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[107th Congress Public Law 210]
[From the U.S. Government Printing Office]

<DOC>
[DOCID: f:publ210.107]

[[Page 116 STAT. 933]]

Public Law 107-210
107th Congress

                                 An Act

 
  To extend the Andean Trade Preference Act, to grant additional trade 
    benefits under that Act, and for other purposes. <<NOTE: Aug. 6, 
                         2002 -  [H.R. 3009]>> 

    Be it enacted by the Senate and House of Representatives of the 
United States <<NOTE: Trade Act of 2002.>>  of America in Congress 
assembled,

SECTION 1. <<NOTE: 19 USC 3801 note.>> SHORT TITLE.

    This Act may be cited as the ``Trade Act of 2002''.

SEC. 2. ORGANIZATION OF ACT INTO DIVISIONS; TABLE OF CONTENTS.

    (a) Divisions.--This Act is organized into 5 divisions as follows:
            (1) Division a.--Trade Adjustment Assistance.
            (2) Division b.--Bipartisan Trade Promotion Authority.
            (3) Division c.--Andean Trade Preference Act.
            (4) Division d.--Extension of Certain Preferential Trade 
        Treatment and Other Provisions.
            (5) Division e.--Miscellaneous Provisions.

    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title.
Sec. 2. Organization of Act into divisions; table of contents.

                 DIVISION A--TRADE ADJUSTMENT ASSISTANCE

Sec. 101. Short title.

              TITLE I--TRADE ADJUSTMENT ASSISTANCE PROGRAM

           Subtitle A--Trade Adjustment Assistance For Workers

Sec. 111. Reauthorization of trade adjustment assistance program.
Sec. 112. Filing of petitions and provision of rapid response 
           assistance; expedited review of petitions by secretary of 
           labor.
Sec. 113. Group eligibility requirements.
Sec. 114. Qualifying requirements for trade readjustment allowances.
Sec. 115. Waivers of training requirements.
Sec. 116. Amendments to limitations on trade readjustment allowances.
Sec. 117. Annual total amount of payments for training.
Sec. 118. Provision of employer-based training.
Sec. 119. Coordination with title I of the Workforce Investment Act of 
           1998.
Sec. 120. Expenditure period.
Sec. 121. Job search allowances.
Sec. 122. Relocation allowances.
Sec. 123. Repeal of NAFTA transitional adjustment assistance program.
Sec. 124. Demonstration project for alternative trade adjustment 
           assistance for older workers.
Sec. 125. Declaration of policy; sense of Congress.

            Subtitle B--Trade Adjustment Assistance For Firms

Sec. 131. Reauthorization of program.

           Subtitle C--Trade Adjustment Assistance For Farmers

Sec. 141. Trade adjustment assistance for farmers.

[[Page 116 STAT. 934]]

Sec. 142. Conforming amendments.
Sec. 143. Study on TAA for fishermen.

                       Subtitle D--Effective Date

Sec. 151. Effective date.

   TITLE II--CREDIT FOR HEALTH INSURANCE COSTS OF ELIGIBLE INDIVIDUALS

Sec. 201. Credit for health insurance costs of individuals receiving a 
           trade readjustment allowance or a benefit from the Pension 
           Benefit Guaranty Corporation.
Sec. 202. Advance payment of credit for health insurance costs of 
           eligible individuals.
Sec. 203. Health insurance assistance for eligible individuals.

                   TITLE III--CUSTOMS REAUTHORIZATION

Sec. 301. Short title.

                Subtitle A--United States Customs Service

   Chapter 1--Drug Enforcement and Other Noncommercial and Commercial 
                               Operations

Sec. 311. Authorization of appropriations for noncommercial operations, 
           commercial operations, and air and marine interdiction.
Sec. 312. Antiterrorist and illicit narcotics detection equipment for 
           the United States-Mexico border, United States-Canada border, 
           and Florida and the Gulf Coast seaports.
Sec. 313. Compliance with performance plan requirements.

     Chapter 2--Child Cyber-smuggling Center of the Customs Service

Sec. 321. Authorization of appropriations for program to prevent child 
           pornography/child sexual exploitation.

                   Chapter 3--Miscellaneous Provisions

Sec. 331. Additional Customs Service officers for United States-Canada 
           Border.
Sec. 332. Study and report relating to personnel practices of the 
           Customs Service.
Sec. 333. Study and report relating to accounting and auditing 
           procedures of the Customs Service.
Sec. 334. Establishment and implementation of cost accounting system; 
           reports.
Sec. 335. Study and report relating to timeliness of prospective 
           rulings.
Sec. 336. Study and report relating to customs user fees.
Sec. 337. Fees for customs inspections at express courier facilities.
Sec. 338. National Customs Automation Program.
Sec. 339. Authorization of appropriations for customs staffing.

                   Chapter 4--Antiterrorism Provisions

Sec. 341. Immunity for United States officials that act in good faith.
Sec. 342. Emergency adjustments to offices, ports of entry, or staffing 
           of the customs service.
Sec. 343. Mandatory advanced electronic information for cargo and other 
           improved Customs reporting procedures.
Sec. 343A. Secure systems of transportation.
Sec. 344. Border search authority for certain contraband in outbound 
           mail.
Sec. 345. Authorization of appropriations for reestablishment of customs 
           operations in New York City.

               Chapter 5--Textile Transshipment Provisions

Sec. 351. GAO audit of textile transshipment monitoring by Customs 
           Service.
Sec. 352. Authorization of appropriations for textile transshipment 
           enforcement operations.
Sec. 353. Implementation of the African Growth and Opportunity Act.

      Subtitle B--Office of the United States Trade Representative

Sec. 361. Authorization of appropriations.

        Subtitle C--United States International Trade Commission

Sec. 371. Authorization of appropriations.

                   Subtitle D--Other trade provisions

Sec. 381. Increase in aggregate value of articles exempt from duty 
           acquired abroad by United States residents.

[[Page 116 STAT. 935]]

Sec. 382. Regulatory audit procedures.
Sec. 383. Payment of duties and fees.

            DIVISION B--BIPARTISAN TRADE PROMOTION AUTHORITY

                  TITLE XXI--TRADE PROMOTION AUTHORITY

Sec. 2101. Short title and findings.
Sec. 2102. Trade negotiating objectives.
Sec. 2103. Trade agreements authority.
Sec. 2104. Consultations and assessment.
Sec. 2105. Implementation of trade agreements.
Sec. 2106. Treatment of certain trade agreements for which negotiations 
           have already begun.
Sec. 2107. Congressional Oversight Group.
Sec. 2108. Additional implementation and enforcement requirements.
Sec. 2109. Committee staff.
Sec. 2110. Conforming amendments.
Sec. 2111. Report on impact of trade promotion authority.
Sec. 2112. Interests of small business.
Sec. 2113. Definitions.

                 DIVISION C--ANDEAN TRADE PREFERENCE ACT

                   TITLE XXXI--ANDEAN TRADE PREFERENCE

Sec. 3101. Short title.
Sec. 3102. Findings.
Sec. 3103. Articles eligible for preferential treatment.
Sec. 3104. Termination.
Sec. 3105. Report on Free Trade Agreement with Israel.
Sec. 3106. Modification of duty treatment for tuna.
Sec. 3107. Trade benefits under the caribbean basin economic recovery 
           act.
Sec. 3108. Trade benefits under the African Growth and Opportunity Act.

      DIVISION D--EXTENSION OF CERTAIN PREFERENTIAL TRADE TREATMENT

        TITLE XLI--EXTENSION OF GENERALIZED SYSTEM OF PREFERENCES

Sec. 4101. Extension of generalized system of preferences.
Sec. 4102. Amendments to generalized system of preferences.

                  DIVISION E--MISCELLANEOUS PROVISIONS

                  TITLE L--MISCELLANEOUS TRADE BENEFITS

                       Subtitle A--Wool Provisions

Sec. 5101. Wool provisions.
Sec. 5102. Duty suspension on wool.

                      Subtitle B--Other Provisions

Sec. 5201. Fund for WTO dispute settlements.
Sec. 5202. Certain steam or other vapor generating boilers used in 
           nuclear facilities.
Sec. 5203. Sugar tariff-rate quota circumvention.

  DIVISION A--TRADE <<NOTE: Trade Adjustment Assistance Reform Act of 
2002.>>  ADJUSTMENT ASSISTANCE

SEC. 101. SHORT <<NOTE: 19 USC 2101 note.>>  TITLE.

    This division may be cited as the ``Trade Adjustment Assistance 
Reform Act of 2002''.

[[Page 116 STAT. 936]]

              TITLE I--TRADE ADJUSTMENT ASSISTANCE PROGRAM

           Subtitle A--Trade Adjustment Assistance For Workers

SEC. 111. REAUTHORIZATION OF TRADE ADJUSTMENT ASSISTANCE PROGRAM.

    (a) Assistance for Workers.--Section 245 of the Trade Act of 1974 
(19 U.S.C. 2317) is amended by striking ``October 1, 1998, and ending 
September 30, 2001,'' each place it appears and inserting ``October 1, 
2001, and ending September 30, 2007,''.
    (b) Assistance for Firms.--Section 256(b) of the Trade Act of 1974 
(19 U.S.C. 2346(b)) is amended by striking ``October 1, 1998, and ending 
September 30, 2001'' and inserting ``October 1, 2001, and ending 
September 30, 2007,''.
    (c) Termination.--Section 285 of the Trade Act of 1974 is amended to 
read as follows:

``SEC. 285. <<NOTE: 19 USC note prec. 2271.>> TERMINATION.

    ``(a) Assistance for Workers.--
            ``(1) In general.--Except as provided in paragraph (2), 
        trade adjustment assistance, vouchers, allowances, and other 
        payments or benefits may not be provided under chapter 2 after 
        September 30, 2007.
            ``(2) Exception.--Notwithstanding paragraph (1), a worker 
        shall continue to receive trade adjustment assistance benefits 
        and other benefits under chapter 2 for any week for which the 
        worker meets the eligibility requirements of that chapter, if on 
        or before September 30, 2007, the worker is--
                    ``(A) certified as eligible for trade adjustment 
                assistance benefits under chapter 2 of this title; and
                    ``(B) otherwise eligible to receive trade adjustment 
                assistance benefits under chapter 2.

    ``(b) Other Assistance.--
            ``(1) Assistance for firms.--Technical assistance may not be 
        provided under chapter 3 after September 30, 2007.
            ``(2) Assistance for farmers.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), adjustment assistance, vouchers, 
                allowances, and other payments or benefits may not be 
                provided under chapter 6 after September 30, 2007.
                    ``(B) Exception.--Notwithstanding subparagraph (A), 
                an agricultural commodity producer (as defined in 
                section 291(2)) shall continue to receive adjustment 
                assistance benefits and other benefits under chapter 6, 
                for any week for which the agricultural commodity 
                producer meets the eligibility requirements of chapter 
                6, if on or before September 30, 2007, the agricultural 
                commodity producer is--
                          ``(i) certified as eligible for adjustment 
                      assistance benefits under chapter 6; and
                          ``(ii) is otherwise eligible to receive 
                      adjustment assistance benefits under such chapter 
                      6.''.

[[Page 116 STAT. 937]]

SEC. 112. FILING OF PETITIONS AND PROVISION OF RAPID RESPONSE 
            ASSISTANCE; EXPEDITED REVIEW OF PETITIONS BY SECRETARY OF 
            LABOR.

    (a) Filing of Petitions and Provision of Rapid Response 
Assistance.--Section 221(a) of the Trade Act of 1974 (19 U.S.C. 2271(a)) 
is amended to read as follows:
    ``(a)(1) A petition for certification of eligibility to apply for 
adjustment assistance for a group of workers under this chapter may be 
filed simultaneously with the Secretary and with the Governor of the 
State in which such workers' firm or subdivision is located by any of 
the following:
            ``(A) The group of workers (including workers in an 
        agricultural firm or subdivision of any agricultural firm).
            ``(B) The certified or recognized union or other duly 
        authorized representative of such workers.
            ``(C) Employers of such workers, one-stop operators or one-
        stop partners (as defined in section 101 of the Workforce 
        Investment Act of 1998 (29 U.S.C. 2801)), including State 
        employment security agencies, or the State dislocated worker 
        unit established under title I of such Act, on behalf of such 
        workers.

    ``(2) Upon receipt of a petition filed under paragraph (1), the 
Governor shall--
            ``(A) ensure that rapid response assistance, and appropriate 
        core and intensive services (as described in section 134 of the 
        Workforce Investment Act of 1998 (29 U.S.C. 2864)) authorized 
        under other Federal laws are made available to the workers 
        covered by the petition to the extent authorized under such 
        laws; and
            ``(B) assist the Secretary in the review of the petition by 
        verifying such information and providing such other assistance 
        as the Secretary may request.

    ``(3) Upon receipt of the petition, the Secretary shall promptly 
publish notice in the Federal Register that the Secretary has received 
the petition and initiated an investigation.''.
    (b) Expedited Review of Petitions by Secretary of Labor.--Section 
223(a) of such Act (19 U.S.C. 2273(a)) is amended in the first sentence 
by striking ``60 days'' and inserting ``40 days''.

SEC. 113. GROUP ELIGIBILITY REQUIREMENTS.

    (a) Trade Adjustment Assistance Program.--
            (1) In general.--Section 222 of the Trade Act of 1974 (19 
        U.S.C. 2272) is amended--
                    (A) by amending subsection (a) to read as follows:

    ``(a) In General.--A group of workers (including workers in any 
agricultural firm or subdivision of an agricultural firm) shall be 
certified by the Secretary as eligible to apply for adjustment 
assistance under this chapter pursuant to a petition filed under section 
221 if the Secretary determines that--
            ``(1) a significant number or proportion of the workers in 
        such workers' firm, or an appropriate subdivision of the firm, 
        have become totally or partially separated, or are threatened to 
        become totally or partially separated; and
            ``(2)(A)(i) the sales or production, or both, of such firm 
        or subdivision have decreased absolutely;
            ``(ii) imports of articles like or directly competitive with 
        articles produced by such firm or subdivision have increased; 
        and

[[Page 116 STAT. 938]]

            ``(iii) the increase in imports described in clause (ii) 
        contributed importantly to such workers' separation or threat of 
        separation and to the decline in the sales or production of such 
        firm or subdivision; or
            ``(B)(i) there has been a shift in production by such 
        workers' firm or subdivision to a foreign country of articles 
        like or directly competitive with articles which are produced by 
        such firm or subdivision; and
            ``(ii)(I) the country to which the workers' firm has shifted 
        production of the articles is a party to a free trade agreement 
        with the United States;
            ``(II) the country to which the workers' firm has shifted 
        production of the articles is a beneficiary country under the 
        Andean Trade Preference Act, African Growth and Opportunity Act, 
        or the Caribbean Basin Economic Recovery Act; or
            ``(III) there has been or is likely to be an increase in 
        imports of articles that are like or directly competitive with 
        articles which are or were produced by such firm or 
        subdivision.'';
                    (B) by redesignating subsection (b) as subsection 
                (c); and
                    (C) by inserting after subsection (a) the following:

    ``(b) Adversely affected secondary workers.--A group of workers 
(including workers in any agricultural firm or subdivision of an 
agricultural firm) shall be certified by the Secretary as eligible to 
apply for trade adjustment assistance benefits under this chapter if the 
Secretary determines that--
            ``(1) a significant number or proportion of the workers in 
        the workers' firm or an appropriate subdivision of the firm have 
        become totally or partially separated, or are threatened to 
        become totally or partially separated;
            ``(2) the workers' firm (or subdivision) is a supplier or 
        downstream producer to a firm (or subdivision) that employed a 
        group of workers who received a certification of eligibility 
        under subsection (a), and such supply or production is related 
        to the article that was the basis for such certification (as 
        defined in subsection (c) (3) and (4)); and
            ``(3) either--
                    ``(A) the workers' firm is a supplier and the 
                component parts it supplied to the firm (or subdivision) 
                described in paragraph (2) accounted for at least 20 
                percent of the production or sales of the workers' firm; 
                or
                    ``(B) a loss of business by the workers' firm with 
                the firm (or subdivision) described in paragraph (2) 
                contributed importantly to the workers' separation or 
                threat of separation determined under paragraph (1).''.

    (b) Definitions.--Section 222(c) of such Act, <<NOTE: 19 USC 
2272.>> as redesignated by paragraph (1)(A), is amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``subsection (a)(3)'' and inserting ``this section''; and
            (2) by adding at the end the following:
            ``(3) Downstream producer.--The term `downstream producer' 
        means a firm that performs additional, value-added production 
        processes for a firm or subdivision, including a firm that 
        performs final assembly or finishing, directly for another firm 
        (or subdivision), for articles that were the basis for a 
        certification of eligibility under subsection (a) of a group of

[[Page 116 STAT. 939]]

        workers employed by such other firm, if the certification of 
        eligibility under subsection (a) is based on an increase in 
        imports from, or a shift in production to, Canada or Mexico.
            ``(4) Supplier.--The term `supplier' means a firm that 
        produces and supplies directly to another firm (or subdivision) 
        component parts for articles that were the basis for a 
        certification of eligibility under subsection (a) of a group of 
        workers employed by such other firm.''.

SEC. 114. QUALIFYING REQUIREMENTS FOR TRADE READJUSTMENT ALLOWANCES.

    (a) Clarification of Certain Reductions.--Section 231(a)(3)(B) of 
the Trade Act of 1974 (19 U.S.C. 2291(a)(3)(B)) is amended by inserting 
after ``any unemployment insurance'' the following: ``, except 
additional compensation that is funded by a State and is not reimbursed 
from any Federal funds,''.
    (b) Enrollment in Training Requirement.--Section 231(a)(5)(A) of 
such Act (19 U.S.C. 2291(a)(5)(A)) is amended--
            (1) by inserting ``(i)'' after ``(A)'';
            (2) by adding ``and'' after the comma at the end; and
            (3) by adding at the end the following:
                    ``(ii) the enrollment <<NOTE: Deadlines.>> required 
                under clause (i) occurs no later than the latest of--
                          ``(I) the last day of the 16th week after the 
                      worker's most recent total separation from 
                      adversely affected employment which meets the 
                      requirements of paragraphs (1) and (2),
                          ``(II) the last day of the 8th week after the 
                      week in which the Secretary issues a certification 
                      covering the worker,
                          ``(III) 45 days after the later of the dates 
                      specified in subclause (I) or (II), if the 
                      Secretary determines there are extenuating 
                      circumstances that justify an extension in the 
                      enrollment period, or
                          ``(IV) the last day of a period determined by 
                      the Secretary to be approved for enrollment after 
                      the termination of a waiver issued pursuant to 
                      subsection (c),''.

SEC. 115. WAIVERS OF TRAINING REQUIREMENTS.

