.

SEC. 106. ARBITRATION OF CLAIMS.

    (a) Submission of Certain Claims.--The United States is authorized 
to resolve any claim against the United States covered by article 
10.15(1)(a)(i)(C) or 10.15(1)(b)(i)(C) of the Agreement, pursuant to 
the Investor-State Dispute Settlement procedures set forth in section B 
of chapter 10 of the Agreement.
    (b) Contract Clauses.--All contracts executed by any agency of the 
United States on or after the date of entry into force of the Agreement 
shall contain a clause specifying the law that will apply to resolve 
any breach of contract claim.

SEC. 107. EFFECTIVE DATES; EFFECT OF TERMINATION.

    (a) Effective Dates.--Except as provided in subsection (b), the 
provisions of this Act and the amendments made by this Act take effect 
on the date the Agreement enters into force.
    (b) Exceptions.--Sections 1 through 3 and this title take effect on 
the date of the enactment of this Act.
    (c) Termination of the Agreement.--On the date on which the 
Agreement ceases to be in force, the provisions of this Act (other than 
this subsection) and the amendments made by this Act shall cease to be 
effective.

                      TITLE II--CUSTOMS PROVISIONS

SEC. 201. TARIFF MODIFICATIONS.

    (a) Tariff Modifications Provided for in the Agreement.--
        (1) Proclamation authority.--The President may proclaim--
            (A) such modifications or continuation of any duty,
            (B) such continuation of duty-free or excise treatment, or
            (C) such additional duties,
    as the President determines to be necessary or appropriate to carry 
    out or apply articles 3.3, 3.7, 3.9, article 3.20 (8), (9), (10), 
    and (11), and Annex 3.3 of the Agreement.
        (2) Effect on chilean gsp status.--Notwithstanding section 
    502(a)(1) of the Trade Act of 1974 (19 U.S.C. 2462(a)(1)), the 
    President shall terminate the designation of Chile as a beneficiary 
    developing country for purposes of title V of the Trade Act of 1974 
    on the date of entry into force of the Agreement.
    (b) Other Tariff Modifications.--Subject to the consultation and 
layover provisions of section 103(a), the President may proclaim--
        (1) such modifications or continuation of any duty,
        (2) such modifications as the United States may agree to with 
    Chile regarding the staging of any duty treatment set forth in 
    Annex 3.3 of the Agreement,
        (3) such continuation of duty-free or excise treatment, or
        (4) such additional duties,
as the President determines to be necessary or appropriate to maintain 
the general level of reciprocal and mutually advantageous concessions 
with respect to Chile provided for by the Agreement.
    (c) Additional Tariffs on Agricultural Safeguard Goods.--
        (1) In general.--In addition to any duty proclaimed under 
    subsection (a) or (b), and subject to paragraphs (3) through (5), 
    the Secretary of the Treasury shall assess a duty, in the amount 
    prescribed under paragraph (2), on an agricultural safeguard good 
    if the Secretary of the Treasury determines that the unit import 
    price of the good when it enters the United States, determined on 
    an F.O.B. basis, is less than the trigger price indicated for that 
    good in Annex 3.18 of the Agreement or any amendment thereto.
        (2) Calculation of additional duty.--The amount of the 
    additional duty assessed under this subsection shall be determined 
    as follows:
            (A) If the difference between the unit import price and the 
        trigger price is less than, or equal to, 10 percent of the 
        trigger price, no additional duty shall be imposed.
            (B) If the difference between the unit import price and the 
        trigger price is greater than 10 percent, but less than or 
        equal to 40 percent, of the trigger price, the additional duty 
        shall be equal to 30 percent of the difference between the 
        preferential tariff rate and the column 1 general rate of duty 
        imposed under the HTS on like articles at the time the 
        additional duty is imposed.
            (C) If the difference between the unit import price and the 
        trigger price is greater than 40 percent, but less than or 
        equal to 60 percent, of the trigger price, the additional duty 
        shall be equal to 50 percent of the difference between the 
        preferential tariff rate and the column 1 general rate of duty 
        imposed under the HTS on like articles at the time the 
        additional duty is imposed.
            (D) If the difference between the unit import price and the 
        trigger price is greater than 60 percent, but less than or 
        equal to 75 percent, of the trigger price, the additional duty 
        shall be equal to 70 percent of the difference between the 
        preferential tariff rate and the column 1 general rate of duty 
        imposed under the HTS on like articles at the time the 
        additional duty is imposed.
            (E) If the difference between the unit import price and the 
        trigger price is greater than 75 percent of the trigger price, 
        the additional duty shall be equal to 100 percent of the 
        difference between the preferential tariff rate and the column 
        1 general rate of duty imposed under the HTS on like articles 
        at the time the additional duty is imposed.
        (3) Exceptions.--No additional duty under this subsection shall 
    be assessed on an agricultural safeguard good if, at the time of 
    entry, the good is subject to import relief under--
            (A) subtitle A of title III of this Act; or
            (B) chapter 1 of title II of the Trade Act of 1974 (19 
        U.S.C. 2251 et seq.).
        (4) Termination.--This subsection shall cease to apply on the 
    date that is 12 years after the date on which the Agreement enters 
    into force.
        (5) Tariff-rate quotas.--If an agricultural safeguard good is 
    subject to a tariff-rate quota, and the in-quota duty rate for the 
    good proclaimed pursuant to subsection (a) or (b) is zero, any 
    additional duty assessed under this subsection shall be applied 
    only to over-quota imports of the good.
        (6) Notice.--Not later than 60 days after the Secretary of the 
    Treasury first assesses additional duties on an agricultural 
    safeguard good under this subsection, the Secretary shall notify 
    the Government of Chile in writing of such action and shall provide 
    to the Government of Chile data supporting the assessment of 
    additional duties.
        (7) Modification of trigger prices.--Not later than 60 calendar 
    days before agreeing with the Government of Chile pursuant to 
    article 3.18(2)(b) of the Agreement on a modification to a trigger 
    price for a good listed in Annex 3.18 of the Agreement, the 
    President shall notify the Committees on Ways and Means and 
    Agriculture of the House of Representatives and the Committees on 
    Finance and Agriculture of the Senate of the proposed modification 
    and the reasons therefor.
        (8) Definitions.--In this subsection:
            (A) Agricultural safeguard good.--The term ``agricultural 
        safeguard good'' means a good--
                (i) that qualifies as an originating good under section 
            202;
                (ii) that is included in the United States Agricultural 
            Safeguard Product List set forth in Annex 3.18 of the 
            Agreement; and
                (iii) for which a claim for preferential tariff 
            treatment under the Agreement has been made.
            (B) F.O.B.--The term ``F.O.B.'' means free on board, 
        regardless of the mode of transportation, at the point of 
        direct shipment by the seller to the buyer.
            (C) Unit import price.--The term ``unit import price'' 
        means the price expressed in dollars per kilogram.
    (d) Conversion to Ad Valorem Rates.--For purposes of subsections 
(a) and (b), with respect to any good for which the base rate in the 
Schedule of the United States to Annex 3.3 of the Agreement is a 
specific or compound rate of duty, the President may substitute for the 
base rate an ad valorem rate that the President determines to be 
equivalent to the base rate.

SEC. 202. RULES OF ORIGIN.

    (a) Originating Goods.--
        (1) In general.--For purposes of this Act and for purposes of 
    implementing the tariff treatment provided for under the Agreement, 
    except as otherwise provided in this section, a good is an 
    originating good if--
            (A) the good is wholly obtained or produced entirely in the 
        territory of Chile, the United States, or both;
            (B) the good--
                (i) is produced entirely in the territory of Chile, the 
            United States, or both, and

                    (I) each of the nonoriginating materials used in 
                the production of the good undergoes an applicable 
                change in tariff classification specified in Annex 4.1 
                of the Agreement, or
                    (II) the good otherwise satisfies any applicable 
                regional value-content or other requirements specified 
                in Annex 4.1 of the Agreement; and

                (ii) satisfies all other applicable requirements of 
            this section; or
            (C) the good is produced entirely in the territory of 
        Chile, the United States, or both, exclusively from materials 
        described in subparagraph (A) or (B).
        (2) Simple combination or mere dilution.--A good shall not be 
    considered to be an originating good and a material shall not be 
    considered to be an originating material by virtue of having 
    undergone--
            (A) simple combining or packaging operations; or
            (B) mere dilution with water or another substance that does 
        not materially alter the characteristics of the good or 
        material.
    (b) De Minimis Amounts of Nonoriginating Materials.--
        (1) In general.--Except as provided in paragraphs (2) and (3), 
    a good that does not undergo a change in tariff classification 
    pursuant to Annex 4.1 of the Agreement is an originating good if--
            (A) the value of all nonoriginating materials that are used 
        in the production of the good and do not undergo the applicable 
        change in tariff classification does not exceed 10 percent of 
        the adjusted value of the good;
            (B) the value of such nonoriginating materials is included 
        in the value of nonoriginating materials for any applicable 
        regional value-content requirement; and
            (C) the good meets all other applicable requirements of 
        this section.
        (2) Exceptions.--Paragraph (1) does not apply to the following:
            (A) A nonoriginating material provided for in chapter 4 of 
        the HTS, or a nonoriginating dairy preparation containing over 
        10 percent by weight of milk solids provided for in subheading 
        1901.90 or 2106.90 of the HTS, that is used in the production 
        of a good provided for in chapter 4 of the HTS.
            (B) A nonoriginating material provided for in chapter 4 of 
        the HTS, or nonoriginating dairy preparations containing over 
        10 percent by weight of milk solids provided for in subheading 
        1901.90 of the HTS, that are used in the production of the 
        following goods:
                (i) Infant preparations containing over 10 percent in 
            weight of milk solids provided for in subheading 1901.10 of 
            the HTS.
                (ii) Mixes and doughs, containing over 25 percent by 
            weight of butterfat, not put up for retail sale, provided 
            for in subheading 1901.20 of the HTS.
                (iii) Dairy preparations containing over 10 percent by 
            weight of milk solids provided for in subheading 1901.90 or 
            2106.90 of the HTS.
                (iv) Goods provided for in heading 2105 of the HTS.
                (v) Beverages containing milk provided for in 
            subheading 2202.90 of the HTS.
                (vi) Animal feeds containing over 10 percent by weight 
            of milk solids provided for in subheading 2309.90 of the 
            HTS.
            (C) A nonoriginating material provided for in heading 0805 
        of the HTS, or any of subheadings 2009.11.00 through 2009.39 of 
        the HTS, that is used in the production of a good provided for 
        in any of subheadings 2009.11.00 through 2009.39 of the HTS, or 
        in fruit or vegetable juice of any single fruit or vegetable, 
        fortified with minerals or vitamins, concentrated or 
        unconcentrated, provided for in subheading 2106.90 or 2202.90 
        of the HTS.
            (D) A nonoriginating material provided for in chapter 15 of 
        the HTS that is used in the production of a good provided for 
        in any of headings 1501.00.00 through 1508, 1512, 1514, and 
        1515 of the HTS.
            (E) A nonoriginating material provided for in heading 1701 
        of the HTS that is used in the production of a good provided 
        for in any of headings 1701 through 1703 of the HTS.
            (F) A nonoriginating material provided for in chapter 17 of 
        the HTS or in heading 1805.00.00 of the HTS that is used in the 
        production of a good provided for in subheading 1806.10 of the 
        HTS.
            (G) A nonoriginating material provided for in any of 
        headings 2203 through 2208 of the HTS that is used in the 
        production of a good provided for in heading 2207 or 2208 of 
        the HTS.
            (H) A nonoriginating material used in the production of a 
        good provided for in any of chapters 1 through 21 of the HTS, 
        unless the nonoriginating material is provided for in a 
        different subheading than the good for which origin is being 
        determined under this section.
        (3) Goods provided for in chapters 50 through 63 of the hts.--
            (A) In general.--Except as provided in subparagraph (B), a 
        good provided for in any of chapters 50 through 63 of the HTS 
        that is not an originating good because certain fibers or yarns 
        used in the production of the component of the good that 
        determines the tariff classification of the good do not undergo 
        an applicable change in tariff classification set out in Annex 
        4.1 of the Agreement, shall be considered to be an originating 
        good if the total weight of all such fibers or yarns in that 
        component is not more than 7 percent of the total weight of 
        that component.
            (B) Certain textile or apparel goods.--A textile or apparel 
        good containing elastomeric yarns in the component of the good 
        that determines the tariff classification of the good shall be 
        considered to be an originating good only if such yarns are 
        wholly formed in the territory of Chile or the United States.
    (c) Accumulation.--
        (1) Originating goods incorporated in goods of other country.--
    Originating goods or materials of Chile or the United States that 
    are incorporated into a good in the territory of the other country 
    shall be considered to originate in the territory of the other 
    country.
        (2) Multiple procedures.--A good that is produced in the 
    territory of Chile, the United States, or both, by 1 or more 
    producers, is an originating good if the good satisfies the 
    requirements of subsection (a) and all other applicable 
    requirements of this section.
    (d) Regional Value-Content.--
        (1) In general.--For purposes of subsection (a)(2), the 
    regional value-content of a good referred to in Annex 4.1 of the 
    Agreement shall be calculated, at the choice of the person claiming 
    preferential tariff treatment for the good, on the basis of the 
    build-down method described in paragraph (2) or the build-up method 
    described in paragraph (3), unless otherwise provided in Annex 4.1 
    of the Agreement.
        (2) Build-down method.--
            (A) In general.--The regional value-content of a good may 
        be calculated on the basis of the following build-down method:

