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[House Report 112-237]
[From the U.S. Government Publishing Office]

112th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    112-237

======================================================================

 
  UNITED STATES-COLOMBIA TRADE PROMOTION AGREEMENT IMPLEMENTATION ACT

                                _______
                                

October 6, 2011.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

            Mr. Camp, from the Committee on Ways and Means,
                        submitted the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 3078]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 3078) to implement the United States-Colombia Trade 
Promotion Agreement, having considered the same, report 
favorably thereon without amendment and recommend that the bill 
do pass.

                                CONTENTS

                                                                   Page
  I. Summary and Background...........................................2
          A. Purpose and Summary.................................     2
          B. Background..........................................     2
          C. Legislative History.................................     7
 II. Section-by-Section Summary.......................................8
          A. Title I: Approval and General Provisions............     8
          B. Title II: Customs Provisions........................    11
          C. Title III: Relief from Imports......................    17
          D. Title IV: Procurement...............................    21
          E. Title V: Extension of Andean Trade Preference Act...    22
          F. Title VI: Offsets...................................    22
III. Votes of the Committee..........................................24
 IV. Budget Effects of the Bill......................................24
          A. Committee Estimate of Budgetary Effects.............    24
          B. Statement Regarding New Budget Authority and Tax 
              Expenditures Budget Authority......................    24
          C. Cost Estimate Prepared by the Congressional Budget 
              Office.............................................    25
          D. Macroeconomic Impact Analysis.......................    31
  V. Other Matters to be Discussed Under the Rules of the House of 
     Representatives.................................................31
          A. Committee Oversight Findings and Recommendations....    31
          B. Statement of General Performance Goals and 
              Objectives.........................................    31
          C. Information Relating to Unfunded Mandates...........    32
          D. Applicability of House Rule XXI 5(b)................    32
          E. Tax Complexity Analysis.............................    32
          F. Congressional Earmarks, Limited Tax Benefits, and 
              Limited Tariff Benefits............................    32
 VI. Changes in Existing Law Made by the Bill, as Reported...........32
VII. Views...........................................................40

                       I. SUMMARY AND BACKGROUND

                         A. Purpose and Summary

    H.R. 3078 would implement the agreement establishing a free 
trade area between the United States and Colombia.

                             B. Background

The United States-Colombia Trade Promotion Agreement

    The United States-Colombia Trade Promotion Agreement was 
signed on November 22, 2006. In 2007, the agreement was 
modified to reflect provisions required by the deal reached on 
May 10, 2007, between Congressional leaders and the last 
Administration, regarding labor, environment, intellectual 
property, investment, government procurement, and port security 
(``May 10 deal''). The trade agreement, as modified by the May 
10 deal, is hereinafter referred to as ``the Agreement.'' The 
Agreement covers all agricultural and industrial sectors, 
provides for greatly expanded market access for U.S. services, 
contains robust protections for U.S. intellectual property 
rights holders, and includes strong labor and environment 
provisions. The Committee believes that the Agreement meets the 
objectives and priorities set forth in the Bipartisan Trade 
Promotion Authority Act of 2002.
    U.S. exports to Colombia face an average tariff of 12.5 
percent, whereas the average U.S. tariff on Colombian exports 
to the United States is just three percent, according to the 
U.S. International Trade Commission (``ITC''). Due in large 
part to preference programs, the vast majority of Colombia's 
exports to the United States--about 90 percent in 2010--have 
received duty-free treatment, although the Andean Trade 
Preference Act expired on February 12, 2011. The Agreement 
would transition the U.S.-Colombia trading relationship from 
one-way preferences to full partnership and reciprocal 
commitments, helping U.S. exporters gain greater access to the 
Colombian market, which is the third largest U.S. export market 
in Latin America, behind only Mexico and Brazil. The ITC 
estimates that annual U.S. exports to Colombia would increase 
by $1.1 billion under the Agreement.
    The following are key sectoral benefits and aspects of the 
Agreement:
    Agriculture: U.S. agriculture exports to Colombia currently 
face an average tariff of 20 percent, whereas only two 
Colombian agricultural exports to the United States face 
tariffs above three percent. The Agreement would remedy this by 
providing immediate duty-free treatment for 77.5 percent of 
Colombia's agricultural tariff lines, including U.S. exports of 
soybeans, cotton, wheat, barley, peanuts, bacon, high-quality 
beef, the vast majority of processed products, and almost all 
fruit and vegetable products, with tariffs eliminated on almost 
93 percent of agricultural tariff lines within 10 years. The 
Agreement would immediately eliminate Colombia's separate 
``price band'' variable tariffs for U.S. exports, which the 
European Union's trade agreement with Colombia does not 
eliminate for EU exports.
    As a result, the ITC estimates significant gains in U.S. 
agricultural exports. For example, the ITC estimates that U.S. 
exports of grains could increase by 55 to 77 percent and 
soybeans, soybean products, and animal feeds by 30 to 50 
percent. The Agreement would also provide guarantees against 
key non-tariff barriers. For example, Colombia has committed to 
continuing to recognize the equivalence of the U.S. food safety 
system for meat and poultry and would provide access for all 
U.S. beef and beef products consistent with international 
norms.
    Manufacturing: The Agreement would significantly lower both 
tariff and non-tariff barriers to U.S. exports of manufactured 
goods. Tariffs on U.S. manufactured goods exported to Colombia 
average over nine percent, with tariffs on auto and auto parts 
at 17.4 percent, consumer goods at 15 percent, and building 
products at 13.2 percent. Upon implementation, over 80 percent 
of U.S. exports of consumer and industrial products to Colombia 
would immediately become duty-free, with remaining tariffs 
phased out over ten years. Key U.S. export sectors that would 
receive immediate duty-free treatment include aircraft and auto 
parts; agricultural and construction equipment; agro-chemicals; 
and medical, scientific, and information technology equipment. 
The Agreement would also guarantee access to Colombia for U.S. 
exports of remanufactured products, such as industrial 
machinery and consumer electronics.
    As a result, the ITC estimates significant gains in U.S. 
exports in key sectors and products. For example, the ITC 
estimates that exports of motor vehicles and parts would be 
likely to increase by 43.8 percent. Exports of miscellaneous 
machinery would be likely to increase by 14.9 percent and 
electronics by 8 percent. Colombia also agreed in the Agreement 
to become a full participant under the WTO Information 
Technology Agreement, which would further open Colombia's 
market to U.S. high-tech exports. The Agreement would provide 
U.S. firms with lower tariff barriers than major competitors 
from countries that do not have trade agreements with Colombia 
in effect.
    Services: The services sector accounts for over half of 
Colombia's GDP, making improved market access for U.S. services 
critical. The Agreement would provide U.S. service firms with 
market access, national treatment, and regulatory transparency 
exceeding that afforded by the WTO General Agreement on 
Services. The Agreement would eliminate significant 
restrictions on the ability of U.S. firms to compete in the 
engineering, architecture, real estate, telecommunications, 
computer, and financial services markets. U.S. nationals would 
be allowed to serve in key executive and professional posts, 
which Colombia now prohibits. The ITC estimates, based on 
tariff equivalents, that the Agreement would reduce barriers in 
the banking sector by more than half. Significant restrictions 
on U.S. asset managers would be eliminated four years after the 
Agreement's entry into force. U.S. service providers that 
establish a local presence in Colombia would benefit from 
strong investor protections included in the Agreement.
    Government Procurement: The government procurement 
provisions of the Agreement are essential to guaranteeing non-
discriminatory access for U.S. goods, services, and suppliers 
to 28 key Colombian central government agencies, all state-
level governments, and certain significant government 
enterprises, including ECOPETROL (national oil company), ISS 
(public healthcare provider), and ADPOSTAL (postal service). 
These provisions are particularly important because Colombia is 
not a member of the WTO Government Procurement Agreement and is 
only an observer. The procurement provisions would grant U.S. 
entities greater access and protection than they currently have 
to Colombia's government procurement market, which, by one 
measure, is $28.3 billion to $42.4 billion annually. 
(Government procurement is generally 10 to 15 percent of a 
country's gross domestic product (``GDP''), and Colombia's 2010 
GDP was over $283 billion.)
    Intellectual Property Rights: Under the Agreement, Colombia 
would adopt higher and extended standards for the protection of 
intellectual property rights, such as copyrights, patents, 
trademarks, and trade secrets. The Agreement would also provide 
enhanced means for enforcing those rights. Under the Agreement, 
each partner country would be required to grant national 
treatment to nationals of the other, and all laws, regulations, 
procedures, and final judicial decisions would need to be in 
writing and published or made publicly available. The Agreement 
would lengthen terms for copyright protection, cover electronic 
and digital media, and increase enforcement to go beyond the 
WTO Agreement on Trade-Related Aspects of Intellectual Property 
Rights. Both parties would be obliged to provide appropriate 
civil and criminal remedies for willful violators of 
intellectual property rights.
    Textile and Apparel: All U.S. textiles and apparel products 
meeting the Agreement's rules of origin would immediately 
become duty-free and quota-free when exported to Colombia. The 
Agreement's rules of origin are generally based on the ``yarn-
forward'' standard. A ``de minimis'' provision would allow 
limited amounts of specified third-country content to go into 
U.S. and Colombian apparel, giving producers in both countries 
needed flexibility. The Agreement would allow the use of 
``short supply'' fabrics, yarns, and fibers (that is, fabrics, 
yarns, and fibers not made in Colombia or the United States 
that have been determined not to be commercially available in 
either country) as inputs. The Parties agreed to a list of 
short supply fabrics, and the Agreement includes a process for 
adding more.
    Customs cooperation commitments between the United States 
and Colombia would allow for verification of claims of origin 
or preferential treatment, and denial of preferential treatment 
or entry if claims cannot be verified. A special textile 
safeguard would provide for temporary tariff relief if 
increased imports under the Agreement prove to cause serious 
damage to U.S. producers.
    Investment: The Agreement would ensure a stable legal 
framework for U.S. investors operating in Colombia. All forms 
of investment would be protected under the Agreement, including 
enterprises, debt, concessions and similar contracts, and 
intellectual property. With very few exceptions, U.S. investors 
would be treated as well as Colombian investors in the 
establishment, acquisition, and operation of investments in 
Colombia.
    The Agreement draws from U.S. legal principles and 
practices to provide U.S. investors in Colombia with a basic 
set of substantive and procedural protections that Colombian 
investors currently enjoy under the U.S. legal system. These 
include due process protections and the right to receive fair 
market value for property in the event of an expropriation. The 
Agreement includes recourse to an investor-state dispute 
settlement mechanism for certain types of claims.
    In the preamble, the Parties agree that ``foreign investors 
are not hereby accorded greater substantive rights with respect 
to investment protections than domestic investors under 
domestic law where, as in the United States, protections of 
investor rights under domestic law equal or exceed those set 
forth in this Agreement.'' This provision reflects one of the 
negotiating objectives of TPA to ensure ``that foreign 
investors in the United States are not accorded greater 
substantive rights with respect to investment protections than 
United States investors in the United States.''
    Labor: The labor chapter of the Agreement includes the 
obligation that the Parties adopt and effectively enforce the 
five core international labor rights as stated in the 1998 
International Labor Organization Declaration on Fundamental 
Principles and Rights at Work. The Agreement would also require 
each country to enforce its own existing laws concerning 
acceptable conditions of work with respect to minimum wages, 
hours of work, and occupational safety and health. The 
obligations under the labor chapter would be subject to the 
same dispute settlement mechanisms and enforcement mechanisms 
as obligations in other chapters of the Agreement. Neither 
Party would be permitted to waive or otherwise derogate from 
its laws that implement this obligation in a manner affecting 
trade or investment between the Parties. Procedural guarantees 
in the Agreement would ensure that workers and employers have 
fair, equitable, and transparent access to labor tribunals or 
courts.
    Environment: The Agreement would commit the Parties to 
effectively enforce their own domestic environmental laws and 
adopt, maintain, and implement laws and all other measures to 
fulfill obligations under covered multilateral environmental 
agreements. The Agreement also includes a fully enforceable, 
binding commitment that would prohibit the Parties from 
lowering environmental standards in the future in a manner 
affecting trade or investment. The Agreement would promote a 
comprehensive approach to environmental protection by 
encouraging voluntary, market-based mechanisms to protect the 
environment and by providing procedural guarantees that ensure 
fair, equitable and transparent proceedings for the 
administration and enforcement of environmental laws. The 
Agreement would call for a public submissions process with an 
independent secretariat for environmental matters to ensure 
that views of civil society are appropriately considered. All 
obligations in the environment chapter would be subject to the 
same dispute settlement procedures and enforcement mechanisms 
as obligations in other chapters of the Agreement.