    (a) In General.--Section 231(c) of the Trade Act of 1974 (19 U.S.C. 
2291(c)) is amended to read as follows:
    ``(c) Waivers of Training Requirements.--
            ``(1) Issuance of waivers.--The Secretary may issue a 
        written statement to an adversely affected worker waiving the 
        requirement to be enrolled in training described in subsection 
        (a)(5)(A) if the Secretary determines that it is not feasible or 
        appropriate for the worker, because of 1 or more of the 
        following reasons:
                    ``(A) Recall.--The worker has been notified that the 
                worker will be recalled by the firm from which the 
                separation occurred.
                    ``(B) Marketable skills.--The worker possesses 
                marketable skills for suitable employment (as determined 
                pursuant to an assessment of the worker, which may 
                include the profiling system under section 303(j) of the 
                Social Security Act (42 U.S.C. 503(j)), carried out in 
                accordance with guidelines issued by the Secretary) and 
                there

[[Page 116 STAT. 940]]

                is a reasonable expectation of employment at equivalent 
                wages in the foreseeable future.
                    ``(C) Retirement.--The worker is within 2 years of 
                meeting all requirements for entitlement to either--
                          ``(i) old-age insurance benefits under title 
                      II of the Social Security Act (42 U.S.C. 401 et 
                      seq.) (except for application therefor); or
                          ``(ii) a private pension sponsored by an 
                      employer or labor organization.
                    ``(D) Health.--The worker is unable to participate 
                in training due to the health of the worker, except that 
                a waiver under this subparagraph shall not be construed 
                to exempt a worker from requirements relating to the 
                availability for work, active search for work, or 
                refusal to accept work under Federal or State 
                unemployment compensation laws.
                    ``(E) Enrollment unavailable.--The first available 
                enrollment date for the approved training of the worker 
                is within 60 days after the date of the determination 
                made under this paragraph, or, if later, there are 
                extenuating circumstances for the delay in enrollment, 
                as determined pursuant to guidelines issued by the 
                Secretary.
                    ``(F) Training not available.--Training approved by 
                the Secretary is not reasonably available to the worker 
                from either governmental agencies or private sources 
                (which may include area vocational education schools, as 
                defined in section 3 of the Carl D. Perkins Vocational 
                and Technical Education Act of 1998 (20 U.S.C. 2302), 
                and employers), no training that is suitable for the 
                worker is available at a reasonable cost, or no training 
                funds are available.
            ``(2) Duration of waivers.--
                    ``(A) In general.--A waiver issued under paragraph 
                (1) shall be effective for not more than 6 months after 
                the date on which the waiver is issued, unless the 
                Secretary determines otherwise.
                    ``(B) Revocation.--The Secretary shall revoke a 
                waiver issued under paragraph (1) if the Secretary 
                determines that the basis of a waiver is no longer 
                applicable to the worker and shall notify the worker in 
                writing of the revocation.
            ``(3) Agreements under section 239.--
                    ``(A) Issuance by cooperating states.--Pursuant to 
                an agreement under section 239, the Secretary may 
                authorize a cooperating State to issue waivers as 
                described in paragraph (1).
                    ``(B) Submission of statements.--An agreement under 
                section 239 shall include a requirement that the 
                cooperating State submit to the Secretary the written 
                statements provided under paragraph (1) and a statement 
                of the reasons for the waiver.''.

    (b) Conforming Amendment.--Section 231(a)(5)(C) of such Act (19 
U.S.C. 2291(a)(5)(C)) is amended by striking ``certified''.

[[Page 116 STAT. 941]]

SEC. 116. AMENDMENTS TO LIMITATIONS ON TRADE READJUSTMENT ALLOWANCES.

    (a) Increase in Maximum Number of Weeks.--Section 233(a) of the 
Trade Act of 1974 (19 U.S.C. 2293(a)) is amended--
            (1) in paragraph (2), by inserting after ``104-week period'' 
        the following: ``(or, in the case of an adversely affected 
        worker who requires a program of remedial education (as 
        described in section 236(a)(5)(D)) in order to complete training 
        approved for the worker under section 236, the 130-week 
        period)''; and
            (2) in paragraph (3), by striking ``26'' each place it 
        appears and inserting ``52''.

    (b) Special Rule Relating to Break in Training.--Section 233(f) of 
the Trade Act of 1974 (19 U.S.C. 2293(f)) is amended in the matter 
preceding paragraph (1) by striking ``14 days'' and inserting ``30 
days''.
    (c) Additional Weeks for Individuals in Need of Remedial 
Education.--Section 233 of the Trade Act of 1974 (19 U.S.C. 2293) is 
amended by adding at the end the following:
    ``(g) Notwithstanding any other provision of this section, in order 
to assist an adversely affected worker to complete training approved for 
the worker under section 236 which includes a program of remedial 
education (as described in section 236(a)(5)(D)), and in accordance with 
regulations prescribed by the Secretary, payments may be made as trade 
readjustment allowances for up to 26 additional weeks in the 26-week 
period that follows the last week of entitlement to trade readjustment 
allowances otherwise payable under this chapter.''.

SEC. 117. ANNUAL TOTAL AMOUNT OF PAYMENTS FOR TRAINING.

    Section 236(a)(2)(A) of the Trade Act of 1974 (19 U.S.C. 
2296(a)(2)(A)) is amended by striking ``$80,000,000'' and all that 
follows through ``$70,000,000'' and inserting ``$220,000,000''.

SEC. 118. PROVISION OF EMPLOYER-BASED TRAINING.

    (a) In General.--Section 236(a)(5)(A) of the Trade Act of 1974 (19 
U.S.C. 2296(a)(5)(A)) is amended to read as follows:
            ``(A) employer-based training, including--
                    ``(i) on-the-job training, and
                    ``(ii) customized training,''.

    (b) Reimbursement.--Section 236(c)(8) of such Act (19 U.S.C. 
2296(c)(8)) is amended to read as follows:
            ``(8) the employer is provided reimbursement of not more 
        than 50 percent of the wage rate of the participant, for the 
        cost of providing the training and additional supervision 
        related to the training,''.

    (c) Definition.--Section 236 of such Act (19 U.S.C. 2296) is amended 
by adding at the end the following new subsection:
    ``(f) For purposes of this section, the term `customized training' 
means training that is--
            ``(1) designed to meet the special requirements of an 
        employer or group of employers;
            ``(2) conducted with a commitment by the employer or group 
        of employers to employ an individual upon successful completion 
        of the training; and
            ``(3) for which the employer pays for a significant portion 
        (but in no case less than 50 percent) of the cost of such 
        training, as determined by the Secretary.''.

[[Page 116 STAT. 942]]

SEC. 119. COORDINATION WITH TITLE I OF THE WORKFORCE INVESTMENT ACT OF 
            1998.

    Section 235 of the Trade Act of 1974 (19 U.S.C. 2295) is amended by 
inserting before the period at the end of the first sentence the 
following: ``, including the services provided through one-stop delivery 
systems described in section 134(c) of the Workforce Investment Act of 
1998 (29 U.S.C. 2864(c))''.

SEC. 120. EXPENDITURE PERIOD.

    Section 245 of the Trade Act of 1974 (19 U.S.C. 2317), as amended by 
section 111(a) of this Act, is further amended by amending subsection 
(b) to read as follows:
    ``(b) Period of Expenditure.--Funds obligated for any fiscal year to 
carry out activities under sections 235 through 238 may be expended by 
each State receiving such funds during that fiscal year and the 
succeeding two fiscal years.''.

SEC. 121. JOB SEARCH ALLOWANCES.

    Section 237 of the Trade Act of 1974 (19 U.S.C. 2297) is amended to 
read as follows:

``SEC. 237. JOB SEARCH ALLOWANCES.

    ``(a) Job Search Allowance Authorized.--
            ``(1) In general.--An adversely affected worker covered by a 
        certification issued under subchapter A of this chapter may file 
        an application with the Secretary for payment of a job search 
        allowance.
            ``(2) Approval of applications.--The Secretary may grant an 
        allowance pursuant to an application filed under paragraph (1) 
        when all of the following apply:
                    ``(A) Assist adversely affected worker.--The 
                allowance is paid to assist an adversely affected worker 
                who has been totally separated in securing a job within 
                the United States.
                    ``(B) Local employment not available.--The Secretary 
                determines that the worker cannot reasonably be expected 
                to secure suitable employment in the commuting area in 
                which the worker resides.
                    ``(C) <<NOTE: Deadlines.>> Application.--The worker 
                has filed an application for the allowance with the 
                Secretary before--
                          ``(i) the later of--
                                    ``(I) the 365th day after the date 
                                of the certification under which the 
                                worker is certified as eligible; or
                                    ``(II) the 365th day after the date 
                                of the worker's last total separation; 
                                or
                          ``(ii) the date that is the 182d day after the 
                      date on which the worker concluded training, 
                      unless the worker received a waiver under section 
                      231(c).

    ``(b) Amount of Allowance.--
            ``(1) In general.--An allowance granted under subsection (a) 
        shall provide reimbursement to the worker of 90 percent of the 
        cost of necessary job search expenses as prescribed by the 
        Secretary in regulations.
            ``(2) Maximum allowance.--Reimbursement under this 
        subsection may not exceed $1,250 for any worker.
            ``(3) Allowance for subsistence and transportation.--
        Reimbursement under this subsection may not be made for

[[Page 116 STAT. 943]]

        subsistence and transportation expenses at levels exceeding 
        those allowable under section 236(b) (1) and (2).

    ``(c) Exception.--Notwithstanding subsection (b), the Secretary 
shall reimburse any adversely affected worker for necessary expenses 
incurred by the worker in participating in a job search program approved 
by the Secretary.''.

SEC. 122. RELOCATION ALLOWANCES.

    Section 238 of the Trade Act of 1974 (19 U.S.C. 2298) is amended to 
read as follows:

``SEC. 238. RELOCATION ALLOWANCES.

    ``(a) Relocation Allowance Authorized.--
            ``(1) In general.--Any adversely affected worker covered by 
        a certification issued under subchapter A of this chapter may 
        file an application for a relocation allowance with the 
        Secretary, and the Secretary may grant the relocation allowance, 
        subject to the terms and conditions of this section.
            ``(2) Conditions for granting allowance.--A relocation 
        allowance may be granted if all of the following terms and 
        conditions are met:
                    ``(A) Assist an adversely affected worker.--The 
                relocation allowance will assist an adversely affected 
                worker in relocating within the United States.
                    ``(B) Local employment not available.--The Secretary 
                determines that the worker cannot reasonably be expected 
                to secure suitable employment in the commuting area in 
                which the worker resides.
                    ``(C) Total separation.--The worker is totally 
                separated from employment at the time relocation 
                commences.
                    ``(D) Suitable employment obtained.--The worker--
                          ``(i) has obtained suitable employment 
                      affording a reasonable expectation of long-term 
                      duration in the area in which the worker wishes to 
                      relocate; or
                          ``(ii) has obtained a bona fide offer of such 
                      employment.
                    ``(E) <<NOTE: Deadlines.>> Application.--The worker 
                filed an application with the Secretary before--
                          ``(i) the later of--
                                    ``(I) the 425th day after the date 
                                of the certification under subchapter A 
                                of this chapter; or
                                    ``(II) the 425th day after the date 
                                of the worker's last total separation; 
                                or
                          ``(ii) the date that is the 182d day after the 
                      date on which the worker concluded training, 
                      unless the worker received a waiver under section 
                      231(c).

    ``(b) Amount of Allowance.--The relocation allowance granted to a 
worker under subsection (a) includes--
            ``(1) 90 percent of the reasonable and necessary expenses 
        (including, but not limited to, subsistence and transportation 
        expenses at levels not exceeding those allowable under section 
        236(b) (1) and (2) specified in regulations prescribed by the 
        Secretary, incurred in transporting the worker, the worker's 
        family, and household effects; and
            ``(2) a lump sum equivalent to 3 times the worker's average 
        weekly wage, up to a maximum payment of $1,250.

    ``(c) Limitations.--A relocation allowance may not be granted to a 
worker unless--

[[Page 116 STAT. 944]]

            ``(1) the relocation occurs within 182 days after the filing 
        of the application for relocation assistance; or
            ``(2) the relocation occurs within 182 days after the 
        conclusion of training, if the worker entered a training program 
        approved by the Secretary under section 236(b) (1) and (2).''.

SEC. 123. REPEAL OF NAFTA TRANSITIONAL ADJUSTMENT ASSISTANCE PROGRAM.

    (a) In General.--Subchapter D of chapter 2 of title II of such Act 
(19 U.S.C. 2331) is repealed.
    (b) Conforming Amendments.--
            (1) Section 225(b) (1) and (2) of the Trade Act of 1974 (19 
        U.S.C. 2275(b) (1) and (2)) is amended by striking ``or 
        subchapter D'' each place it appears.
            (2) Section 249A of such Act (19 U.S.C. 2322) is repealed.
            (3) The table of contents of such Act is amended--
                    (A) by striking the item relating to section 249A; 
                and
                    (B) by striking the items relating to subchapter D 
                of chapter 2 of title II.
            (4) Section 284(a) <<NOTE: 19 USC 2395.>>  of such Act is 
        amended by striking ``or section 250(c)''.

    (c) Effective <<NOTE: 19 USC 2331 note.>> Date.--
            (1) In general.--The amendments made by this section shall 
        apply with respect to petitions filed under chapter 2 of title 
        II of the Trade Act of 1974, on or after the date that is 90 
        days after the date of enactment of this Act.
            (2) Workers certified as eligible before effective date.--
        Notwithstanding subsection (a), a worker receiving benefits 
        under chapter 2 of title II of the Trade Act of 1974 shall 
        continue to receive (or be eligible to receive) benefits and 
        services under chapter 2 of title II of the Trade Act of 1974, 
        as in effect on the day before the amendments made by this 
        section take effect under subsection (a), for any week for which 
        the worker meets the eligibility requirements of such chapter 2 
        as in effect on such date.

SEC. 124. DEMONSTRATION PROJECT FOR ALTERNATIVE TRADE ADJUSTMENT 
            ASSISTANCE FOR OLDER WORKERS.

    (a) Demonstration Program.--Chapter 2 of title II of the Trade Act 
of 1974 (19 U.S.C. 2271 et seq.) is amended by striking section 246 and 
inserting the following new section:

``SEC. 246. <<NOTE: 19 USC 2318.>> DEMONSTRATION PROJECT FOR ALTERNATIVE 
            TRADE ADJUSTMENT ASSISTANCE FOR OLDER WORKERS.

    ``(a) In General.--
            ``(1) Establishment.--Not <<NOTE: Deadline.>> later than 1 
        year after the date of enactment of the Trade Adjustment 
        Assistance Reform Act of 2002, the Secretary shall establish an 
        alternative trade adjustment assistance program for older 
        workers that provides the benefits described in paragraph (2).
            ``(2) Benefits.
                    ``(A) Payments.--A State shall use the funds 
                provided to the State under section 241 to pay, for a 
                period not to exceed 2 years, to a worker described in 
                paragraph (3)(B), 50 percent of the difference between--
                          ``(i) the wages received by the worker from 
                      reemployment; and

[[Page 116 STAT. 945]]

                          ``(ii) the wages received by the worker at the 
                      time of separation.
                    ``(B) Health insurance.--A worker described in 
                paragraph (3)(B) participating in the program 
                established under paragraph (1) is eligible to receive, 
                for a period not to exceed 2 years, a credit for health 
                insurance costs under section 35 of the Internal Revenue 
                Code of 1986, as added by section 201 of the Trade Act 
                of 2002.
            ``(3) Eligibility.--
                    ``(A) Firm eligibility.--
                          ``(i) In general.--The Secretary shall provide 
                      the opportunity for a group of workers on whose 
                      behalf a petition is filed under section 221 to 
                      request that the group of workers be certified for 
                      the alternative trade adjustment assistance 
                      program under this section at the time the 
                      petition is filed.
                          ``(ii) Criteria.--In determining whether to 
                      certify a group of workers as eligible for the 
                      alternative trade adjustment assistance program, 
                      the Secretary shall consider the following 
                      criteria:
                                    ``(I) Whether a significant number 
                                of workers in the workers' firm are 50 
                                years of age or older.
                                    ``(II) Whether the workers in the 
                                workers' firm possess skills that are 
                                not easily transferable.
                                    ``(III) The competitive conditions 
                                within the workers' industry.
                          ``(iii) Deadline.--The Secretary shall 
                      determine whether the workers in the group are 
                      eligible for the alternative trade adjustment 
                      assistance program by the date specified in 
                      section 223(a).
                    ``(B) Individual Eligibility.--A worker in the group 
                that the Secretary has certified as eligible for the 
                alternative trade adjustment assistance program may 
                elect to receive benefits under the alternative trade 
                adjustment assistance program if the worker--
                          ``(i) is covered by a certification under 
                      subchapter A of this chapter;
                          ``(ii) obtains reemployment not more than 26 
                      weeks after the date of separation from the 
                      adversely affected employment;
                          ``(iii) is at least 50 years of age; and
                          ``(iv) earns not more than $50,000 a year in 
                      wages from reemployment;
                          ``(v) is employed on a full-time basis as 
                      defined by State law in the State in which the 
                      worker is employed; and
                          ``(vi) does not return to the employment from 
                      which the worker was separated.
            ``(4) Total amount of payments.--The payments described in 
        paragraph (2)(A) made to a worker may not exceed $10,000 per 
        worker during the 2-year eligibility period.
            ``(5) Limitation on other benefits.--Except as provided in 
        section 238(a)(2)(B), if a worker is receiving payments pursuant 
        to the program established under paragraph (1), the worker shall 
        not be eligible to receive any other benefits under this title.

    ``(b) Termination.--

[[Page 116 STAT. 946]]

            ``(1) In general.--Except as provided in paragraph (2), no 
        payments may be made by a State under the program established 
        under subsection (a)(1) after the date that is 5 years after the 
        date on which such program is implemented by the State.
            ``(2) Exception.--Notwithstanding paragraph (1), a worker 
        receiving payments under the program established under 
        subsection (a)(1) on the termination date described in paragraph 
        (1) shall continue to receive such payments provided that the 
        worker meets the criteria described in subsection (a)(3)(B).''.

    (b) Table of Contents.--The Trade Act of 1974 (U.S.C. et seq.) is 
amended in the table of contents by inserting after the item relating to 
section 245 the following new item:

``Sec. 246.  Demonstration project for alternative trade adjustment 
           assistance for older workers.''.

SEC. 125. <<NOTE: 19 USC 2271 note.>> DECLARATION OF POLICY; SENSE OF 
            CONGRESS.

    (a) Declaration of Policy.--Congress reiterates that, under the 
trade adjustment assistance program under chapter 2 of title II of the 
Trade Act of 1974, workers are eligible for transportation, childcare, 
and healthcare assistance, as well as other related assistance under 
programs administered by the Department of Labor.
    (b) Sense of Congress.--It is the sense of Congress that the 
Secretary of Labor, working independently and in conjunction with the 
States, should, in accordance with section 225 of the Trade Act of 1974, 
provide more specific information about benefit allowances, training, 
and other employment services, and the petition and application 
procedures (including appropriate filing dates) for such allowances, 
training, and services, under the trade adjustment assistance program 
under chapter 2 of title II of the Trade Act of 1974 to workers who are 
applying for, or are certified to receive, assistance under that 
program, including information on all other Federal assistance available 
to such workers.

            Subtitle B--Trade Adjustment Assistance For Firms

SEC. 131. REAUTHORIZATION OF PROGRAM.

    Section 256(b) of chapter 3 of title II of the Trade Act of 1974 (19 
U.S.C. 2346(b)) is amended to read as follows:
    ``(b) There are authorized to be appropriated to the Secretary 
$16,000,000 for each of fiscal years 2003 through 2007, to carry out the 
Secretary's functions under this chapter in connection with furnishing 
adjustment assistance to firms. Amounts appropriated under this 
subsection shall remain available until expended.''.

           Subtitle C--Trade Adjustment Assistance For Farmers

SEC. 141. TRADE ADJUSTMENT ASSISTANCE FOR FARMERS.

    (a) In General.--Title II of the Trade Act of 1974 (19 U.S.C. 2251 
et seq.) is amended by adding at the end the following new chapter:

[[Page 116 STAT. 947]]

             ``CHAPTER 6--ADJUSTMENT ASSISTANCE FOR FARMERS

``SEC. 291. <<NOTE: 19 USC 2401.>> DEFINITIONS.

