19–006 

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 


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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 tarVerDate Mar 15 2010 07:07 Oct 07, 2011 Jkt 019006 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\HR237.XXX HR237

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iff 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 


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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 


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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. 


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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 


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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 


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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. 


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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 


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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. 


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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. 


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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. 


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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-counVerDate Mar 15 2010 07:07 Oct 07, 2011 Jkt 019006 PO 00000 Frm 00013 Fmt 6659 Sfmt 6602 E:\HR\OC\HR237.XXX HR237

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try 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 TREAT- MENT

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 


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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. 


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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 necVerDate Mar 15 2010 07:07 Oct 07, 2011 Jkt 019006 PO 00000 Frm 00016 Fmt 6659 Sfmt 6602 E:\HR\OC\HR237.XXX HR237

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essary 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 workVerDate Mar 15 2010 07:07 Oct 07, 2011 Jkt 019006 PO 00000 Frm 00017 Fmt 6659 Sfmt 6602 E:\HR\OC\HR237.XXX HR237

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ers 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. 


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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. 


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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 


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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. 


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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. 


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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. 


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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. 


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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 StatesColombia 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. 


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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. 


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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 SPENDING a

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 Spending a.

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. a In 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. 


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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 


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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-asyou-go procedures are shown in the following table. 


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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 


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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. 


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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— 

ø(i) the arrival of any passenger whose journey— 

ø(I) originated in— 

ø(aa) Canada, 


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ø(bb) Mexico, 

ø(cc) a territory or possession of the United States, 

or 

ø(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 

ø(II) originated in the United States and was limited 

to— 

ø(aa) Canada, 

ø(bb) Mexico, 

ø(cc) territories and possessions of the United 

States, and 

ø(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) * * * 

* * * * * * * 


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(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. 

* * * * * * * 


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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, øor¿ section 203 of the United States-Peru 

Trade Promotion Agreement Implementation Act øfor 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 


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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 IN- FORMATION.—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 StatesVerDate Mar 15 2010 07:07 Oct 07, 2011 Jkt 019006 PO 00000 Frm 00036 Fmt 6659 Sfmt 6601 E:\HR\OC\HR237.XXX HR237

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Oman Free Trade Agreement Implementation Act, øand¿ 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.— 


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(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 FAB- RICS 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 ø8 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, øand 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 ø7 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) * * * 


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(ii) RULES RELATING TO BILATERAL EMERGENCY AC- TION.—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 øFebruary 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 øFebruary 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 øFebruary 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) * * * 

* * * * * * * 


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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 antiunion 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. 


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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. 

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. 

Year 

ENS (Colombian 

Think Tank) Murder 

Count 

Government of 

Colombia Murder 

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

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 inforVerDate Mar 15 2010 07:07 Oct 07, 2011 Jkt 019006 PO 00000 Frm 00041 Fmt 6604 Sfmt 6602 E:\HR\OC\HR237.XXX HR237

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mation 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 thenPresident 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 


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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 


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2There 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. 

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. 

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 


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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 onethird 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 (onethird 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 


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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. 

Æ 


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