Colombia's importance as a faithful ally and strategic partner of the 
        United States

    Colombia has a long history of standing with the United 
States as an important strategic ally in a region that includes 
several increasingly anti-American governments. Colombia serves 
on the United Nations Security Council and chairs its Iran 
Sanctions Committee. Colombian troops served alongside U.S. 
troops in the Korean War and serve under the United Nations 
mandate in Haiti, Sierra Leone, and--since 1956--the Sinai. 
Colombia has also been training militaries and police forces in 
counter-narcotics and counterinsurgency measures in numerous 
countries.
    The Committee notes that Colombia has shown dramatic 
improvement over the last decade in protection of labor rights 
for Colombian workers, in recognition of which the 
International Labor Organization (ILO) removed Colombia from 
its labor watch list in 2010. According to Vice President 
Garzon's Observatory for Human Rights, homicides against trade 
union members declined from 196 in 2002 to 37 in 2010--a 
decline of 81 percent. The decline has continued in 2011, with 
22 homicides against trade union members through the end of 
September 2011. Prosecutions and convictions for crimes against 
trade union members have also increased substantially since 
2006, when the Prosecutor General established a team of 114 
specialists focused solely on labor violence cases. Convictions 
increased from 16 in 2006 to 84 in 2009 to over 100 in 2010, 
and the total since 2006 stood at 391 as of the end of August 
2011. As a result of these and other improvements, the ILO 
removed Colombia from its labor watch list in 2010, recognizing 
``all the measures . . . adopt[ed] recently to combat . . . 
violence against the trade union movement.''
    Particularly noteworthy is the Colombian Action Plan 
Related to Labor Rights, to which Presidents Obama and Santos 
agreed on April 7, 2011. The Office of the U.S. Trade 
Representative has certified that Colombia has completed all 
action items that were due by September 15, 2011, accounting 
for almost all of the actions required under the action plan. 
The few actions that remain to be completed are due in December 
2011 and in 2012. For example, Colombia massively expanded 
labor union eligibility for its protection program, which has 
already provided security for over 10,000 people, none of whom 
were killed while in the program. Colombia also assigned 95 new 
investigators to labor violence cases and significantly 
increased funding for the special labor violence unit within 
the Prosecutor General's office. In endorsing the action plan, 
the president of one of Colombia's three main labor 
confederations called it the most significant social 
achievement of the last 50 years in Colombia.

Procedures of the Trade Act of 2002

    H.R. 3078 is being considered by the Senate under the 
procedures of the Bipartisan Trade Promotion Authority Act of 
2002, included in the Trade Act of 2002 (``TPA''). In the 
House, all provisions of TPA applied to negotiation, signature, 
submission, and consideration of the Agreement until passage of 
H. Res. 1092, on April 10, 2008, as described below.
    Pursuant to the requirements of TPA, the President is 
required to provide written notice to Congress of the 
President's intention to enter into the negotiations. 
Throughout the negotiating process, and prior to entering into 
an agreement, the President is required to consult with 
Congress regarding the ongoing negotiations. Under TPA, the 
President must notify Congress of his intent to enter into a 
trade agreement at least 90 calendar days before the agreement 
is signed. Within 60 days after entering in the Agreement, the 
President must submit to Congress a description of those 
changes to existing laws that the President considers would be 
required to bring the United States into compliance with the 
Agreement. After entering into the Agreement, the President 
must also submit to Congress the formal legal text of the 
agreement, draft implementing legislation, a statement of 
administrative action proposed to implement the Agreement, and 
other related supporting information as required under section 
2105(a) of the Trade Act of 2002.
    Under TPA, following submission of these documents, the 
implementing bill is introduced, by request, by the Majority 
Leader and the Minority Leader in each chamber. The House then 
has up to 60 legislative days to consider implementing 
legislation for the Agreement, and the Senate has up to an 
additional 30 legislative days. No amendments to the 
legislation are allowed under TPA requirements.

                         C. Legislative History

    On November 18, 2003, the United States Trade 
Representative (``USTR'') formally notified the Congress of its 
intention to initiate negotiation of a trade agreement with 
Colombia. Negotiations on a trade agreement between the United 
States and Colombia began on May 18, 2004. On August 24, 2006, 
the President notified the Congress of his intention to enter 
into a trade agreement with Colombia. On November 22, 2006, the 
Deputy U.S. Trade Representative and the Colombian Minister of 
Commerce, Industry and Tourism signed the United States-
Colombia Trade Promotion Agreement. On January 17, 2007, the 
USTR transmitted to Congress a description of the changes to 
existing U.S. laws required to comply with the Agreement. On 
June 14, 2007, Colombia's National Assembly approved the trade 
agreement, as signed on November 22, 2006.
    On June 28, 2007, the USTR and the Colombian Minister of 
Trade, Industry and Tourism entered into a Protocol amending 
the trade agreement to reflect the May 10 deal. Colombia's 
National Assembly approved the Agreement, as amended, on 
October 30, 2007. On April 8, 2008, President Bush sent a bill 
to Congress to implement the Agreement, and it was introduced 
by request that day by then-Majority Leader Hoyer and then-
Minority Leader Boehner (H.R. 5724). On April 9, 2008, Rep. 
Slaughter (D-NY) introduced H. Res. 1092, to eliminate the 
procedures providing for expedited consideration of the 
implementing bill by the House under TPA. On April 10, 2008, 
the House adopted H. Res. 1092 by a vote of 224 to 195. 
Congress did not consider the implementing bill.

Legislative hearings

    On January 25, 2011, the Committee on Ways and Means held a 
hearing on the Agreement, as well as the U.S.-Panama Trade 
Promotion Agreement and the U.S.-Korea Free Trade Agreement. 
The Trade Subcommittee of the Committee on Ways and Means then 
held a hearing on the Colombia Agreement on March 17, 2011.

Committee action

    On July 7, 2011, the Committee on Ways and Means 
considered, in an informal mark-up session, draft legislation 
to implement the Agreement and a statement of administrative 
action. The Committee approved the draft legislation by a vote 
of 22 to 14, after agreeing to an amendment in the nature of a 
substitute offered by Chairman Camp.
    On October 3, 2011, President Obama transmitted the United 
States-Colombia Trade Promotion Agreement, a legislative 
proposal to implement the agreement, a Statement of 
Administrative Action, and supporting documents to Congress. On 
the same day, H.R. 3078, a bill to implement the United States-
Colombia Trade Promotion Agreement, was introduced by Majority 
Leader Eric Cantor (R-VA), by request, for himself and Rep. Sam 
Farr (D-CA). H.R. 3078 was then referred to the Committee on 
Ways and Means.
    On October 5, 2011, the Committee on Ways and Means 
formally met to consider H.R. 3078. The Committee ordered H.R. 
3078 favorably reported to the House of Representatives by a 
vote of 24 to 12, without amendment.

                     II. SECTION-BY-SECTION SUMMARY

                Title I: Approval and General Provisions

SECTIONS 1-3: SHORT TITLE, TABLE OF CONTENTS, PURPOSES, AND DEFINITIONS

Present law

    No provision.

Explanation of provision

    Section 2 sets forth the purposes of the Act, which include 
approving and implementing the Agreement.

Reason for change

    The provision makes clear that the bill implements the 
Agreement.

               SECTION 101: APPROVAL AND ENTRY INTO FORCE

Present law

    No provision.

Explanation of provision

    Section 101 states that Congress approves the United 
States-Colombia Trade Promotion Agreement (``Agreement'') and 
the Statement of Administrative Action. The Agreement enters 
into force when the President determines that Colombia is in 
compliance with all provisions that take effect on the date of 
entry into force of the Agreement and exchanges notes with the 
Government of Colombia providing for entry into force on or 
after January 1, 2012.

Reason for change

    Approval of the Agreement and the Statement of 
Administrative Action is required under the procedures of 
section 2103(b)(3) of the Trade Act of 2002.

 SECTION 102: RELATIONSHIP OF THE AGREEMENT TO UNITED STATES AND STATE 
                                  LAW

Present law

    No provision.

Explanation of provision

    Section 102(a) provides that U.S. law prevails in the case 
of a conflict with the Agreement. Section 102(b) provides that 
only the United States is entitled to bring a court action 
challenging a state law as being invalid on grounds of 
inconsistency with the Agreement. Section 102(c) states that 
there is no private cause of action or defense under the 
Agreement and no person other than the United States may 
challenge a federal or state law in court as being inconsistent 
with the Agreement.

Reason for change

    The provision addresses the operation of the Agreement 
relative to federal and state law, as well as private remedies. 
Section 102 is necessary to make clear that no provision of the 
Agreement will be given effect if it is inconsistent with 
federal law and that entry into force of the Agreement creates 
no new private remedy.

 SECTION 103: IMPLEMENTING ACTIONS IN ANTICIPATION OF ENTRY INTO FORCE 
                        AND INITIAL REGULATIONS

Present law

    No provision.

Explanation of provision

    Section 103(a) provides that, after the date of enactment, 
the President may proclaim such actions, and other U.S. 
government officers may issue such regulations, as are 
necessary to ensure the appropriate implementation of any 
provision of the implementing act (``Act'') that is to take 
effect on the date of entry into force of the Agreement. The 
effective date of such actions and regulations may not be 
earlier than the date of entry into force of the Agreement. 
Where proclaimed actions are not subject to consultation and 
layover requirements under the Act, proclamations generally may 
not take effect earlier than 15 days after their publication.
    Section 103(b) establishes that regulations necessary or 
appropriate to carry out actions under the Act and Statement of 
Administrative Action must, to the maximum extent feasible, be 
issued within one year of entry into force of the Agreement or, 
where a provision takes effect on a date after which the 
Agreement enters into force, within one year of the effective 
date of the provision.

Reason for change

    Section 103 provides for the issuance of regulations. The 
Committee strongly believes that regulations should be issued 
in a timely manner to provide maximum clarity to parties 
claiming benefits under the Agreement. The Committee notes, 
further, that the Statement of Administrative Action commits 
each agency that will be issuing regulations to provide a 
report to Congress if it cannot issue regulations within one 
year of the Agreement's entry into force and that such report 
must be submitted at least 30 days prior to the end of the one-
year period.

      SECTION 104: CONSULTATION AND LAYOVER FOR PROCLAIMED ACTIONS

Present law

    No provision.

Explanation of provision

    Section 104 establishes requirements for proclamation of 
actions that are subject to consultation and layover provisions 
under the Act. The President may proclaim such action only 
after: (1) obtaining advice from the International Trade 
Commission and the appropriate private sector advisory 
committees; (2) submitting a report to the Ways and Means and 
Finance Committees concerning the reasons for the action; and 
(3) providing for a 60-day layover period (starting after the 
President has both obtained the required advice and provided 
the required report). The proposed action cannot take effect 
until after the expiration of the 60-day period and after the 
President has consulted with the Ways and Means and Finance 
Committees regarding the proposed action.

Reason for change

    The bill gives the President certain proclamation authority 
but requires extensive consultation with Congress before such 
authority may be exercised. The Committee believes that such 
consultation is an essential component of the delegation of 
authority to the President and expects that such consultations 
will be conducted in a thorough and timely manner.

     SECTION 105: ADMINISTRATION OF DISPUTE SETTLEMENT PROCEEDINGS

Present law

    No provision.

Explanation of provision

    Section 105 authorizes the President to establish an office 
within the Department of Commerce responsible for providing 
administrative assistance to dispute settlement panels that are 
established under the Agreement. The section also authorizes 
appropriations of up to $262,500 for the establishment and 
operation of the office and to pay the U.S. share of expenses 
of the panels.

Reason for change

    Dispute settlement procedures and panels are necessary to 
ensure that disputes over compliance with Agreement provisions 
can be resolved effectively. The authorization is necessary for 
the Commerce Department to provide administrative assistance to 
panels.

                   SECTION 106: ARBITRATION OF CLAIMS

Present law

    No provision.

Explanation of provision

    Section 106 authorizes the United States to resolve certain 
claims covered by the Investor-State Dispute Settlement 
Procedures set forth in the Agreement.

Reason for change

    This provision is necessary to meet U.S. obligations under 
Section B of Chapter 10 of the Agreement.

          SECTION 107: EFFECTIVE DATES; EFFECT OF TERMINATION

Present law

    No provision.

Explanation of provision

    Section 107 provides that, with the exception of Sections 1 
through 3 and Titles I and VI of the Act, which take effect on 
the date of enactment of the Act, and Title V of the Act, which 
contains effective date provisions applicable to that title, 
the effective date of the Act is the date that the Agreement 
enters into force with respect to the United States. Amendments 
made to U.S. law by Sections 204, 205, 207, and 401 of the Act 
take effect on the date of enactment of the Act but apply with 
respect to Colombia on the date on which the Agreement enters 
into force. Other than Titles V and VI, the provisions of the 
Act terminate on the date on which the Agreement terminates.