    ``In this chapter:
            ``(1) Agricultural commodity.--The term `agricultural 
        commodity' means any agricultural commodity (including 
        livestock) in its raw or natural state.
            ``(2) Agricultural commodity producer.--The term 
        `agricultural commodity producer' has the same meaning as the 
        term `person' as prescribed by regulations promulgated under 
        section 1001(5) of the Food Security Act of 1985 (7 U.S.C. 
        1308(5)).
            ``(3) Contributed importantly.--
                    ``(A) In general.--The term `contributed 
                importantly' means a cause which is important but not 
                necessarily more important than any other cause.
                    ``(B) Determination of contributed importantly.--The 
                determination of whether imports of articles like or 
                directly competitive with an agricultural commodity with 
                respect to which a petition under this chapter was filed 
                contributed importantly to a decline in the price of the 
                agricultural commodity shall be made by the Secretary.
            ``(4) Duly authorized representative.--The term `duly 
        authorized representative' means an association of agricultural 
        commodity producers.
            ``(5) National average price.--The term `national average 
        price' means the national average price paid to an agricultural 
        commodity producer for an agricultural commodity in a marketing 
        year as determined by the Secretary.
            ``(6) Secretary.--The term `Secretary' means the Secretary 
        of Agriculture.

``SEC. 292. <<NOTE: 19 USC 2401a.>> PETITIONS; GROUP ELIGIBILITY.

    ``(a) In General.--A petition for a certification of eligibility to 
apply for adjustment assistance under this chapter may be filed with the 
Secretary by a group of agricultural commodity producers or by their 
duly authorized representative. <<NOTE: Notice. Federal Register, 
publication.>> Upon receipt of the petition, the Secretary shall 
promptly publish notice in the Federal Register that the Secretary has 
received the petition and initiated an investigation.

    ``(b) Hearings.--If the petitioner, or any other person found by the 
Secretary to have a substantial interest in the proceedings, submits not 
later than 10 days after the date of the Secretary's publication under 
subsection (a) a request for a hearing, the Secretary shall provide for 
a public hearing and afford such interested person an opportunity to be 
present, to produce evidence, and to be heard.
    ``(c) Group Eligibility Requirements.--The Secretary shall certify a 
group of agricultural commodity producers as eligible to apply for 
adjustment assistance under this chapter if the Secretary determines--
            ``(1) that the national average price for the agricultural 
        commodity, or a class of goods within the agricultural 
        commodity, produced by the group for the most recent marketing 
        year for which the national average price is available is less 
        than 80 percent of the average of the national average price for 
        such agricultural commodity, or such class of goods, for

[[Page 116 STAT. 948]]

        the 5 marketing years preceding the most recent marketing year; 
        and
            ``(2) that increases in imports of articles like or directly 
        competitive with the agricultural commodity, or class of goods 
        within the agricultural commodity, produced by the group 
        contributed importantly to the decline in price described in 
        paragraph (1).

    ``(d) Special Rule for Qualified Subsequent Years.--A group of 
agricultural commodity producers certified as eligible under section 293 
shall be eligible to apply for assistance under this chapter in any 
qualified year after the year the group is first certified, if the 
Secretary determines that--
            ``(1) the national average price for the agricultural 
        commodity, or class of goods within the agricultural commodity, 
        produced by the group for the most recent marketing year for 
        which the national average price is available is equal to or 
        less than the price determined under subsection (c)(1); and
            ``(2) the requirements of subsection (c)(2) are met.

    ``(e) Determination of Qualified Year and Commodity.--In this 
chapter:
            ``(1) Qualified year.--The term `qualified year', with 
        respect to a group of agricultural commodity producers certified 
        as eligible under section 293, means each consecutive year after 
        the year in which the group is certified and in which the 
        Secretary makes the determination under subsection (c) or (d), 
        as the case may be.
            ``(2) Classes of goods within a commodity.--In any case in 
        which there are separate classes of goods within an agricultural 
        commodity, the Secretary shall treat each class as a separate 
        commodity in determining group eligibility, the national average 
        price, and level of imports under this section and section 296.

``SEC. 293. <<NOTE: 19 USC 2401b.>> DETERMINATIONS BY SECRETARY OF 
            AGRICULTURE.

    ``(a) In General.--As soon as practicable <<NOTE: Deadline.>> after 
the date on which a petition is filed under section 292, but in any 
event not later than 40 days after that date, the Secretary shall 
determine whether the petitioning group meets the requirements of 
section 292 (c) or (d), as the case may be, and shall, if the group 
meets the requirements, issue a certification of eligibility to apply 
for assistance under this chapter covering agricultural commodity 
producers in any group that meets the requirements. Each certification 
shall specify the date on which eligibility under this chapter begins.

    ``(b) Notice.--Upon <<NOTE: Federal Register, publication.>> making 
a determination on a petition, the Secretary shall promptly publish a 
summary of the determination in the Federal Register, together with the 
Secretary's reasons for making the determination.

    ``(c) Termination of Certification.-- <<NOTE: Federal Register, 
publication.>> Whenever the Secretary determines, with respect to any 
certification of eligibility under this chapter, that the decline in 
price for the agricultural commodity covered by the certification is no 
longer attributable to the conditions described in section 292, the 
Secretary shall terminate such certification and promptly cause notice 
of such termination to be published in the Federal Register, together 
with the Secretary's reasons for making such determination.

[[Page 116 STAT. 949]]

``SEC. 294. <<NOTE: 19 USC 2401c.>> STUDY BY SECRETARY OF AGRICULTURE 
            WHEN INTERNATIONAL TRADE COMMISSION BEGINS INVESTIGATION.

    ``(a) In General.--Whenever the International Trade Commission (in 
this chapter referred to as the `Commission') begins an investigation 
under section 202 with respect to an agricultural commodity, the 
Commission shall immediately notify the Secretary of the investigation. 
Upon receipt of the notification, the Secretary shall immediately 
conduct a study of--
            ``(1) the number of agricultural commodity producers 
        producing a like or directly competitive agricultural commodity 
        who have been or are likely to be certified as eligible for 
        adjustment assistance under this chapter, and
            ``(2) the extent to which the adjustment of such producers 
        to the import competition may be facilitated through the use of 
        existing programs.

    ``(b) Report.-- <<NOTE: Deadline.>> Not later than 15 days after the 
day on which the Commission makes its report under section 202(f), the 
Secretary shall submit a report to the President setting forth the 
findings of the study described in subsection (a). <<NOTE: Federal 
Register, publication.>> Upon making the report to the President, the 
Secretary shall also promptly make the report public (with the exception 
of information which the Secretary determines to be confidential) and 
shall have a summary of the report published in the Federal Register.

``SEC. 295. <<NOTE: 19 USC 2401d.>> BENEFIT INFORMATION TO AGRICULTURAL 
            COMMODITY PRODUCERS.

    ``(a) In General.--The Secretary shall provide full information to 
agricultural commodity producers about the benefit allowances, training, 
and other employment services available under this title and about the 
petition and application procedures, and the appropriate filing dates, 
for such allowances, training, and services. The Secretary shall provide 
whatever assistance is necessary to enable groups to prepare petitions 
or applications for program benefits under this title.
    ``(b) Notice of Benefits.--
            ``(1) In general.--The Secretary shall mail written notice 
        of the benefits available under this chapter to each 
        agricultural commodity producer that the Secretary has reason to 
        believe is covered by a certification made under this chapter.
            ``(2) Other notice.-- <<NOTE: Publication.>> The Secretary 
        shall publish notice of the benefits available under this 
        chapter to agricultural commodity producers that are covered by 
        each certification made under this chapter in newspapers of 
        general circulation in the areas in which such producers reside.
            ``(3) Other federal assistance.--The Secretary shall also 
        provide information concerning procedures for applying for and 
        receiving all other Federal assistance and services available to 
        workers facing economic distress.

``SEC. 296. <<NOTE: 19 USC 2401e.>> QUALIFYING REQUIREMENTS FOR 
            AGRICULTURAL COMMODITY PRODUCERS.

    ``(a) In General.--
            ``(1) Requirements.--Payment of a trade adjustment allowance 
        shall be made to an adversely affected agricultural commodity 
        producer covered by a certification under this chapter who files 
        an application for such allowance within 90 days after the date 
        on which the Secretary makes a determination

[[Page 116 STAT. 950]]

        and issues a certification of eligibility under section 293, if 
        the following conditions are met:
                    ``(A) The producer submits to the Secretary 
                sufficient information to establish the amount of 
                agricultural commodity covered by the application filed 
                under subsection (a) that was produced by the producer 
                in the most recent year.
                    ``(B) The producer certifies that the producer has 
                not received cash benefits under any provision of this 
                title other than this chapter.
                    ``(C) The producer's net farm income (as determined 
                by the Secretary) for the most recent year is less than 
                the producer's net farm income for the latest year in 
                which no adjustment assistance was received by the 
                producer under this chapter.
                    ``(D) The producer certifies that the producer has 
                met with an Extension Service employee or agent to 
                obtain, at no cost to the producer, information and 
                technical assistance that will assist the producer in 
                adjusting to import competition with respect to the 
                adversely affected agricultural commodity, including--
                          ``(i) information regarding the feasibility 
                      and desirability of substituting 1 or more 
                      alternative commodities for the adversely affected 
                      agricultural commodity; and
                          ``(ii) technical assistance that will improve 
                      the competitiveness of the production and 
                      marketing of the adversely affected agricultural 
                      commodity by the producer, including yield and 
                      marketing improvements.
            ``(2) Limitations.--
                    ``(A) Adjusted gross income.--
                          ``(i) In general.--Notwithstanding any other 
                      provision of this chapter, an agricultural 
                      commodity producer shall not be eligible for 
                      assistance under this chapter in any year in which 
                      the average adjusted gross income of the producer 
                      exceeds the level set forth in section 1001D of 
                      the Food Security Act of 1985.
                          ``(ii) Certification.--To comply with the 
                      limitation under subparagraph (A), an individual 
                      or entity shall provide to the Secretary--
                                    ``(I) a certification by a certified 
                                public accountant or another third party 
                                that is acceptable to the Secretary that 
                                the average adjusted gross income of the 
                                producer does not exceed the level set 
                                forth in section 1001D of the Food 
                                Security Act of 1985; or
                                    ``(II) information and documentation 
                                regarding the adjusted gross income of 
                                the producer through other procedures 
                                established by the Secretary.
                    ``(B) Counter-cyclical payments.--The total amount 
                of payments made to an agricultural producer under this 
                chapter during any crop year may not exceed the 
                limitation on counter-cyclical payments set forth in 
                section 1001(c) of the Food Security Act of 1985.
                    ``(C) Definitions.--In this subsection:

[[Page 116 STAT. 951]]

                          ``(i) Adjusted gross income.--The term 
                      `adjusted gross income' means adjusted gross 
                      income of an agricultural commodity producer--
                                    ``(I) as defined in section 62 of 
                                the Internal Revenue Code of 1986 and 
                                implemented in accordance with 
                                procedures established by the Secretary; 
                                and
                                    ``(II) that is earned directly or 
                                indirectly from all agricultural and 
                                nonagricultural sources of an individual 
                                or entity for a fiscal or corresponding 
                                crop year.
                          ``(ii) Average adjusted gross income.--
                                    ``(I) In general.--The term `average 
                                adjusted gross income' means the average 
                                adjusted gross income of a producer for 
                                each of the 3 preceding taxable years.
                                    ``(II) Effective adjusted gross 
                                income.--In the case of a producer that 
                                does not have an adjusted gross income 
                                for each of the 3 preceding taxable 
                                years, the Secretary shall establish 
                                rules that provide the producer with an 
                                effective adjusted gross income for the 
                                applicable year.

    ``(b) Amount of Cash Benefits.--
            ``(1) In general.--Subject to the provisions of section 298, 
        an adversely affected agricultural commodity producer described 
        in subsection (a) shall be entitled to adjustment assistance 
        under this chapter in an amount equal to the product of--
                    ``(A) one-half of the difference between--
                          ``(i) an amount equal to 80 percent of the 
                      average of the national average price of the 
                      agricultural commodity covered by the application 
                      described in subsection (a) for the 5 marketing 
                      years preceding the most recent marketing year, 
                      and
                          ``(ii) the national average price of the 
                      agricultural commodity for the most recent 
                      marketing year, and
                    ``(B) the amount of the agricultural commodity 
                produced by the agricultural commodity producer in the 
                most recent marketing year.
            ``(2) Special rule for subsequent qualified years.--The 
        amount of cash benefits for a qualified year shall be determined 
        in the same manner as cash benefits are determined under 
        paragraph (1) except that the average national price of the 
        agricultural commodity shall be determined under paragraph 
        (1)(A)(i) by using the 5-marketing-year period used to determine 
        the amount of cash benefits for the first certification.

    ``(c) Maximum Amount of Cash Assistance.--The maximum amount of cash 
benefits an agricultural commodity producer may receive in any 12-month 
period shall not exceed $10,000.
    ``(d) Limitations on Other Assistance.--An agricultural commodity 
producer entitled to receive a cash benefit under this chapter--
            ``(1) shall not be eligible for any other cash benefit under 
        this title, and
            ``(2) shall be entitled to employment services and training 
        benefits under part II of subchapter B of chapter 2.

[[Page 116 STAT. 952]]

``SEC. 297. <<NOTE: 19 USC 2401f.>> FRAUD AND RECOVERY OF OVERPAYMENTS.

    ``(a) In General.--
            ``(1) Repayment.--If the Secretary, or a court of competent 
        jurisdiction, determines that any person has received any 
        payment under this chapter to which the person was not entitled, 
        such person shall be liable to repay such amount to the 
        Secretary, except that the Secretary may waive such repayment if 
        the Secretary determines, in accordance with guidelines 
        prescribed by the Secretary, that--
                    ``(A) the payment was made without fault on the part 
                of such person; and
                    ``(B) requiring such repayment would be contrary to 
                equity and good conscience.
            ``(2) Recovery of overpayment.--Unless an overpayment is 
        otherwise recovered, or waived under paragraph (1), the 
        Secretary shall recover the overpayment by deductions from any 
        sums payable to such person under this chapter.

    ``(b) False Statement.--A person shall, in addition to any other 
penalty provided by law, be ineligible for any further payments under 
this chapter--
            ``(1) if the Secretary, or a court of competent 
        jurisdiction, determines that the person--
                    ``(A) knowingly has made, or caused another to make, 
                a false statement or representation of a material fact; 
                or
                    ``(B) knowingly has failed, or caused another to 
                fail, to disclose a material fact; and
            ``(2) as a result of such false statement or representation, 
        or of such nondisclosure, such person has received any payment 
        under this chapter to which the person was not entitled.

    ``(c) Notice and Determination.--Except for overpayments determined 
by a court of competent jurisdiction, no repayment may be required, and 
no deduction may be made, under this section until a determination under 
subsection (a)(1) by the Secretary has been made, notice of the 
determination and an opportunity for a fair hearing thereon has been 
given to the person concerned, and the determination has become final.
    ``(d) Payment to Treasury.--Any amount recovered under this section 
shall be returned to the Treasury of the United States.
    ``(e) Penalties.--Whoever makes a false statement of a material fact 
knowing it to be false, or knowingly fails to disclose a material fact, 
for the purpose of obtaining or increasing for himself or for any other 
person any payment authorized to be furnished under this chapter shall 
be fined not more than $10,000 or imprisoned for not more than 1 year, 
or both.

``SEC. 298. <<NOTE: 19 USC 2401g.>> AUTHORIZATION OF APPROPRIATIONS.

    ``(a) In General.--There are authorized to be appropriated and there 
are appropriated to the Department of Agriculture not to exceed 
$90,000,000 for each of the fiscal years 2003 through 2007 to carry out 
the purposes of this chapter.
    ``(b) Proportionate Reduction.--If in any year the amount 
appropriated under this chapter is insufficient to meet the requirements 
for adjustment assistance payable under this chapter, the amount of 
assistance payable under this chapter shall be reduced 
proportionately.''.

[[Page 116 STAT. 953]]

    (b)  <<NOTE: 19 USC 2401 note.>> Effective Date.--The amendments 
made by this title shall take effect on the date that is 180 days after 
the date of enactment of this Act.

SEC. 142. CONFORMING AMENDMENTS.

    (a) Judicial review.--
            (1) Section 284(a) of the Trade Act of 1974 (19 U.S.C. 
        2395(a)) is amended--
                    (A) by inserting ``an agricultural commodity 
                producer (as defined in section 291(2)) aggrieved by a 
                determination of the Secretary of Agriculture under 
                section 293, '' after ``section 251 of this title,''; 
                and
                    (B) in the second sentence of subsection (a) and in 
                subsections (b) and (c), by striking ``or the Secretary 
                of Commerce'' each place it appears and inserting ``, 
                the Secretary of Commerce, or the Secretary of 
                Agriculture''.

    (b) Chapters 6.--The table of contents for title II of the Trade Act 
of 1974, as amended by subparagraph (A), is amended by inserting after 
the items relating to chapter 5 the following:

             ``Chapter 6--Adjustment Assistance for Farmers

``Sec. 291. Definitions.
``Sec. 292. Petitions; group eligibility.
``Sec. 293. Determinations by Secretary of Agriculture.
``Sec. 294. Study by Secretary of Agriculture when International Trade 
           Commission begins investigation.
``Sec. 295. Benefit information to agricultural commodity producers.
``Sec. 296. Qualifying requirements for agricultural commodity 
           producers.
``Sec. 297. Fraud and recovery of overpayments.
``Sec. 298. Authorization of appropriations.''.

SEC. 143. <<NOTE: 19 USC 2251 note.>> STUDY ON TAA FOR FISHERMEN.

    Not <<NOTE: Deadline.>> later than 1 year after the date of 
enactment of this Act, the Secretary of Commerce shall conduct a study 
and report to Congress regarding whether a trade adjustment assistance 
program is appropriate and feasible for fishermen. For purposes of the 
preceding sentence, the term ``fishermen'' means any person who is 
engaged in commercial fishing or is a United States fish processor.

                       Subtitle D--Effective Date

SEC. 151. <<NOTE: 19 USC note prec. 2271.>> EFFECTIVE DATE.

    (a) In General.--Except as otherwise provided in sections 123(c) and 
141(b), and subsections (b), (c), and (d) of this section, the 
amendments made by this division shall apply to petitions for 
certification filed under chapter 2 or 3 of title II of the Trade Act of 
1974 on or after the date that is 90 days after the date of enactment of 
this Act.
    (b) Workers Certified as Eligible Before Effective Date.--
Notwithstanding subsection (a), a worker shall continue to receive (or 
be eligible to receive) trade adjustment assistance and other benefits 
under chapter 2 of title II of the Trade Act of 1974, as in effect on 
September 30, 2001, for any week for which the worker meets the 
eligibility requirements of such chapter 2 as in effect on such date, if 
on or before such date, the worker--
            (1) was certified as eligible for trade adjustment 
        assistance benefits under such chapter as in effect on such 
        date; and

[[Page 116 STAT. 954]]

            (2) would otherwise be eligible to receive trade adjustment 
        assistance benefits under such chapter as in effect on such 
        date.

    (c) Workers Who Became Eligible During Qualified Period.--
            (1) In general.--Notwithstanding subsection (a) or any other 
        provision of law, including section 285 of the Trade Act of 
        1974, any worker who would have been eligible to receive trade 
        adjustment assistance or other benefits under chapter 2 of title 
        II of the Trade Act of 1974 during the qualified period if such 
        chapter 2 had been in effect during such period, shall be 
        eligible to receive trade adjustment assistance and other 
        benefits under chapter 2 of title II of the Trade Act of 1974, 
        as in effect on September 30, 2001, for any week during the 
        qualified period for which the worker meets the eligibility 
        requirements of such chapter 2 as in effect on September 30, 
        2001.
            (2) Qualified period.--For purposes of this subsection, the 
        term ``qualified period'' means the period beginning on January 
        11, 2002, and ending on the date that is 90 days after the date 
        of enactment of this Act.

    (d) Adjustment Assistance for Firms.--
            (1) In general.--Notwithstanding subsection (a) or any other 
        provision of law, including section 285 of the Trade Act of 
        1974, and except as provided in paragraph (2), any firm that 
        would have been eligible to receive adjustment assistance under 
        chapter 3 of title II of the Trade Act if 1974 during the 
        qualified period if such chapter 3 had been in effect during 
        such period, shall be eligible to receive adjustment assistance 
        under chapter 3 of title II of the Trade Act of 1974, as in 
        effect on September 30, 2001, for any week during the qualified 
        period for which the firm meets the eligibility requirements of 
        such chapter 3 as in effect on September 30, 2001.
            (2) Qualified period.--For purposes of this subsection, the 
        term ``qualified period'' means the period beginning on October 
        1, 2001, and ending on the date that is 90 days after the date 
        of enactment of this Act.