 
                               AV - VNM
                      RVC =  ------------ <greek-e>
                                  AV         100
------------------------------------------------------------------------
 

            (B) Definitions.--For purposes of subparagraph (A):
                (i) The term ``RVC'' means the regional value-content, 
            expressed as a percentage.
                (ii) The term ``AV'' means the adjusted value.
                (iii) The term ``VNM'' means the value of 
            nonoriginating materials used by the producer in the 
            production of the good.
        (3) Build-up method.--
            (A) In general.--The regional value-content of a good may 
        be calculated on the basis of the following build-up method:

 
                                  VOM
                      RVC =  ------------ <greek-e>
                                  AV         100
------------------------------------------------------------------------
 

            (B) Definitions.--For purposes of subparagraph (A):
                (i) The term ``RVC'' means the regional value-content, 
            expressed as a percentage.
                (ii) The term ``AV'' means the adjusted value.
                (iii) The term ``VOM'' means the value of originating 
            materials used by the producer in the production of the 
            good.
    (e) Value of Materials.--
        (1) In general.--For purposes of calculating the regional 
    value-content of a good under subsection (d), and for purposes of 
    applying the de minimis rules under subsection (b), the value of a 
    material is--
            (A) in the case of a material that is imported by the 
        producer of the good, the adjusted value of the material with 
        respect to that importation;
            (B) in the case of a material acquired in the territory in 
        which the good is produced, except for a material to which 
        subparagraph (C) applies, the producer's price actually paid or 
        payable for the material;
            (C) in the case of a material provided to the producer 
        without charge, or at a price reflecting a discount or similar 
        reduction, the sum of--
                (i) all expenses incurred in the growth, production, or 
            manufacture of the material, including general expenses; 
            and
                (ii) an amount for profit; or
            (D) in the case of a material that is self-produced, the 
        sum of--
                (i) all expenses incurred in the production of the 
            material, including general expenses; and
                (ii) an amount for profit.
        (2) Further adjustments to the value of materials.--
            (A) Originating materials.--The following expenses, if not 
        included in the value of an originating material calculated 
        under paragraph (1), may be added to the value of the 
        originating material:
                (i) The costs of freight, insurance, packing, and all 
            other costs incurred in transporting the material to the 
            location of the producer.
                (ii) Duties, taxes, and customs brokerage fees on the 
            material paid in the territory of Chile, the United States, 
            or both, other than duties and taxes that are waived, 
            refunded, refundable, or otherwise recoverable, including 
            credit against duty or tax paid or payable.
                (iii) The cost of waste and spoilage resulting from the 
            use of the material in the production of the good, less the 
            value of renewable scrap or byproduct.
            (B) Nonoriginating materials.--The following expenses, if 
        included in the value of a nonoriginating material calculated 
        under paragraph (1), may be deducted from the value of the 
        nonoriginating material:
                (i) The costs of freight, insurance, packing, and all 
            other costs incurred in transporting the material to the 
            location of the producer.
                (ii) Duties, taxes, and customs brokerage fees on the 
            material paid in the territory of Chile, the United States, 
            or both, other than duties and taxes that are waived, 
            refunded, refundable, or otherwise recoverable, including 
            credit against duty or tax paid or payable.
                (iii) The cost of waste and spoilage resulting from the 
            use of the material in the production of the good, less the 
            value of renewable scrap or byproducts.
                (iv) The cost of originating materials used in the 
            production of the nonoriginating material in the territory 
            of Chile or the United States.
    (f) Accessories, Spare Parts, or Tools.--Accessories, spare parts, 
or tools delivered with a good that form part of the good's standard 
accessories, spare parts, or tools shall be regarded as a material used 
in the production of the good, if--
        (1) the accessories, spare parts, or tools are classified with 
    and not invoiced separately from the good; and
        (2) the quantities and value of the accessories, spare parts, 
    or tools are customary for the good.
    (g) Fungible Goods and Materials.--
        (1) In general.--
            (A) Claim for preferential treatment.--A person claiming 
        preferential tariff treatment for a good may claim that a 
        fungible good or material is originating either based on the 
        physical segregation of each fungible good or material or by 
        using an inventory management method.
            (B) Inventory management method.--In this subsection, the 
        term ``inventory management method'' means--
                (i) averaging;
                (ii) ``last-in, first-out'';
                (iii) ``first-in, first-out''; or
                (iv) any other method--

                    (I) recognized in the generally accepted accounting 
                principles of the country in which the production is 
                performed (whether Chile or the United States); or
                    (II) otherwise accepted by that country.

