I

106TH CONGRESS

2D SESSION H. R. 5127

To amend the Harmonized Tariff Schedule of the United States with respect

to the production incentive certificate program for watch and jewelry

producers in the United States Virgin Islands, Guam, and American

Samoa.

IN THE HOUSE OF REPRESENTATIVES

SEPTEMBER 7, 2000

Mrs. CHRISTENSEN introduced the following bill; which was referred to the

Committee on Ways and Means

A BILL

To amend the Harmonized Tariff Schedule of the United

States with respect to the production incentive certificate

program for watch and jewelry producers in the United

States Virgin Islands, Guam, and American Samoa.

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

3 SECTION 1. AMENDMENTS TO UNITED STATES INSULAR

4 POSSESSION PROGRAM.

5 (a) PRODUCTION CERTIFICATES.—The additional

6 U.S. Note 5(h) to chapter 91 of the Harmonized Tariff

7 Schedule of the United States is amended—
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1 (1) by amending subparagraphs (i) and (ii) to

2 read as follows:

3 ‘‘(i) In the case of each calendar quarter beginning after

4 January 1, 2001, and before January 1, 2015, the

5 Secretaries jointly, shall:

6 ‘‘(A) verify for the preceding calendar quarter both

7 the wages paid by each producer to permanent

8 residents of the insular possessions (including

9 the value of any fringe benefits) and the total

10 quantity and value of watches produced in the

11 insular possessions and imported into the cus12 toms territory of the United States; and

13 ‘‘(B) issue to each producer (not later than 30 days

14 after the end of the calendar quarter) a certifi15 cate for the applicable amount.

16 ‘‘(ii) For purposes of subparagraph (i), except as provided

17 in subparagraphs (iii) and (iv), the term ‘applicable

18 amount’ means an amount equal to the sum of:

19 ‘‘(A) 90 percent of the producer’s creditable wages

20 (including the value of any fringe benefits) on

21 watch assembly during the preceding calendar

22 quarter (but only the first 300,000 units per

23 calendar year); plus

24 ‘‘(B) the applicable graduated declining percentage

25 (determined each year by the Secretaries) of the
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1 producer’s creditable wages (including the value

2 of any fringe benefits) on the assembly during

3 the preceding calendar quarter for units in ex4 cess of 300,000 that calendar year, but not in

5 excess of 750,000 that calendar year; plus

6 ‘‘(C) the difference between the duties that would

7 have been due on the producer’s watches (ex8 cluding digital watches) imported into the cus9 toms territory of the United States during the

10 preceding quarter if they had been imported

11 from a country eligible for normal trade rela12 tions subject to duty at the rates set forth in

13 column 1 under this chapter that were in effect

14 on January 1, 2000, and the duties that would

15 have been due on those watches if they had

16 been imported from the same country under the

17 tariffs in effect for the preceding calendar quar18 ter.’’; and

19 (2) by amending subparagraph (v) to read as

20 follows:

21 ‘‘(v)(A) Any certificate issued under subparagraph (i)

22 shall entitle the certificate holder to secure the refund

23 of duties equal to the face value of the certificate on

24 watches, watch movements and, with the exception of

25 discrete cases, parts therefor imported into the cus-
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1 toms territory of the United States by the certificate

2 holder. Such refunds shall be made under regulations

3 issued by the Treasury Department. Not more than

4 5 percent of such refunds may be retained as a reim5 bursement to the Customs Service for the administra6 tive costs of making the refunds. If the Secretary of

7 the Treasury determines that there is an insufficient

8 level of duties from watch and watch-related tariffs,

9 the Secretary may authorize refunds of duties col10 lected on jewelry under chapter 71 or any other du11 ties that the Secretary determines are appropriate.

12 ‘‘(B) At the election of the certificate holder and upon

13 making the certification described in this clause, the

14 Secretary of the Treasury shall pay to the holder the

15 face value of the certificate, less the value of (1) any

16 duty refund claimed by the holder under the certifi17 cate, plus (2) a discount of not more than 2 percent

18 of the face value of the certificate, as determined by

19 the Secretary of the Treasury. A certificate holder

20 shall not be eligible for direct payment under this

21 clause unless the certificate holder certifies to the

22 Secretaries that the funds received will be reinvested

23 or utilized to support and continue employment in the

24 Virgin Islands.
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1 ‘‘(C) The Secretary of the Treasury is authorized to make

2 the payments provided for in clause (B) from duties

3 collected on watches, watch movements and, with the

4 exception of discrete cases, parts therefor. If such du5 ties are insufficient, the Secretary of the Treasury is

6 authorized to make those payments from duties col7 lected on jewelry under chapter 71 or any other du8 ties that the Secretary determines are appropriate.’’.

9 (b) JEWELRY.—Additional U.S. Note to chapter 71

10 of the Harmonized Tariff Schedule of the United States

11 is amended—

12 (1) by redesignating paragraphs (b), (c), (d),

13 and (e) as paragraphs (c), (d), (e), and (f), respec14 tively;

15 (2) by inserting after paragraph (a) the fol16 lowing new paragraph:

17 ‘‘(b) The 750,000 unit limitation in additional U.S. Note

18 5(h)(ii)(B) to chapter 91 shall not apply to articles

19 of jewelry subject to this note.’’; and

20 (3) by striking paragraph (f), as so redesig21 nated, and inserting the following:

22 ‘‘(f) Notwithstanding any other provision of law, prior to

23 February 9, 2003, any article of jewelry provided for

24 in heading 7113 that is assembled in the Virgin Is25 lands, Guam, or American Samoa shall be treated as
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1 a product of the Virgin Islands, Guam, or American

2 Samoa for purposes of this note and General Note

3 3(a)(iv) of this Schedule.’’.

4 SEC. 2. EFFECTIVE DATE.

5 The amendments made by this Act shall take effect

6 on April 1, 2001, with respect to goods imported into the

7 customs territory of the United States on or after January

8 1, 2001.

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