   TITLE II--CREDIT FOR HEALTH INSURANCE COSTS OF ELIGIBLE INDIVIDUALS

SEC. 201. CREDIT FOR HEALTH INSURANCE COSTS OF INDIVIDUALS RECEIVING A 
            TRADE READJUSTMENT ALLOWANCE OR A BENEFIT FROM THE PENSION 
            BENEFIT GUARANTY CORPORATION.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to refundable credits) is 
amended by redesignating section 35 as section 36 and inserting after 
section 34 the following new section:

``SEC. 35. <<NOTE: 26 USC 35.>> HEALTH INSURANCE COSTS OF ELIGIBLE 
            INDIVIDUALS.

    ``(a) In General.--In the case of an individual, there shall be 
allowed as a credit against the tax imposed by subtitle A an amount 
equal to 65 percent of the amount paid by the taxpayer

[[Page 116 STAT. 955]]

for coverage of the taxpayer and qualifying family members under 
qualified health insurance for eligible coverage months beginning in the 
taxable year.
    ``(b) Eligible Coverage Month.--For purposes of this section--
            ``(1) In general.--The term `eligible coverage month' means 
        any month if--
                    ``(A) as of the first day of such month, the 
                taxpayer--
                          ``(i) is an eligible individual,
                          ``(ii) is covered by qualified health 
                      insurance, the premium for which is paid by the 
                      taxpayer,
                          ``(iii) does not have other specified 
                      coverage, and
                          ``(iv) is not imprisoned under Federal, State, 
                      or local authority, and
                    ``(B) such month begins more than 90 days after the 
                date of the enactment of the Trade Act of 2002.
            ``(2) Joint returns.--In the case of a joint return, the 
        requirements of paragraph (1)(A) shall be treated as met with 
        respect to any month if at least 1 spouse satisfies such 
        requirements.

    ``(c) Eligible Individual.--For purposes of this section--
            ``(1) In general.--The term `eligible individual' means--
                    ``(A) an eligible TAA recipient,
                    ``(B) an eligible alternative TAA recipient, and
                    ``(C) an eligible PBGC pension recipient.
            ``(2) Eligible taa recipient.--The term `eligible TAA 
        recipient' means, with respect to any month, any individual who 
        is receiving for any day of such month a trade readjustment 
        allowance under chapter 2 of title II of the Trade Act of 1974 
        or who would be eligible to receive such allowance if section 
        231 of such Act were applied without regard to subsection 
        (a)(3)(B) of such section. An individual shall continue to be 
        treated as an eligible TAA recipient during the first month that 
        such individual would otherwise cease to be an eligible TAA 
        recipient by reason of the preceding sentence.
            ``(3) Eligible alternative taa recipient.--The term 
        `eligible alternative TAA recipient' means, with respect to any 
        month, any individual who--
                    ``(A) is a worker described in section 246(a)(3)(B) 
                of the Trade Act of 1974 who is participating in the 
                program established under section 246(a)(1) of such Act, 
                and
                    ``(B) is receiving a benefit for such month under 
                section 246(a)(2) of such Act.
        An individual shall continue to be treated as an eligible 
        alternative TAA recipient during the first month that such 
        individual would otherwise cease to be an eligible alternative 
        TAA recipient by reason of the preceding sentence.
            ``(4) Eligible pbgc pension recipient.--The term `eligible 
        PBGC pension recipient' means, with respect to any month, any 
        individual who--
                    ``(A) has attained age 55 as of the first day of 
                such month, and
                    ``(B) is receiving a benefit for such month any 
                portion of which is paid by the Pension Benefit Guaranty 
                Corporation under title IV of the Employee Retirement 
                Income Security Act of 1974.

[[Page 116 STAT. 956]]

    ``(d) Qualifying Family Member.--For purposes of this section--
            ``(1) In general.--The term `qualifying family member' 
        means--
                    ``(A) the taxpayer's spouse, and
                    ``(B) any dependent of the taxpayer with respect to 
                whom the taxpayer is entitled to a deduction under 
                section 151(c).
        Such term does not include any individual who has other 
        specified coverage.
            ``(2) Special dependency test in case of divorced parents, 
        etc.--If paragraph (2) or (4) of section 152(e) applies to any 
        child with respect to any calendar year, in the case of any 
        taxable year beginning in such calendar year, such child shall 
        be treated as described in paragraph (1)(B) with respect to the 
        custodial parent (within the meaning of section 152(e)(1)) and 
        not with respect to the noncustodial parent.

    ``(e) Qualified Health Insurance.--For purposes of this section--
            ``(1) In general.--The term `qualified health insurance' 
        means any of the following:
                    ``(A) Coverage under a COBRA continuation provision 
                (as defined in section 9832(d)(1)).
                    ``(B) State-based continuation coverage provided by 
                the State under a State law that requires such coverage.
                    ``(C) Coverage offered through a qualified State 
                high risk pool (as defined in section 2744(c)(2) of the 
                Public Health Service Act).
                    ``(D) Coverage under a health insurance program 
                offered for State employees.
                    ``(E) Coverage under a State-based health insurance 
                program that is comparable to the health insurance 
                program offered for State employees.
                    ``(F) Coverage through an arrangement entered into 
                by a State and--
                          ``(i) a group health plan (including such a 
                      plan which is a multiemployer plan as defined in 
                      section 3(37) of the Employee Retirement Income 
                      Security Act of 1974),
                          ``(ii) an issuer of health insurance coverage,
                          ``(iii) an administrator, or
                          ``(iv) an employer.
                    ``(G) Coverage offered through a State arrangement 
                with a private sector health care coverage purchasing 
                pool.
                    ``(H) Coverage under a State-operated health plan 
                that does not receive any Federal financial 
                participation.
                    ``(I) Coverage under a group health plan that is 
                available through the employment of the eligible 
                individual's spouse.
                    ``(J) In the case of any eligible individual and 
                such individual's qualifying family members, coverage 
                under individual health insurance if the eligible 
                individual was covered under individual health insurance 
                during the entire 30-day period that ends on the date 
                that such individual became separated from the 
                employment which qualified such individual for--

[[Page 116 STAT. 957]]

                          ``(i) in the case of an eligible TAA 
                      recipient, the allowance described in subsection 
                      (c)(2),
                          ``(ii) in the case of an eligible alternative 
                      TAA recipient, the benefit described in subsection 
                      (c)(3)(B), or
                          ``(iii) in the case of any eligible PBGC 
                      pension recipient, the benefit described in 
                      subsection (c)(4)(B).
                For purposes of this subparagraph, the term `individual 
                health insurance' means any insurance which constitutes 
                medical care offered to individuals other than in 
                connection with a group health plan and does not include 
                Federal- or State-based health insurance coverage.
            ``(2) Requirements for state-based coverage.--
                    ``(A) In general.--The term `qualified health 
                insurance' does not include any coverage described in 
                subparagraphs (B) through (H) of paragraph (1) unless 
                the State involved has elected to have such coverage 
                treated as qualified health insurance under this section 
                and such coverage meets the following requirements:
                          ``(i) Guaranteed issue.--Each qualifying 
                      individual is guaranteed enrollment if the 
                      individual pays the premium for enrollment or 
                      provides a qualified health insurance costs credit 
                      eligibility certificate described in section 7527 
                      and pays the remainder of such premium.
                          ``(ii) No imposition of preexisting condition 
                      exclusion.--No pre-existing condition limitations 
                      are imposed with respect to any qualifying 
                      individual.
                          ``(iii) Nondiscriminatory premium.--The total 
                      premium (as determined without regard to any 
                      subsidies) with respect to a qualifying individual 
                      may not be greater than the total premium (as so 
                      determined) for a similarly situated individual 
                      who is not a qualifying individual.
                          ``(iv) Same benefits.--Benefits under the 
                      coverage are the same as (or substantially similar 
                      to) the benefits provided to similarly situated 
                      individuals who are not qualifying individuals.
                    ``(B) Qualifying individual.--For purposes of this 
                paragraph, the term `qualifying individual' means--
                          ``(i) an eligible individual for whom, as of 
                      the date on which the individual seeks to enroll 
                      in the coverage described in subparagraphs (B) 
                      through (H) of paragraph (1), the aggregate of the 
                      periods of creditable coverage (as defined in 
                      section 9801(c)) is 3 months or longer and who, 
                      with respect to any month, meets the requirements 
                      of clauses (iii) and (iv) of subsection (b)(1)(A); 
                      and
                          ``(ii) the qualifying family members of such 
                      eligible individual.
            ``(3) Exception.--The term `qualified health insurance' 
        shall not include--
                    ``(A) a flexible spending or similar arrangement, 
                and
                    ``(B) any insurance if substantially all of its 
                coverage is of excepted benefits described in section 
                9832(c).

[[Page 116 STAT. 958]]

    ``(f) Other Specified Coverage.--For purposes of this section, an 
individual has other specified coverage for any month if, as of the 
first day of such month--
            ``(1) Subsidized coverage.--
                    ``(A) In general.--Such individual is covered under 
                any insurance which constitutes medical care (except 
                insurance substantially all of the coverage of which is 
                of excepted benefits described in section 9832(c)) under 
                any health plan maintained by any employer (or former 
                employer) of the taxpayer or the taxpayer's spouse and 
                at least 50 percent of the cost of such coverage 
                (determined under section 4980B) is paid or incurred by 
                the employer.
                    ``(B) Eligible alternative taa recipients.--In the 
                case of an eligible alternative TAA recipient, such 
                individual is either--
                          ``(i) eligible for coverage under any 
                      qualified health insurance (other than insurance 
                      described in subparagraph (A), (B), or (F) of 
                      subsection (e)(1)) under which at least 50 percent 
                      of the cost of coverage (determined under section 
                      4980B(f)(4)) is paid or incurred by an employer 
                      (or former employer) of the taxpayer or the 
                      taxpayer's spouse, or
                          ``(ii) covered under any such qualified health 
                      insurance under which any portion of the cost of 
                      coverage (as so determined) is paid or incurred by 
                      an employer (or former employer) of the taxpayer 
                      or the taxpayer's spouse.
                    ``(C) Treatment of cafeteria plans.--For purposes of 
                subparagraphs (A) and (B), the cost of coverage shall be 
                treated as paid or incurred by an employer to the extent 
                the coverage is in lieu of a right to receive cash or 
                other qualified benefits under a cafeteria plan (as 
                defined in section 125(d)).
            ``(2) Coverage under medicare, medicaid, or schip.--Such 
        individual--
                    ``(A) is entitled to benefits under part A of title 
                XVIII of the Social Security Act or is enrolled under 
                part B of such title, or
                    ``(B) is enrolled in the program under title XIX or 
                XXI of such Act (other than under section 1928 of such 
                Act).
            ``(3) Certain other coverage.--Such individual--
                    ``(A) is enrolled in a health benefits plan under 
                chapter 89 of title 5, United States Code, or
                    ``(B) is entitled to receive benefits under chapter 
                55 of title 10, United States Code.

    ``(g) Special Rules.--
            ``(1) Coordination with advance payments of credit.--With 
        respect to any taxable year, the amount which would (but for 
        this subsection) be allowed as a credit to the taxpayer under 
        subsection (a) shall be reduced (but not below zero) by the 
        aggregate amount paid on behalf of such taxpayer under section 
        7527 for months beginning in such taxable year.
            ``(2) Coordination with other deductions.--Amounts taken 
        into account under subsection (a) shall not be taken into 
        account in determining any deduction allowed under section 
        162(l) or 213.

[[Page 116 STAT. 959]]

            ``(3) MSA distributions.--Amounts distributed from an Archer 
        MSA (as defined in section 220(d)) shall not be taken into 
        account under subsection (a).
            ``(4) Denial of credit to dependents.--No credit shall be 
        allowed under this section to any individual with respect to 
        whom a deduction under section 151 is allowable to another 
        taxpayer for a taxable year beginning in the calendar year in 
        which such individual's taxable year begins.
            ``(5) Both spouses eligible individuals.--The spouse of the 
        taxpayer shall not be treated as a qualifying family member for 
        purposes of subsection (a), if--
                    ``(A) the taxpayer is married at the close of the 
                taxable year,
                    ``(B) the taxpayer and the taxpayer's spouse are 
                both eligible individuals during the taxable year, and
                    ``(C) the taxpayer files a separate return for the 
                taxable year.
            ``(6) Marital status; certain married individuals living 
        apart.--Rules similar to the rules of paragraphs (3) and (4) of 
        section 21(e) shall apply for purposes of this section.
            ``(7) Insurance which covers other individuals.--For 
        purposes of this section, rules similar to the rules of section 
        213(d)(6) shall apply with respect to any contract for qualified 
        health insurance under which amounts are payable for coverage of 
        an individual other than the taxpayer and qualifying family 
        members.
            ``(8) Treatment of payments.--For purposes of this section--
                    ``(A) Payments by secretary.--Payments made by the 
                Secretary on behalf of any individual under section 7527 
                (relating to advance payment of credit for health 
                insurance costs of eligible individuals) shall be 
                treated as having been made by the taxpayer on the first 
                day of the month for which such payment was made.
                    ``(B) Payments by taxpayer.--Payments made by the 
                taxpayer for eligible coverage months shall be treated 
                as having been made by the taxpayer on the first day of 
                the month for which such payment was made.
            ``(9) Regulations.--The Secretary may prescribe such 
        regulations and other guidance as may be necessary or 
        appropriate to carry out this section, section 6050T, and 
        section 7527.''.

    (b) Promotion of State High Risk Pools.--Title XXVII of the Public 
Health Service Act is amended by inserting after section 2744 the 
following new section:

``SEC. 2745. <<NOTE: 42 USC 300gg-45.>> PROMOTION OF QUALIFIED HIGH RISK 
            POOLS.

    ``(a) Seed Grants to States.--The Secretary shall provide from the 
funds appropriated under subsection (c)(1) a grant of up to $1,000,000 
to each State that has not created a qualified high risk pool as of the 
date of the enactment of this section for the State's costs of creation 
and initial operation of such a pool.
    ``(b) Matching Funds for Operation of Pools.--
            ``(1) In general.--In the case of a State that has 
        established a qualified high risk pool that--

[[Page 116 STAT. 960]]

                    ``(A) restricts premiums charged under the pool to 
                no more than 150 percent of the premium for applicable 
                standard risk rates;
                    ``(B) offers a choice of two or more coverage 
                options through the pool; and
                    ``(C) has in effect a mechanism reasonably designed 
                to ensure continued funding of losses incurred by the 
                State after the end of fiscal year 2004 in connection 
                with operation of the pool;
        the Secretary shall provide, from the funds appropriated under 
        subsection (c)(2) and allotted to the State under paragraph (2), 
        a grant of up to 50 percent of the losses incurred by the State 
        in connection with the operation of the pool.
            ``(2) Allotment.--The amounts appropriated under subsection 
        (c)(2) for a fiscal year shall be made available to the States 
        in accordance with a formula that is based upon the number of 
        uninsured individuals in the States.

    ``(c) Funding.--Out of any money in the Treasury of the United 
States not otherwise appropriated, there are authorized and 
appropriated--
            ``(1) $20,000,000 for fiscal year 2003 to carry out 
        subsection (a); and
            ``(2) $40,000,000 for each of fiscal years 2003 and 2004 to 
        carry out subsection (b).

Funds appropriated under this subsection for a fiscal year shall remain 
available for obligation through the end of the following fiscal year. 
Nothing in this section shall be construed as providing a State with an 
entitlement to a grant under this section.
    ``(d) Qualified High Risk Pool and State Defined.--For purposes of 
this section, the term `qualified high risk pool' has the meaning given 
such term in section 2744(c)(2) and the term `State' means any of the 50 
States and the District of Columbia.''.

    (c) Conforming Amendments.--
            (1) Paragraph (2) of section 1324(b) of title 31, United 
        States Code, is amended by inserting before the period ``, or 
        from section 35 of such Code''.
            (2) The table of sections for subpart C of part IV of 
        chapter 1 of the Internal Revenue Code of 1986 is amended by 
        striking the last item and inserting the following new items:
                ``Sec. 35. Health insurance costs of eligible 
                                individuals.
                ``Sec. 36. Overpayments of tax.''.

    (d)  <<NOTE: 26 USC 35 note.>> Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to taxable years 
        beginning after December 31, 2001.
            (2) State high risk pools.--The amendment made by subsection 
        (b) shall take effect on the date of the enactment of this Act.

SEC. 202. ADVANCE PAYMENT OF CREDIT FOR HEALTH INSURANCE COSTS OF 
            ELIGIBLE INDIVIDUALS.

    (a) In General.--Chapter 77 of the Internal Revenue Code of 1986 
(relating to miscellaneous provisions) is amended by adding at the end 
the following new section:

[[Page 116 STAT. 961]]

``SEC. 7527. <<NOTE: 26 USC 7527.>> ADVANCE PAYMENT OF CREDIT FOR HEALTH 
            INSURANCE COSTS OF ELIGIBLE INDIVIDUALS.

    ``(a) General <<NOTE: Deadline.>> Rule.--Not later than August 1, 
2003, the Secretary shall establish a program for making payments on 
behalf of certified individuals to providers of qualified health 
insurance (as defined in section 35(e)) for such individuals.

    ``(b) Limitation on Advance Payments During any Taxable Year.--The 
Secretary may make payments under subsection (a) only to the extent that 
the total amount of such payments made on behalf of any individual 
during the taxable year does not exceed 65 percent of the amount paid by 
the taxpayer for coverage of the taxpayer and qualifying family members 
under qualified health insurance for eligible coverage months beginning 
in the taxable year.
    ``(c) Certified Individual.--For purposes of this section, the term 
`certified individual' means any individual for whom a qualified health 
insurance costs credit eligibility certificate is in effect.
    ``(d) Qualified Health Insurance Costs Credit Eligibility 
Certificate.--For purposes of this section, the term `qualified health 
insurance costs credit eligibility certificate' means any written 
statement that an individual is an eligible individual (as defined in 
section 35(c)) if such statement provides such information as the 
Secretary may require for purposes of this section and--
            ``(1) in the case of an eligible TAA recipient (as defined 
        in section 35(c)(2)) or an eligible alternative TAA recipient 
        (as defined in section 35(c)(3)), is certified by the Secretary 
        of Labor (or by any other person or entity designated by the 
        Secretary), or
            ``(2) in the case of an eligible PBGC pension recipient (as 
        defined in section 35(c)(4)), is certified by the Pension 
        Benefit Guaranty Corporation (or by any other person or entity 
        designated by the Secretary).''.

    (b) Disclosure of Return Information for Purposes of Carrying out a 
Program for Advance Payment of Credit for Health Insurance Costs of 
Eligible Individuals.--
            (1) In general.-- <<NOTE: 26 USC 6103.>> Subsection (l) of 
        section 6103 of such Code (relating to disclosure of returns and 
        return information for purposes other than tax administration) 
        is amended by adding at the end the following new paragraph:
            ``(18) Disclosure of return information for purposes of 
        carrying out a program for advance payment of credit for health 
        insurance costs of eligible individuals.--The Secretary may 
        disclose to providers of health insurance for any certified 
        individual (as defined in section 7527(c)) return information 
        with respect to such certified individual only to the extent 
        necessary to carry out the program established by section 7527 
        (relating to advance payment of credit for health insurance 
        costs of eligible individuals).''.
            (2) Procedures and recordkeeping related to disclosures.--
        Subsection (p) of such section is amended--
                    (A) in paragraph (3)(A) by striking ``or (17)'' and 
                inserting ``(17), or (18)'', and
                    (B) in paragraph (4) by inserting ``or (17)'' after 
                ``any other person described in subsection (l)(16)'' 
                each place it appears.
            (3) Unauthorized inspection of returns or return 
        information.--Section 7213A(a)(1)(B) of such Code <<NOTE: 26 USC 
        7213A.>> is amended 

[[Page 116 STAT. 962]]

        by striking ``section 6103(n)'' and inserting ``subsection 
        (l)(18) or (n) of section 6103''.