        (2) Election of inventory method.--A person selecting an 
    inventory management method under paragraph (1) for particular 
    fungible goods or materials shall continue to use that method for 
    those goods or materials throughout the fiscal year of that person.
    (h) Packaging Materials and Containers for Retail Sale.--Packaging 
materials and containers in which a good is packaged for retail sale, 
if classified with the good, shall be disregarded in determining 
whether all nonoriginating materials used in the production of the good 
undergo the applicable change in tariff classification set out in Annex 
4.1 of the Agreement, and, if the good is subject to a regional value-
content requirement, the value of such packaging materials and 
containers shall be taken into account as originating or nonoriginating 
materials, as the case may be, in calculating the regional value-
content of the good.
    (i) Packing Materials and Containers for Shipment.--Packing 
materials and containers for shipment shall be disregarded in 
determining whether--
        (1) the nonoriginating materials used in the production of the 
    good undergo an applicable change in tariff classification set out 
    in Annex 4.1 of the Agreement; and
        (2) the good satisfies a regional value-content requirement.
    (j) Indirect Materials.--An indirect material shall be considered 
to be an originating material without regard to where it is produced.
    (k) Transit and Transshipment.--A good that has undergone 
production necessary to qualify as an originating good under subsection 
(a) shall not be considered to be an originating good if, subsequent to 
that production, the good undergoes further production or any other 
operation outside the territory of Chile or the United States, other 
than unloading, reloading, or any other process necessary to preserve 
the good in good condition or to transport the good to the territory of 
Chile or the United States.
    (l) Textile and Apparel Goods Classifiable as Goods Put Up in 
Sets.--Notwithstanding the rules set forth in Annex 4.1 of the 
Agreement, textile and apparel goods classifiable as goods put up in 
sets for retail sale as provided for in General Rule of Interpretation 
3 of the Harmonized System shall not be considered to be originating 
goods unless each of the goods in the set is an originating good or the 
total value of the nonoriginating goods in the set does not exceed 10 
percent of the value of the set determined for purposes of assessing 
customs duties.
    (m) Application and Interpretation.--In this section:
        (1) The basis for any tariff classification is the HTS.
        (2) Any cost or value referred to in this section shall be 
    recorded and maintained in accordance with the generally accepted 
    accounting principles applicable in the territory of the country in 
    which the good is produced (whether Chile or the United States).
    (n) Definitions.--In this section:
        (1) Adjusted value.--The term ``adjusted value'' means the 
    value determined in accordance with articles 1 through 8, article 
    15, and the corresponding interpretive notes of the Agreement on 
    Implementation of Article VII of the General Agreement on Tariffs 
    and Trade 1994 referred to in section 101(d)(8) of the Uruguay 
    Round Agreements Act, except that such value may be adjusted to 
    exclude any costs, charges, or expenses incurred for 
    transportation, insurance, and related services incident to the 
    international shipment of the merchandise from the country of 
    exportation to the place of importation.
        (2) Fungible goods or fungible materials.--The terms ``fungible 
    goods'' and ``fungible materials'' mean goods or materials, as the 
    case may be, that are interchangeable for commercial purposes and 
    the properties of which are essentially identical.
        (3) Generally accepted accounting principles.--The term 
    ``generally accepted accounting principles'' means the principles, 
    rules, and procedures, including both broad and specific 
    guidelines, that define the accounting practices accepted in the 
    territory of Chile or the United States, as the case may be.
        (4) Goods wholly obtained or produced entirely in the territory 
    of chile, the united states, or both.--The term ``goods wholly 
    obtained or produced entirely in the territory of Chile, the United 
    States, or both'' means--
            (A) mineral goods extracted in the territory of Chile, the 
        United States, or both;
            (B) vegetable goods, as such goods are defined in the 
        Harmonized System, harvested in the territory of Chile, the 
        United States, or both;
            (C) live animals born and raised in the territory of Chile, 
        the United States, or both;
            (D) goods obtained from hunting, trapping, or fishing in 
        the territory of Chile, the United States, or both;
            (E) goods (fish, shellfish, and other marine life) taken 
        from the sea by vessels registered or recorded with Chile or 
        the United States and flying the flag of that country;
            (F) goods produced on board factory ships from the goods 
        referred to in subparagraph (E), if such factory ships are 
        registered or recorded with Chile or the United States and fly 
        the flag of that country;
            (G) goods taken by Chile or the United States or a person 
        of Chile or the United States from the seabed or beneath the 
        seabed outside territorial waters, if Chile or the United 
        States has rights to exploit such seabed;
            (H) goods taken from outer space, if the goods are obtained 
        by Chile or the United States or a person of Chile or the 
        United States and not processed in the territory of a country 
        other than Chile or the United States;
            (I) waste and scrap derived from--
                (i) production in the territory of Chile, the United 
            States, or both; or
                (ii) used goods collected in the territory of Chile, 
            the United States, or both, if such goods are fit only for 
            the recovery of raw materials;
            (J) recovered goods derived in the territory of Chile or 
        the United States from used goods, and used in the territory of 
        that country in the production of remanufactured goods; and
            (K) goods produced in the territory of Chile, the United 
        States, or both, exclusively--
                (i) from goods referred to in any of subparagraphs (A) 
            through (I), or
                (ii) from the derivatives of goods referred to in 
            clause (i),
        at any stage of production.
        (5) Harmonized system.--The term ``Harmonized System'' means 
    the Harmonized Commodity Description and Coding System.
        (6) Indirect material.--The term ``indirect material'' means a 
    good used in the production, testing, or inspection of a good but 
    not physically incorporated into the good, or a good used in the 
    maintenance of buildings or the operation of equipment associated 
    with the production of a good, including--
            (A) fuel and energy;
            (B) tools, dies, and molds;
            (C) spare parts and materials used in the maintenance of 
        equipment or buildings;
            (D) lubricants, greases, compounding materials, and other 
        materials used in production or used to operate equipment or 
        buildings;
            (E) gloves, glasses, footwear, clothing, safety equipment, 
        and supplies;
            (F) equipment, devices, and supplies used for testing or 
        inspecting the good;
            (G) catalysts and solvents; and
            (H) any other goods that are not incorporated into the good 
        but the use of which in the production of the good can 
        reasonably be demonstrated to be a part of that production.
        (7) Material.--The term ``material'' means a good that is used 
    in the production of another good, including a part, ingredient, or 
    indirect material.
        (8) Material that is self-produced.--The term ``material that 
    is self-produced'' means a material that is an originating good 
    produced by a producer of a good and used in the production of that 
    good.
        (9) Nonoriginating good or nonoriginating material.--The terms 
    ``nonoriginating good'' and ``nonoriginating material'' mean a good 
    or material, as the case may be, that does not qualify as an 
    originating good under this section.
        (10) Packing materials and containers for shipment.--The term 
    ``packing materials and containers for shipment'' means the goods 
    used to protect a good during its transportation, and does not 
    include the packaging materials and containers in which a good is 
    packaged for retail sale.
        (11) Preferential tariff treatment.--The term ``preferential 
    tariff treatment'' means the customs duty rate that is applicable 
    to an originating good pursuant to chapter 3 of the Agreement.
        (12) Producer.--The term ``producer'' means a person who 
    engages in the production of a good in the territory of Chile or 
    the United States.
        (13) Production.--The term ``production'' means growing, 
    mining, harvesting, fishing, raising, trapping, hunting, 
    manufacturing, processing, assembling, or disassembling a good.
        (14) Recovered goods.--
            (A) In general.--The term ``recovered goods'' means 
        materials in the form of individual parts that are the result 
        of--
                (i) the complete disassembly of used goods into 
            individual parts; and
                (ii) the cleaning, inspecting, testing, or other 
            processing of those parts as necessary for improvement to 
            sound working condition by one or more of the processes 
            described in subparagraph (B), in order for such parts to 
            be assembled with other parts, including other parts that 
            have undergone the processes described in this paragraph, 
            in the production of a remanufactured good.
            (B) Processes.--The processes referred to in subparagraph 
        (A)(ii) are welding, flame spraying, surface machining, 
        knurling, plating, sleeving, and rewinding.
        (15) Remanufactured good.--The term ``remanufactured good'' 
    means an industrial good assembled in the territory of Chile or the 
    United States, that is listed in Annex 4.18 of the Agreement, and--
            (A) is entirely or partially comprised of recovered goods;
            (B) has the same life expectancy and meets the same 
        performance standards as a new good; and
            (C) enjoys the same factory warranty as such a new good.
    (o) Presidential Proclamation Authority.--
        (1) In general.--The President is authorized to proclaim, as 
    part of the HTS--
            (A) the provisions set out in Annex 4.1 of the Agreement; 
        and
            (B) any additional subordinate category necessary to carry 
        out this title consistent with the Agreement.
        (2) Modifications.--
            (A) In general.--Subject to the consultation and layover 
        provisions of section 103(a), the President may proclaim 
        modifications to the provisions proclaimed under the authority 
        of paragraph (1)(A), other than provisions of chapters 50 
        through 63 of the HTS, as included in Annex 4.1 of the 
        Agreement.
            (B) Additional proclamations.--Notwithstanding subparagraph 
        (A), and subject to the consultation and layover provisions of 
        section 103(a), the President may proclaim--
                (i) modifications to the provisions proclaimed under 
            the authority of paragraph (1)(A) that are necessary to 
            implement an agreement with Chile pursuant to article 
            3.20(5) of the Agreement; and
                (ii) before the 1st anniversary of the date of the 
            enactment of this Act, modifications to correct any 
            typographical, clerical, or other nonsubstantive technical 
            error regarding the provisions of chapters 50 through 63 of 
            the HTS, as included in Annex 4.1 of the Agreement.

SEC. 203. DRAWBACK.

    (a) Definition of a Good Subject to Chile FTA Drawback.--For 
purposes of this Act and the amendments made by subsection (b), the 
term ``good subject to Chile FTA drawback'' means any imported good 
other than the following:
        (1) A good entered under bond for transportation and 
    exportation to Chile.
        (2)(A) A good exported to Chile in the same condition as when 
    imported into the United States.
        (B) For purposes of subparagraph (A)--
            (i) processes such as testing, cleaning, repacking, 
        inspecting, sorting, or marking a good, or preserving it in its 
        same condition, shall not be considered to change the condition 
        of the good; and
            (ii) if a good described in subparagraph (A) is commingled 
        with fungible goods and exported in the same condition, the 
        origin of the good for the purposes of subsection (j)(1) of 
        section 313 of the Tariff Act of 1930 (19 U.S.C. 1313(j)(1)) 
        may be determined on the basis of the inventory methods 
        provided for in the regulations implementing this title.
        (3) A good--
            (A) that is--
                (i) deemed to be exported from the United States;
                (ii) used as a material in the production of another 
            good that is deemed to be exported to Chile; or
                (iii) substituted for by a good of the same kind and 
            quality that is used as a material in the production of 
            another good that is deemed to be exported to Chile; and
            (B) that is delivered--
                (i) to a duty-free shop;
                (ii) for ship's stores or supplies for a ship or 
            aircraft; or
                (iii) for use in a project undertaken jointly by the 
            United States and Chile and destined to become the property 
            of the United States.
        (4) A good exported to Chile for which a refund of customs 
    duties is granted by reason of--
            (A) the failure of the good to conform to sample or 
        specification; or
            (B) the shipment of the good without the consent of the 
        consignee.
        (5) A good that qualifies under the rules of origin set out in 
    section 202 that is--
            (A) exported to Chile;
            (B) used as a material in the production of another good 
        that is exported to Chile; or
            (C) substituted for by a good of the same kind and quality 
        that is used as a material in the production of another good 
        that is exported to Chile.
    (b) Consequential Amendments.--
        (1) Bonded manufacturing warehouses.--Section 311 of the Tariff 
    Act of 1930 (19 U.S.C. 1311) is amended by adding at the end the 
    following new paragraph:
    ``No article manufactured in a bonded warehouse from materials that 
are goods subject to Chile FTA drawback, as defined in section 203(a) 
of the United States-Chile Free Trade Agreement Implementation Act, may 
be withdrawn from warehouse for exportation to Chile without assessment 
of a duty on the materials in their condition and quantity, and at 
their weight, at the time of importation into the United States. The 
duty shall be paid before the 61st day after the date of exportation, 
except that the duty may be waived or reduced by--
        ``(1) 100 percent during the 8-year period beginning on January 
    1, 2004;
        ``(2) 75 percent during the 1-year period beginning on January 
    1, 2012;
        ``(3) 50 percent during the 1-year period beginning on January 
    1, 2013; and
        ``(4) 25 percent during the 1-year period beginning on January 
    1, 2014.''.
        (2) Bonded smelting and refining warehouses.--Section 312 of 
    the Tariff Act of 1930 (19 U.S.C. 1312) is amended--
            (A) in paragraph (1) of subsection (b), by striking 
        ``except that'' and all that follows through subparagraph (B) 
        and inserting the following: ``except that--
            ``(A) in the case of a withdrawal for exportation of such a 
        product to a NAFTA country, as defined in section 2(4) of the 
        North American Free Trade Agreement Implementation Act, if any 
        of the imported metal-bearing materials are goods subject to 
        NAFTA drawback, as defined in section 203(a) of that Act, the 
        duties on the materials shall be paid, and the charges against 
        the bond canceled, before the 61st day after the date of 
        exportation; but upon the presentation, before such 61st day, 
        of satisfactory evidence of the amount of any customs duties 
        paid to the NAFTA country on the product, the duties on the 
        materials may be waived or reduced (subject to section 
        508(b)(2)(B)) in an amount that does not exceed the lesser of--
                ``(i) the total amount of customs duties owed on the 
            materials on importation into the United States, or
                ``(ii) the total amount of customs duties paid to the 
            NAFTA country on the product, and
            ``(B) in the case of a withdrawal for exportation of such a 
        product to Chile, if any of the imported metal-bearing 
        materials are goods subject to Chile FTA drawback, as defined 
        in section 203(a) of the United States-Chile Free Trade 
        Agreement Implementation Act, the duties on the materials shall 
        be paid, and the charges against the bond canceled, before the 
        61st day after the date of exportation, except that the duties 
        may be waived or reduced by--
                ``(i) 100 percent during the 8-year period beginning on 
            January 1, 2004,
                ``(ii) 75 percent during the 1-year period beginning on 
            January 1, 2012,
                ``(iii) 50 percent during the 1-year period beginning 
            on January 1, 2013, and
                ``(iv) 25 percent during the 1-year period beginning on 
            January 1, 2014, or'';
            (B) in paragraph (4) of subsection (b), by striking 
        ``except that'' and all that follows through subparagraph (B) 
        and inserting the following: ``except that--
            ``(A) in the case of a withdrawal for exportation of such a 
        product to a NAFTA country, as defined in section 2(4) of the 
        North American Free Trade Agreement Implementation Act, if any 
        of the imported metal-bearing materials are goods subject to 
        NAFTA drawback, as defined in section 203(a) of that Act, the 
        duties on the materials shall be paid, and the charges against 
        the bond canceled, before the 61st day after the date of 
        exportation; but upon the presentation, before such 61st day, 
        of satisfactory evidence of the amount of any customs duties 
        paid to the NAFTA country on the product, the duties on the 
        materials may be waived or reduced (subject to section 
        508(b)(2)(B)) in an amount that does not exceed the lesser of--
                ``(i) the total amount of customs duties owed on the 
            materials on importation into the United States, or
                ``(ii) the total amount of customs duties paid to the 
            NAFTA country on the product, and
            ``(B) in the case of a withdrawal for exportation of such a 
        product to Chile, if any of the imported metal-bearing 
        materials are goods subject to Chile FTA drawback, as defined 
        in section 203(a) of the United States-Chile Free Trade 
        Agreement Implementation Act, the duties on the materials shall 
        be paid, and the charges against the bond canceled, before the 
        61st day after the date of exportation, except that the duties 
        may be waived or reduced by--
                ``(i) 100 percent during the 8-year period beginning on 
            January 1, 2004,
                ``(ii) 75 percent during the 1-year period beginning on 
            January 1, 2012,
                ``(iii) 50 percent during the 1-year period beginning 
            on January 1, 2013, and
                ``(iv) 25 percent during the 1-year period beginning on 
            January 1, 2014, or''; and
            (C) in subsection (d), in the matter preceding paragraph 
        (1), by striking ``except that'' and all that follows through 
        the end of paragraph (2) and inserting the following: ``except 
        that--
        ``(1) in the case of a withdrawal for exportation to a NAFTA 
    country, as defined in section 2(4) of the North American Free 
    Trade Agreement Implementation Act, if any of the imported metal-
    bearing materials are goods subject to NAFTA drawback, as defined 
    in section 203(a) of that Act, charges against the bond shall be 
    paid before the 61st day after the date of exportation; but upon 
    the presentation, before such 61st day, of satisfactory evidence of 
    the amount of any customs duties paid to the NAFTA country on the 
    product, the bond shall be credited (subject to section 
    508(b)(2)(B)) in an amount not to exceed the lesser of--
            ``(A) the total amount of customs duties paid or owed on 
        the materials on importation into the United States, or
            ``(B) the total amount of customs duties paid to the NAFTA 
        country on the product; and
        ``(2) in the case of a withdrawal for exportation to Chile, if 
    any of the imported metal-bearing materials are goods subject to 
    Chile FTA drawback, as defined in section 203(a) of the United 
    States-Chile Free Trade Agreement Implementation Act, charges 
    against the bond shall be paid before the 61st day after the date 
    of exportation, and the bond shall be credited in an amount equal 
    to--
            ``(A) 100 percent of the total amount of customs duties 
        paid or owed on the materials on importation into the United 
        States during the 8-year period beginning on January 1, 2004,
            ``(B) 75 percent of the total amount of customs duties paid 
        or owed on the materials on importation into the United States 
        during the 1-year period beginning on January 1, 2012,
            ``(C) 50 percent of the total amount of customs duties paid 
        or owed on the materials on importation into the United States 
        during the 1-year period beginning on January 1, 2013, and
            ``(D) 25 percent of the total amount of customs duties paid 
        or owed on the materials on importation into the United States 
        during the 1-year period beginning on January 1, 2014.''.
        (3) Drawback.--Section 313 of the Tariff Act of 1930 (19 U.S.C. 
    1313) is amended--
            (A) in paragraph (4) of subsection (j)--
                (i) by striking ``(4)'' and inserting ``(4)(A)''; and
                (ii) by adding at the end the following new 
            subparagraph:
        ``(B) Beginning on January 1, 2015, the exportation to Chile of 
    merchandise that is fungible with and substituted for imported 
    merchandise, other than merchandise described in paragraphs (1) 
    through (5) of section 203(a) of the United States-Chile Free Trade 
    Agreement Implementation Act, shall not constitute an exportation 
    for purposes of paragraph (2). The preceding sentence shall not be 
    construed to permit the substitution of unused drawback under 
    paragraph (2) of this subsection with respect to merchandise 
    described in paragraph (2) of section 203(a) of the United States-
    Chile Free Trade Agreement Implementation Act.'';
            (B) in subsection (n)--
                (i) by striking ``(n)'' and inserting the following:
    ``(n) Refunds, Waivers, or Reductions Under Certain Free Trade 
Agreements.--'';
                (ii) in paragraph (1)--