Reason for change

    Section 107 implements provisions of the Agreement relating 
to the effective date and date of termination of the Act.

                      Title II: Customs Provisions

                   SECTION 201: TARIFF MODIFICATIONS

Present law

    No provision.

Explanation of provision

    Section 201(a) provides the President with the authority to 
proclaim tariff modifications necessary or appropriate to carry 
out the Agreement and requires the President to terminate 
Colombia's designation as a beneficiary developing country for 
the purposes of the Generalized System of Preferences program 
(``GSP'') and as a beneficiary country for the purposes of the 
Andean Trade Preference Act (``ATPA''), as of the date that the 
Agreement enters into force.
    Section 201(b) gives the President the authority, subject 
to consultation and layover, to proclaim further tariff 
modifications necessary or appropriate to maintain the general 
level of reciprocal and mutually advantageous concessions with 
respect to Colombia provided for by the Agreement.
    Section 201(c) allows the President, for any goods for 
which the base rate under the Agreement is a specific or 
compound rate of duty, to substitute for the base rate an 
equivalent ad valorem rate to carry out the tariff 
modifications in subsections (a) and (b) of Section 201.
    Section 201(d) directs the President, when implementing 
tariff rate quotas under the Agreement, to ensure that imports 
of agricultural goods do not disrupt the orderly marketing of 
commodities in the United States.

Reason for change

    The provision is necessary to ensure United States 
compliance with the market access provisions of the Agreement. 
The Committee expects the President to comply with the letter 
and spirit of the consultation and layover provisions of this 
Act in carrying out Section 201(b).

      SECTION 202: ADDITIONAL DUTIES ON CERTAIN AGRICULTURAL GOODS

Present law

    No provision.

Explanation of provision

    Section 202 implements the agricultural safeguard 
provisions of Article 2.18 and Annex 2.18 of the Agreement. 
Section 202(b) directs the Secretary of the Treasury 
(``Secretary'') to assess an additional duty in any year when 
the volume of imports to the United States of a ``safeguard 
good'' exceeds 140 percent of the in-quota quantity allocated 
to Colombia for the good in that calendar year, as set forth in 
Appendix I of the General Notes to the Schedule of the United 
States to Annex 2.3 of the Agreement. The additional duty is 
calculated as a specified percentage of the difference between 
the Normal Trade Relations (``NTR'' or ``MFN'') rate of duty 
and the duty set out in the Schedule of the United States to 
Annex 2.3 of the Agreement. The sum of the duties assessed 
under the agricultural safeguard and the applicable rate of 
duty in the U.S. Schedule may not exceed the NTR (MFN) rate of 
duty. No additional duty may be applied on a good if, at the 
time of entry, the good is subject to a safeguard measure under 
the procedures set out in Subtitle A of Title III of the Act or 
under the safeguard procedures set out in Chapter 1 of Title II 
of the Trade Act of 1974 (the ``Section 201'' global 
safeguard). The additional duties remain in effect only until 
the end of the calendar year in which they are imposed.

Reason for change

    This provision implements commitments made in the Agreement 
relating to agricultural safeguards. Such safeguards provide 
temporary relief to farmers in the United States who face a 
surge in certain agricultural imports following entry into 
force of the Agreement.

                      SECTION 203: RULES OF ORIGIN

Present law

    No provision.

Explanation of provision

    Section 203 codifies the rules of origin set out in Article 
3.3 and Chapter 4 of the Agreement. Section 203(b) establishes 
three basic ways for a Colombian good to qualify as an 
``originating good'' and therefore to be eligible for 
preferential tariff treatment when it is imported into the 
United States. A good is an originating good if (1) it is 
``wholly obtained or produced entirely in the territory of 
Colombia, the United States, or both''; (2) it is produced 
entirely in the United States, Colombia, or both, and any 
materials used to produce the good that are not themselves 
originating goods are transformed in such a way as to cause 
their tariff classification to change or the good otherwise 
meets regional value-content and other requirements, as 
specified in Annex 3-A or Annex 4.1 of the Agreement; or (3) it 
is produced entirely in the territory of Colombia, the United 
States, or both, exclusively from originating materials.
    Under the rules in Chapter 3, Annex 3-A, Chapter 4, and 
Annex 4.1 of the Agreement, an apparel product must generally 
meet a tariff shift rule that effectively imposes a ``yarn 
forward'' requirement. Thus, to qualify as an originating good 
imported into the United States from Colombia, an apparel 
product must have been cut (or knit to shape) and sewn or 
otherwise assembled in Colombia, the United States, or both, 
from yarn, or fabric made from yarn, that originates in 
Colombia, the United States, or both.
    Section 203(o)(2) provides authority for the President to 
add fabrics, yarns, or fibers to a list of products that are 
unavailable in commercial quantities in a timely manner, and 
such products are treated as if they originate in Colombia, 
regardless of their actual origin, when used as inputs in the 
production of textile or apparel goods. Section 203(o)(4) 
provides a process by which the President may modify that list 
at the request of interested entities, defined as Colombia and 
potential and actual suppliers and purchasers of textile or 
apparel goods.
    The remainder of Section 203 sets forth more detailed rules 
for determining whether a good meets the Agreement's 
requirements under the second method of qualifying as an 
originating good. These include rules pertaining to de minimis 
quantities of non-originating materials that do not undergo a 
tariff transformation, transformation by regional content, and 
alternative methods for calculating regional value-content. 
Other provisions in Section 203 address valuation of materials; 
determination of the originating or non-originating status of 
fungible goods and materials; and treatment of accessories, 
spare parts and tools, packaging materials, indirect materials, 
and goods put up in sets. Section 203(l) specifies that goods 
that undergo further production or other operations outside 
Colombia or the United States (with certain exceptions) or do 
not remain under the control of the customs authorities of such 
other countries do not qualify as originating goods.

Reason for change

    This provision implements the commitments made in the 
Agreement with respect to rules of origin applying to imports 
from Colombia. Rules of origin are needed to confine Agreement 
benefits, such as tariff cuts, to Colombian goods and to 
prevent third-country goods from being transshipped through 
Colombia and claiming benefits under the Agreement.

                     SECTION 204: CUSTOMS USER FEES

Present law

    Section 13031(a) of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 (``COBRA''), at 19 U.S.C. 58c(a), 
authorizes the Secretary of the Treasury to collect a 
merchandise processing fee for formal and informal entries of 
merchandise into the United States (``Merchandise Processing 
Fee''). Section 13031(b) of COBRA exempts from the Merchandise 
Processing Fee all originating goods under each of the trade 
agreements currently in force between the United States and 
other countries.

Explanation of provision

    Section 204 implements the U.S. commitments under Article 
2.10.4 of the Agreement to eliminate the Merchandise Processing 
Fee on originating goods under the Agreement. In accordance 
with U.S. obligations under the General Agreement on Tariffs 
and Trade 1994, the provision also prohibits use of funds in 
the Customs User Fee Account to provide services related to 
entry of originating goods.

Reason for change

    As with other trade agreements, the Agreement eliminates 
the Merchandise Processing Fee on qualifying goods from 
Colombia. Other customs user fees remain in place. Section 204 
is necessary to ensure United States compliance with the user 
fee elimination provisions of the Agreement. The Committee 
expects that the President, in his yearly budget request, will 
take into account the need for funds to pay expenses for 
entries under the Agreement given that Merchandise Processing 
Fee funds will not be available.

SECTION 205: DISCLOSURE OF INCORRECT INFORMATION; FALSE CERTIFICATIONS 
           OF ORIGIN; DENIAL OF PREFERENTIAL TARIFF TREATMENT

Present law

    No provision.

Explanation of provision

    Section 205 implements Articles 4.18.5 and 4.19.3 of the 
Agreement. Section 205(a) prohibits the imposition of a penalty 
upon importers who make an invalid claim for preferential 
tariff treatment under the Agreement if the importer acts 
promptly and voluntarily to correct the error and pays any 
duties owed on the good in question. The provision also makes 
it unlawful for a person to falsely certify, by fraud, gross 
negligence, or negligence, that a good exported from the United 
States is an originating good. However, the provision prohibits 
the imposition of a penalty if the exporter or producer 
promptly and voluntarily provides notice of the incorrect 
information to every person to whom a certification was issued.
    Section 205(b) provides that if U.S. authorities find that 
an importer, exporter, or producer has engaged in a pattern of 
conduct of providing false or unsupported representations, the 
authorities may suspend preferential treatment with respect to 
identical goods covered by subsequent representations made by 
that importer, exporter, or producer, until U.S. authorities 
have determined that its representations are accurate.

Reason for change

    This provision is necessary to implement commitments in the 
Agreement relating to application of penalties for submission 
of false information or certifications by importers, exporters, 
and producers.

                 SECTION 206: RELIQUIDATION OF ENTRIES

Present law

    No provision.

Explanation of provision

    Section 206 implements Article 4.19.5 of the Agreement and 
provides authority for U.S. Customs and Border Protection 
(``CBP'') to reliquidate an entry to refund any excess duties 
(including any merchandise processing fees) paid on a good 
qualifying under the rules of origin for which no claim for 
preferential tariff treatment was made at the time of 
importation if the importer so requests within one year after 
the date of importation.

Reason for change

    Article 4.19.5 of the Agreement anticipates that private 
parties may err in claiming preferential benefits under the 
Agreement and provides a one-year period for parties to make 
such claims for preferential tariff treatment even if the entry 
of the goods at issue has already been liquidated, i.e., 
legally finalized by customs officials. Section 206 is 
necessary to ensure United States compliance with Article 
4.19.5.

                SECTION 207: RECORDKEEPING REQUIREMENTS

Present law

    No provision.

Explanation of provision

    Section 207 implements Article 4.17 of the Agreement. The 
provision requires any person who completes and issues a 
certificate of origin under Article 4.15 of the Agreement for a 
good exported from the United States to maintain, for a period 
of five years after the date of certification, specified 
documents demonstrating that the good qualifies as originating.

Reason for change

    Section 207 is necessary to ensure United States compliance 
with the recordkeeping requirement provisions in Article 4.17 
of the Agreement.

 SECTION 208: ENFORCEMENT RELATING TO TRADE IN TEXTILE OR APPAREL GOODS

Present law

    No provision.

Explanation of provision

    Section 208 implements the customs cooperation and 
verification of origin provisions in Article 3.2 of the 
Agreement. Under Article 3.2, the United States may request the 
Government of Colombia to conduct a verification of whether a 
claim of origin for a textile or apparel good is accurate or a 
particular exporter or producer is complying with applicable 
customs laws, regulations, and procedures regarding trade in 
textile or apparel goods. Section 208(a) provides that the 
President may direct the Secretary to take ``appropriate 
action'' while such a verification is being conducted. 
``Appropriate action'' may include (i) suspending preferential 
tariff treatment for textile or apparel goods that the person 
subject to the verification has produced or exported if the 
Secretary determines that there is insufficient information to 
sustain a claim for such treatment; (ii) denying preferential 
tariff treatment to such goods if the Secretary determines that 
a person has provided incorrect information to support a claim 
for such treatment; (iii) detaining such goods if the Secretary 
determines that there is not enough information to determine 
their country of origin; and (iv) denying entry to such goods 
if the Secretary determines that a person has provided 
erroneous information on their origin.
    Under Section 208(c), the President may also direct the 
Secretary to take ``appropriate action'' after a verification 
has been completed. Such action may include (i) denying 
preferential tariff treatment to textile or apparel goods that 
the person subject to the verification has exported or produced 
if the Secretary determines that there is insufficient 
information to support a claim for such treatment or determines 
that a person has provided incorrect information to support a 
claim for such treatment; and (ii) denying entry to such goods 
if the Secretary determines that a person has provided 
incorrect information regarding their origin or that there is 
insufficient information to determine their origin. Unless the 
President sets an earlier date, any such action may remain in 
place until the Secretary obtains enough information to decide 
whether the exporter or producer that was subject to the 
verification is complying with applicable customs rules or 
whether a claim that the goods qualify for preferential tariff 
treatment or originate in an Agreement country is accurate.
    Under Section 208(e), the Secretary may publish the name of 
a person that the Secretary has determined (i) is engaged in 
circumvention of applicable laws, regulations, or procedures 
affecting trade in textile or apparel goods; or (ii) has failed 
to demonstrate that it produces, or is capable of producing, 
textile or apparel goods.

Reason for change

    To avoid textile transshipment, special textile enforcement 
provisions have been included in the Agreement. Section 208 is 
necessary to authorize these enforcement mechanisms for use by 
U.S. authorities.

                        SECTION 209: REGULATIONS

Present law

    No provision.

Explanation of provision

    Section 209 directs the Secretary to prescribe regulations 
necessary to carry out the tariff-related provisions of the 
Act, including the rules of origin and customs user fee 
provisions.