    (c) Information Reporting.--
            (1) In general.--Subpart B of part III of subchapter A of 
        chapter 61 of the Internal Revenue Code of 1986 (relating to 
        information concerning transactions with other persons) is 
        amended by inserting after section 6050S the following new 
        section:

``SEC. 6050T. <<NOTE: 26 USC 6050T.>> RETURNS RELATING TO CREDIT FOR 
            HEALTH INSURANCE COSTS OF ELIGIBLE INDIVIDUALS.

    ``(a) Requirement of Reporting.--Every person who is entitled to 
receive payments for any month of any calendar year under section 7527 
(relating to advance payment of credit for health insurance costs of 
eligible individuals) with respect to any certified individual (as 
defined in section 7527(c)) shall, at such time as the Secretary may 
prescribe, make the return described in subsection (b) with respect to 
each such individual.
    ``(b) Form and Manner of Returns.--A return is described in this 
subsection if such return--
            ``(1) is in such form as the Secretary may prescribe, and
            ``(2) contains--
                    ``(A) the name, address, and TIN of each individual 
                referred to in subsection (a),
                    ``(B) the number of months for which amounts were 
                entitled to be received with respect to such individual 
                under section 7527 (relating to advance payment of 
                credit for health insurance costs of eligible 
                individuals),
                    ``(C) the amount entitled to be received for each 
                such month, and
                    ``(D) such other information as the Secretary may 
                prescribe.

    ``(c) Statements To Be Furnished to Individuals With Respect to Whom 
Information Is Required.--Every person required to make a return under 
subsection (a) shall furnish to each individual whose name is required 
to be set forth in such return a written statement showing--
            ``(1) the name and address of the person required to make 
        such return and the phone number of the information contact for 
        such person, and
            ``(2) the information required to be shown on the return 
        with respect to such individual.

The written statement required <<NOTE: Deadline.>>  under the preceding 
sentence shall be furnished on or before January 31 of the year 
following the calendar year for which the return under subsection (a) is 
required to be made.''.
            (2) Assessable penalties.--
                    (A) Subparagraph (B) <<NOTE: 26 USC 6724.>> of 
                section 6724(d)(1) of such Code (relating to 
                definitions) is amended by redesignating clauses (xi) 
                through (xvii) as clauses (xii) through (xviii), 
                respectively, and by inserting after clause (x) the 
                following new clause:
                          ``(xi) section 6050T (relating to returns 
                      relating to credit for health insurance costs of 
                      eligible individuals),''.
                    (B) Paragraph (2) of section 6724(d) of such Code is 
                amended by striking ``or'' at the end of subparagraph 
                (Z),

[[Page 116 STAT. 963]]

                by striking the period at the end of subparagraph (AA) 
                and inserting ``, or'', and by adding after subparagraph 
                (AA) the following new subparagraph:
                    ``(BB) section 6050T (relating to returns relating 
                to credit for health insurance costs of eligible 
                individuals).''.

    (d) Clerical Amendments.--
            (1) Advance payment.--The table of sections for chapter 77 
        of the Internal Revenue Code of 1986 is amended by adding at the 
        end the following new item:
                ``Sec. 7527. Advance payment of credit for health 
                                insurance costs of eligible 
                                individuals.''.

            (2) Information reporting.--The table of sections for 
        subpart B of part III of subchapter A of chapter 61 of such Code 
        is amended by inserting after the item relating to section 6050S 
        the following new item:
                ``Sec. 6050T. Returns relating to credit for health 
                                insurance costs of eligible 
                                individuals.''.

    (e) Effective <<NOTE: 26 USC 6050T note.>> Date.--The amendments 
made by this section shall take effect on the date of the enactment of 
this Act.

SEC. 203. HEALTH INSURANCE ASSISTANCE FOR ELIGIBLE INDIVIDUALS.

    (a) Eligibility for Grants.--Section 173(a) of the Workforce 
Investment Act of 1998 (29 U.S.C. 2918(a)) is amended--
            (1) in paragraph (2), by striking ``and'' at the end;
            (2) in paragraph (3), by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following:
            ``(4) from funds appropriated under section 174(c)--
                    ``(A) to a State or entity (as defined in section 
                173(c)(1)(B)) to carry out subsection (f), including 
                providing assistance to eligible individuals; and
                    ``(B) to a State or entity (as so defined) to carry 
                out subsection (g), including providing assistance to 
                eligible individuals.''.

    (b) Use of Funds for Health Insurance Coverage.--Section 173 of the 
Workforce Investment Act of 1998 (29 U.S.C. 2918) is amended by adding 
at the end the following:
    ``(f) Health Insurance Coverage Assistance for Eligible 
Individuals.--
            ``(1) In general.--Funds made available to a State or entity 
        under paragraph (4)(A) of subsection (a) may be used by the 
        State or entity for the following:
                    ``(A) Health insurance coverage.--To assist an 
                eligible individual and such individual's qualifying 
                family members in enrolling in qualified health 
                insurance.
                    ``(B) Administrative and start-up expenses.--To pay 
                the administrative expenses related to the enrollment of 
                eligible individuals and such individuals' qualifying 
                family members in qualified health insurance, 
                including--
                          ``(i) eligibility verification activities;
                          ``(ii) the notification of eligible 
                      individuals of available qualified health 
                      insurance options;
                          ``(iii) processing qualified health insurance 
                      costs credit eligibility certificates provided for 
                      under section 7527 of the Internal Revenue Code of 
                      1986;

[[Page 116 STAT. 964]]

                          ``(iv) providing assistance to eligible 
                      individuals in enrolling in qualified health 
                      insurance;
                          ``(v) the development or installation of 
                      necessary data management systems; and
                          ``(vi) any other expenses determined 
                      appropriate by the Secretary, including start-up 
                      costs and on going administrative expenses to 
                      carry out clauses (iv) through (ix) of paragraph 
                      (2)(A).
            ``(2) Qualified health insurance.--For purposes of this 
        subsection and subsection (g)--
                    ``(A) In general.--The term `qualified health 
                insurance' means any of the following:
                          ``(i) Coverage under a COBRA continuation 
                      provision (as defined in section 733(d)(1) of the 
                      Employee Retirement Income Security Act of 1974).
                          ``(ii) State-based continuation coverage 
                      provided by the State under a State law that 
                      requires such coverage.
                          ``(iii) Coverage offered through a qualified 
                      State high risk pool (as defined in section 
                      2744(c)(2) of the Public Health Service Act).
                          ``(iv) Coverage under a health insurance 
                      program offered for State employees.
                          ``(v) Coverage under a State-based health 
                      insurance program that is comparable to the health 
                      insurance program offered for State employees.
                          ``(vi) Coverage through an arrangement entered 
                      into by a State and--
                                    ``(I) a group health plan (including 
                                such a plan which is a multiemployer 
                                plan as defined in section 3(37) of the 
                                Employee Retirement Income Security Act 
                                of 1974),
                                    ``(II) an issuer of health insurance 
                                coverage,
                                    ``(III) an administrator, or
                                    ``(IV) an employer.
                          ``(vii) Coverage offered through a State 
                      arrangement with a private sector health care 
                      coverage purchasing pool.
                          ``(viii) Coverage under a State-operated 
                      health plan that does not receive any Federal 
                      financial participation.
                          ``(ix) Coverage under a group health plan that 
                      is available through the employment of the 
                      eligible individual's spouse.
                          ``(x) In the case of any eligible individual 
                      and such individual's qualifying family members, 
                      coverage under individual health insurance if the 
                      eligible individual was covered under individual 
                      health insurance during the entire 30-day period 
                      that ends on the date that such individual became 
                      separated from the employment which qualified such 
                      individual for--
                                    ``(I) in the case of an eligible TAA 
                                recipient, the allowance described in 
                                section 35(c)(2) of the Internal Revenue 
                                Code of 1986,
                                    ``(II) in the case of an eligible 
                                alternative TAA recipient, the benefit 
                                described in section 35(c)(3)(B) of such 
                                Code, or

[[Page 116 STAT. 965]]

                                    ``(III) in the case of any eligible 
                                PBGC pension recipient, the benefit 
                                described in section 35(c)(4)(B) of such 
                                Code.
                      For purposes of this clause, the term `individual 
                      health insurance' means any insurance which 
                      constitutes medical care offered to individuals 
                      other than in connection with a group health plan 
                      and does not include Federal- or State-based 
                      health insurance coverage.
                    ``(B) Requirements for state-based coverage.--
                          ``(i) In general.--The term `qualified health 
                      insurance' does not include any coverage described 
                      in clauses (ii) through (viii) of subparagraph (A) 
                      unless the State involved has elected to have such 
                      coverage treated as qualified health insurance 
                      under this paragraph and such coverage meets the 
                      following requirements:
                                    ``(I) Guaranteed issue.--Each 
                                qualifying individual is guaranteed 
                                enrollment if the individual pays the 
                                premium for enrollment or provides a 
                                qualified health insurance costs credit 
                                eligibility certificate described in 
                                section 7527 of the Internal Revenue 
                                Code of 1986 and pays the remainder of 
                                such premium.
                                    ``(II) No imposition of preexisting 
                                condition exclusion.--No pre-existing 
                                condition limitations are imposed with 
                                respect to any qualifying individual.
                                    ``(III) Nondiscriminatory premium.--
                                The total premium (as determined without 
                                regard to any subsidies) with respect to 
                                a qualifying individual may not be 
                                greater than the total premium (as so 
                                determined) for a similarly situated 
                                individual who is not a qualifying 
                                individual.
                                    ``(IV) Same benefits.--Benefits 
                                under the coverage are the same as (or 
                                substantially similar to) the benefits 
                                provided to similarly situated 
                                individuals who are not qualifying 
                                individuals.
                          ``(ii) Qualifying individual.--For purposes of 
                      this subparagraph, the term `qualifying 
                      individual' means--
                                    ``(I) an eligible individual for 
                                whom, as of the date on which the 
                                individual seeks to enroll in clauses 
                                (ii) through (viii) of subparagraph (A), 
                                the aggregate of the periods of 
                                creditable coverage (as defined in 
                                section 9801(c) of the Internal Revenue 
                                Code of 1986) is 3 months or longer and 
                                who, with respect to any month, meets 
                                the requirements of clauses (iii) and 
                                (iv) of section 35(b)(1)(A) of such 
                                Code; and
                                    ``(II) the qualifying family members 
                                of such eligible individual.
                    ``(C) Exception.--The term `qualified health 
                insurance' shall not include--
                          ``(i) a flexible spending or similar 
                      arrangement, and
                          ``(ii) any insurance if substantially all of 
                      its coverage is of excepted benefits described in 
                      section 733(c)

[[Page 116 STAT. 966]]

                      of the Employee Retirement Income Security Act of 
                      1974.
            ``(3) Availability of funds.--
                    ``(A) Expedited procedures.--With respect to 
                applications submitted by States or entities for grants 
                under this subsection, the Secretary shall--
                          ``(i) <<NOTE: Deadline.>> not later than 15 
                      days after the date on which the Secretary 
                      receives a completed application from a State or 
                      entity, notify the State or entity of the 
                      determination of the Secretary with respect to the 
                      approval or disapproval of such application;
                          ``(ii) in the case of an application of a 
                      State or other entity that is disapproved by the 
                      Secretary, provide technical assistance, at the 
                      request of the State or entity, in a timely manner 
                      to enable the State or entity to submit an 
                      approved application; and
                          ``(iii) develop procedures to expedite the 
                      provision of funds to States and entities with 
                      approved applications.
                    ``(B) Availability and distribution of funds.--The 
                Secretary shall ensure that funds made available under 
                section 174(c)(1)(A) to carry out subsection (a)(4)(A) 
                are available to States and entities throughout the 
                period described in section 174(c)(2)(A).
            ``(4) Eligible individual defined.--For purposes of this 
        subsection and subsection (g), the term `eligible individual' 
        means--
                  ``(A) an eligible TAA recipient (as defined in section 
                35(c)(2) of the Internal Revenue Code of 1986),
                    ``(B) an eligible alternative TAA recipient (as 
                defined in section 35(c)(3) of the Internal Revenue Code 
                of 1986), and
                    ``(C) an eligible PBGC pension recipient (as defined 
                in section 35(c)(4) of the Internal Revenue Code of 
                1986),
        who, as of the first day of the month, does not have other 
        specified coverage and is not imprisoned under Federal, State, 
        or local authority.
            ``(5) Qualifying family member defined.--For purposes of 
        this subsection and subsection (g)--
                    ``(A) In general.--The term `qualifying family 
                member' means--
                          ``(i) the eligible individual's spouse, and
                          ``(ii) any dependent of the eligible 
                      individual with respect to whom the individual is 
                      entitled to a deduction under section 151(c) of 
                      the Internal Revenue Code of 1986.
                Such term does not include any individual who has other 
                specified coverage.
                    ``(B) Special dependency test in case of divorced 
                parents, etc.--If paragraph (2) or (4) of section 152(e) 
                of such Code applies to any child with respect to any 
                calendar year, in the case of any taxable year beginning 
                in such calendar year, such child shall be treated as 
                described in subparagraph (A)(ii) with respect to the 
                custodial parent (within the meaning of section 
                152(e)(1) of such Code) and not with respect to the 
                noncustodial parent.

[[Page 116 STAT. 967]]

            ``(6) State.--For purposes of this subsection and subsection 
        (g), the term `State' includes an entity as defined in 
        subsection (c)(1)(B).
            ``(7) Other specified coverage.--For purposes of this 
        subsection, an individual has other specified coverage for any 
        month if, as of the first day of such month--
                    ``(A) Subsidized coverage.--
                          ``(i) In general.--Such individual is covered 
                      under any insurance which constitutes medical care 
                      (except insurance substantially all of the 
                      coverage of which is of excepted benefits 
                      described in section 9832(c) of the Internal 
                      Revenue Code of 1986) under any health plan 
                      maintained by any employer (or former employer) of 
                      the taxpayer or the taxpayer's spouse and at least 
                      50 percent of the cost of such coverage 
                      (determined under section 4980B of such Code) is 
                      paid or incurred by the employer.
                          ``(ii) Eligible alternative taa recipients.--
                      In the case of an eligible alternative TAA 
                      recipient (as defined in section 35(c)(3) of the 
                      Internal Revenue Code of 1986), such individual is 
                      either--
                                    ``(I) eligible for coverage under 
                                any qualified health insurance (other 
                                than insurance described in clause (i), 
                                (ii), or (vi) of paragraph (2)(A)) under 
                                which at least 50 percent of the cost of 
                                coverage (determined under section 
                                4980B(f)(4) of such Code) is paid or 
                                incurred by an employer (or former 
                                employer) of the taxpayer or the 
                                taxpayer's spouse, or
                                    ``(II) covered under any such 
                                qualified health insurance under which 
                                any portion of the cost of coverage (as 
                                so determined) is paid or incurred by an 
                                employer (or former employer) of the 
                                taxpayer or the taxpayer's spouse.
                          ``(iii) Treatment of cafeteria plans.--For 
                      purposes of clauses (i) and (ii), the cost of 
                      coverage shall be treated as paid or incurred by 
                      an employer to the extent the coverage is in lieu 
                      of a right to receive cash or other qualified 
                      benefits under a cafeteria plan (as defined in 
                      section 125(d) of the Internal Revenue Code of 
                      1986).
                    ``(B) Coverage under medicare, medicaid, or schip.--
                Such individual--
                          ``(i) is entitled to benefits under part A of 
                      title XVIII of the Social Security Act or is 
                      enrolled under part B of such title, or
                          ``(ii) is enrolled in the program under title 
                      XIX or XXI of such Act (other than under section 
                      1928 of such Act).
                    ``(C) Certain other coverage.--Such individual--
                          ``(i) is enrolled in a health benefits plan 
                      under chapter 89 of title 5, United States Code, 
                      or
                          ``(ii) is entitled to receive benefits under 
                      chapter 55 of title 10, United States Code.

    ``(g) Interim Health Insurance Coverage and Other Assistance.--

[[Page 116 STAT. 968]]

            ``(1) In general.--Funds made available to a State or entity 
        under paragraph (4)(B) of subsection (a) may be used by the 
        State or entity to provide assistance and support services to 
        eligible individuals, including health care coverage to the 
        extent provided under subsection (f)(1)(A), transportation, 
        child care, dependent care, and income assistance.
            ``(2) Income support.--With respect to any income assistance 
        provided to an eligible individual with such funds, such 
        assistance shall supplement and not supplant other income 
        support or assistance provided under chapter 2 of title II of 
        the Trade Act of 1974 (19 U.S.C. 2271 et seq.) (as in effect on 
        the day before the effective date of the Trade Act of 2002) or 
        the unemployment compensation laws of the State where the 
        eligible individual resides.
            ``(3) Health insurance coverage.--With respect to any 
        assistance provided to an eligible individual with such funds in 
        enrolling in qualified health insurance, the following rules 
        shall apply:
                    ``(A) The State or entity may provide assistance in 
                obtaining such coverage to the eligible individual and 
                to such individual's qualifying family members.
                    ``(B) Such assistance shall supplement and may not 
                supplant any other State or local funds used to provide 
                health care coverage and may not be included in 
                determining the amount of non-Federal contributions 
                required under any program.
            ``(4) Availability of funds.--
                    ``(A) Expedited procedures.--With respect to 
                applications submitted by States or entities for grants 
                under this subsection, the Secretary shall--
                          ``(i) <<NOTE: Deadline.>> not later than 15 
                      days after the date on which the Secretary 
                      receives a completed application from a State or 
                      entity, notify the State or entity of the 
                      determination of the Secretary with respect to the 
                      approval or disapproval of such application;
                          ``(ii) in the case of an application of a 
                      State or entity that is disapproved by the 
                      Secretary, provide technical assistance, at the 
                      request of the State or entity, in a timely manner 
                      to enable the State or entity to submit an 
                      approved application; and
                          ``(iii) develop procedures to expedite the 
                      provision of funds to States and entities with 
                      approved applications.
                    ``(B) Availability and distribution of funds.--The 
                Secretary shall ensure that funds made available under 
                section 174(c)(1)(B) to carry out subsection (a)(4)(B) 
                are available to States and entities throughout the 
                period described in section 174(c)(2)(B).
            ``(5) Inclusion of certain individuals as eligible 
        individuals.--For purposes of this subsection, the term 
        `eligible individual' includes an individual who is a member of 
        a group of workers certified after April 1, 2002, under chapter 
        2 of title II of the Trade Act of 1974 (as in effect on the day 
        before the effective date of the Trade Act of 2002) and is 
        participating in the trade adjustment allowance program under 
        such chapter (as so in effect) or who would be determined to be 
        participating in such program under such chapter (as

[[Page 116 STAT. 969]]

        so in effect) if such chapter were applied without regard to 
        section 231(a)(3)(B) of the Trade Act of 1974 (as so in 
        effect).''.