                    (I) by striking ``; and'' at the end of 
                subparagraph (B);
                    (II) by striking the period at the end of 
                subparagraph (C) and inserting ``; and''; and
                    (III) by adding at the end the following new 
                subparagraph:

        ``(D) the term `good subject to Chile FTA drawback' has the 
    meaning given that term in section 203(a) of the United States-
    Chile Free Trade Agreement Implementation Act.''; and
                (iii) by adding the following new paragraph at the end:
    ``(4)(A) For purposes of subsections (a), (b), (f), (h), (j)(2), 
(p), and (q), if an article that is exported to Chile is a good subject 
to Chile FTA drawback, no customs duties on the good may be refunded, 
waived, or reduced, except as provided in subparagraph (B).
    ``(B) The customs duties referred to in subparagraph (A) may be 
refunded, waived, or reduced by--
        ``(i) 100 percent during the 8-year period beginning on January 
    1, 2004;
        ``(ii) 75 percent during the 1-year period beginning on January 
    1, 2012;
        ``(iii) 50 percent during the 1-year period beginning on 
    January 1, 2013; and
        ``(iv) 25 percent during the 1-year period beginning on January 
    1, 2014.''; and
            (C) in subsection (o)--
                (i) by striking ``(o)'' and inserting the following:
    ``(o) Special Rules for Certain Vessels and Imported Materials.--
''; and
                (ii) by adding at the end the following new paragraphs:
    ``(3) For purposes of subsection (g), if--
        ``(A) a vessel is built for the account and ownership of a 
    resident of Chile or the Government of Chile, and
        ``(B) imported materials that are used in the construction and 
    equipment of the vessel are goods subject to Chile FTA drawback, as 
    defined in section 203(a) of the United States-Chile Free Trade 
    Agreement Implementation Act,
no customs duties on such materials may be refunded, waived, or 
reduced, except as provided in paragraph (4).
    ``(4) The customs duties referred to in paragraph (3) may be 
refunded, waived or reduced by--
        ``(A) 100 percent during the 8-year period beginning on January 
    1, 2004;
        ``(B) 75 percent during the 1-year period beginning on January 
    1, 2012;
        ``(C) 50 percent during the 1-year period beginning on January 
    1, 2013; and
        ``(D) 25 percent during the 1-year period beginning on January 
    1, 2014.''.
        (4) Manipulation in warehouse.--Section 562 of the Tariff Act 
    of 1930 (19 U.S.C. 1562) is amended--
            (A) in paragraph (3), by striking ``to a NAFTA country'' 
        and inserting ``to Chile, to a NAFTA country,'';
            (B) by striking ``and'' at the end of paragraph (4)(B);
            (C) by striking the period at the end of paragraph (5) and 
        inserting ``; and''; and
            (D) by inserting after paragraph (5) the following:
        ``(6)(A) without payment of duties for exportation to Chile, if 
    the merchandise is of a kind described in any of paragraphs (1) 
    through (5) of section 203(a) of the United States-Chile Free Trade 
    Agreement Implementation Act; and
        ``(B) for exportation to Chile if the merchandise consists of 
    goods subject to Chile FTA drawback, as defined in section 203(a) 
    of the United States-Chile Free Trade Agreement Implementation Act, 
    except that--
            ``(i) the merchandise may not be withdrawn from warehouse 
        without assessment of a duty on the merchandise in its 
        condition and quantity, and at its weight, at the time of 
        withdrawal from the warehouse with such additions to, or 
        deductions from, the final appraised value as may be necessary 
        by reason of a change in condition, and
            ``(ii) duty shall be paid on the merchandise before the 
        61st day after the date of exportation, except that such duties 
        may be waived or reduced by--
                ``(I) 100 percent during the 8-year period beginning on 
            January 1, 2004,
                ``(II) 75 percent during the 1-year period beginning on 
            January 1, 2012,
                ``(III) 50 percent during the 1-year period beginning 
            on January 1, 2013, and
                ``(IV) 25 percent during the 1-year period beginning on 
            January 1, 2014.''.
        (5) Foreign trade zones.--Section 3(a) of the Act of June 18, 
    1934 (commonly known as the ``Foreign Trade Zones Act''; 19 U.S.C. 
    81c(a)) is amended by striking the end period and inserting the 
    following: ``: Provided further, That no merchandise that consists 
    of goods subject to Chile FTA drawback, as defined in section 
    203(a) of the United States-Chile Free Trade Agreement 
    Implementation Act, that is manufactured or otherwise changed in 
    condition shall be exported to Chile without an assessment of a 
    duty on the merchandise in its condition and quantity, and at its 
    weight, at the time of its exportation (or if the privilege in the 
    first proviso to this subsection was requested, an assessment of a 
    duty on the merchandise in its condition and quantity, and at its 
    weight, at the time of its admission into the zone) and the payment 
    of the assessed duty before the 61st day after the date of 
    exportation of the article, except that the customs duty may be 
    waived or reduced by (1) 100 percent during the 8-year period 
    beginning on January 1, 2004; (2) 75 percent during the 1-year 
    period beginning on January 1, 2012; (3) 50 percent during the 1-
    year period beginning on January 1, 2013; and (4) 25 percent during 
    the 1-year period beginning on January 1, 2014.''.
    (c) Inapplicability to Countervailing and Antidumping Duties.--
Nothing in this section or the amendments made by this section shall be 
considered to authorize the refund, waiver, or reduction of 
countervailing duties or antidumping duties imposed on an imported 
good.

SEC. 204. CUSTOMS USER FEES.

    Section 13031(b) of the Consolidated Omnibus Budget Reconciliation 
Act of 1985 (19 U.S.C. 58c(b)) is amended by inserting after paragraph 
(11) the following:
    ``(12) No fee may be charged under subsection (a) (9) or (10) with 
respect to goods that qualify as originating goods under section 202 of 
the United States-Chile Free Trade Agreement Implementation Act. Any 
service for which an exemption from such fee is provided by reason of 
this paragraph may not be funded with money contained in the Customs 
User Fee Account.''.

SEC. 205. DISCLOSURE OF INCORRECT INFORMATION; DENIAL OF PREFERENTIAL 
              TARIFF TREATMENT; FALSE CERTIFICATES OF ORIGIN.