Reason for change

    Because the Act involves lengthy and complex implementation 
procedures by customs officials, this provision is necessary to 
authorize the Secretary of the Treasury to carry out provisions 
of the Act through regulations. No such regulations may take 
effect before the Agreement enters into force.

                     Title III: Relief From Imports

                        SECTION 301: DEFINITIONS

Present law

    No provision.

Explanation of provision

    Section 301 defines ``Colombian article'' and ``Colombian 
textile or apparel article,'' which are key terms for Title III 
of the Act.

Reason for change

    This provision clarifies the scope of the provisions in 
Title III.

     Subtitle A: Relief From Imports Benefiting From the Agreement

                            SECTIONS 311-316

Present law

    No provision.

Explanation of provisions

    Subtitle A to Title III of the Act (Sections 311 to 316) 
authorizes the President, after an investigation and 
affirmative determination by the ITC, to impose certain import 
relief measures when, as a result of the reduction or 
elimination of a duty under the Agreement, a Colombian product 
is being imported into the United States in such increased 
quantities and under such conditions as to be a substantial 
cause of serious injury or threat of serious injury to the 
domestic industry.
    Section 311 provides for the filing of petitions with the 
ITC and for the ITC to conduct safeguard investigations under 
Subtitle A. Section 311(a) provides that a petition requesting 
a safeguard action may be filed by an entity that is 
``representative of an industry.'' As under Section 202(a)(1) 
of the Trade Act of 1974, a trade association, firm, certified 
or recognized union, or a group of workers can be considered 
such an entity. Section 311(b) sets out the standard to be used 
by the ITC in undertaking an investigation and making a 
determination in safeguard proceedings under Subtitle A of 
Title III of the Act.
    Section 311(c) provides that certain provisions of Section 
202 of the Trade Act of 1974 also apply with respect to 
investigations initiated under Section 311(b), including 
provisions defining ``substantial cause'' and listing factors 
to be taken into account in making safeguard determinations.
    Section 311(d) exempts from investigation under this 
section Colombian articles with respect to which relief has 
previously been provided under Subtitle A of Title III of the 
Act.
    Section 312 requires the ITC to make a determination not 
later than 120 days after the date on which the Section 311 
investigation is initiated. Under Sections 312(b) and (c), if 
the ITC makes an affirmative determination, it must find and 
recommend to the President the amount of import relief that is 
necessary to remedy or prevent serious injury and to facilitate 
the efforts of the domestic industry to make a positive 
adjustment to import competition. Section 312(d) directs the 
ITC to submit a report to the President regarding the 
determination no later than 30 days after the determination is 
made. Section 312(e) requires the ITC to make this report 
public and to publish a summary of it in the Federal Register.
    Section 313(a) provides that the President, within 30 days 
of receiving a report from the ITC under Section 312, must 
provide import relief to the extent that the President 
determines is necessary to remedy or prevent the injury found 
by the ITC and to facilitate the efforts of the domestic 
industry to make a positive adjustment to import competition. 
Under Section 313(b), the President is not required to provide 
import relief if the relief will not provide greater economic 
and social benefits than costs.
    Section 313(c) sets forth the nature of the relief that the 
President may provide. The President may take action in the 
form of a suspension of further reductions in the rate of duty 
to be applied to the articles in question, or in the form of an 
increase in the rate of duty on the articles in question to a 
level that does not exceed the lesser of the existing NTR (MFN) 
rate or the NTR (MFN) rate of duty that was imposed on the day 
before the Agreement entered into force. Under Section 
313(c)(2), if the relief the President provides has duration 
greater than one year, the relief must be subject to 
progressive liberalization at regular intervals over the course 
of its application.
    Section 313(d) provides that the President may initially 
provide import relief for up to two years. This period may be 
extended for an additional two years (to a maximum aggregate 
period of four years) if, after an investigation by the ITC and 
receipt of an ITC report, the President determines that import 
relief continues to be necessary and there is evidence that the 
industry is making a positive adjustment to import competition. 
The ITC must conduct an investigation on these issues if, 
within a specified period before the relief terminates, a 
concerned industry files a petition requesting an 
investigation. The ITC must issue a report on its investigation 
to the President no later than 60 days before the termination 
of the import relief.
    Section 313(e) specifies that upon the termination of 
import relief, the rate of duty for the remainder of the 
calendar year is the rate that was scheduled to have been in 
effect one year after the initial provision of import relief. 
In the calendar year that follows the year of termination of 
import relief, the President may either apply the rate of duty 
set out in the relevant U.S. Schedule to the Agreement or 
eliminate the duty in equal annual stages until the end of the 
scheduled phase-out period.
    Section 313(f) exempts from relief any article that is (i) 
subject to import relief under the global safeguard provisions 
in U.S. law (Chapter 1 of Title II of the Trade Act of 1974); 
(ii) subject to import relief under Subtitle B of Title III of 
the Act (Sections 321 to 328); or (iii) subject to additional 
duties as an agricultural good under Section 202(b).
    Section 314 provides that no relief may be provided under 
Subtitle A to Title III of the Act after ten years from the 
date the Agreement enters into force, unless the scheduled 
tariff phase-out period for the article under the Agreement is 
greater than ten years, in which case relief may not be 
provided for that article after the scheduled phase-out period 
ends.
    Section 315 authorizes the President to provide 
compensation to Colombia consistent with Article 8.5 of the 
Agreement if relief is ordered.
    Section 316 provides for the treatment of confidential 
business information submitted to the ITC in the course of 
investigations conducted under Title III of the Act.

Reason for change

    Sections 311 to 316 establish a mechanism for providing 
temporary import relief where a U.S. industry experiences 
serious injury or threat of serious injury by reason of 
increased import competition from Colombia resulting from 
reduction or elimination of a duty under the Agreement. The 
Committee notes that the President is not required to provide 
relief if the relief will not provide greater economic and 
social benefits than costs. The Committee intends that 
administration of this safeguard be consistent with U.S. 
obligations under Section A of Chapter Eight (Trade Remedies) 
of the Agreement.

           Subtitle B: Textile and Apparel Safeguard Measures

                            SECTIONS 321-328

Present law

    No provision.

Explanation of provisions

    Subtitle B of Title III of the Act (Sections 321 to 328) 
authorizes the President to impose certain import relief 
measures when he determines that, as a result of the 
elimination or reduction of a duty provided under the 
Agreement, a Colombian 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 the domestic industry.
    Section 321 provides that an interested party may file a 
request with the President for safeguard relief under Subtitle 
B of Title III of the Act. The President must review the 
request and determine whether to commence consideration of the 
request. Under Section 321(b), if the President determines that 
the request contains information necessary to warrant 
consideration on the merits, the President must publish notice 
in the Federal Register stating that the request will be 
considered and seeking public comments on the request.
    Section 322(a) provides that the President shall determine, 
pursuant to a request by an interested party, whether, as a 
result of the elimination or reduction of a duty provided under 
the Agreement, a Colombian 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.
    Section 322(b) sets forth the relief that the President may 
provide, which is an increase in the rate of duty on the 
articles in question to a level that does not exceed the lesser 
of the existing NTR (MFN) rate or the NTR (MFN) rate of duty 
that was imposed on the day before the Agreement entered into 
force.
    Section 323 of the Act provides that the period of relief 
shall be no longer than two years. The period may be extended 
for an additional period of not more than one year if the 
President determines that continuation is necessary to remedy 
or prevent serious damage and to facilitate adjustment by the 
domestic industry to import competition and there is evidence 
the industry is making a positive adjustment to import 
competition. The aggregate period of relief, including any 
extension, may not exceed three years.
    Section 324 provides that relief may not be granted to an 
article under this subtitle if relief has previously been 
granted under this subtitle for that article, or the article is 
subject to import relief under Subtitle A of Title III of the 
Act or under Chapter 1 of Title II of the Trade Act of 1974.
    Under Section 325, after a safeguard expires, the rate of 
duty on the article that had been subject to the safeguard 
shall be the rate that would have been in effect at that time, 
but for the safeguard action.
    Section 326 provides that the authority to provide 
safeguard relief under Subtitle B to Title III of the Act 
expires five years after the date on which the Agreement enters 
into force.
    Section 327 authorizes the President to provide 
compensation to Colombia if relief is ordered.
    Section 328 provides for the treatment of confidential 
business information received by the President in connection 
with an investigation or determination under Subtitle B to 
Title III of the Act.

Reason for change

    Sections 321 to 328 implement the commitments under the 
Agreement relating to textile and apparel safeguard measures. 
The Committee intends that the provisions of Subtitle B of 
Title III of the Act be administered in a manner that is 
transparent and that will serve as an example to our trading 
partners. For example, in addition to publishing a summary of 
the request for safeguard relief, the Committee notes that the 
President plans to make available the full text of the request, 
subject to the protection of business confidential data, on the 
website of the Department of Commerce, International Trade 
Administration. In addition, the Committee encourages the 
President promptly to issue regulations on procedures for 
requesting such safeguard measures, for making determinations 
under Section 322(a), and for providing relief under Section 
322(b).

       Subtitle C: Cases Under Title II of the Trade Act of 1974

        SECTION 331: FINDINGS AND ACTION ON GOODS FROM COLOMBIA

Present law

    No provision.

Explanation of provision

    Section 331(a) provides that, if the ITC makes an 
affirmative determination or a determination that the President 
may consider to be an affirmative determination in a global 
safeguard investigation under Section 202(b) of the Trade Act 
of 1974, the ITC must find and report to the President whether 
Colombian imports of the article that qualify as originating 
goods under the Agreement are a substantial cause of serious 
injury or threat thereof. Under Section 331(b), if the ITC 
makes a negative finding under Section 331(a), the President 
may exclude any imports that are covered by the ITC's finding 
from the global safeguard action.

Reason for change

    This provision implements commitments under the Agreement 
relating to treatment of Colombian imports in global safeguard 
investigations under Section 202(b) of the Trade Act of 1974.

                         Title IV: Procurement

                     SECTION 401: ELIGIBLE PRODUCTS

Present law

    U.S. procurement law (such as the Buy American Act of 1933 
and the Buy American Act of 1988) limits procurement from 
certain foreign suppliers of goods and services in favor of 
U.S. providers of goods and services. Most discriminatory 
purchasing provisions are waived if the United States is a 
party to a bilateral or multilateral procurement agreement, 
such as the WTO Agreement on Government Procurement, or a 
bilateral or multilateral trade agreement that includes 
provisions on procurement.

Explanation of provision

    Section 401 implements Chapter 9 of the Agreement and 
amends the definition of ``eligible product'' in Section 
308(4)(A) of the Trade Agreements Act of 1979. As amended, 
Section 308(4)(A) provides that an ``eligible product'' means a 
product or service of Colombia that is covered under the 
Agreement for procurement by the United States.

Reason for change

    This provision implements U.S. commitments under Chapter 9 
of the Agreement (Government Procurement).

           Title V: Extension of Andean Trade Preference Act

         SECTION 501: EXTENSION OF ANDEAN TRADE PREFERENCE ACT

Present law

    ATPA, as amended in 2002 by the Andean Trade Promotion and 
Drug Eradication Act, provides duty-free treatment to most 
products originating in Bolivia, Colombia, Ecuador, and Peru, 
for the purpose of assisting these Andean countries in their 
fight against drug production and trafficking by expanding 
their economic alternatives.

Explanation of provision

    Section 501 extends ATPA through July 31, 2013, with duty-
free treatment under ATPA applying to articles that enter 
fifteen days or more after enactment of the Act. ATPA expired 
on February 12, 2011. Section 501 lays out procedures for 
retroactive application of ATPA treatment (and reimbursement of 
duties paid) for articles that entered the United States after 
February 12, 2011, but before articles begin qualifying for 
duty-free treatment under the ATPA extension provided for in 
Section 501.

Reason for change

    This provision is ``necessary or appropriate'' to implement 
the Agreement. Benefits under ATPA (including for Colombia) 
expired on February 12, 2011. This extension will allow imports 
from Colombia to continue to benefit under the program until 
the earlier of the date on which the Agreement enters into 
force or July 31, 2013.

                           Title VI: Offsets

    SECTION 601: ELIMINATION OF CERTAIN NAFTA CUSTOMS FEES EXEMPTION

Present law

    Section 13031 of COBRA authorizes the Secretary of the 
Treasury to collect certain customs user fees. Section 412 of 
the Homeland Security Act of 2002 authorized the Secretary of 
the Treasury to delegate such authority to the Secretary of 
Homeland Security. One of these fees, provided for under 19 
U.S.C. 58c(a)(5), is a fee for air and sea passenger 
processing. The arrival of any passenger whose journey 
originated in Canada, Mexico, a territory or possession of the 
United States, or adjacent islands is currently exempted from 
that fee.