    (c) Authorization of Appropriations.--Section 174 of the Workforce 
Investment Act of 1998 (29 U.S.C. 2919) is amended by adding at the end 
the following:
    ``(c) Assistance for Eligible Workers.--
            ``(1) Authorization and appropriation for fiscal year 
        2002.--There are authorized to be appropriated and 
        appropriated--
                    ``(A) to carry out subsection (a)(4)(A) of section 
                173, $10,000,000 for fiscal year 2002; and
                    ``(B) to carry out subsection (a)(4)(B) of section 
                173, $50,000,000 for fiscal year 2002.
            ``(2) Authorization of appropriations for subsequent fiscal 
        years.--There are authorized to be appropriated--
                    ``(A) to carry out subsection (a)(4)(A) of section 
                173, $60,000,000 for each of fiscal years 2003 through 
                2007; and
                    ``(B) to carry out subsection (a)(4)(B) of section 
                173--
                          ``(i) $100,000,000 for fiscal year 2003; and
                          ``(ii) $50,000,000 for fiscal year 2004.
            ``(3) Availability of funds.--Funds appropriated pursuant 
        to--
                    ``(A) paragraphs (1)(A) and (2)(A) for each fiscal 
                year shall, notwithstanding section 189(g), remain 
                available for obligation during the pendency of any 
                outstanding claim under the Trade Act of 1974, as 
                amended by the Trade Act of 2002; and
                    ``(B) paragraph (1)(B) and (2)(B), for each fiscal 
                year shall, notwithstanding section 189(g), remain 
                available during the period that begins on the date of 
                enactment of the Trade Act of 2002 and ends on September 
                30, 2004.''.

    (d) Conforming Amendment.--Section 132(a)(2)(A) of the Workforce 
Investment Act of 1998 (29 U.S.C. 2862(a)(2)(A)) is amended by inserting 
``, other than under subsection (a)(4), (f), and (g)'' after ``grants''.

    (e) Temporary Extension of COBRA Election Period for Certain 
Individuals.--
            (1) ERISA amendments.--Section 605 of the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 1165) is 
        amended--
                    (A) by inserting ``(a) In General.--'' before ``For 
                purposes of this part''; and
                    (B) by adding at the end the following:

    ``(b) Temporary Extension of COBRA Election Period for Certain 
Individuals.--
            ``(1) In general.--In <<NOTE: Deadline.>> the case of a 
        nonelecting TAA-eligible individual and notwithstanding 
        subsection (a), such individual may elect continuation coverage 
        under this part during the 60-day period that begins on the 
        first day of the month in which the individual becomes a TAA-
        eligible individual, but only if such election is made not later 
        than 6 months after the date of the TAA-related loss of 
        coverage.
            ``(2) Commencement of coverage; no reach-back.--Any 
        continuation coverage elected by a TAA-eligible individual under 
        paragraph (1) shall commence at the beginning of the

[[Page 116 STAT. 970]]

        60-day election period described in such paragraph and shall not 
        include any period prior to such 60-day election period.
            ``(3) Preexisting conditions.--With respect to an individual 
        who elects continuation coverage pursuant to paragraph (1), the 
        period--
                    ``(A) beginning on the date of the TAA-related loss 
                of coverage, and
                    ``(B) ending on the first day of the 60-day election 
                period described in paragraph (1),
        shall be disregarded for purposes of determining the 63-day 
        periods referred to in section 701(c)(2), section 2701(c)(2) of 
        the Public Health Service Act, and section 9801(c)(2) of the 
        Internal Revenue Code of 1986.
            ``(4) Definitions.--For purposes of this subsection:
                    ``(A) Nonelecting taa-eligible individual.--The term 
                `nonelecting TAA-eligible individual' means a TAA-
                eligible individual who--
                          ``(i) has a TAA-related loss of coverage; and
                          ``(ii) did not elect continuation coverage 
                      under this part during the TAA-related election 
                      period.
                    ``(B) TAA-eligible individual.--The term `TAA-
                eligible individual' means--
                          ``(i) an eligible TAA recipient (as defined in 
                      paragraph (2) of section 35(c) of the Internal 
                      Revenue Code of 1986), and
                          ``(ii) an eligible alternative TAA recipient 
                      (as defined in paragraph (3) of such section).
                    ``(C) TAA-related election period.--The term `TAA-
                related election period' means, with respect to a TAA-
                related loss of coverage, the 60-day election period 
                under this part which is a direct consequence of such 
                loss.
                    ``(D) TAA-related loss of coverage.--The term `TAA-
                related loss of coverage' means, with respect to an 
                individual whose separation from employment gives rise 
                to being an TAA-eligible individual, the loss of health 
                benefits coverage associated with such separation.''.
            (2) PHSA amendments.--Section 2205 of the Public Health 
        Service Act (42 U.S.C. 300bb-5) is amended--
                    (A) by inserting ``(a) In General.--'' before ``For 
                purposes of this title''; and
                    (B) by adding at the end the following:

    ``(b) Temporary Extension of COBRA Election Period for Certain 
Individuals.--
            ``(1) In <<NOTE: Deadline.>> general.--In the case of a 
        nonelecting TAA-eligible individual and notwithstanding 
        subsection (a), such individual may elect continuation coverage 
        under this title during the 60-day period that begins on the 
        first day of the month in which the individual becomes a TAA-
        eligible individual, but only if such election is made not later 
        than 6 months after the date of the TAA-related loss of 
        coverage.
            ``(2) Commencement of coverage; no reach-back.--Any 
        continuation coverage elected by a TAA-eligible individual under 
        paragraph (1) shall commence at the beginning of the 60-day 
        election period described in such paragraph and shall not 
        include any period prior to such 60-day election period.

[[Page 116 STAT. 971]]

            ``(3) Preexisting conditions.--With respect to an individual 
        who elects continuation coverage pursuant to paragraph (1), the 
        period--
                    ``(A) beginning on the date of the TAA-related loss 
                of coverage, and
                    ``(B) ending on the first day of the 60-day election 
                period described in paragraph (1),
        shall be disregarded for purposes of determining the 63-day 
        periods referred to in section 2701(c)(2), section 701(c)(2) of 
        the Employee Retirement Income Security Act of 1974, and section 
        9801(c)(2) of the Internal Revenue Code of 1986.
            ``(4) Definitions.--For purposes of this subsection:
                    ``(A) Nonelecting taa-eligible individual.--The term 
                `nonelecting TAA-eligible individual' means a TAA-
                eligible individual who--
                          ``(i) has a TAA-related loss of coverage; and
                          ``(ii) did not elect continuation coverage 
                      under this part during the TAA-related election 
                      period.
                    ``(B) TAA-eligible individual.--The term `TAA-
                eligible individual' means--
                          ``(i) an eligible TAA recipient (as defined in 
                      paragraph (2) of section 35(c) of the Internal 
                      Revenue Code of 1986), and
                          ``(ii) an eligible alternative TAA recipient 
                      (as defined in paragraph (3) of such section).
                    ``(C) TAA-related election period.--The term `TAA-
                related election period' means, with respect to a TAA-
                related loss of coverage, the 60-day election period 
                under this part which is a direct consequence of such 
                loss.
                    ``(D) TAA-related loss of coverage.--The term `TAA-
                related loss of coverage' means, with respect to an 
                individual whose separation from employment gives rise 
                to being an TAA-eligible individual, the loss of health 
                benefits coverage associated with such separation.''.
            (3) IRC amendments.--Paragraph (5) of section 4980B(f) of 
        the Internal Revenue Code of <<NOTE: 26 USC 4980B.>> 1986 
        (relating to election) is amended by adding at the end the 
        following:
                    ``(C) Temporary extension of cobra election period 
                for certain individuals.--
                          ``(i) In general.--In <<NOTE: Deadline.>> the 
                      case of a nonelecting TAA-eligible individual and 
                      notwithstanding subparagraph (A), such individual 
                      may elect continuation coverage under this 
                      subsection during the 60-day period that begins on 
                      the first day of the month in which the individual 
                      becomes a TAA-eligible individual, but only if 
                      such election is made not later than 6 months 
                      after the date of the TAA-related loss of 
                      coverage.
                          ``(ii) Commencement of coverage; no reach-
                      back.--Any continuation coverage elected by a TAA-
                      eligible individual under clause (i) shall 
                      commence at the beginning of the 60-day election 
                      period described in such paragraph and shall not 
                      include any period prior to such 60-day election 
                      period.
                          ``(iii) Preexisting conditions.--With respect 
                      to an individual who elects continuation coverage 
                      pursuant to clause (i), the period--

[[Page 116 STAT. 972]]

                                    ``(I) beginning on the date of the 
                                TAA-related loss of coverage, and
                                    ``(II) ending on the first day of 
                                the 60-day election period described in 
                                clause (i),
                      shall be disregarded for purposes of determining 
                      the 63-day periods referred to in section 
                      9801(c)(2), section 701(c)(2) of the Employee 
                      Retirement Income Security Act of 1974, and 
                      section 2701(c)(2) of the Public Health Service 
                      Act.
                          ``(iv) Definitions.--For purposes of this 
                      subsection:
                                    ``(I) Nonelecting taa-eligible 
                                individual.--The term `nonelecting TAA-
                                eligible individual' means a TAA-
                                eligible individual who has a TAA-
                                related loss of coverage and did not 
                                elect continuation coverage under this 
                                subsection during the TAA-related 
                                election period.
                                    ``(II) TAA-eligible individual.--The 
                                term `TAA-eligible individual' means an 
                                eligible TAA recipient (as defined in 
                                paragraph (2) of section 35(c)) and an 
                                eligible alternative TAA recipient (as 
                                defined in paragraph (3) of such 
                                section).
                                    ``(III) TAA-related election 
                                period.--The term `TAA-related election 
                                period' means, with respect to a TAA-
                                related loss of coverage, the 60-day 
                                election period under this subsection 
                                which is a direct consequence of such 
                                loss.
                                    ``(IV) TAA-related loss of 
                                coverage.--The term `TAA-related loss of 
                                coverage' means, with respect to an 
                                individual whose separation from 
                                employment gives rise to being an TAA-
                                eligible individual, the loss of health 
                                benefits coverage associated with such 
                                separation.''.

    (f) Rule of Construction.-- <<NOTE: 29 USC 2918 note.>> Nothing in 
this title (or the amendments made by this title), other than provisions 
relating to COBRA continuation coverage and reporting requirements, 
shall be construed as creating any new mandate on any party regarding 
health insurance coverage.

   TITLE III--CUSTOMS <<NOTE: Customs Border Security Act of 2002.>>  
REAUTHORIZATION

SEC. 301. <<NOTE: 19 USC 1654 note.>> SHORT TITLE.

    This Act may be cited as the ``Customs Border Security Act of 
2002''.

[[Page 116 STAT. 973]]

                Subtitle A--United States Customs Service

   CHAPTER 1--DRUG ENFORCEMENT AND OTHER NONCOMMERCIAL AND COMMERCIAL 
                               OPERATIONS

SEC. 311. AUTHORIZATION OF APPROPRIATIONS FOR NONCOMMERCIAL OPERATIONS, 
            COMMERCIAL OPERATIONS, AND AIR AND MARINE INTERDICTION.

    (a) Noncommercial Operations.--Section 301(b)(1) of the Customs 
Procedural Reform and Simplification Act of 1978 (19 U.S.C. 2075(b)(1)) 
is amended--
            (1) by striking subparagraph (A), and inserting the 
        following:
                    ``(A) $1,365,456,000 for fiscal year 2003.''; and
            (2) by striking subparagraph (B), and inserting the 
        following:
                    ``(B) $1,399,592,400 for fiscal year 2004.''.

    (b) Commercial Operations.--
            (1) In general.--Section 301(b)(2)(A) of the Customs 
        Procedural Reform and Simplification Act of 1978 (19 U.S.C. 
        2075(b)(2)(A)) is amended--
                    (A) by striking clause (i), and inserting the 
                following:
                    ``(i) $1,642,602,000 for fiscal year 2003.''; and
                    (B) by striking clause (ii), and inserting the 
                following:
                    ``(ii) $1,683,667,050 for fiscal year 2004.''.
            (2) Automated <<NOTE: 19 USC 2075 note.>> commercial 
        environment computer system.--Of the amount made available for 
        each of fiscal years 2003 and 2004 under section 301(b)(2)(A) of 
        the Customs Procedural Reform and Simplification Act of 1978 (19 
        U.S.C. 2075(b)(2)(A)), as amended by paragraph (1), $308,000,000 
        shall be available until expended for each such fiscal year for 
        the development, establishment, and implementation of the 
        Automated Commercial Environment computer system.
            (3) Reports.--Not <<NOTE: Deadline. 19 USC 2075 
        note.>> later than 90 days after the date of the enactment of 
        this Act, and not later than the end of each subsequent 90-day 
        period, the Commissioner of Customs shall prepare and submit to 
        the Committee on Ways and Means of the House of Representatives 
        and the Committee on Finance of the Senate a report 
        demonstrating that the development and establishment of the 
        Automated Commercial Environment computer system is being 
        carried out in a cost-effective manner and meets the 
        modernization requirements of title VI of the North American 
        Free Trade Agreement Implementation Act.

    (c) Air and Marine Interdiction.--Section 301(b)(3) of the Customs 
Procedural Reform and Simplification Act of 1978 (19 U.S.C. 2075(b)(3)) 
is amended--
            (1) by striking subparagraph (A), and inserting the 
        following:
                    ``(A) $170,829,000 for fiscal year 2003.''; and
            (2) by striking subparagraph (B), and inserting the 
        following:
                    ``(B) $175,099,725 for fiscal year 2004.''.

    (d) Submission of Out-Year Budget Projections.--Section 301(a) of 
the Customs Procedural Reform and Simplification Act of 1978 (19 U.S.C. 
2075(a)) is amended by adding at the end the following:

[[Page 116 STAT. 974]]

    ``(3) By not later than the date on which the President submits to 
Congress the budget of the United States Government for a fiscal year, 
the Commissioner of Customs shall submit to the Committee on Ways and 
Means of the House of Representatives and the Committee on Finance of 
the Senate the projected amount of funds for the succeeding fiscal year 
that will be necessary for the operations of the Customs Service as 
provided for in subsection (b).''.

SEC. 312. ANTITERRORIST AND ILLICIT NARCOTICS DETECTION EQUIPMENT FOR 
            THE UNITED STATES-MEXICO BORDER, UNITED STATES-CANADA 
            BORDER, AND FLORIDA AND THE GULF COAST SEAPORTS.

    (a) Fiscal Year 2003.--Of the amounts made available for fiscal year 
2003 under section 301(b)(1)(A) of the Customs Procedural Reform and 
Simplification Act of 1978 (19 U.S.C. 2075(b)(1)(A)), as amended by 
section 311(a) of this Act, $90,244,000 shall be available until 
expended for acquisition and other expenses associated with 
implementation and deployment of antiterrorist and illicit narcotics 
detection equipment along the United States-Mexico border, the United 
States-Canada border, and Florida and the Gulf Coast seaports, as 
follows:
            (1) United states-mexico border.--For the United States-
        Mexico border, the following:
                    (A) $6,000,000 for 8 Vehicle and Container 
                Inspection Systems (VACIS).
                    (B) $11,200,000 for 5 mobile truck x-rays with 
                transmission and backscatter imaging.
                    (C) $13,000,000 for the upgrade of 8 fixed-site 
                truck x-rays from the present energy level of 450,000 
                electron volts to 1,000,000 electron volts (1-MeV).
                    (D) $7,200,000 for 8 1-MeV pallet x-rays.
                    (E) $1,000,000 for 200 portable contraband detectors 
                (busters) to be distributed among ports where the 
                current allocations are inadequate.
                    (F) $600,000 for 50 contraband detection kits to be 
                distributed among all southwest border ports based on 
                traffic volume.
                    (G) $500,000 for 25 ultrasonic container inspection 
                units to be distributed among all ports receiving 
                liquid-filled cargo and to ports with a hazardous 
                material inspection facility.
                    (H) $2,450,000 for 7 automated targeting systems.
                    (I) $360,000 for 30 rapid tire deflator systems to 
                be distributed to those ports where port runners are a 
                threat.
                    (J) $480,000 for 20 portable Treasury Enforcement 
                Communications Systems (TECS) terminals to be moved 
                among ports as needed.
                    (K) $1,000,000 for 20 remote watch surveillance 
                camera systems at ports where there are suspicious 
                activities at loading docks, vehicle queues, secondary 
                inspection lanes, or areas where visual surveillance or 
                observation is obscured.
                    (L) $1,254,000 for 57 weigh-in-motion sensors to be 
                distributed among the ports with the greatest volume of 
                outbound traffic.

[[Page 116 STAT. 975]]

                    (M) $180,000 for 36 AM traffic information radio 
                stations, with 1 station to be located at each border 
                crossing.
                    (N) $1,040,000 for 260 inbound vehicle counters to 
                be installed at every inbound vehicle lane.
                    (O) $950,000 for 38 spotter camera systems to 
                counter the surveillance of customs inspection 
                activities by persons outside the boundaries of ports 
                where such surveillance activities are occurring.
                    (P) $390,000 for 60 inbound commercial truck 
                transponders to be distributed to all ports of entry.
                    (Q) $1,600,000 for 40 narcotics vapor and particle 
                detectors to be distributed to each border crossing.
                    (R) $400,000 for license plate reader automatic 
                targeting software to be installed at each port to 
                target inbound vehicles.
            (2) United states-canada border.--For the United States-
        Canada border, the following:
                    (A) $3,000,000 for 4 Vehicle and Container 
                Inspection Systems (VACIS).
                    (B) $8,800,000 for 4 mobile truck x-rays with 
                transmission and backscatter imaging.
                    (C) $3,600,000 for 4 1-MeV pallet x-rays.
                    (D) $250,000 for 50 portable contraband detectors 
                (busters) to be distributed among ports where the 
                current allocations are inadequate.
                    (E) $300,000 for 25 contraband detection kits to be 
                distributed among ports based on traffic volume.
                    (F) $240,000 for 10 portable Treasury Enforcement 
                Communications Systems (TECS) terminals to be moved 
                among ports as needed.
                    (G) $400,000 for 10 narcotics vapor and particle 
                detectors to be distributed to each border crossing 
                based on traffic volume.
            (3) Florida and gulf coast seaports.--For Florida and the 
        Gulf Coast seaports, the following:
                    (A) $4,500,000 for 6 Vehicle and Container 
                Inspection Systems (VACIS).
                    (B) $11,800,000 for 5 mobile truck x-rays with 
                transmission and backscatter imaging.
                    (C) $7,200,000 for 8 1-MeV pallet x-rays.
                    (D) $250,000 for 50 portable contraband detectors 
                (busters) to be distributed among ports where the 
                current allocations are inadequate.
                    (E) $300,000 for 25 contraband detection kits to be 
                distributed among ports based on traffic volume.

    (b) Fiscal Year 2004.--Of the amounts made available for fiscal year 
2004 under section 301(b)(1)(B) of the Customs Procedural Reform and 
Simplification Act of 1978 (19 U.S.C. 2075(b)(1)(B)), as amended by 
section 311(a) of this Act, $9,000,000 shall be available until expended 
for the maintenance and support of the equipment and training of 
personnel to maintain and support the equipment described in subsection 
(a).
    (c) Acquisition of Technologically Superior Equipment; Transfer of 
Funds.--
            (1) In general.--The Commissioner of Customs may use amounts 
        made available for fiscal year 2003 under section

[[Page 116 STAT. 976]]

        301(b)(1)(A) of the Customs Procedural Reform and Simplification 
        Act of 1978 (19 U.S.C. 2075(b)(1)(A)), as amended by section 
        311(a) of this Act, for the acquisition of equipment other than 
        the equipment described in subsection (a) if such other 
        equipment--
                    (A)(i) is technologically superior to the equipment 
                described in subsection (a); and
                    (ii) will achieve at least the same results at a 
                cost that is the same or less than the equipment 
                described in subsection (a); or
                    (B) can be obtained at a lower cost than the 
                equipment described in subsection (a).
            (2) Transfer of funds.--Notwithstanding any other provision 
        of this section, the Commissioner of Customs may reallocate an 
        amount not to exceed 10 percent of--
                    (A) the amount specified in any of subparagraphs (A) 
                through (R) of subsection (a)(1) for equipment specified 
                in any other of such subparagraphs (A) through (R);
                    (B) the amount specified in any of subparagraphs (A) 
                through (G) of subsection (a)(2) for equipment specified 
                in any other of such subparagraphs (A) through (G); and
                    (C) the amount specified in any of subparagraphs (A) 
                through (E) of subsection (a)(3) for equipment specified 
                in any other of such subparagraphs (A) through (E).