    (a) Disclosure of Incorrect Information.--Section 592 of the Tariff 
Act of 1930 (19 U.S.C. 1592) is amended--
        (1) in subsection (c)--
            (A) by redesignating paragraph (6) as paragraph (7); and
            (B) by inserting after paragraph (5) the following new 
        paragraph:
        ``(6) Prior disclosure regarding claims under the united 
    states-chile free trade agreement.--An importer shall not be 
    subject to penalties under subsection (a) for making an incorrect 
    claim that a good qualifies as an originating good under section 
    202 of the United States-Chile Free Trade Agreement Implementation 
    Act if the importer, in accordance with regulations issued by the 
    Secretary of the Treasury, voluntarily makes a corrected 
    declaration and pays any duties owing.''; and
        (2) by adding at the end the following new subsection:
    ``(g) False Certifications of Origin Under the United States-Chile 
Free Trade Agreement.--
        ``(1) In general.--Subject to paragraph (2), it is unlawful for 
    any person to certify falsely, by fraud, gross negligence, or 
    negligence, in a Chile FTA Certificate of Origin (as defined in 
    section 508(f)(1)(B) of this Act that a good exported from the 
    United States qualifies as an originating good under the rules of 
    origin set out in section 202 of the United States-Chile Free Trade 
    Agreement Implementation Act. The procedures and penalties of this 
    section that apply to a violation of subsection (a) also apply to a 
    violation of this subsection.
        ``(2) Immediate and voluntary disclosure of incorrect 
    information.--No penalty shall be imposed under this subsection if, 
    immediately after an exporter or producer that issued a Chile FTA 
    Certificate of Origin has reason to believe that such certificate 
    contains or is based on incorrect information, the exporter or 
    producer voluntarily provides written notice of such incorrect 
    information to every person to whom the certificate was issued.
        ``(3) Exception.--A person may not be considered to have 
    violated paragraph (1) if--
            ``(A) the information was correct at the time it was 
        provided in a Chile FTA Certificate of Origin but was later 
        rendered incorrect due to a change in circumstances; and
            ``(B) the person immediately and voluntarily provides 
        written notice of the change in circumstances to all persons to 
        whom the person provided the certificate.''.
    (b) Denial of Preferential Tariff Treatment.--Section 514 of the 
Tariff Act of 1930 (19 U.S.C. 1514) is amended by adding at the end the 
following new subsection:
    ``(g) Denial of Preferential Tariff Treatment Under United States-
Chile Free Trade Agreement.--If the Bureau of Customs and Border 
Protection or the Bureau of Immigration and Customs Enforcement finds 
indications of a pattern of conduct by an importer of false or 
unsupported representations that goods qualify under the rules of 
origin set out in section 202 of the United States-Chile Free Trade 
Agreement Implementation Act, the Bureau of Customs and Border 
Protection, in accordance with regulations issued by the Secretary of 
the Treasury, may deny preferential tariff treatment under the United 
States-Chile Free Trade Agreement to entries of identical goods 
imported by that person until the person establishes to the 
satisfaction of the Bureau of Customs and Border Protection that 
representations of that person are in conformity with such section 
202.''.

SEC. 206. RELIQUIDATION OF ENTRIES.

    Subsection (d) of section 520 of the Tariff Act of 1930 (19 U.S.C. 
1520(d)) is amended--
        (1) by striking ``(d)'' and inserting the following:
    ``(d) Goods Qualifying Under Free Trade Agreement Rules of 
Origin.--'';
        (2) in the matter preceding paragraph (1), by inserting ``or 
    section 202 of the United States-Chile Free Trade Agreement 
    Implementation Act'' after ``Act'';
        (3) in paragraph (1), by striking ``those'' and inserting ``the 
    applicable''; and
        (4) in paragraph (2), by inserting before the semicolon ``, or 
    other certificates of origin, as the case may be''.

SEC. 207. RECORDKEEPING REQUIREMENTS.

    Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended--
        (1) by striking the heading of subsection (b) and inserting the 
    following: ``Exportations to NAFTA Countries.--''; and
        (2) by adding at the end the following:
    ``(f) Certificates of Origin for Goods Exported Under the United 
States-Chile Free Trade Agreement.--
        ``(1) Definitions.--In this subsection:
            ``(A) Records and supporting documents.--The term `records 
        and supporting documents' means, with respect to an exported 
        good under paragraph (2), records and documents related to the 
        origin of the good, including--
                ``(i) the purchase, cost, and value of, and payment 
            for, the good;
                ``(ii) if applicable, the purchase, cost, and value of, 
            and payment for, all materials, including recovered goods, 
            used in the production of the good; and
                ``(iii) if applicable, the production of the good in 
            the form in which it was exported.
            ``(B) Chile fta certificate of origin.--The term `Chile FTA 
        Certificate of Origin' means the certification, established 
        under article 4.13 of the United States-Chile Free Trade 
        Agreement, that a good qualifies as an originating good under 
        such Agreement.
        ``(2) Exports to chile.--Any person who completes and issues a 
    Chile FTA Certificate of Origin for a good exported from the United 
    States shall make, keep, and, pursuant to rules and regulations 
    promulgated by the Secretary of the Treasury, render for 
    examination and inspection all records and supporting documents 
    related to the origin of the good (including the Certificate or 
    copies thereof).
        ``(3) Retention period.--Records and supporting documents shall 
    be kept by the person who issued a Chile FTA Certificate of Origin 
    for at least 5 years after the date on which the certificate was 
    issued.
    ``(g) Penalties.--Any person who fails to retain records and 
supporting documents required by subsection (f) or the regulations 
issued to implement that subsection shall be liable for the greater 
of--
        ``(1) a civil penalty not to exceed $10,000; or
        ``(2) the general record keeping penalty that applies under the 
    customs laws of the United States.''.

SEC. 208. ENFORCEMENT OF TEXTILE AND APPAREL RULES OF ORIGIN.

    (a) Action During Verification.--If the Secretary of the Treasury 
requests the Government of Chile to conduct a verification pursuant to 
article 3.21 of the Agreement for purposes of determining that--
        (1) an exporter or producer in Chile is complying with 
    applicable customs laws, regulations, and procedures regarding 
    trade in textile and apparel goods, or
        (2) claims that textile or apparel goods exported or produced 
    by such exporter or producer--
            (A) qualify as originating goods under section 202 of this 
        Act, or
            (B) are goods of Chile,
    are accurate,
the President may direct the Secretary to take appropriate action 
described in subsection (b) while the verification is being conducted.
    (b) Appropriate Action Described.--Appropriate action under 
subsection (a) includes--
        (1) suspension of liquidation of entries of textile and apparel 
    goods exported or produced by the person that is the subject of the 
    verification, in a case in which the request for verification was 
    based on a reasonable suspicion of unlawful activity related to 
    such goods; and
        (2) publication of the name of the person that is the subject 
    of the verification.
    (c) Action When Information is Insufficient.--If the Secretary of 
the Treasury determines that the information obtained within 12 months 
after making a request for a verification under subsection (a) is 
insufficient to make a determination under subsection (a), the 
President may direct the Secretary to take appropriate action described 
in subsection (d) until such time as the Secretary receives information 
sufficient to make a determination under subsection (a) or until such 
earlier date as the President may direct.
    (d) Appropriate Action Described.--Appropriate action under 
subsection (c) includes--
        (1) publication of the identity of the person that is the 
    subject of the verification;
        (2) denial of preferential tariff treatment under the Agreement 
    to any textile or apparel goods exported or produced by the person 
    that is the subject of the verification; and
        (3) denial of entry into the United States of any textile or 
    apparel goods exported or produced by the person that is the 
    subject of the verification.

SEC. 209. CONFORMING AMENDMENTS.

    Section 508(b)(2)(B)(i)(I) of the Tariff Act of 1930 (19 U.S.C. 
1508(b)(2)(B)(i)(I)) is amended--
        (1) by striking ``the last paragraph of section 311'' and 
    inserting ``the eleventh paragraph of section 311''; and
        (2) by striking ``the last proviso to section 3(a)'' and 
    inserting ``the proviso preceding the last proviso to section 
    3(a)''.

SEC. 210. REGULATIONS.

    The Secretary of the Treasury shall prescribe such regulations as 
may be necessary to carry out--
        (1) subsections (a) through (n) of section 202, and sections 
    203 and 204;
        (2) amendments made by the sections referred to in paragraph 
    (1); and
        (3) proclamations issued under section 202(o).

                     TITLE III--RELIEF FROM IMPORTS

SEC. 301. DEFINITIONS.

    In this title:
        (1) Commission.--The term ``Commission'' means the United 
    States International Trade Commission.
        (2) Chilean article.--The term ``Chilean article'' means an 
    article that qualifies as an originating good under section 202(a) 
    of this Act.
        (3) Chilean textile or apparel article.--The term ``Chilean 
    textile or apparel article'' means an article--
            (A) that is listed in the Annex to the Agreement on 
        Textiles and Clothing referred to in section 101(d)(4) of the 
        Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)); and
            (B) that is a Chilean article.

     Subtitle A--Relief From Imports Benefiting From the Agreement

SEC. 311. COMMENCING OF ACTION FOR RELIEF.

    (a) Filing of Petition.--A petition requesting action under this 
subtitle for the purpose of adjusting to the obligations of the United 
States under the Agreement may be filed with the Commission by an 
entity, including a trade association, firm, certified or recognized 
union, or group of workers, that is representative of an industry. The 
Commission shall transmit a copy of any petition filed under this 
subsection to the United States Trade Representative.
    (b) Investigation and Determination.--Upon the filing of a petition 
under subsection (a), the Commission, unless subsection (d) applies, 
shall promptly initiate an investigation to determine whether, as a 
result of the reduction or elimination of a duty provided for under the 
Agreement, a Chilean article is being imported into the United States 
in such increased quantities, in absolute terms or relative to domestic 
production, and under such conditions that imports of the Chilean 
article constitute a substantial cause of serious injury or threat 
thereof to the domestic industry producing an article that is like, or 
directly competitive with, the imported article.
    (c) Applicable Provisions.--The following provisions of section 202 
of the Trade Act of 1974 (19 U.S.C. 2252) apply with respect to any 
investigation initiated under subsection (b):
        (1) Paragraphs (1)(B) and (3) of subsection (b).
        (2) Subsection (c).
        (3) Subsection (i).
    (d) Articles Exempt From Investigation.--No investigation may be 
initiated under this section with respect to any Chilean article if, 
after the date that the Agreement enters into force, import relief has 
been provided with respect to that Chilean article under this subtitle, 
or if, at the time the petition is filed, the article is subject to 
import relief under chapter 1 of title II of the Trade Act of 1974.

SEC. 312. COMMISSION ACTION ON PETITION.

    (a) Determination.--Not later than 120 days after the date on which 
an investigation is initiated under section 311(b) with respect to a 
petition, the Commission shall make the determination required under 
that section.
    (b) Applicable Provisions.--For purposes of this subtitle, the 
provisions of paragraphs (1), (2), and (3) of section 330(d) of the 
Tariff Act of 1930 (19 U.S.C. 1330(d) (1), (2), and (3)) shall be 
applied with respect to determinations and findings made under this 
section as if such determinations and findings were made under section 
202 of the Trade Act of 1974 (19 U.S.C. 2252).
    (c) Additional Finding and Recommendation if Determination 
Affirmative.--If the determination made by the Commission under 
subsection (a) with respect to imports of an article is affirmative, or 
if the President may consider a determination of the Commission to be 
an affirmative determination as provided for under paragraph (1) of 
section 330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d)), the 
Commission shall find, and recommend to the President in the report 
required under subsection (d), the amount of import relief that is 
necessary to remedy or prevent the injury found by the Commission in 
the determination and to facilitate the efforts of the domestic 
industry to make a positive adjustment to import competition. The 
import relief recommended by the Commission under this subsection shall 
be limited to the relief described in section 313(c). Only those 
members of the Commission who voted in the affirmative under subsection 
(a) are eligible to vote on the proposed action to remedy or prevent 
the injury found by the Commission. Members of the Commission who did 
not vote in the affirmative may submit, in the report required under 
subsection (d), separate views regarding what action, if any, should be 
taken to remedy or prevent the injury.
    (d) Report to President.--Not later than the date that is 30 days 
after the date on which a determination is made under subsection (a) 
with respect to an investigation, the Commission shall submit to the 
President a report that includes--
        (1) the determination made under subsection (a) and an 
    explanation of the basis for the determination;
        (2) if the determination under subsection (a) is affirmative, 
    any findings and recommendations for import relief made under 
    subsection (c) and an explanation of the basis for each 
    recommendation; and
        (3) any dissenting or separate views by members of the 
    Commission regarding the determination and recommendation referred 
    to in paragraphs (1) and (2).
    (e) Public Notice.--Upon submitting a report to the President under 
subsection (d), the Commission shall promptly make public such report 
(with the exception of information which the Commission determines to 
be confidential) and shall cause a summary thereof to be published in 
the Federal Register.