Explanation of provision

    Section 601 eliminates the current exemption from the 
customs user fee for air and sea passengers arriving from 
Canada, Mexico, and the Caribbean.

Reason for change

    The Committee believes it is appropriate, for budgetary 
offset purposes, to eliminate the exemption from the Passenger 
and Conveyance Processing fee for air and sea passengers 
arriving from Canada, Mexico, and the Caribbean.

              SECTION 602: EXTENSION OF CUSTOMS USER FEES

Present law

    Section 13031 of COBRA, at 19 U.S.C. 58c, authorizes the 
Secretary of the Treasury to collect certain service fees. 
Section 412 of the Homeland Security Act of 2002 authorized the 
Secretary of the Treasury to delegate such authority to the 
Secretary of Homeland Security. The fees include the 
Merchandise Processing Fee and, under 19 U.S.C. 58c(a)(1) 
through (8), processing fees for air and sea passengers, 
commercial trucks, rail cars, private aircraft and vessels, 
commercial vessels, dutiable mail packages, barges and bulk 
carriers, and Customs broker permits (``Passenger and 
Conveyance Processing Fees''). COBRA has been amended on 
several occasions. The current authorization for the collection 
of the Passenger and Conveyance Processing Fees is through 
January 14, 2020. The current authorization for the collection 
of the Merchandise Processing Fee is through January 7, 2020.

Explanation of provision

    Section 602 extends the Passenger and Conveyance Processing 
Fees authorized under Section 13031 of COBRA from December 9, 
2020 to August 31, 2021 and extends the Merchandise Processing 
Fee authorized under Section 13031 of COBRA from August 3, 2021 
to September 30, 2021.

Reason for change

    The Committee believes it is appropriate, for budgetary 
offset purposes, to extend the Passenger and Conveyance 
Processing Fees and the Merchandise Processing Fee authorized 
under COBRA.

       SECTION 603: TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES

Present law

    In general, corporations are required to make quarterly 
estimated tax payments of their income tax liability. For a 
corporation whose taxable year is a calendar year, these 
estimated tax payments must be made by April 15, June 15, 
September 15, and December 15.

Explanation of provision

    For corporations with assets of at least $1 billion, the 
provision increases the amount of the required installment of 
estimated tax otherwise due in July, August, or September 2016 
by 0.50 percent of such amount (determined without regard to 
any increase in such amount not contained in the Internal 
Revenue Code). The next required installment is reduced 
accordingly.

Reason for change

    The Committee believes it is appropriate to adjust the 
corporate estimated tax payments, for budgetary offset 
purposes.

                      III. VOTES OF THE COMMITTEE

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the following statements are made 
concerning the vote of the Committee on Ways and Means in its 
consideration of the bill, H.R. 3078.

                       MOTION TO REPORT THE BILL

    The bill, H.R. 3078, was ordered favorably reported by a 
rollcall vote of 24 yeas to 12 nays (with a quorum being 
present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
         Representative             Yea       Nay     Present     Representative      Yea       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp.......................        X   ........  .........  Mr. Levin........  ........        X   .........
Mr. Herger.....................        X   ........  .........  Mr. Rangel.......  ........        X   .........
Mr. Johnson....................        X   ........  .........  Mr. Stark........  ........        X   .........
Mr. Brady......................        X   ........  .........  Mr. McDermott....  ........        X   .........
Mr. Ryan.......................        X   ........  .........  Mr. Lewis........  ........        X   .........
Mr. Nunes......................        X   ........  .........  Mr. Neal.........  ........        X   .........
Mr. Tiberi.....................        X   ........  .........  Mr. Becerra......  ........        X   .........
Mr. Davis......................        X   ........  .........  Mr. Doggett......  ........        X   .........
Mr. Reichert...................        X   ........  .........  Mr. Thompson.....  ........        X   .........
Mr. Boustany...................        X   ........  .........  Mr. Larson.......  ........  ........  .........
Mr. Roskam.....................        X   ........  .........  Mr. Blumenauer...  ........        X   .........
Mr. Gerlach....................        X   ........  .........  Mr. Kind.........        X   ........  .........
Mr. Price......................        X   ........  .........  Mr. Pascrell.....  ........        X   .........
Mr. Buchanan...................        X   ........  .........  Ms. Berkley......  ........        X   .........
Mr. Smith......................        X   ........  .........  Mr. Crowley......        X   ........  .........
Mr. Schock.....................        X   ........  .........
Ms. Jenkins....................        X   ........  .........
Mr. Paulsen....................        X   ........  .........
Mr. Berg.......................        X   ........  .........
Ms. Black......................        X   ........  .........
Mr. Reed.......................        X   ........  .........
----------------------------------------------------------------------------------------------------------------

                     IV. BUDGET EFFECTS OF THE BILL

               A. Committee Estimate of Budgetary Effects

    In compliance with clause 3(d) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the effects on the budget of this bill, H.R. 3078, 
as reported: The Committee agrees with the estimate prepared by 
the Congressional Budget Office (CBO) which is included below.

B. Statement Regarding New Budget Authority and Tax Expenditures Budget 
                               Authority

    In compliance with subdivision 3(c)(2) of rule XIII of the 
Rules of the House of Representatives, the Committee states 
that the provisions of H.R. 3078 would reduce customs duty 
receipts, due to lower tariffs imposed on goods from Colombia.

      C. Cost Estimate Prepared by the Congressional Budget Office

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, requiring a cost estimate 
prepared by CBO, the following report prepared by CBO is 
provided:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, October 5, 2011.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3078, the United 
States-Colombia Trade Promotion Agreement Implementation Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Kalyani 
Parthasarathy.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 3078--United States-Colombia Trade Promotion Agreement 
        Implementation Act

    Summary: H.R. 3078 would approve the trade promotion 
agreement between the government of the United States and the 
government of Colombia that was signed on November 22, 2006. It 
would provide for tariff reductions and other changes in law 
related to implementation of the agreement. It also would 
retroactively extend the Andean Trade Preference Act (ATPA) 
from February 12, 2011, through July 31, 2013, while removing 
Colombia from eligibility for trade preferences under that 
program. The bill would extend user fees collected by Customs 
and Border Protection (CBP) that expire under current law, and 
remove an exemption from those fees for travelers to the United 
States from Mexico, Canada, and certain Caribbean countries. It 
also would shift some corporate income tax payments between 
fiscal years.
    The Congressional Budget Office (CBO) and the staff of the 
Joint Committee on Taxation (JCT) estimate that enacting H.R. 
3078 would reduce revenues by $139 million in 2012 and by about 
$1.5 billion over the 2012-2021 period. CBO estimates that 
enacting H.R. 3078 would decrease direct spending by $68 
million in 2012 and by about $1.5 billion over the 2012-2021 
period. The net impact of those effects is an estimated 
reduction in deficits of $22 million over the 2012-2021 period. 
Pay-as-you-go procedures apply because enacting the legislation 
would affect direct spending and revenues.
    Further, CBO estimates that implementing the legislation 
would result in discretionary costs of $4 million over the 
2012-2016 period, assuming the availability of appropriated 
funds.
    CBO has determined that the nontax provisions of H.R. 3078 
contain no intergovernmental mandates as defined in the 
Unfunded Mandates Reform Act (UMRA), and would impose no costs 
on state, local, or tribal governments.
    CBO has determined that the nontax provisions of the bill 
contain private-sector mandates with costs that would exceed 
the annual threshold established in UMRA for private-sector 
mandates ($142 million in 2011, adjusted annually for 
inflation).
    JCT has determined that the tax provision of H.R. 3078 
contains no private-sector or intergovernmental mandates as 
defined in UMRA.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 3078 is shown in the following table. 
The costs of this legislation fall within budget functions 150 
(international affairs), 370 (commerce and housing credit), 750 
(administration of justice), and 800 (general government).
    Basis of estimate: For the purposes of this estimate, CBO 
assumes that H.R. 3078 will be enacted early in fiscal year 
2012.

                                REVENUES

    Under the United States-Colombia trade promotion agreement, 
tariffs on U.S. imports from Colombia would be phased out over 
time. The tariffs would be phased out for individual products 
at varying rates, ranging from immediate elimination on the 
date the agreement enters into force to gradual elimination 
over 10 or more years. According to the U.S. International 
Trade Commission, the United States collected about $9 million 
in customs duties in 2010 on $16 billion of imports from 
Colombia. However, since 1991, imports to the United States 
from Colombia have been subject to reduced tariff rates in 
accordance with the ATPA, which was expanded in legislation 
enacted in 2002, and expired on February 12, 2011. The ATPA 
overlaps to a large extent with the trade promotion agreement 
that would be implemented by this bill. As a result, enacting 
the bill would effectively extend the ATPA for Colombia, while 
also lowering tariff rates not covered by the ATPA.
    Based on expected imports from Colombia, CBO estimates that 
implementing the tariff schedule outlined in the U.S.-Colombia 
trade promotion agreement would reduce revenues by $55 million 
in 2012, and by about $1.4 billion over the 2012-2021 period, 
net of income and payroll tax offsets.

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                           By fiscal year, in millions of dollars--
                                                             -----------------------------------------------------------------------------------------------------------------------------------
                                                                 2012       2013       2014       2015       2016       2017       2018       2019       2020       2021    2012-2016  2012-2021
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

                                                                                       CHANGES IN REVENUES

Preferential Trade Agreement................................        -55       -100       -110       -122       -135       -148       -159       -171       -185       -199       -522     -1,384
Extend ATPA.................................................        -84        -19          0          0          0          0          0          0          0          0       -103       -103
Corporate Payment Shift.....................................          0          0          0          0        344       -344          0          0          0          0        344          0
                                                             -----------------------------------------------------------------------------------------------------------------------------------
    Estimated Revenues......................................       -139       -119       -110       -122        209       -492       -159       -171       -185       -199       -282     -1,488

                                                                                   CHANGES IN DIRECT SPENDINGa
Extend Customs User Fees....................................
    Estimated Budget Authority..............................          0          0          0          0          0          0          0          0          0       -754          0       -754
    Estimated Outlays.......................................          0          0          0          0          0          0          0          0          0       -754          0       -754
Eliminate COBRA Fee Exemption...............................
    Estimated Budget Authority..............................        -83       -111       -112       -113       -114       -116       -117       -118        -35        -80       -533       -999
    Estimated Outlays.......................................        -83       -111       -112       -113       -114       -116       -117       -118        -35        -80       -533       -999
Exemption from Merchandise Processing Fee...................
    Estimated Budget Authority..............................         15         26         28         29         30         32         34         35         10          5        128        243
    Estimated Outlays.......................................         15         26         28         29         30         32         34         35         10          5        128        243
Total, Direct Spendinga.....................................
    Estimated Budget Authority..............................        -68        -85        -84        -84        -84        -84        -83        -83        -25       -829       -405     -1,510
    Estimated Outlays.......................................        -68        -85        -84        -84        -84        -84        -83        -83        -25       -829       -405     -1,510

                                                    NET INCREASE OR DECREASE (-) IN THE DEFICIT FROM CHANGES IN DIRECT SPENDING AND RECEIPTS

Impact on Deficit...........................................         71         34         26         38       -293        408         76         88        160       -630       -123       -22
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Sources: Congressional Budget Office and the staff of the Joint Committee on Taxation.
Note: Components may not sum to totals because of rounding. ATPA = Andean Trade Preference Act; COBRA = Consolidated Omnibus Budget Reconciliation Act.
aIn addition, CBO estimates that implementing the provisions of H.R. 3078 would have a discretionary cost of $4 million over the 2012-2016 period, assuming appropriation of the necessary
  amounts.

    This estimate includes the effects of increased imports 
from Colombia that would result from the reduced prices of 
imported products in the United States, reflecting the lower 
tariff rates. It is likely that some of the increase in U.S. 
imports from Colombia would displace imports from other 
countries. In the absence of specific data on the extent of 
this substitution effect, CBO assumes that an amount equal to 
one-half of the increase in U.S. imports from Colombia would 
displace imports from other countries.
    The Generalized System of Preferences, which allows duty-
free importation of a wide range of products from 129 
countries, including Colombia, expired on December 31, 2010. If 
those preferences were extended through July 13, 2013, in other 
legislation enacted prior to H.R. 3078 (such as in H.R. 2832 as 
passed by the Senate on September 22, 2011), then the revenue 
loss from implementing the tariff reductions in H.R. 3078 would 
be reduced by $6 million over the 2012-2021 period, to $1.378 
billion instead of $1.384 billion.
    Under H.R. 3078, the ATPA trade preferences, which expired 
on February 12, 2011, would be extended, retroactively, for 
each of the beneficiary countries: Colombia and Ecuador. (The 
free trade agreement with Peru supersedes that country's ATPA 
preferences. Bolivia, which had been a member country in 
previous years, had its eligibility revoked in June 2009.) The 
preferences would be extended from February 12, 2011, through 
July 31, 2013, with Colombia losing its eligibility for ATPA 
preferences upon enactment of the trade promotion agreement. 
CBO estimates that the retroactive extension of the ATPA 
preferences, including removing Colombia for eligibility, would 
reduce revenues from customs duties by $84 million in 2012, 
including refunds of duties paid by importers in 2011, and $19 
million in 2013, net of income and payroll tax offsets.
    H.R. 3078 also would shift payments of corporate estimated 
taxes between fiscal years 2016 and 2017. For corporations with 
at least $1 billion in assets, the bill would increase the 
portion of corporate estimated payments due from July through 
September of 2016. JCT estimates that this change would 
increase revenues by $344 million in 2016 and decrease revenues 
by $344 million in 2017.