SEC. 313. COMPLIANCE WITH PERFORMANCE PLAN REQUIREMENTS.

    As part of the annual performance plan for each of the fiscal years 
2003 and 2004 covering each program activity set forth in the budget of 
the United States Customs Service, as required under section 1115 of 
title 31, United States Code, the Commissioner of Customs shall 
establish performance goals and performance indicators, and shall comply 
with all other requirements contained in paragraphs (1) through (6) of 
subsection (a) of such section with respect to each of the activities to 
be carried out pursuant to section 312.

     CHAPTER 2--CHILD CYBER-SMUGGLING CENTER OF THE CUSTOMS SERVICE

SEC. 321. AUTHORIZATION OF APPROPRIATIONS FOR PROGRAM TO PREVENT CHILD 
            PORNOGRAPHY/CHILD SEXUAL EXPLOITATION.

    (a) Authorization of Appropriations.--There is authorized to be 
appropriated to the Customs Service $10,000,000 for fiscal year 2003 to 
carry out the program to prevent child pornography/child sexual 
exploitation established by the Child Cyber-Smuggling Center of the 
Customs Service.
    (b) Use of Amounts for Child Pornography Cyber Tipline.--Of the 
amount appropriated under subsection (a), the Customs Service shall 
provide 3.75 percent of such amount to the National Center for Missing 
and Exploited Children for the operation of the child pornography cyber 
tipline of the Center and for increased public awareness of the tipline.

[[Page 116 STAT. 977]]

                   CHAPTER 3--MISCELLANEOUS PROVISIONS

SEC. 331. ADDITIONAL CUSTOMS SERVICE OFFICERS FOR UNITED STATES-CANADA 
            BORDER.

    Of the amount made available for fiscal year 2003 under paragraphs 
(1) and (2)(A) of section 301(b) of the Customs Procedural Reform and 
Simplification Act of 1978 (19 U.S.C. 2075(b)), as amended by section 
311 of this Act, $28,300,000 shall be available until expended for the 
Customs Service to hire approximately 285 additional Customs Service 
officers to address the needs of the offices and ports along the United 
States-Canada border.

SEC. 332. STUDY AND REPORT RELATING TO PERSONNEL PRACTICES OF THE 
            CUSTOMS SERVICE.

    (a) Study.--The Commissioner of Customs shall conduct a study of 
current personnel practices of the Customs Service, including an 
overview of performance standards and the effect and impact of the 
collective bargaining process on drug interdiction efforts of the 
Customs Service and a comparison of duty rotation policies of the 
Customs Service and other Federal agencies that employ similarly 
situated personnel.
    (b) Report.-- <<NOTE: Deadline.>> Not later than 120 days after the 
date of the enactment of this Act, the Commissioner of Customs shall 
submit to the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate a report 
containing the results of the study conducted under subsection (a).

SEC. 333. STUDY AND REPORT RELATING TO ACCOUNTING AND AUDITING 
            PROCEDURES OF THE CUSTOMS SERVICE.

    (a) Study.--(1) The Commissioner of Customs shall conduct a study of 
actions by the Customs Service to ensure that appropriate training is 
being provided to Customs Service personnel who are responsible for 
financial auditing of importers.
    (2) In conducting the study, the Commissioner--
            (A) shall specifically identify those actions taken to 
        comply with provisions of law that protect the privacy and trade 
        secrets of importers, such as section 552(b) of title 5, United 
        States Code, and section 1905 of title 18, United States Code; 
        and
            (B) shall provide for public notice and comment relating to 
        verification of the actions described in subparagraph (A).

    (b) Report.-- <<NOTE: Deadline.>> Not later than 6 months after the 
date of the enactment of this Act, the Commissioner of Customs shall 
submit to the Committee on Ways and Means of the House of 
Representatives and the Committee on Finance of the Senate a report 
containing the results of the study conducted under subsection (a).

SEC. 334. <<NOTE: 19 USC 2082 note.>> ESTABLISHMENT AND IMPLEMENTATION 
            OF COST ACCOUNTING SYSTEM; REPORTS.

    (a) Establishment and Implementation.--
            (1) In general.-- <<NOTE: Deadline.>> Not later than 
        September 30, 2003, the Commissioner of Customs shall, in 
        accordance with the audit of the Customs Service's fiscal years 
        2000 and 1999 financial statements (as contained in the report 
        of the Office of the Inspector General of the Department of the 
        Treasury issued on February 23, 2001), establish and implement a 
        cost accounting system for expenses incurred in both commercial 
        and noncommercial operations of the Customs Service.

[[Page 116 STAT. 978]]

            (2) Additional requirement.--The cost accounting system 
        described in paragraph (1) shall provide for an identification 
        of expenses based on the type of operation, the port at which 
        the operation took place, the amount of time spent on the 
        operation by personnel of the Customs Service, and an 
        identification of expenses based on any other appropriate 
        classification necessary to provide for an accurate and complete 
        accounting of the expenses.

    (b) Reports.--Beginning on the date of the enactment of this Act and 
ending on the date on which the cost accounting system described in 
subsection (a) is fully implemented, the Commissioner of Customs shall 
prepare and submit to Congress on a quarterly basis a report on the 
progress of implementing the cost accounting system pursuant to 
subsection (a).

SEC. 335. <<NOTE: 19 USC 1625 note.>> STUDY AND REPORT RELATING TO 
            TIMELINESS OF PROSPECTIVE RULINGS.

    (a) Study.--The Comptroller General shall conduct a study on the 
extent to which the Office of Regulations and Rulings of the Customs 
Service has made improvements to decrease the amount of time to issue 
prospective rulings from the date on which a request for the ruling is 
received by the Customs Service.
    (b) Report.-- <<NOTE: Deadline.>> Not later than 1 year after the 
date of the enactment of this Act, the Comptroller General shall submit 
to the Committee on Ways and Means of the House of Representatives and 
the Committee on Finance of the Senate a report containing the results 
of the study conducted under subsection (a).

    (c) Definition.--In this section, the term ``prospective ruling'' 
means a ruling that is requested by an importer on goods that are 
proposed to be imported into the United States and that relates to the 
proper classification, valuation, or marking of such goods.

SEC. 336. STUDY AND REPORT RELATING TO CUSTOMS USER FEES.

    (a) Study.--The Comptroller General shall conduct a study on the 
extent to which the amount of each customs user fee imposed under 
section 13031(a) of the Consolidated Omnibus Budget Reconciliation Act 
of 1985 (19 U.S.C. 58c(a)) is commensurate with the level of services 
provided by the Customs Service relating to the fee so imposed.
    (b) Report.-- <<NOTE: Deadline.>> Not later than 120 days after the 
date of the enactment of this Act, the Comptroller General shall submit 
to the Committee on Ways and Means of the House of Representatives and 
the Committee on Finance of the Senate a report in classified form 
containing--
            (1) the results of the study conducted under subsection (a); 
        and
            (2) recommendations for the appropriate amount of the 
        customs user fees if such results indicate that the fees are not 
        commensurate with the level of services provided by the Customs 
        Service.

SEC. 337. FEES FOR CUSTOMS INSPECTIONS AT EXPRESS COURIER FACILITIES.

    (a) In General.--Section 13031(b)(9) of the Consolidated Omnibus 
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)(9)) is amended as 
follows:
            (1) In subparagraph (A)--

[[Page 116 STAT. 979]]

                    (A) in the matter preceding clause (i), by striking 
                ``the processing of merchandise that is informally 
                entered or released'' and inserting ``the processing of 
                letters, documents, records, shipments, merchandise, or 
                any other item that is valued at an amount that is less 
                than $2,000 (or such higher amount as the Secretary of 
                the Treasury may set by regulation pursuant to section 
                498 of the Tariff Act of 1930), except such items 
                entered for transportation and exportation or immediate 
                exportation''; and
                    (B) by striking clause (ii), and inserting the 
                following:
                          ``(ii) Subject to the provisions of 
                      subparagraph (B), in the case of an express 
                      consignment carrier facility or centralized hub 
                      facility, $.66 per individual airway bill or bill 
                      of lading.''.
            (2) By redesignating subparagraph (B) as subparagraph (C) 
        and inserting after subparagraph (A) the following:
                    ``(B)(i) Beginning in fiscal year 2004, the 
                Secretary of the Treasury may adjust (not more than once 
                per fiscal year) the amount described in subparagraph 
                (A)(ii) to an amount that is not less than $.35 and not 
                more than $1.00 per individual airway bill or bill of 
                lading. The Secretary shall provide notice in the 
                Federal Register of a proposed adjustment under the 
                preceding sentence and the reasons therefor and shall 
                allow for public comment on the proposed adjustment.
                    ``(ii) Notwithstanding section 451 of the Tariff Act 
                of 1930, the payment required by subparagraph (A)(ii) 
                shall be the only payment required for reimbursement of 
                the Customs Service in connection with the processing of 
                an individual airway bill or bill of lading in 
                accordance with such subparagraph and for providing 
                services at express consignment carrier facilities or 
                centralized hub facilities, except that the Customs 
                Service may require such facilities to cover expenses of 
                the Customs Service for adequate office space, 
                equipment, furnishings, supplies, and security.
                    ``(iii)(I) The payment required by subparagraph 
                (A)(ii) and clause (ii) of this subparagraph shall be 
                paid on a quarterly basis by the carrier using the 
                facility to the Customs Service in accordance with 
                regulations prescribed by the Secretary of the Treasury.
                    ``(II) 50 percent of the amount of payments received 
                under subparagraph (A)(ii) and clause (ii) of this 
                subparagraph shall, in accordance with section 524 of 
                the Tariff Act of 1930, be deposited in the Customs User 
                Fee Account and shall be used to directly reimburse each 
                appropriation for the amount paid out of that 
                appropriation for the costs incurred in providing 
                services to express consignment carrier facilities or 
                centralized hub facilities. Amounts deposited in 
                accordance with the preceding sentence shall be 
                available until expended for the provision of customs 
                services to express consignment carrier facilities or 
                centralized hub facilities.
                    ``(III) Notwithstanding section 524 of the Tariff 
                Act of 1930, the remaining 50 percent of the amount of 
                payments received under subparagraph (A)(ii) and clause 
                (ii) of this subparagraph shall be paid to the Secretary 
                of

[[Page 116 STAT. 980]]

                the Treasury, which is in lieu of the payment of fees 
                under subsection (a)(10) of this section.''.

    (b) Effective Date.--The <<NOTE: 19 USC 58c note.>> amendments made 
by subsection (a) take effect on October 1, 2002.

SEC. 338. NATIONAL CUSTOMS AUTOMATION PROGRAM.

    Section 411(b) of the Tariff Act of 1930 (19 U.S.C. 1411(b)) is 
amended by striking the second sentence and inserting the following: 
``The Secretary may, by regulation, require the electronic submission of 
information described in subsection (a) or any other information 
required to be submitted to the Customs Service separately pursuant to 
this subpart.''.

SEC. 339. AUTHORIZATION OF APPROPRIATIONS FOR CUSTOMS STAFFING.

    There are authorized to be appropriated to the Department of 
Treasury such sums as may be necessary to provide an increase in the 
annual rate of basic pay--
            (1) for all journeyman Customs inspectors and Canine 
        Enforcement Officers who have completed at least one year's 
        service and are receiving an annual rate of basic pay for 
        positions at GS-9 of the General Schedule under section 5332 of 
        title 5, United States Code, from the annual rate of basic pay 
        payable for positions at GS-9 of the General Schedule under such 
        section 5332, to an annual rate of basic pay payable for 
        positions at GS-11 of the General Schedule under such section 
        5332; and
            (2) for the support staff associated with the personnel 
        described in subparagraph (A), at the appropriate GS level of 
        the General Schedule under such section 5332.

                   CHAPTER 4--ANTITERRORISM PROVISIONS

SEC. 341. IMMUNITY FOR UNITED STATES OFFICIALS THAT ACT IN GOOD FAITH.

    (a) Immunity.--Section 3061 of the Revised Statutes (19 U.S.C. 482) 
is amended--
            (1) by striking ``Any of the officers'' and inserting ``(a) 
        Any of the officers''; and
            (2) by adding at the end the following:

    ``(b) Any officer or employee of the United States conducting a 
search of a person pursuant to subsection (a) shall not be held liable 
for any civil damages as a result of such search if the officer or 
employee performed the search in good faith and used reasonable means 
while effectuating such search.''.
    (b) Requirement <<NOTE: 19 USC 482 note. Deadline.>> To Post Policy 
and Procedures for Searches of Passengers.--Not later than 30 days after 
the date of the enactment of this Act, the Commissioner of Customs shall 
ensure that at each Customs border facility appropriate notice is posted 
that provides a summary of the policy and procedures of the Customs 
Service for searching passengers, including a statement of the policy 
relating to the prohibition on the conduct of profiling of passengers 
based on gender, race, color, religion, or ethnic background.

[[Page 116 STAT. 981]]

SEC. 342. EMERGENCY ADJUSTMENTS TO OFFICES, PORTS OF ENTRY, OR STAFFING 
            OF THE CUSTOMS SERVICE.

    Section 318 of the Tariff Act of 1930 (19 U.S.C. 1318) is amended--
            (1) by striking ``Whenever the President'' and inserting 
        ``(a) Whenever the President''; and
            (2) by adding at the end the following:

    ``(b)(1) Notwithstanding any other provision of law, the Secretary 
of the Treasury, when necessary to respond to a national emergency 
declared under the National Emergencies Act (50 U.S.C. 1601 et seq.) or 
to a specific threat to human life or national interests, is authorized 
to take the following actions on a temporary basis:
            ``(A) Eliminate, consolidate, or relocate any office or port 
        of entry of the Customs Service.
            ``(B) Modify hours of service, alter services rendered at 
        any location, or reduce the number of employees at any location.
            ``(C) Take any other action that may be necessary to respond 
        directly to the national emergency or specific threat.

    ``(2) Notwithstanding any other provision of law, the Commissioner 
of Customs, when necessary to respond to a specific threat to human life 
or national interests, is authorized to close temporarily any Customs 
office or port of entry or take any other lesser action that may be 
necessary to respond to the specific threat.
    ``(3) <<NOTE: Notification. Deadline.>> The Secretary of the 
Treasury or the Commissioner of Customs, as the case may be, shall 
notify the Committee on Ways and Means of the House of Representatives 
and the Committee on Finance of the Senate not later than 72 hours after 
taking any action under paragraph (1) or (2).''.

SEC. 343. <<NOTE: 19 USC 2071 note.>> MANDATORY ADVANCED ELECTRONIC 
            INFORMATION FOR CARGO AND OTHER IMPROVED CUSTOMS REPORTING 
            PROCEDURES.

    (a) Cargo Information.--
            (1) In general.--Subject to paragraphs (2) and (3), not 
        later than 1 year after the date of enactment of this Act, the 
        Secretary shall promulgate regulations providing for the 
        transmission to the Customs Service, through an electronic data 
        interchange system, of information pertaining to cargo destined 
        for importation into the United States or exportation from the 
        United States, prior to such importation or exportation.
            (2) Information required.--The information required by the 
        regulations promulgated pursuant to paragraph (1) under the 
        parameters set forth in paragraph (3) shall be such information 
        as the Secretary determines to be reasonably necessary to ensure 
        aviation, maritime, and surface transportation safety and 
        security pursuant to those laws enforced and administered by the 
        Customs Service.
            (3) Parameters.--In developing regulations pursuant to 
        paragraph (1), the Secretary shall adhere to the following 
        parameters:
                    (A) The Secretary shall solicit comments from and 
                consult with a broad range of parties likely to be 
                affected by the regulations, including importers, 
                exporters, carriers, customs brokers, and freight 
                forwarders, among other interested parties.

[[Page 116 STAT. 982]]

                    (B) In general, the requirement to provide 
                particular information shall be imposed on the party 
                most likely to have direct knowledge of that 
                information. Where requiring information from the party 
                with direct knowledge of that information is not 
                practicable, the regulations shall take into account 
                how, under ordinary commercial practices, information is 
                acquired by the party on which the requirement is 
                imposed, and whether and how such party is able to 
                verify the information. Where information is not 
                reasonably verifiable by the party on which a 
                requirement is imposed, the regulations shall permit 
                that party to transmit information on the basis of what 
                it reasonably believes to be true.
                    (C) The Secretary shall take into account the 
                existence of competitive relationships among the parties 
                on which requirements to provide particular information 
                are imposed.
                    (D) Where the regulations impose requirements on 
                carriers of cargo, they shall take into account 
                differences among different modes of transportation, 
                including differences in commercial practices, 
                operational characteristics, and technological capacity 
                to collect and transmit information electronically.
                    (E) The regulations shall take into account the 
                extent to which the technology necessary for parties to 
                transmit and the Customs Service to receive and analyze 
                data in a timely fashion is available. To the extent 
                that the Secretary determines that the necessary 
                technology will not be widely available to particular 
                modes of transportation or other affected parties until 
                after promulgation of the regulations, the regulations 
                shall provide interim requirements appropriate for the 
                technology that is available at the time of 
                promulgation.
                    (F) The information collected pursuant to the 
                regulations shall be used exclusively for ensuring 
                aviation, maritime, and surface transportation safety 
                and security, and shall not be used for determining 
                entry or for any other commercial enforcement purposes.
                    (G) The regulations shall protect the privacy of 
                business proprietary and any other confidential 
                information provided to the Customs Service. However, 
                this parameter does not repeal, amend, or otherwise 
                modify other provisions of law relating to the public 
                disclosure of information transmitted to the Customs 
                Service.
                    (H) In determining the timing for transmittal of any 
                information, the Secretary shall balance likely impact 
                on flow of commerce with impact on aviation, maritime, 
                and surface transportation safety and security. With 
                respect to requirements that may be imposed on carriers 
                of cargo, the timing for transmittal of information 
                shall take into account differences among different 
                modes of transportation, as described in subparagraph 
                (D).
                    (I) Where practicable, the regulations shall avoid 
                imposing requirements that are redundant with one 
                another or that are redundant with requirements in other 
                provisions of law.

[[Page 116 STAT. 983]]

                    (J) The Secretary shall determine whether it is 
                appropriate to provide transition periods between 
                promulgation of the regulations and the effective date 
                of the regulations and shall prescribe such transition 
                periods in the regulations, as appropriate. The 
                Secretary may determine that different transition 
                periods are appropriate for different classes of 
                affected parties.
                    (K) With respect to requirements imposed on 
                carriers, the Secretary, in consultation with the 
                Postmaster General, shall determine whether it is 
                appropriate to impose the same or similar requirements 
                on shipments by the United States Postal Service. If the 
                Secretary determines that such requirements are 
                appropriate, then they shall be set forth in the 
                regulations.
                    (L) <<NOTE: Deadline.>> Not later than 60 days prior 
                to promulgation of the regulations, the Secretary shall 
                transmit to the Committees on Finance and Commerce, 
                Science, and Transportation of the Senate and the 
                Committees on Ways and Means and Transportation and 
                Infrastructure of the House of Representatives a report 
                setting forth--
                          (i) the proposed regulations;
                          (ii) an explanation of how particular 
                      requirements in the proposed regulations meet the 
                      needs of aviation, maritime, and surface 
                      transportation safety and security;
                          (iii) an explanation of how the Secretary 
                      expects the proposed regulations to affect the 
                      commercial practices of affected parties; and
                          (iv) an explanation of how the proposed 
                      regulations address particular comments received 
                      from interested parties.

    (b) Documentation of Waterborne Cargo.--Part II of title IV of the 
Tariff Act of 1930 is amended by inserting after section 431 the 
following new section:

``SEC. 431A. <<NOTE: 19 USC 1431a.>> DOCUMENTATION OF WATERBORNE CARGO.