SEC. 313. PROVISION OF RELIEF.

    (a) In General.--Not later than the date that is 30 days after the 
date on which the President receives the report of the Commission in 
which the Commission's determination under section 312(a) is 
affirmative, or which contains a determination under section 312(a) 
that the President considers to be affirmative under paragraph (1) of 
section 330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d)(1)), the 
President, subject to subsection (b), shall provide relief from imports 
of the article that is the subject of such determination to the extent 
that the President determines necessary to remedy or prevent the injury 
found by the Commission and to facilitate the efforts of the domestic 
industry to make a positive adjustment to import competition.
    (b) Exception.--The President is not required to provide import 
relief under this section if the President determines that the 
provision of the import relief will not provide greater economic and 
social benefits than costs.
    (c) Nature of Relief.--
        (1) In general.--The import relief that the President is 
    authorized to provide under this section with respect to imports of 
    an article is as follows:
            (A) The suspension of any further reduction provided for 
        under Annex 3.3 of the Agreement in the duty imposed on such 
        article.
            (B) An increase in the rate of duty imposed on such article 
        to a level that does not exceed the lesser of--
                (i) the column 1 general rate of duty imposed under the 
            HTS on like articles at the time the import relief is 
            provided; or
                (ii) the column 1 general rate of duty imposed under 
            the HTS on like articles on the day before the date on 
            which the Agreement enters into force.
        (2) Progressive liberalization.--If the period for which import 
    relief is provided under this section is greater than 1 year, the 
    President shall provide for the progressive liberalization 
    (described in article 8.2(2) of the Agreement) of such relief at 
    regular intervals during the period of its application.
    (d) Period of Relief.--
        (1) In general.--Subject to paragraph (2), the import relief 
    that the President is authorized to provide under this section, 
    including any extensions thereof, may not, in the aggregate, exceed 
    3 years.
        (2) Extension.--
            (A) In general.--If the initial period for any import 
        relief provided under this section is less than 3 years, the 
        President, after receiving an affirmative determination from 
        the Commission under subparagraph (B), may extend the effective 
        period of any import relief provided under this section, 
        subject to the limitation under paragraph (1), if the President 
        determines that--
                (i) the import relief continues to be necessary to 
            remedy or prevent serious injury and to facilitate 
            adjustment; and
                (ii) there is evidence that the industry is making a 
            positive adjustment to import competition.
            (B) Action by commission.--(i) Upon a petition on behalf of 
        the industry concerned, filed with the Commission not earlier 
        than the date which is 9 months, and not later than the date 
        which is 6 months, before the date on which any action taken 
        under subsection (a) is to terminate, the Commission shall 
        conduct an investigation to determine whether action under this 
        section continues to be necessary to remedy or prevent serious 
        injury and whether there is evidence that the industry is 
        making a positive adjustment to import competition.
            (ii) The Commission shall publish notice of the 
        commencement of any proceeding under this subparagraph in the 
        Federal Register and shall, within a reasonable time 
        thereafter, hold a public hearing at which the Commission shall 
        afford interested parties and consumers an opportunity to be 
        present, to present evidence, and to respond to the 
        presentations of other parties and consumers, and otherwise to 
        be heard.
            (iii) The Commission shall transmit to the President a 
        report on its investigation and determination under this 
        subparagraph not later than 60 days before the action under 
        subsection (a) is to terminate, unless the President specifies 
        a different date.
    (e) Rate After Termination of Import Relief.--When import relief 
under this section is terminated with respect to an article--
        (1) the rate of duty on that article after such termination and 
    on or before December 31 of the year in which such termination 
    occurs shall be the rate that, according to the Schedule of the 
    United States in Annex 3.3 of the Agreement for the staged 
    elimination of the tariff, would have been in effect 1 year after 
    the provision of relief under subsection (a); and
        (2) the rate of duty for that article after December 31 of the 
    year in which termination occurs shall be, at the discretion of the 
    President, either--
            (A) the applicable rate of duty for that article set out in 
        the Schedule of the United States in Annex 3.3 of the 
        Agreement; or
            (B) the rate of duty resulting from the elimination of the 
        tariff in equal annual stages ending on the date set out in the 
        United States Schedule in Annex 3.3 of the Agreement for the 
        elimination of the tariff.
    (f) Articles Exempt From Relief.--No import relief may be provided 
under this section on any article subject to import relief under 
chapter 1 of title II of the Trade Act of 1974.

SEC. 314. TERMINATION OF RELIEF AUTHORITY.

    (a) General Rule.--No import relief may be provided under this 
subtitle after the date that is 10 years after the date on which the 
Agreement enters into force.
    (b) Exception.--If an article for which relief is provided under 
this subtitle is an article for which the period for tariff 
elimination, set out in the Schedule of the United States to Annex 3.3 
of the Agreement, is 12 years, no relief under this subtitle may be 
provided for that article after the date that is 12 years after the 
date on which the Agreement enters into force.

SEC. 315. COMPENSATION AUTHORITY.

    For purposes of section 123 of the Trade Act of 1974 (19 U.S.C. 
2133), any import relief provided by the President under section 313 
shall be treated as action taken under chapter 1 of title II of such 
Act.

SEC. 316. CONFIDENTIAL BUSINESS INFORMATION.

    Section 202(a)(8) of the Trade Act of 1974 (19 U.S.C. 2252(a)(8)) 
is amended in the first sentence--
        (1) by striking ``and''; and
        (2) by inserting before the period at the end ``, and title III 
    of the United States-Chile Free Trade Agreement Implementation 
    Act''.

           Subtitle B--Textile and Apparel Safeguard Measures

 SEC. 321. COMMENCEMENT OF ACTION FOR RELIEF.

    (a) In General.--A request under this subtitle for the purpose of 
adjusting to the obligations of the United States under the Agreement 
may be filed with the President by an interested party. Upon the filing 
of a request, the President shall review the request to determine, from 
information presented in the request, whether to commence consideration 
of the request.
    (b) Publication of Request.--If the President determines that the 
request under subsection (a) provides the information necessary for the 
request to be considered, the President shall cause to be published in 
the Federal Register a notice of commencement of consideration of the 
request, and notice seeking public comments regarding the request. The 
notice shall include the request and the dates by which comments and 
rebuttals must be received.

SEC. 322. DETERMINATION AND PROVISION OF RELIEF.

    (a) Determination.--
        (1) In general.--If a positive determination is made under 
    section 321(b), the President shall determine whether, as a result 
    of the elimination of a duty under the Agreement, a Chilean textile 
    or apparel article is being imported into the United States in such 
    increased quantities, in absolute terms or relative to the domestic 
    market for that article, and under such conditions as to cause 
    serious damage, or actual threat thereof, to a domestic industry 
    producing an article that is like, or directly competitive with, 
    the imported article.
        (2) Serious damage.--In making a determination under paragraph 
    (1), the President--
            (A) shall examine the effect of increased imports on the 
        domestic industry, as reflected in changes in such relevant 
        economic factors as output, productivity, utilization of 
        capacity, inventories, market share, exports, wages, 
        employment, domestic prices, profits, and investment, none of 
        which is necessarily decisive; and
            (B) shall not consider changes in technology or consumer 
        preference as factors supporting a determination of serious 
        damage or actual threat thereof.
    (b) Provision of Relief.--
        (1) In general.--If a determination under subsection (a) is 
    affirmative, the President may provide relief from imports of the 
    article that is the subject of such determination, as provided in 
    paragraph (2), to the extent that the President determines 
    necessary to remedy or prevent the serious damage and to facilitate 
    adjustment by the domestic industry.
        (2) Nature of relief.--The relief that the President is 
    authorized to provide under this subsection with respect to imports 
    of an article is an increase in the rate of duty imposed on the 
    article to a level that does not exceed the lesser of--
            (A) the column 1 general rate of duty imposed under the HTS 
        on like articles at the time the import relief is provided; or
            (B) the column 1 general rate of duty imposed under the HTS 
        on like articles on the day before the date on which the 
        Agreement enters into force.

SEC. 323. PERIOD OF RELIEF.

    (a) In General.--The import relief that the President is authorized 
to provide under section 322, including any extensions thereof, may 
not, in the aggregate, exceed 3 years.
    (b) Extension.--If the initial period for any import relief 
provided under this section is less than 3 years, the President may 
extend the effective period of any import relief provided under this 
section, subject to the limitation set forth in subsection (a), if the 
President determines that--
        (1) the import relief continues to be necessary to remedy or 
    prevent serious damage and to facilitate adjustment; and
        (2) there is evidence that the industry is making a positive 
    adjustment to import competition.

 SEC. 324. ARTICLES EXEMPT FROM RELIEF.

    The President may not provide import relief under this subtitle 
with respect to any article if import relief previously has been 
provided under this subtitle with respect to that article.

SEC. 325. RATE AFTER TERMINATION OF IMPORT RELIEF.

    When import relief under this subtitle is terminated with respect 
to an article, the rate of duty on that article shall be duty-free.

SEC. 326. TERMINATION OF RELIEF AUTHORITY.

    No import relief may be provided under this subtitle with respect 
to any article after the date that is 8 years after the date on which 
duties on the article are eliminated pursuant to the Agreement.

SEC. 327. COMPENSATION AUTHORITY.

    For purposes of section 123 of the Trade Act of 1974 (19 U.S.C. 
2133), any import relief provided by the President under this subtitle 
shall be treated as action taken under chapter 1 of title II of that 
Act.

SEC. 328. BUSINESS CONFIDENTIAL INFORMATION.

    The President may not release information which the President 
considers to be confidential business information unless the party 
submitting the confidential business information had notice, at the 
time of submission, that such information would be released by the 
President, or such party subsequently consents to the release of the 
information. To the extent business confidential information is 
provided, a nonconfidential version of the information shall also be 
provided, in which the business confidential information is summarized 
or, if necessary, deleted.

             TITLE IV--TEMPORARY ENTRY OF BUSINESS PERSONS

SEC. 401. NONIMMIGRANT TRADERS AND INVESTORS.

    Upon a basis of reciprocity secured by the Agreement, an alien who 
is a national of Chile (and any spouse or child (as defined in section 
101(b)(1) of the Immigration and Nationality Act (8 U.S.C. 1101(b)(1))) 
of such alien, if accompanying or following to join the alien) may, if 
otherwise eligible for a visa and if otherwise admissible into the 
United States under the Immigration and Nationality Act (8 U.S.C. 1101 
et seq.), be considered to be classifiable as a nonimmigrant under 
section 101(a)(15)(E) of such Act (8 U.S.C. 1101(a)(15)(E)) if entering 
solely for a purpose specified in clause (i) or (ii) of such section 
101(a)(15)(E). For purposes of this section, the term ``national'' has 
the meaning given such term in article 14.9 of the Agreement.