                            DIRECT SPENDING

    Under current law, user fees collected by CBP will expire 
in January of 2020.The bill would permit CBP to collect COBRA 
fees (which were established in the Consolidated Omnibus Budget 
reconciliation Act of 1985) from December 9, 2020, through 
August 31, 2021, and to collect merchandise processing fees 
from August 3, 2021, through September 30, 2021. CBO estimates 
that those changes would increase offsetting receipts (a credit 
against direct spending) by about $750 million in 2021.
    Under current law, certain travelers arriving in the United 
States from Mexico, Canada, and some Caribbean countries are 
exempt from paying COBRA fees; the bill would remove this 
exemption. CBO estimates that this would increase offsetting 
receipts by about $1 billion over the 2012-2021 period.
    In addition, the bill would exempt imports from Colombia 
from merchandise processing fees. CBO estimates that this would 
reduce offsetting receipts by about $130 million over the five-
year period and by $245 million over the 10-year period.

                   SPENDING SUBJECT TO APPROPRIATION

    Implementing provisions of H.R. 3078 would increase the 
costs of several agencies affected by the bill including:
          The Department of Commerce to provide 
        administrative support for dispute-settlement panels 
        established in the agreement,
          The International Trade Commission to conduct 
        investigations, if petitioned, into whether Colombian 
        imports might threaten or cause serious injury to 
        domestic competitors, and
          The Department of Treasury and the United 
        States Trade Representative to establish regulations to 
        carry out provisions of the agreement.
    Based on information from the agencies, CBO estimates that 
these activities would cost $4 million over the 2012-2016 
period, assuming appropriation of the necessary amounts.
    Pay-as-you-go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays and revenues that are 
subject to those pay-as-you-go procedures are shown in the 
following table.

                               CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 3078 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON OCTOBER 5, 2011
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                           By fiscal year, in millions of dollars--
                                                             -----------------------------------------------------------------------------------------------------------------------------------
                                                                 2012       2013       2014       2015       2016       2017       2018       2019       2020       2021    2012-2016  2012-2021
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           NET INCREASE OR DECREASE (-) IN THE DEFICIT

Statutory Pay-As-You-Go Impact..............................         71         34         26         38       -293        408         76         88        160       -630       -123        -22
Memorandum:
    Changes in Revenues.....................................       -139       -119       -110       -122        209       -492       -159       -171       -185       -199       -282     -1,488
    Changes in Outlays......................................        -68        -85        -84        -84        -84        -84        -83        -83        -25       -829       -405     -1,510
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

    Estimated impact on State, Local, and Tribal Governments: 
CBO has determined that the nontax provisions of H.R. 3078 
contain no intergovernmental mandates as defined in UMRA, and 
would impose no costs on state, local, or tribal governments. 
JCT has determined that the tax provision of the bill contains 
no intergovernmental mandates as defined in UMRA.
    Estimated impact on the private sector: CBO has determined 
that the nontax provisions of H.R. 3078 would impose private-
sector mandates, as defined in UMRA, by extending the customs 
user fees, increasing merchandise processing fees, and by 
enforcing new record-keeping requirements. CBO estimates that 
the aggregate costs of those mandates would exceed the annual 
threshold established in UMRA for private-sector mandates ($142 
million in 2011, adjusted annually for inflation). JCT has 
determined that the tax provision of H.R. 3078 contains no 
private-sector mandates as defined in UMRA.
    Estimate prepared by: Federal Revenues: Kalyani 
Parthasarathy; Federal Spending: Sunita D'Monte, Mark 
Grabowicz, Matthew Pickford, and Susan Willie; Impact on State, 
Local, and Tribal Governments: Lisa Ramirez-Branum; Impact on 
the Private Sector: Marin Randall.
    Estimate approved by: Peter H. Fontaine, Assistant Director 
for Budget Analysis; and Frank Sammartino, Assistant Director 
for Tax Analysis.

                    D. Macroeconomic Impact Analysis

    In compliance with clause 3(h)(2) of rule XIII of the Rules 
of the House of Representatives, the following statement is 
made by the Joint Committee on Taxation with respect to the 
provisions of the bill amending the Internal Revenue Code of 
1986: the effects of the tax provisions of the bill on economic 
activity are so small as to be incalculable within the context 
of a model of the aggregate economy.

   V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE OF 
                            REPRESENTATIVES

          A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives (relating to oversight findings), 
the Committee concluded that it is appropriate and timely to 
consider H.R. 3078, as reported.

        B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the performance goals and 
objectives of the part of this legislation that authorizes 
funding are for (a) the payment of the U.S. share of the 
expenses incurred in dispute settlement proceedings established 
under Chapter 21 of the U.S.-Colombia Trade Promotion Agreement 
and (b) the establishment and operation of an office within the 
Department of Commerce responsible for providing assistance to 
the panels in such proceedings.

              C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (P.L. 104-4). The 
Committee has determined that the revenue provisions of the 
bill do not impose a Federal mandate on the private sector. The 
Committee has determined that the revenue provisions of the 
bill do not impose a Federal intergovernmental mandate on 
State, local, or tribal governments.

                D. Applicability of House Rule XXI 5(b)

    Clause 5(b) of rule XXI of the Rules of the House of 
Representatives provides, in part, ``A bill or joint 
resolution, amendment, or conference report carrying a Federal 
income tax increase may not be considered as passed or agreed 
to unless so determined by a vote of not less than three-fifths 
of the Members voting, a quorum being present.'' The Committee 
has carefully reviewed the sections of the bill and states that 
the bill does not involve any Federal income tax rate increases 
within the meaning of the rule.

                       E. Tax Complexity Analysis

    The Joint Committee on Taxation, in consultation with the 
Internal Revenue Service and the Department of the Treasury, 
will provide a tax complexity analysis to Members of the 
Committee as soon as practicable after the report is filed.

  F. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the bill and states that the provisions of 
the bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

             VI. CHANGES IN EXISTING LAW MADE BY THE BILL, 
                              AS REPORTED

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

SECTION 13031 OF THE CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF 
                                  1985

SEC. 13031.   FEES FOR CERTAIN CUSTOMS SERVICES.

  (a) * * *
  (b) Limitations on Fees.--(1)(A) Except as provided in 
subsection (a)(5)(B) of this section, no fee may be charged 
under subsection (a) of this section for customs services 
provided in connection with--
          [(i) the arrival of any passenger whose journey--
                  [(I) originated in--
                          [(aa) Canada,
                          [(bb) Mexico,
                          [(cc) a territory or possession of 
                        the United States, or
                          [(dd) any adjacent island (within the 
                        meaning of section 101(b)(5) of the 
                        Immigration and Nationality Act (8 
                        U.S.C. 1101(b)(5))), or
                  [(II) originated in the United States and was 
                limited to--
                          [(aa) Canada,
                          [(bb) Mexico,
                          [(cc) territories and possessions of 
                        the United States, and
                          [(dd) such adjacent islands;]
          (i) the arrival of any passenger whose journey--
                  (I) originated in a territory or possession 
                of the United States; or
                  (II) originated in the United States and was 
                limited to territories and possessions of the 
                United States;

           *       *       *       *       *       *       *

  (20) No fee may be charged under subsection (a) (9) or (10) 
with respect to goods that qualify as originating goods under 
section 203 of the United States-Colombia Trade Promotion 
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.

           *       *       *       *       *       *       *

  (j) Effective Dates.--(1) * * *

           *       *       *       *       *       *       *

  (3)(A) * * *

           *       *       *       *       *       *       *

  (C)(i) Notwithstanding subparagraph (A), fees may be charged 
under paragraphs (9) and (10) of subsection (a) during the 
period beginning on August 3, 2021, and ending on September 30, 
2021.
  (ii) Notwithstanding subparagraph (B)(i), fees may be charged 
under paragraphs (1) through (8) of subsection (a) during the 
period beginning on December 9, 2020, and ending on August 31, 
2021.

           *       *       *       *       *       *       *

                              ----------                              

TARIFF ACT OF 1930

           *       *       *       *       *       *       *

TITLE IV--ADMINISTRATIVE PROVISIONS

           *       *       *       *       *       *       *

Part III--Ascertainment, Collection, and Recovery of Duties

           *       *       *       *       *       *       *

SEC. 508.   RECORDKEEPING.

  (a) * * *

           *       *       *       *       *       *       *

  (j) Certifications of Origin for Goods Exported Under the 
United States-Colombia Trade Promotion 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) the purchase, cost, and value 
                        of, and payment for, all materials, 
                        including indirect materials, used in 
                        the production of the good; and
                          (iii) the production of the good in 
                        the form in which it was exported.
                  (B) CTPA certification of origin.--The term 
                ``CTPA certification of origin'' means the 
                certification established under article 4.15 of 
                the United States-Colombia Trade Promotion 
                Agreement that a good qualifies as an 
                originating good under such Agreement.
          (2) Exports to colombia.--Any person who completes 
        and issues a CTPA certification 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 certification 
        or copies thereof).
          (3) Retention period.--The person who issues a CTPA 
        certification of origin shall keep the records and 
        supporting documents relating to that certification of 
        origin for a period of at least 5 years after the date 
        on which the certification is issued.

           *       *       *       *       *       *       *

SEC. 514.   PROTEST AGAINST DECISIONS OF THE CUSTOMS SERVICE.

  (a) * * *

           *       *       *       *       *       *       *

  (k) Denial of Preferential Tariff Treatment Under the United 
States-Colombia Trade Promotion Agreement.--If U.S. Customs and 
Border Protection or U.S. Immigration and Customs Enforcement 
of the Department of Homeland Security finds indications of a 
pattern of conduct by an importer, exporter, or producer of 
false or unsupported representations that goods qualify under 
the rules of origin provided for in section 203 of the United 
States-Colombia Trade Promotion Agreement Implementation Act, 
U.S. Customs and Border Protection, in accordance with 
regulations issued by the Secretary of the Treasury, may 
suspend preferential tariff treatment under the United States-
Colombia Trade Promotion Agreement to entries of identical 
goods covered by subsequent representations by that importer, 
exporter, or producer until U.S. Customs and Border Protection 
determines that representations of that person are in 
conformity with such section 203.

           *       *       *       *       *       *       *

SEC. 520.   REFUNDS AND ERRORS.

  (a) * * *

           *       *       *       *       *       *       *

  (d) Goods Qualifying Under Free Trade Agreement Rules of 
Origin.--Notwithstanding the fact that a valid protest was not 
filed, the Customs Service may, in accordance with regulations 
prescribed by the Secretary, reliquidate an entry to refund any 
excess duties (including any merchandise processing fees) paid 
on a good qualifying under the rules of origin set out in 
section 202 of the North American Free Trade Agreement 
Implementation Act, section 202 of the United States-Chile Free 
Trade Agreement Implementation Act, section 203 of the 
Dominican Republic-Central America-United States Free Trade 
Agreement Implementation Act, section 202 of the United States-
Oman Free Trade Agreement Implementation Act, [or]   section 
203 of the United States-Peru Trade Promotion Agreement 
Implementation Act [for which], or section 203 of the United 
States-Colombia Trade Promotion Agreement Implementation Act 
for which no claim for preferential tariff treatment was made 
at the time of importation if the importer, within 1 year after 
the date of importation, files, in accordance with those 
regulations, a claim that includes--
          (1) * * *

           *       *       *       *       *       *       *

Part V--Enforcement Provisions

           *       *       *       *       *       *       *

SEC. 592.   PENALTIES FOR FRAUD, GROSS NEGLIGENCE, AND NEGLIGENCE.

  (a) * * *

           *       *       *       *       *       *       *

  (c) Maximum Penalties.--
          (1) * * *

           *       *       *       *       *       *       *

          (12) Prior disclosure regarding claims under the 
        united states-colombia trade promotion 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 203 
        of the United States-Colombia Trade Promotion Agreement 
        Implementation Act if the importer, in accordance with 
        regulations issued by the Secretary of the Treasury, 
        promptly and voluntarily makes a corrected declaration 
        and pays any duties owing with respect to that good.

           *       *       *       *       *       *       *

  (k) False Certifications of Origin Under the United States-
Colombia Trade Promotion 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 CTPA 
        certification of origin (as defined in section 508 of 
        this Act) that a good exported from the United States 
        qualifies as an originating good under the rules of 
        origin provided for in section 203 of the United 
        States-Colombia Trade Promotion 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) Prompt and voluntary disclosure of incorrect 
        information.--No penalty shall be imposed under this 
        subsection if, promptly after an exporter or producer 
        that issued a CTPA certification of origin has reason 
        to believe that such certification 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 certification 
        was issued.
          (3) Exception.--A person shall not be considered to 
        have violated paragraph (1) if--
                  (A) the information was correct at the time 
                it was provided in a CTPA certification of 
                origin but was later rendered incorrect due to 
                a change in circumstances; and
                  (B) the person promptly and voluntarily 
                provides written notice of the change in 
                circumstances to all persons to whom the person 
                provided the certification.

           *       *       *       *       *       *       *

                              ----------                              

TRADE ACT OF 1974

           *       *       *       *       *       *       *

       TITLE II--RELIEF FROM INJURY CAUSED BY IMPORT COMPETITION

CHAPTER 1--POSITIVE ADJUSTMENT BY INDUSTRIES INJURED BY IMPORTS

           *       *       *       *       *       *       *

SEC. 202.   INVESTIGATIONS, DETERMINATIONS, AND RECOMMENDATIONS BY 
                    COMMISSION.

  (a) Petitions and Adjustment Plans.--
          (1) * * *

           *       *       *       *       *       *       *

          (8) The procedures concerning the release of 
        confidential business information set forth in section 
        332(g) of the Tariff Act of 1930 shall apply with 
        respect to information received by the Commission in 
        the course of investigations conducted under this 
        chapter, part 1 of title III of the North American Free 
        Trade Agreement Implementation Act, title II of the 
        United States-Jordan Free Trade Area Implementation 
        Act, title III of the United States-Chile Free Trade 
        Agreement Implementation Act, title III of the United 
        States-Singapore Free Trade Agreement Implementation 
        Act, title III of the United States-Australia Free 
        Trade Agreement Implementation Act, title III of the 
        United States-Morocco Free Trade Agreement 
        Implementation Act, title III of the Dominican 
        Republic-Central America-United States Free Trade 
        Agreement Implementation Act, title III of the United 
        States-Bahrain Free Trade Agreement Implementation Act, 
        title III of the United States-Oman Free Trade 
        Agreement Implementation Act, [and] title III of the 
        United States-Peru Trade Promotion Agreement 
        Implementation Act, and title III of the United States-
        Colombia Trade Promotion Agreement Implementation Act. 
        The Commission may request that parties providing 
        confidential business information furnish 
        nonconfidential summaries thereof or, if such parties 
        indicate that the information in the submission cannot 
        be summarized, the reasons why a summary cannot be 
        provided. If the Commission finds that a request for 
        confidentiality is not warranted and if the party 
        concerned is either unwilling to make the information 
        public or to authorize its disclosure in generalized or 
        summarized form, the Commission may disregard the 
        submission.

           *       *       *       *       *       *       *

                              ----------                              

TRADE AGREEMENTS ACT OF 1979

           *       *       *       *       *       *       *

TITLE III--GOVERNMENT PROCUREMENT

           *       *       *       *       *       *       *

SEC. 308.   DEFINITIONS.

   As used in this title--
          (1) * * *

           *       *       *       *       *       *       *

          (4) Eligible products.--
                  (A) In general.--The term ``eligible 
                product'' means, with respect to any foreign 
                country or instrumentality that is--
                          (i) * * *

           *       *       *       *       *       *       *

                          (vii) a party to the United States-
                        Peru Trade Promotion Agreement, a 
                        product or service of that country or 
                        instrumentality which is covered under 
                        that agreement for procurement by the 
                        United States.

           *       *       *       *       *       *       *

                          (ix) a party to the United States-
                        Colombia Trade Promotion Agreement, a 
                        product or service of that country or 
                        instrumentality which is covered under 
                        that agreement for procurement by the 
                        United States.

           *       *       *       *       *       *       *

                              ----------                              

                      ANDEAN TRADE PREFERENCE ACT

TITLE II--TRADE PREFERENCE FOR THE ANDEAN REGION

           *       *       *       *       *       *       *

SEC. 204.   ELIGIBLE ARTICLES.

  (a) * * *
  (b) Exceptions and Special Rules.--
          (1) * * *

           *       *       *       *       *       *       *

          (3) Apparel articles and certain textile articles.--
                  (A) * * *
                  (B) Covered articles.--The apparel articles 
                referred to in subparagraph (A) are the 
                following:
                          (i) * * *

           *       *       *       *       *       *       *

                          (iii) Apparel articles assembled in 1 
                        or more atpdea beneficiary countries 
                        from regional fabrics or regional 
                        components.--(I) * * *
                          (II) The preferential treatment 
                        referred to in subclause (I) shall be 
                        extended in the 1-year period beginning 
                        October 1, 2002, and in each of the [8 
                        succeeding 1-year periods] 10 
                        succeeding 1-year periods, to imports 
                        of apparel articles in an amount not to 
                        exceed the applicable percentage of the 
                        aggregate square meter equivalents of 
                        all apparel articles imported into the 
                        United States in the preceding 12-month 
                        period for which data are available.
                          (III) For purposes of subclause (II), 
                        the term ``applicable percentage'' 
                        means--
                                  (aa) * * *
                                  (bb) for the 1-year period 
                                beginning October 1, 2007, [and 
                                for the succeeding 3-year 
                                period] and for the succeeding 
                                5-year period, the percentage 
                                determined under item (aa) for 
                                the 1-year period beginning 
                                October 1, 2006.

           *       *       *       *       *       *       *

                          (v) Certain other apparel articles.--
                                  (I) * * *
                                  (II) Limitation.--During the 
                                1-year period beginning on 
                                October 1, 2003, and during 
                                each of the [7 succeeding 1-
                                year periods] 9 succeeding 1-
                                year periods, apparel articles 
                                described in subclause (I) of a 
                                producer or an entity 
                                controlling production shall be 
                                eligible for preferential 
                                treatment under this paragraph 
                                only if the aggregate cost of 
                                fabrics (exclusive of all 
                                findings and trimmings) formed 
                                in the United States that are 
                                used in the production of all 
                                such articles of that producer 
                                or entity that are entered and 
                                eligible under this clause 
                                during the preceding 1-year 
                                period is at least 75 percent 
                                of the aggregate declared 
                                customs value of the fabric 
                                (exclusive of all findings and 
                                trimmings) contained in all 
                                such articles of that producer 
                                or entity that are entered and 
                                eligible under this clause 
                                during the preceding 1-year 
                                period.

           *       *       *       *       *       *       *

                  (E) Bilateral emergency actions.--
                          (i) * * *
                          (ii) Rules relating to bilateral 
                        emergency action.--For purposes of 
                        applying bilateral emergency action 
                        under this subparagraph--
                                  (I) * * *
                                  (II) the term ``transition 
                                period'' in section 4 of the 
                                Annex shall mean the period 
                                ending [February 12, 2011] July 
                                31, 2013; and

           *       *       *       *       *       *       *

SEC. 208.   TERMINATION OF PREFERENTIAL TREATMENT.

  (a) In General.--No duty-free treatment or other preferential 
treatment extended to beneficiary countries under this title 
shall--
          (1) remain in effect--
                  (A) with respect to Colombia after [February 
                12, 2011] July 31, 2013; and

           *       *       *       *       *       *       *

          (2) remain in effect with respect to Ecuador after 
        June 30, 2009, except that duty-free treatment and 
        other preferential treatment under this title shall 
        remain in effect with respect to Ecuador during the 
        period beginning on July 1, 2009, and ending on 
        [February 12, 2011] July 31, 2013, unless the President 
        reviews the criteria set forth in section 203, and on 
        or before June 30, 2009, reports to the Committee on 
        Finance of the Senate and the Committee on Ways and 
        Means of the House of Representatives pursuant to 
        subsection (b) that--
                  (A) * * *

           *       *       *       *       *       *       *

                         VII. DISSENTING VIEWS

                                Summary

    Colombia is an important ally in a vital region of the 
world. Congressional Democrats have worked to change the 
Colombia free trade agree (FTA) because we believed there was a 
course that could strengthen our economic ties and address 
persistent and pervasive violence against labor and other 
activists in Colombia, impunity for such acts, and extensive 
deficiencies in Colombia's labor laws.
    Congressional Democrats believe workers in Colombia need 
basic labor rights to improve their financial standing and 
climb the economic ladder. This is critical to increasing U.S. 
exports and jobs. The development of a middle class creates 
consumers and robust markets for our products and services. It 
is also vitally important to U.S. workers who are correct in 
asserting they should not unfairly compete with workers whose 
rights are suppressed.
    There are longstanding Democratic concerns regarding anti-
union violence, impunity, and deficient labor laws in Colombia:
       Pervasive Violence: The International Trade 
Union Confederation reported that in 2010, Colombia had more 
union worker assassinations--49--than the rest of the world 
combined.
       Impunity: In February 2011, the International 
Labor Organization (ILO) reported that ``the majority of the 
cases [of violence against workers] have not yet been 
investigated nor have the perpetrators, including the 
intellectual authors of these crimes, been brought to 
justice''.
       Serious Labor Law Deficiencies: The ILO has had 
long-standing concerns about the failure of Colombian laws to 
provide basic internationally-recognized worker rights. These 
include laws that: (1) let employers force workers into 
``cooperatives'' and other sham entities to avoid unions, (2) 
let employers by-pass unions and negotiate ``collective pacts'' 
directly with workers, and (3) impose broad restrictions on the 
right to strike.
    These serious concerns about worker rights have prevented 
consideration of the Colombia FTA.
    The Obama Administration negotiated a Labor ``Action Plan'' 
with the Colombian Government, but Republicans have refused to 
even reference this Action Plan in the implementing 
legislation. Given the lack of full implementation of the 
Action Plan to date, and without a provision explicitly linking 
implementation of the FTA to Colombia addressing anti-union 
violence, impunity and fundamentally deficient labor laws under 
the Action Plan, the legislation is fundamentally flawed.

                               Background

 A. CONCERNS ABOUT ANTI-UNION VIOLENCE, IMPUNITY, AND DEFICIENT LABOR 
                                  LAWS

    Concerns about violence against workers and their leaders, 
impunity for such violence, and labor law deficiencies have 
been at the heart of the debate regarding the Colombia FTA from 
the start. These concerns remain today.
    In terms of violence, the data show that, although union 
worker violence has trended downward since 2002, the number of 
murders remains extraordinarily high. See chart below. Indeed, 
according to the recently-released International Trade Union 
Confederation's Annual Survey of Violations of Trade Union 
Rights, in 2010 Colombia had more union worker assassinations 
than the rest of the world combined.

------------------------------------------------------------------------
                                    ENS (Colombian       Government of
              Year                Think Tank) Murder    Colombia Murder
                                         Count               Count
------------------------------------------------------------------------
2000............................                134                 105
2001............................                194                 205
2002............................                183                 196
2003............................                 92                  94
2004............................                 96                  89
2005............................                 70                  40
2006............................                 72                  60
2007............................                 39                  31
2008............................                 49                  42
2009............................                 40                  25
2010............................                 51                  36
------------------------------------------------------------------------

    Moreover, the perpetrators of such violence in Colombia 
enjoy near-universal impunity. As noted by Human Rights Watch, 
the Colombian Attorney General's office charged with 
prosecuting these crimes has obtained just six convictions from 
195 union murders that occurred between January 2007 and May 
2011. Roughly nine in 10 of the subunit's cases from that 
period of time are still in the preliminary stage with no 
suspect formally identified.
    We recognize that Colombia has undergone a significant 
period of overall violence. However, systemic unaddressed 
violence against workers and individuals associated with unions 
has fundamental implications for worker rights in Colombia. The 
ILO has long recognized that ``a climate of violence in which 
the murder . . . of trade union leaders go unpunished 
constitutes a serious obstacle to the exercise of trade union 
rights . . .''\1\
---------------------------------------------------------------------------
    \1\ILO General Survey on Freedom of Association and Collective 
Bargaining, 1994, paras. 26-29. See also Digest of Decisions and 
Principles of the Freedom of Association Committee of the Governing 
Body of the ILO, Fifth (revised) edition, 2006, paras. 42-6.
---------------------------------------------------------------------------
    Serious deficiencies in Colombia's labor laws--and in their 
enforcement--further contribute to the suppression of worker 
rights. For example, both the ILO and the U.S. State Department 
detail extensive concerns about laws that: (1) let employers 
force workers into ``cooperatives'' and other sham entities to 
avoid unions, (2) let employers by-pass unions and negotiate 
``collective pacts'' directly with workers, and (3) impose 
broad restrictions on the right to strike. Moreover, a high-
level ILO mission to Colombia in February 2011 noted, with 
``deep concern,'' the ``repeated and detailed information it 
received concerning acts of anti-union discrimination at the 
enterprise level and in the public sector as well as the 
failure to take effective action to stop it.''