SEC. 402. NONIMMIGRANT PROFESSIONALS; LABOR ATTESTATIONS.

    (a) Nonimmigrant Professionals.--
        (1) Definitions.--Section 101(a)(15)(H)(i)(b) of the 
    Immigration and Nationality Act (8 U.S.C. 1101(a)(15)(H)(i)(b)) is 
    amended by striking ``212(n)(1), or (c)'' and inserting 
    ``212(n)(1), or (b1) who is entitled to enter the United States 
    under and in pursuance of the provisions of an agreement listed in 
    section 214(g)(8)(A), who is engaged in a specialty occupation 
    described in section 214(i)(3), and with respect to whom the 
    Secretary of Labor determines and certifies to the Secretary of 
    Homeland Security and the Secretary of State that the intending 
    employer has filed with the Secretary of Labor an attestation under 
    section 212(t)(1), or (c)''.
        (2) Admission of nonimmigrants.--Section 214 of the Immigration 
    and Nationality Act (8 U.S.C. 1184) is amended--
            (A) in subsection (i)--
                (i) in paragraph (1), by striking ``For purposes'' and 
            inserting ``Except as provided in paragraph (3), for 
            purposes''; and
                (ii) by adding at the end the following:
    ``(3) For purposes of section 101(a)(15)(H)(i)(b1), the term 
`specialty occupation' means an occupation that requires--
        ``(A) theoretical and practical application of a body of 
    specialized knowledge; and
        ``(B) attainment of a bachelor's or higher degree in the 
    specific specialty (or its equivalent) as a minimum for entry into 
    the occupation in the United States.''; and
            (B) in subsection (g), by adding at the end the following:
    ``(8)(A) The agreement referred to in section 101(a)(15)(H)(i)(b1) 
is the United States-Chile Free Trade Agreement.
    ``(B)(i) The Secretary of Homeland Security shall establish annual 
numerical limitations on approvals of initial applications by aliens 
for admission under section 101(a)(15)(H)(i)(b1).
    ``(ii) The annual numerical limitations described in clause (i) 
shall not exceed 1,400 for nationals of Chile for any fiscal year. For 
purposes of this clause, the term `national' has the meaning given such 
term in article 14.9 of the United States-Chile Free Trade Agreement.
    ``(iii) The annual numerical limitations described in clause (i) 
shall only apply to principal aliens and not to the spouses or children 
of such aliens.
    ``(iv) The annual numerical limitation described in paragraph 
(1)(A) is reduced by the amount of the annual numerical limitations 
established under clause (i). However, if a numerical limitation 
established under clause (i) has not been exhausted at the end of a 
given fiscal year, the Secretary of Homeland Security shall adjust 
upwards the numerical limitation in paragraph (1)(A) for that fiscal 
year by the amount remaining in the numerical limitation under clause 
(i). Visas under section 101(a)(15)(H)(i)(b) may be issued pursuant to 
such adjustment within the first 45 days of the next fiscal year to 
aliens who had applied for such visas during the fiscal year for which 
the adjustment was made.
    ``(C) The period of authorized admission as a nonimmigrant under 
section 101(a)(15)(H)(i)(b1) shall be 1 year, and may be extended, but 
only in 1-year increments. After every second extension, the next 
following extension shall not be granted unless the Secretary of Labor 
had determined and certified to the Secretary of Homeland Security and 
the Secretary of State that the intending employer has filed with the 
Secretary of Labor an attestation under section 212(t)(1) for the 
purpose of permitting the nonimmigrant to obtain such extension.
    ``(D) The numerical limitation described in paragraph (1)(A) for a 
fiscal year shall be reduced by one for each alien granted an extension 
under subparagraph (C) during such year who has obtained 5 or more 
consecutive prior extensions.''.
    (b) Labor Attestations.--Section 212 of the Immigration and 
Nationality Act (8 U.S.C. 1182) is amended--
        (1) by redesignating the subsection (p) added by section 
    1505(f) of Public Law 106-386 (114 Stat. 1526) as subsection (s); 
    and
        (2) by adding at the end the following:
    ``(t)(1) No alien may be admitted or provided status as a 
nonimmigrant under section 101(a)(15)(H)(i)(b1) in an occupational 
classification unless the employer has filed with the Secretary of 
Labor an attestation stating the following:
        ``(A) The employer--
            ``(i) is offering and will offer during the period of 
        authorized employment to aliens admitted or provided status 
        under section 101(a)(15)(H)(i)(b1) wages that are at least--
                ``(I) the actual wage level paid by the employer to all 
            other individuals with similar experience and 
            qualifications for the specific employment in question; or
                ``(II) the prevailing wage level for the occupational 
            classification in the area of employment,
        whichever is greater, based on the best information available 
        as of the time of filing the attestation; and
            ``(ii) will provide working conditions for such a 
        nonimmigrant that will not adversely affect the working 
        conditions of workers similarly employed.
        ``(B) There is not a strike or lockout in the course of a labor 
    dispute in the occupational classification at the place of 
    employment.
        ``(C) The employer, at the time of filing the attestation--
            ``(i) has provided notice of the filing under this 
        paragraph to the bargaining representative (if any) of the 
        employer's employees in the occupational classification and 
        area for which aliens are sought; or
            ``(ii) if there is no such bargaining representative, has 
        provided notice of filing in the occupational classification 
        through such methods as physical posting in conspicuous 
        locations at the place of employment or electronic notification 
        to employees in the occupational classification for which 
        nonimmigrants under section 101(a)(15)(H)(i)(b1) are sought.
        ``(D) A specification of the number of workers sought, the 
    occupational classification in which the workers will be employed, 
    and wage rate and conditions under which they will be employed.
    ``(2)(A) The employer shall make available for public examination, 
within one working day after the date on which an attestation under 
this subsection is filed, at the employer's principal place of business 
or worksite, a copy of each such attestation (and such accompanying 
documents as are necessary).
    ``(B)(i) The Secretary of Labor shall compile, on a current basis, 
a list (by employer and by occupational classification) of the 
attestations filed under this subsection. Such list shall include, with 
respect to each attestation, the wage rate, number of aliens sought, 
period of intended employment, and date of need.
    ``(ii) The Secretary of Labor shall make such list available for 
public examination in Washington, D.C.
    ``(C) The Secretary of Labor shall review an attestation filed 
under this subsection only for completeness and obvious inaccuracies. 
Unless the Secretary of Labor finds that an attestation is incomplete 
or obviously inaccurate, the Secretary of Labor shall provide the 
certification described in section 101(a)(15)(H)(i)(b1) within 7 days 
of the date of the filing of the attestation.
    ``(3)(A) The Secretary of Labor shall establish a process for the 
receipt, investigation, and disposition of complaints respecting the 
failure of an employer to meet a condition specified in an attestation 
submitted under this subsection or misrepresentation by the employer of 
material facts in such an attestation. Complaints may be filed by any 
aggrieved person or organization (including bargaining 
representatives). No investigation or hearing shall be conducted on a 
complaint concerning such a failure or misrepresentation unless the 
complaint was filed not later than 12 months after the date of the 
failure or misrepresentation, respectively. The Secretary of Labor 
shall conduct an investigation under this paragraph if there is 
reasonable cause to believe that such a failure or misrepresentation 
has occurred.
    ``(B) Under the process described in subparagraph (A), the 
Secretary of Labor shall provide, within 30 days after the date a 
complaint is filed, for a determination as to whether or not a 
reasonable basis exists to make a finding described in subparagraph 
(C). If the Secretary of Labor determines that such a reasonable basis 
exists, the Secretary of Labor shall provide for notice of such 
determination to the interested parties and an opportunity for a 
hearing on the complaint, in accordance with section 556 of title 5, 
United States Code, within 60 days after the date of the determination. 
If such a hearing is requested, the Secretary of Labor shall make a 
finding concerning the matter by not later than 60 days after the date 
of the hearing. In the case of similar complaints respecting the same 
applicant, the Secretary of Labor may consolidate the hearings under 
this subparagraph on such complaints.
    ``(C)(i) If the Secretary of Labor finds, after notice and 
opportunity for a hearing, a failure to meet a condition of paragraph 
(1)(B), a substantial failure to meet a condition of paragraph (1)(C) 
or (1)(D), or a misrepresentation of material fact in an attestation--
        ``(I) the Secretary of Labor shall notify the Secretary of 
    State and the Secretary of Homeland Security of such finding and 
    may, in addition, impose such other administrative remedies 
    (including civil monetary penalties in an amount not to exceed 
    $1,000 per violation) as the Secretary of Labor determines to be 
    appropriate; and
        ``(II) the Secretary of State or the Secretary of Homeland 
    Security, as appropriate, shall not approve petitions or 
    applications filed with respect to that employer under section 204, 
    214(c), or 101(a)(15)(H)(i)(b1) during a period of at least 1 year 
    for aliens to be employed by the employer.
    ``(ii) If the Secretary of Labor finds, after notice and 
opportunity for a hearing, a willful failure to meet a condition of 
paragraph (1), a willful misrepresentation of material fact in an 
attestation, or a violation of clause (iv)--
        ``(I) the Secretary of Labor shall notify the Secretary of 
    State and the Secretary of Homeland Security of such finding and 
    may, in addition, impose such other administrative remedies 
    (including civil monetary penalties in an amount not to exceed 
    $5,000 per violation) as the Secretary of Labor determines to be 
    appropriate; and
        ``(II) the Secretary of State or the Secretary of Homeland 
    Security, as appropriate, shall not approve petitions or 
    applications filed with respect to that employer under section 204, 
    214(c), or 101(a)(15)(H)(i)(b1) during a period of at least 2 years 
    for aliens to be employed by the employer.
    ``(iii) If the Secretary of Labor finds, after notice and 
opportunity for a hearing, a willful failure to meet a condition of 
paragraph (1) or a willful misrepresentation of material fact in an 
attestation, in the course of which failure or misrepresentation the 
employer displaced a United States worker employed by the employer 
within the period beginning 90 days before and ending 90 days after the 
date of filing of any visa petition or application supported by the 
attestation--
        ``(I) the Secretary of Labor shall notify the Secretary of 
    State and the Secretary of Homeland Security of such finding and 
    may, in addition, impose such other administrative remedies 
    (including civil monetary penalties in an amount not to exceed 
    $35,000 per violation) as the Secretary of Labor determines to be 
    appropriate; and
        ``(II) the Secretary of State or the Secretary of Homeland 
    Security, as appropriate, shall not approve petitions or 
    applications filed with respect to that employer under section 204, 
    214(c), or 101(a)(15)(H)(i)(b1) during a period of at least 3 years 
    for aliens to be employed by the employer.
    ``(iv) It is a violation of this clause for an employer who has 
filed an attestation under this subsection to intimidate, threaten, 
restrain, coerce, blacklist, discharge, or in any other manner 
discriminate against an employee (which term, for purposes of this 
clause, includes a former employee and an applicant for employment) 
because the employee has disclosed information to the employer, or to 
any other person, that the employee reasonably believes evidences a 
violation of this subsection, or any rule or regulation pertaining to 
this subsection, or because the employee cooperates or seeks to 
cooperate in an investigation or other proceeding concerning the 
employer's compliance with the requirements of this subsection or any 
rule or regulation pertaining to this subsection.
    ``(v) The Secretary of Labor and the Secretary of Homeland Security 
shall devise a process under which a nonimmigrant under section 
101(a)(15)(H)(i)(b1) who files a complaint regarding a violation of 
clause (iv) and is otherwise eligible to remain and work in the United 
States may be allowed to seek other appropriate employment in the 
United States for a period not to exceed the maximum period of stay 
authorized for such nonimmigrant classification.
    ``(vi)(I) It is a violation of this clause for an employer who has 
filed an attestation under this subsection to require a nonimmigrant 
under section 101(a)(15)(H)(i)(b1) to pay a penalty for ceasing 
employment with the employer prior to a date agreed to by the 
nonimmigrant and the employer. The Secretary of Labor shall determine 
whether a required payment is a penalty (and not liquidated damages) 
pursuant to relevant State law.
    ``(II) If the Secretary of Labor finds, after notice and 
opportunity for a hearing, that an employer has committed a violation 
of this clause, the Secretary of Labor may impose a civil monetary 
penalty of $1,000 for each such violation and issue an administrative 
order requiring the return to the nonimmigrant of any amount paid in 
violation of this clause, or, if the nonimmigrant cannot be located, 
requiring payment of any such amount to the general fund of the 
Treasury.
    ``(vii)(I) It is a failure to meet a condition of paragraph (1)(A) 
for an employer who has filed an attestation under this subsection and 
who places a nonimmigrant under section 101(a)(15)(H)(i)(b1) designated 
as a full-time employee in the attestation, after the nonimmigrant has 
entered into employment with the employer, in nonproductive status due 
to a decision by the employer (based on factors such as lack of work), 
or due to the nonimmigrant's lack of a permit or license, to fail to 
pay the nonimmigrant full-time wages in accordance with paragraph 
(1)(A) for all such nonproductive time.
    ``(II) It is a failure to meet a condition of paragraph (1)(A) for 
an employer who has filed an attestation under this subsection and who 
places a nonimmigrant under section 101(a)(15)(H)(i)(b1) designated as 
a part-time employee in the attestation, after the nonimmigrant has 
entered into employment with the employer, in nonproductive status 
under circumstances described in subclause (I), to fail to pay such a 
nonimmigrant for such hours as are designated on the attestation 
consistent with the rate of pay identified on the attestation.
    ``(III) In the case of a nonimmigrant under section 
101(a)(15)(H)(i)(b1) who has not yet entered into employment with an 
employer who has had approved an attestation under this subsection with 
respect to the nonimmigrant, the provisions of subclauses (I) and (II) 
shall apply to the employer beginning 30 days after the date the 
nonimmigrant first is admitted into the United States, or 60 days after 
the date the nonimmigrant becomes eligible to work for the employer in 
the case of a nonimmigrant who is present in the United States on the 
date of the approval of the attestation filed with the Secretary of 
Labor.
    ``(IV) This clause does not apply to a failure to pay wages to a 
nonimmigrant under section 101(a)(15)(H)(i)(b1) for nonproductive time 
due to non-work-related factors, such as the voluntary request of the 
nonimmigrant for an absence or circumstances rendering the nonimmigrant 
unable to work.
    ``(V) This clause shall not be construed as prohibiting an employer 
that is a school or other educational institution from applying to a 
nonimmigrant under section 101(a)(15)(H)(i)(b1) an established salary 
practice of the employer, under which the employer pays to 
nonimmigrants under section 101(a)(15)(H)(i)(b1) and United States 
workers in the same occupational classification an annual salary in 
disbursements over fewer than 12 months, if--
        ``(aa) the nonimmigrant agrees to the compressed annual salary 
    payments prior to the commencement of the employment; and
        ``(bb) the application of the salary practice to the 
    nonimmigrant does not otherwise cause the nonimmigrant to violate 
    any condition of the nonimmigrant's authorization under this Act to 
    remain in the United States.
    ``(VI) This clause shall not be construed as superseding clause 
(viii).
    ``(viii) It is a failure to meet a condition of paragraph (1)(A) 
for an employer who has filed an attestation under this subsection to 
fail to offer to a nonimmigrant under section 101(a)(15)(H)(i)(b1), 
during the nonimmigrant's period of authorized employment, benefits and 
eligibility for benefits (including the opportunity to participate in 
health, life, disability, and other insurance plans; the opportunity to 
participate in retirement and savings plans; and cash bonuses and non-
cash compensation, such as stock options (whether or not based on 
performance)) on the same basis, and in accordance with the same 
criteria, as the employer offers to United States workers.
    ``(D) If the Secretary of Labor finds, after notice and opportunity 
for a hearing, that an employer has not paid wages at the wage level 
specified in the attestation and required under paragraph (1), the 
Secretary of Labor shall order the employer to provide for payment of 
such amounts of back pay as may be required to comply with the 
requirements of paragraph (1), whether or not a penalty under 
subparagraph (C) has been imposed.
    ``(E) The Secretary of Labor may, on a case-by-case basis, subject 
an employer to random investigations for a period of up to 5 years, 
beginning on the date on which the employer is found by the Secretary 
of Labor to have committed a willful failure to meet a condition of 
paragraph (1) or to have made a willful misrepresentation of material 
fact in an attestation. The authority of the Secretary of Labor under 
this subparagraph shall not be construed to be subject to, or limited 
by, the requirements of subparagraph (A).
    ``(F) Nothing in this subsection shall be construed as superseding 
or preempting any other enforcement-related authority under this Act 
(such as the authorities under section 274B), or any other Act.
    ``(4) For purposes of this subsection:
        ``(A) The term `area of employment' means the area within 
    normal commuting distance of the worksite or physical location 
    where the work of the nonimmigrant under section 
    101(a)(15)(H)(i)(b1) is or will be performed. If such worksite or 
    location is within a Metropolitan Statistical Area, any place 
    within such area is deemed to be within the area of employment.
        ``(B) In the case of an attestation with respect to one or more 
    nonimmigrants under section 101(a)(15)(H)(i)(b1) by an employer, 
    the employer is considered to `displace' a United States worker 
    from a job if the employer lays off the worker from a job that is 
    essentially the equivalent of the job for which the nonimmigrant or 
    nonimmigrants is or are sought. A job shall not be considered to be 
    essentially equivalent of another job unless it involves 
    essentially the same responsibilities, was held by a United States 
    worker with substantially equivalent qualifications and experience, 
    and is located in the same area of employment as the other job.
        ``(C)(i) The term `lays off', with respect to a worker--
            ``(I) means to cause the worker's loss of employment, other 
        than through a discharge for inadequate performance, violation 
        of workplace rules, cause, voluntary departure, voluntary 
        retirement, or the expiration of a grant or contract; but
            ``(II) does not include any situation in which the worker 
        is offered, as an alternative to such loss of employment, a 
        similar employment opportunity with the same employer at 
        equivalent or higher compensation and benefits than the 
        position from which the employee was discharged, regardless of 
        whether or not the employee accepts the offer.
        ``(ii) Nothing in this subparagraph is intended to limit an 
    employee's rights under a collective bargaining agreement or other 
    employment contract.
        ``(D) The term `United States worker' means an employee who--
            ``(i) is a citizen or national of the United States; or
            ``(ii) is an alien who is lawfully admitted for permanent 
        residence, is admitted as a refugee under section 207 of this 
        title, is granted asylum under section 208, or is an immigrant 
        otherwise authorized, by this Act or by the Secretary of 
        Homeland Security, to be employed.''.
    (c) Special Rule for Computation of Prevailing Wage.--Section 
212(p)(1) of the Immigration and Nationality Act (8 U.S.C. 1182(p)(1)) 
is amended by striking ``(n)(1)(A)(i)(II) and (a)(5)(A)'' and inserting 
``(a)(5)(A), (n)(1)(A)(i)(II), and (t)(1)(A)(i)(II)''.
    (d) Fee.--
        (1) In general.--Section 214(c) of the Immigration and 
    Nationality Act (8 U.S.C. 1184(c)) is amended by adding at the end 
    the following:
    ``(11)(A) Subject to subparagraph (B), the Secretary of Homeland 
Security or the Secretary of State, as appropriate, shall impose a fee 
on an employer who has filed an attestation described in section 
212(t)--
        ``(i) in order that an alien may be initially granted 
    nonimmigrant status described in section 101(a)(15)(H)(i)(b1); or
        ``(ii) in order to satisfy the requirement of the second 
    sentence of subsection (g)(8)(C) for an alien having such status to 
    obtain certain extensions of stay.
    ``(B) The amount of the fee shall be the same as the amount imposed 
by the Secretary of Homeland Security under paragraph (9), except that 
if such paragraph does not authorize such Secretary to impose any fee, 
no fee shall be imposed under this paragraph.
    ``(C) Fees collected under this paragraph shall be deposited in the 
Treasury in accordance with section 286(s).''.
        (2) Use of fee.--Section 286(s)(1) of the Immigration and 
    Nationality Act (8 U.S.C. 1356(s)(1)) is amended by striking 
    ``section 214(c)(9).'' and inserting ``paragraphs (9) and (11) of 
    section 214(c).''.