    B. Renegotiation to Include Fundamental Labor Standards and the 
      Agreement on the ``Action Plan'' Were Critical Steps Forward

    From the start of FTA negotiations with Colombia, Democrats 
have insisted that the problems of violence, impunity, and 
labor law deficiencies would have to be effectively addressed 
and that the flawed ``enforce-your-own-laws'' approach of 
earlier trade agreements could not simply be imported. In 2007, 
with new majorities in Congress, Democrats were able to move in 
this direction. Pursuant to the ``May 10'' agreement, House 
Democrats pushed President Bush to re-open the Colombia FTA (as 
well as the Peru, Panama, and Korea FTAs) to include critical 
new text. This new text included a fully enforceable commitment 
that FTA countries adopt, maintain, and enforce in their laws 
and practice the five basic international labor standards, 
including freedom of association and the right to collective 
bargaining.
    The incorporation of these fundamental labor standards was 
a significant step forward. At the same time, reflecting the 
unique challenges presented in Colombia's case, the May 10 
agreement referred to, and included, a letter from Ways and 
Means Democratic leaders stating that:

          Colombia has special problems and considerations . . 
        . including the systemic, persistent violence against 
        trade unionists and other human rights defenders, the 
        related problem of impunity . . . Congress and the 
        Administration must work with the Government of 
        Colombia on these serious problems to determine what 
        additional steps can be taken to allow for 
        consideration of the FTA.

    Under the new Administration led by President Obama, U.S. 
Trade Representative Ronald Kirk echoed the same concerns. In 
February 9, 2011 testimony before the Ways and Means Committee, 
Ambassador Kirk stated that:

          There remain serious issues to be resolved before the 
        Colombia [FTA] . . . can be submitted for Congressional 
        consideration. . . . [I]t will be imperative to resolve 
        issues regarding laws and practices impacting the 
        protection of internationally-recognized labor rights, 
        as well as issues concerning violence against labor 
        leaders and the prosecution of the perpetrators.

    Picking up on years of detailed discussions between Ways 
and Means Democrats and the Colombian Administration led by 
then-President Alvaro Uribe--which unfortunately yielded few 
results--the Obama Administration began intensive discussions 
with the new Colombian Administration of President Santos. 
President Santos had signaled a serious intent to address the 
issues of labor rights and violence and impunity. And, on April 
7, 2011, the discussions between the U.S. and Colombian 
Administrations resulted in the negotiation of an additional 
agreement--the labor ``Action Plan''--prescribing specific 
steps to address the problems of violence, impunity, and labor 
law deficiencies in Colombia and establishing deadlines for 
completion of the steps.
    The Obama Administration made clear that the Action Plan 
was an agreement between Colombia and the United States entered 
into to clear the way for movement on the FTA. For example, in 
comments dated April 28, 2011, U.S. Trade Representative Kirk 
stated that ``[l]ast month, President Obama and President 
Santos agreed to an Action Plan Related to Labor Rights that 
will allow us to move forward with the U.S. Colombia trade 
agreement.'' (emphasis added). Similarly, in a June 13, 2011 
press release, USTR explained that ``The Obama Administration 
negotiated the Action Plan to address concerns related to the 
U.S.-Colombia trade agreement.''
    The May 10 agreement, together with effective 
implementation of the specific commitments under the Action 
Plan held the promise of addressing the issues of violence, 
impunity, and labor law deficiencies that had held up 
Congressional consideration of the Colombia FTA. The critical 
question, however, was whether Colombia could effectively 
implement the Action Plan, or whether the vested interests that 
had successfully thwarted reform in Colombia in the past would 
do so again.

C. FAILURE TO ESTABLISH A LINK BETWEEN THE FTA AND THE ACTION PLAN IS A 
      FUNDAMENTAL MISTAKE AND A STEP BACKWARDS FROM PAST PRECEDENT

    Given the central relevance of the Action Plan commitments 
to moving forward with the Colombia FTA, and the importance of 
Colombia effectively meeting those commitments, Democrats 
proposed at the informal markup of the Colombia FTA 
implementing bill that a link be established between the FTA 
and the Action Plan. The amendment offered by Ranking Member 
Levin would have including a provision in the FTA implementing 
bill conditioning the FTA's entry into force on Colombia's 
meaningful implementation of Action Plan commitments (as of the 
time Colombia was otherwise ready for entry into force).
    The proposed amendment received the unanimous support of 
Ways and Means Democrats (and an identical amendment was 
proposed in the Senate Finance Committee). Unfortunately, due 
apparently to rigid ideological opposition, our Republican 
colleagues blocked the amendment. Indeed, they have rejected 
including even any mention of the Action Plan in the Colombia 
FTA implementing legislation.
    This is a fundamental mistake. The proposed amendment 
served a number of important objectives. First, it would 
provide additional leverage--including to reformers in 
Colombia--to ensure meaningful compliance with the Action Plan 
commitments. Second, it would create additional time for 
monitoring Colombia's implementation, addressing the concerns 
of many Members that the vote on the FTA was happening 
prematurely. Third, it would have helped flesh out the worker 
rights commitments in the Labor Chapter of the FTA, providing 
valuable context in the event of future labor disputes under 
the FTA. At the same time, the proposed amendment would have 
done nothing to slow down passage of the FTA or its 
implementation--meeting the interests of those in Congress 
primarily concerned with quick action.
    Moreover, the proposed amendment is fully consistent with 
past precedent. For example, in the NAFTA implementing bill, 
President Clinton included a provision explicitly linking 
``entry into force'' of NAFTA to implementation of separate 
labor and environmental side agreements, to help ensure that 
Mexico and Canada followed through in adopting the (deficient) 
side agreements. This situation is analogous--indeed, the case 
is substantially stronger here because the Colombia FTA 
actually includes meaningful labor obligations whereas NAFTA 
did not.\2\ Failure to include the proposed amendment in the 
Colombia FTA implementing bill, therefore, is not only a 
mistake, it is a significant step backwards from past 
precedent.
---------------------------------------------------------------------------
    \2\There is also another analogous precedent with more recent trade 
agreements. For example, the Bush Administration, in the CAFTA 
implementing bill, included extensive labor reporting requirements 
related to the CAFTA and a separate ``White Paper'' on labor.
---------------------------------------------------------------------------

 D. LACK OF MEANINGFUL IMPLEMENTATION TO DATE CONFIRMS THE NEED FOR A 
    LINK BETWEEN THE ACTION PLAN COMMITMENTS AND FTA IMPLEMENTATION

    The need for including a mechanism to link implementation 
of the FTA to Colombia meaningfully meeting its commitments 
under the Action Plan is becoming all the more apparent given 
the increasing evidence of weak implementation over the last 
five months. The following examples demonstrate precisely the 
need to link the Action Plan to implementation of the FTA:
           Abuse of Cooperatives and Other Contractual 
        Employment Relationships. The ILO has long identified, 
        as one of the most serious problems facing Colombian 
        workers, the use of sham ``cooperatives'' and other 
        such contract forms to camouflage true employment 
        relationships and thwart workers' efforts to organize. 
        (In Colombia, only workers who are directly employed 
        can form a union and collectively bargain.) Colombia 
        initially committed to stop such abuses, passing far-
        reaching legislation and proposing effective 
        regulations. In recent months, however, Colombia has 
        backed away, reading the new law and regulations as 
        applying solely to one of these contract forms 
        (cooperatives), and thus creating massive loopholes. 
        Immediately, Colombian employers, including a major 
        beverage company and palm oil producers, began 
        converting cooperatives to other contract forms to 
        continue denying workers their basic rights. Although 
        there was private pressure for months by the U.S. 
        government on Colombia to clarify the law, to try to 
        stem this problematic shift, it was not until midnight 
        on October 4--hours before a Ways and Means Committee 
        markup and once a significant public spotlight was 
        shone on the matter--that Colombia issued a 
        ``clarification.'' And this clarification fails to 
        restore the scope of the laws and regulations, leaving 
        major loopholes.
           Union-Related Violence and Impunity. 
        President Santos' commitment to ending impunity has not 
        translated into results. According to Human Rights 
        Watch, Colombian authorities have obtained just six 
        convictions for 195 union murders that occurred between 
        January 2007 and May 2011. Roughly 9 in 10 of the cases 
        from that period are still in the preliminary stage 
        with no suspect formally identified. Notwithstanding 
        clear commitments under the Action Plan to improve this 
        situation through reforms in investigative policies and 
        methods, Colombia did not take the first step to do 
        this--publication of an analysis of closed union murder 
        cases--until October 3, the eve of the Ways and Means 
        markup, even though the Action Plan called for its 
        completion on July 15. And even with this, it is clear 
        that additional leverage is necessary. Interviews by 
        Human Rights Watch with Colombian prosecutors reveal 
        that there has been no clear direction to implement new 
        policies and methods, as committed to under the Action 
        Plan.
           Threats Against Teachers. Teachers are an 
        especially vulnerable population in Colombia. To 
        address violence and threats against this population, 
        Colombia committed to strengthen the teacher protection 
        program to ``ensure that meritorious requests [for 
        protection] are granted'', which entails relocating the 
        teachers. But, five months after the announcement of 
        the Action Plan, Colombia is far from meeting the 
        commitment. Indeed, a recent report shows that 224 of 
        648 teachers found by the government to be 
        ``threatened''--more than one-third of the most 
        vulnerable members of this population--have yet to be 
        relocated.
           Bypassing Restrictions on Collective Pacts. 
        Colombian employers can bypass unions whenever unions 
        are small (one-third of workers or less), and can 
        negotiate wages and benefits--``collective pacts''--
        directly with non-union workers. The ILO has found that 
        this severely undermines unions and called on Colombia 
        to bar collective pacts in unionized workplaces. While 
        the Action Plan did not adopt this recommendation, it 
        did require Colombia to criminalize the offering of 
        better terms under a collective pact than under a union 
        agreement. But even that minimal requirement is not 
        being meaningfully implemented. Colombian employers are 
        being allowed to circumvent the law simply by renaming 
        the pacts (e.g., as ``voluntary benefit agreements'').
           Overbroad Restrictions on Strike. Colombia 
        prohibits strikes in an over-broad range of sectors 
        designated ``essential'' by law, including its oil 
        sector. While the ILO has called on Colombia to narrow 
        its list, the Action Plan did not require it to do so. 
        Instead, it simply required Colombia to publish a 
        summary of the relevant court decisions. Unfortunately, 
        that summary reveals that Colombian courts have broad 
        latitude to add sectors to the list, and that they have 
        done exactly that, rendering Colombian law even more 
        inconsistent with international norms.
           Lack of Enforcement of Penal Sanctions for 
        Anti-Union Conduct. In June 2011, pursuant to the 
        Action Plan, Colombia passed legislation attaching 
        prison sentences to acts to impede or disrupt the 
        exercise of labor rights. Earlier Colombian laws 
        criminalized the same acts but applied only fines, and 
        these fines were rarely imposed. Whether the new law 
        will deter anti-union conduct hinges on whether 
        Colombia's Prosecutor General is active in prosecuting 
        cases and seeking jail time for employer offenders. To 
        date, no such cases have been reported.
           Lack of Meaningful Consultation with 
        Stakeholders. Colombia has engaged in only cursory 
        efforts to engage stakeholders in implementation and 
        enforcement, even when the Action Plan contemplates 
        meaningful engagement. For example, notwithstanding a 
        commitment to meet ``periodically'' with ENS--the 
        leading Colombian labor think tank--to reconcile 
        differing union homicide lists, the Colombian 
        government has only held one such meeting, in which it 
        demanded that ENS accept the government list. 
        Similarly, Colombia has not consulted unions in 
        developing a request for expanded ILO presence, making 
        it more likely that the mission will be unsuccessful in 
        bringing Colombian labor law and practice into 
        compliance with ILO norms.
                                   Sander Levin.
                                   Jim McDermott.
                                   John Lewis.
                                   Pete Stark.
                                   Shelley Berkley.
                                   Xavier Becerra.
                                   John B. Larson.
                                   Richard E. Neal.
                                   Bill Pascrell, Jr.
                                   Charles B. Rangel.
                                   Earl Blumenauer.

                                  

```