SEC. 403. LABOR DISPUTES.

    Section 214(j) of the Immigration and Nationality Act (8 U.S.C. 
1184(j)) is amended--
        (1) by striking ``(j)'' and inserting ``(j)(1)'';
        (2) by striking ``this subsection'' each place such term 
    appears and inserting ``this paragraph''; and
        (3) by adding at the end the following:
    ``(2) Notwithstanding any other provision of this Act except 
section 212(t)(1), and subject to regulations promulgated by the 
Secretary of Homeland Security, an alien who seeks to enter the United 
States under and pursuant to the provisions of an agreement listed in 
subsection (g)(8)(A), and the spouse and children of such an alien if 
accompanying or following to join the alien, may be denied admission as 
a nonimmigrant under subparagraph (E), (L), or (H)(i)(b1) of section 
101(a)(15) if there is in progress a labor dispute in the occupational 
classification at the place or intended place of employment, unless 
such alien establishes, pursuant to regulations promulgated by the 
Secretary of Homeland Security after consultation with the Secretary of 
Labor, that the alien's entry will not affect adversely the settlement 
of the labor dispute or the employment of any person who is involved in 
the labor dispute. Notice of a determination under this paragraph shall 
be given as may be required by such agreement.''.

SEC. 404. CONFORMING AMENDMENTS.

    Section 214 of the Immigration and Nationality Act (8 U.S.C. 1184) 
is amended--
        (1) in subsection (b), by striking ``(other than a nonimmigrant 
    described in subparagraph (H)(i), (L), or (V) of section 
    101(a)(15))'' and inserting ``(other than a nonimmigrant described 
    in subparagraph (L) or (V) of section 101(a)(15), and other than a 
    nonimmigrant described in any provision of section 101(a)(15)(H)(i) 
    except subclause (b1) of such section)'';
        (2) in subsection (c)(1), by striking ``section 101(a)(15)(H), 
    (L), (O), or (P)(i)'' and inserting ``subparagraph (H), (L), (O), 
    or (P)(i) of section 101(a)(15) (excluding nonimmigrants under 
    section 101(a)(15)(H)(i)(b1))''; and
        (3) in subsection (h), by striking ``(H)(i)'' and inserting 
    ``(H)(i)(b) or (c)''.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.
```