    ``(a) Applicability.--This section shall apply to all cargo to be 
exported that is moved by a vessel carrier from a port in the United 
States.
    ``(b) Documentation Required.--(1) No shipper of cargo subject to 
this section (including an ocean transportation intermediary that is a 
non-vessel-operating common carrier (as defined in section 3(17)(B) of 
the Shipping Act of 1984 (46 U.S.C. App. 1702(17)(B)) may tender or 
cause to be tendered to a vessel carrier cargo subject to this section 
for loading on a vessel in a United States port, unless such cargo is 
properly documented pursuant to this subsection.
    ``(2) For the purposes of this subsection, cargo shall be considered 
properly documented if the shipper submits to the vessel carrier or its 
agent a complete set of shipping documents no later than 24 hours after 
the cargo is delivered to the marine terminal operator, but under no 
circumstances later than 24 hours prior to departure of the vessel.
    ``(3) A complete set of shipping documents shall include--
            ``(A) for shipments for which a shipper's export declaration 
        is required, a copy of the export declaration or, if the shipper 
        files such declarations electronically in the Automated Export

[[Page 116 STAT. 984]]

        System, the complete bill of lading, and the master or 
        equivalent shipping instructions, including the Internal 
        Transaction Number (ITN); or
            ``(B) for shipments for which a shipper's export declaration 
        is not required, a shipper's export declaration exemption 
        statement and such other documents or information as the 
        Secretary may by regulation prescribe.

    ``(4) <<NOTE: Regulations.>> The Secretary shall by regulation 
prescribe the time, manner, and form by which shippers shall transmit 
documents or information required under this subsection to the Customs 
Service.

    ``(c) Loading Undocumented Cargo Prohibited.--
            ``(1) No marine terminal operator (as defined in section 
        3(14) of the Shipping Act of 1984 (46 U.S.C. App. 1702(14))) may 
        load, or cause to be loaded, any cargo subject to this section 
        on a vessel unless instructed by the vessel carrier operating 
        the vessel that such cargo has been properly documented in 
        accordance with this section.
            ``(2) <<NOTE: Notification.>> When cargo is booked by 1 
        vessel carrier to be transported on the vessel of another vessel 
        carrier, the booking carrier shall notify the operator of the 
        vessel that the cargo has been properly documented in accordance 
        with this section. The operator of the vessel may rely on such 
        notification in releasing the cargo for loading aboard the 
        vessel.

    ``(d) Reporting of Undocumented Cargo.--A vessel carrier shall 
notify the Customs Service of any cargo tendered to such carrier that is 
not properly documented pursuant to this section and that has remained 
in the marine terminal for more than 48 hours after being delivered to 
the marine terminal, and the location of the cargo in the marine 
terminal. For vessel carriers that are members of vessel sharing 
agreements (or any other arrangement whereby a carrier moves cargo on 
another carrier's vessel), the vessel carrier accepting the booking 
shall be responsible for reporting undocumented cargo, without regard to 
whether it operates the vessel on which the transportation is to be 
made.
    ``(e) Assessment of Penalties.--Whoever is found to have violated 
subsection (b) of this section shall be liable to the United States for 
civil penalties in a monetary amount up to the value of the cargo, or 
the actual cost of the transportation, whichever is greater.
    ``(f) Seizure of Undocumented Cargo.--
            ``(1) Any cargo that is not properly documented pursuant to 
        this section and has remained in the marine terminal for more 
        than 48 hours after being delivered to the marine terminal 
        operator shall be subject to search, seizure, and forfeiture.
            ``(2) The shipper of any such cargo is liable to the marine 
        terminal operator and to the ocean carrier for demurrage and 
        other applicable charges for any undocumented cargo which has 
        been notified to or searched or seized by the Customs Service 
        for the entire period the cargo remains under the order and 
        direction of the Customs Service. Unless the cargo is seized by 
        the Customs Service and forfeited, the marine terminal operator 
        and the ocean carrier shall have a lien on the cargo for the 
        amount of the demurrage and other charges.

    ``(g) Effect on Other Provisions.--Nothing in this section shall be 
construed, interpreted, or applied to relieve or excuse any party from 
compliance with any obligation or requirement

[[Page 116 STAT. 985]]

arising under any other law, regulation, or order with regard to the 
documentation or carriage of cargo.''.
    (c) Secretary.--For <<NOTE: 19 USC 2071 note.>> purposes of this 
section, the term ``Secretary'' means the Secretary of the Treasury. If, 
at the time the regulations required by subsection (a)(1) are 
promulgated, the Customs Service is no longer located in the Department 
of the Treasury, then the Secretary of the Treasury shall exercise the 
authority under subsection (a) jointly with the Secretary of the 
Department in which the Customs Service is located.

SEC. 343A. <<NOTE: 19 USC 2071 note.>> SECURE SYSTEMS OF TRANSPORTATION.

    (a) Joint Task Force.--The <<NOTE: Establishment.>> Secretary of the 
Treasury shall establish a joint task force to evaluate, prototype, and 
certify secure systems of transportation. The joint task force shall be 
comprised of officials from the Department of Transportation and the 
Customs Service, and any other officials that the Secretary deems 
appropriate. The task force shall establish <<NOTE: Deadline.>> a 
program to evaluate and certify secure systems of international 
intermodal transport no later than 1 year after the date of enactment of 
this Act. The task force shall solicit and consider input from a broad 
range of interested parties.

    (b) Program Requirements.--At a minimum the program referred to in 
subsection (a) shall require certified systems of international 
intermodal transport to be significantly more secure than existing 
transportation programs, and the program shall--
            (1) establish standards and a process for screening and 
        evaluating cargo prior to import into or export from the United 
        States;
            (2) establish standards and a process for a system of 
        securing cargo and monitoring it while in transit;
            (3) establish standards and a process for allowing the 
        United States Government to ensure and validate compliance with 
        the program elements; and
            (4) include any other elements that the task force deems 
        necessary to ensure the security and integrity of the 
        international intermodal transport movements.

    (c) Recognition of Certified Systems.--
            (1) Secretary of the Treasury.--The Secretary of the 
        Treasury shall recognize certified systems of intermodal 
        transport in the requirements of a national security plan for 
        United States seaports, and in the provisions requiring planning 
        to reopen United States ports for commerce.
            (2) Commissioner of Customs.--The Commissioner of Customs 
        shall recognize certified systems of intermodal transport in the 
        evaluation of cargo risk for purposes of United States imports 
        and exports.

    (d) Report.--Within <<NOTE: Deadline.>> 1 year after the program 
described in subsection (a) is implemented, the Secretary of the 
Treasury shall transmit a report to the Committees on Commerce, Science, 
and Transportation and Finance of the Senate and the Committees on 
Transportation and Infrastructure and Ways and Means of the House of 
Representatives that--
            (1) evaluates the program and its requirements;
            (2) states the Secretary's views as to whether any 
        procedure, system, or technology evaluated as part of the 
        program offers a higher level of security than under existing 
        procedures;

[[Page 116 STAT. 986]]

            (3) states the Secretary's views as to the integrity of the 
        procedures, technology, or systems evaluated as part of the 
        program; and
            (4) makes a recommendation with respect to whether the 
        program, or any procedure, system, or technology should be 
        incorporated in a nationwide system for certified systems of 
        intermodal transport.

SEC. 344. BORDER SEARCH AUTHORITY FOR CERTAIN CONTRABAND IN OUTBOUND 
            MAIL.

    (a) In General.--The Tariff Act of 1930 is amended by inserting 
after section 582 the following:

``SEC. 583. <<NOTE: 19 USC 1583.>> EXAMINATION OF OUTBOUND MAIL.

    ``(a) Examination.--
            ``(1) In general.--For purposes of ensuring compliance with 
        the Customs laws of the United States and other laws enforced by 
        the Customs Service, including the provisions of law described 
        in paragraph (2), a Customs officer may, subject to the 
        provisions of this section, stop and search at the border, 
        without a search warrant, mail of domestic origin transmitted 
        for export by the United States Postal Service and foreign mail 
        transiting the United States that is being imported or exported 
        by the United States Postal Service.
            ``(2) Provisions of law described.--The provisions of law 
        described in this paragraph are the following:
                    ``(A) Section 5316 of title 31, United States Code 
                (relating to reports on exporting and importing monetary 
                instruments).
                    ``(B) Sections 1461, 1463, 1465, and 1466, and 
                chapter 110 of title 18, United States Code (relating to 
                obscenity and child pornography).
                    ``(C) Section 1003 of the Controlled Substances 
                Import and Export Act (relating to exportation of 
                controlled substances) (21 U.S.C. 953).
                    ``(D) The Export Administration Act of 1979 (50 
                U.S.C. App. 2401 et seq.).
                    ``(E) Section 38 of the Arms Export Control Act (22 
                U.S.C. 2778).
                    ``(F) The International Emergency Economic Powers 
                Act (50 U.S.C. 1701 et seq.).

    ``(b) Search of Mail Not Sealed Against Inspection and Other Mail.--
Mail not sealed against inspection under the postal laws and regulations 
of the United States, mail which bears a Customs declaration, and mail 
with respect to which the sender or addressee has consented in writing 
to search, may be searched by a Customs officer.
    ``(c) Search of Mail Sealed Against Inspection Weighing in Excess of 
16 Ounces.--
    ``(1) In general.--Mail weighing in excess of 16 ounces sealed 
against inspection under the postal laws and regulations of the United 
States may be searched by a Customs officer, subject to paragraph (2), 
if there is reasonable cause to suspect that such mail contains one or 
more of the following:
            ``(A) Monetary instruments, as defined in section 1956 of 
        title 18, United States Code.
            ``(B) A weapon of mass destruction, as defined in section 
        2332a(b) of title 18, United States Code.

[[Page 116 STAT. 987]]

            ``(C) A drug or other substance listed in schedule I, II, 
        III, or IV in section 202 of the Controlled Substances Act (21 
        U.S.C. 812).
            ``(D) National defense and related information transmitted 
        in violation of any of sections 793 through 798 of title 18, 
        United States Code.
            ``(E) Merchandise mailed in violation of section 1715 or 
        1716 of title 18, United States Code.
            ``(F) Merchandise mailed in violation of any provision of 
        chapter 71 (relating to obscenity) or chapter 110 (relating to 
        sexual exploitation and other abuse of children) of title 18, 
        United States Code.
            ``(G) Merchandise mailed in violation of the Export 
        Administration Act of 1979 (50 U.S.C. App. 2401 et seq.).
            ``(H) Merchandise mailed in violation of section 38 of the 
        Arms Export Control Act (22 U.S.C. 2778).
            ``(I) Merchandise mailed in violation of the International 
        Emergency Economic Powers Act (50 U.S.C. 1701 et seq.).
            ``(J) Merchandise mailed in violation of the Trading with 
        the Enemy Act (50 U.S.C. App. 1 et seq.).
            ``(K) Merchandise subject to any other law enforced by the 
        Customs Service.
            ``(2) Limitation.--No person acting under the authority of 
        paragraph (1) shall read, or authorize any other person to read, 
        any correspondence contained in mail sealed against inspection 
        unless prior to so reading--
                    ``(A) a search warrant has been issued pursuant to 
                rule 41 of the Federal Rules of Criminal Procedure; or
                    ``(B) the sender or addressee has given written 
                authorization for such reading.

    ``(d) Search of Mail Sealed Against Inspection Weighing 16 Ounces or 
Less.--Notwithstanding any other provision of this section, subsection 
(a)(1) shall not apply to mail weighing 16 ounces or less sealed against 
inspection under the postal laws and regulations of the United 
States.''.
    (b) Certification by Secretary.--Not <<NOTE: Deadline. 19 USC 1583 
note.>> later than 3 months after the date of enactment of this section, 
the Secretary of State shall determine whether the application of 
section 583 of the Tariff Act of 1930 to foreign mail transiting the 
United States that is imported or exported by the United States Postal 
Service is being handled in a manner consistent with international law 
and any international obligation of the United States. Section 583 of 
such Act shall not apply to such foreign mail unless the Secretary 
certifies to Congress that the application of such section 583 is 
consistent with international law and any international obligation of 
the United States.

    (c) Effective <<NOTE: 19 USC 1583 note.>> Date.--
            (1) In general.--Except as provided in paragraph (2), this 
        section and the amendments made by this section shall take 
        effect on the date of enactment of this Act.
            (2) Certification with respect to foreign mail.--The 
        provisions of section 583 of the Tariff Act of 1930 relating to 
        foreign mail transiting the United States that is imported or 
        exported by the United States Postal Service shall not take 
        effect until the Secretary of State certifies to Congress, 
        pursuant to subsection (b), that the application of such section 
        583

[[Page 116 STAT. 988]]

        is consistent with international law and any international 
        obligation of the United States.

SEC. 345. AUTHORIZATION OF APPROPRIATIONS FOR REESTABLISHMENT OF CUSTOMS 
            OPERATIONS IN NEW YORK CITY.

    (a) Authorization of Appropriations.--
            (1) In general.--There is authorized to be appropriated for 
        the reestablishment of operations of the Customs Service in New 
        York, New York, such sums as may be necessary for fiscal year 
        2003.
            (2) Operations described.--The operations referred to in 
        paragraph (1) include, but are not limited to, the following:
                    (A) Operations relating to the Port Director of New 
                York City, the New York Customs Management Center 
                (including the Director of Field Operations), and the 
                Special Agent-In-Charge for New York.
                    (B) Commercial operations, including textile 
                enforcement operations and salaries and expenses of--
                          (i) trade specialists who determine the origin 
                      and value of merchandise;
                          (ii) analysts who monitor the entry data into 
                      the United States of textiles and textile 
                      products; and
                          (iii) Customs officials who work with foreign 
                      governments to examine textile makers and verify 
                      entry information.

    (b) Availability.--Amounts appropriated pursuant to the 
authorization of appropriations under subsection (a) are authorized to 
remain available until expended.

               CHAPTER 5--TEXTILE TRANSSHIPMENT PROVISIONS

SEC. 351. GAO AUDIT OF TEXTILE TRANSSHIPMENT MONITORING BY CUSTOMS 
            SERVICE.

    (a) GAO Audit.--The Comptroller General of the United States shall 
conduct an audit of the system established and carried out by the 
Customs Service to monitor transshipment.
    (b) Report.--Not <<NOTE: Deadline.>> later than 9 months after the 
date of enactment of this Act, the Comptroller General shall submit to 
the Committee on Ways and Means of the House of Representatives and 
Committee on Finance of the Senate a report that contains the results of 
the study conducted under subsection (a), including recommendations for 
improvements to the transshipment monitoring system if applicable.

    (c) Transshipment Described.--Transshipment within the meaning of 
this section has occurred when preferential treatment under any 
provision of law has been claimed for a textile or apparel article on 
the basis of material false information concerning the country of 
origin, manufacture, processing, or assembly of the article or any of 
its components. For purposes of the preceding sentence, false 
information is material if disclosure of the true information would mean 
or would have meant that the article is or was ineligible for 
preferential treatment under the provision of law in question.

SEC. 352. AUTHORIZATION OF APPROPRIATIONS FOR TEXTILE TRANSSHIPMENT 
            ENFORCEMENT OPERATIONS.

    (a) Authorization of Appropriations.--
            (1) In general.--There is authorized to be appropriated for 
        transshipment (as described in section 351(c)) enforcement

[[Page 116 STAT. 989]]

        operations, outreach, and education of the Customs Service 
        $9,500,000 for fiscal year 2003.
            (2) Availability.--Amounts appropriated pursuant to the 
        authorization of appropriations under paragraph (1) are 
        authorized to remain available until expended.

    (b) Use of Funds.--Of the amount appropriated pursuant to the 
authorization of appropriations under subsection (a), the following 
amounts are authorized to be made available for the following purposes:
            (1) Import specialists.--$1,463,000 for 21 Customs import 
        specialists to be assigned to selected ports for documentation 
        review to support detentions and exclusions and 1 additional 
        Customs import specialist assigned to the Customs headquarters 
        textile program to administer the program and provide oversight.
            (2) Inspectors.--$652,080 for 10 Customs inspectors to be 
        assigned to selected ports to examine targeted high-risk 
        shipments.
            (3) Investigators.--(A) $1,165,380 for 10 investigators to 
        be assigned to selected ports to investigate instances of 
        smuggling, quota and trade agreement circumvention, and use of 
        counterfeit visas to enter inadmissible goods.
            (B) $149,603 for 1 investigator to be assigned to the 
        Customs headquarters textile program to coordinate and ensure 
        implementation of textile production verification team results 
        from an investigation perspective.
            (4) International trade specialists.--$226,500 for 3 
        international trade specialists to be assigned to Customs 
        headquarters to be dedicated to illegal textile transshipment 
        policy issues, outreach, education, and other free trade 
        agreement enforcement issues.
            (5) Permanent import specialists for hong kong.--$500,000 
        for 2 permanent import specialist positions and $500,000 for 2 
        investigators to be assigned to Hong Kong to work with Hong Kong 
        and other government authorities in Southeast Asia to assist 
        such authorities in pursuing proactive enforcement of bilateral 
        trade agreements.
            (6) Various permanent trade positions.--$3,500,000 for the 
        following:
                    (A) 2 permanent positions to be assigned to the 
                Customs attache office in Central America to address 
                trade enforcement issues for that region.
                    (B) 2 permanent positions to be assigned to the 
                Customs attache office in South Africa to address trade 
                enforcement issues pursuant to the African Growth and 
                Opportunity Act (title I of Public Law 106-200).
                    (C) 4 permanent positions to be assigned to the 
                Customs attache office in Mexico to address the threat 
                of illegal textile transshipment through Mexico and 
                other related issues under the North American Free Trade 
                Agreement Act.
                    (D) 2 permanent positions to be assigned to the 
                Customs attache office in Seoul, South Korea, to address 
                the trade issues in the geographic region.
                    (E) 2 permanent positions to be assigned to the 
                proposed Customs attache office in New Delhi, India, to

[[Page 116 STAT. 990]]

                address the threat of illegal textile transshipment and 
                other trade enforcement issues.
                    (F) 2 permanent positions to be assigned to the 
                Customs attache office in Rome, Italy, to address trade 
                enforcement issues in the geographic region, including 
                issues under free trade agreements with Jordan and 
                Israel.
            (7) Attorneys.--$179,886 for 2 attorneys for the Office of 
        the Chief Counsel of the Customs Service to pursue cases 
        regarding illegal textile transshipment.
            (8) Auditors.--$510,000 for 6 Customs auditors to perform 
        internal control reviews and document and record reviews of 
        suspect importers.
            (9) Additional travel funds.--$250,000 for deployment of 
        additional textile production verification teams to sub-Saharan 
        Africa.
            (10) Training.--(A) $75,000 for training of Customs 
        personnel.
            (B) $200,000 for training for foreign counterparts in risk 
        management analytical techniques and for teaching factory 
        inspection techniques, model law development, and enforcement 
        techniques.
            (11) Outreach.--$60,000 for outreach efforts to United 
        States importers.

SEC. 353. IMPLEMENTATION OF THE AFRICAN GROWTH AND OPPORTUNITY ACT.

    Of the amount made available for fiscal year 2003 under section 
301(b)(2)(A) of the Customs Procedural Reform and Simplification Act of 
1978 (19 U.S.C. 2075(b)(2)(A)), as amended by section 311(b)(1) of this 
Act, $1,317,000 shall be available until expended for the Customs 
Service to provide technical assistance to help sub-Saharan African 
countries develop and implement effective visa and anti-transshipment 
systems as required by the African Growth and Opportunity Act (title I 
of Public Law 106-200), as follows:
            (1) Travel funds.--$600,000 for import specialists, special 
        agents, and other qualified Customs personnel to travel to sub-
        Saharan African countries to provide technical assistance in 
        developing and implementing effective visa and anti-
        transshipment systems.
            (2) Import specialists.--$266,000 for 4 import specialists 
        to be assigned to Customs headquarters to be dedicated to 
        providing technical assistance to sub-Saharan African countries 
        for developing and implementing effective visa and anti-
        transshipment systems.
            (3) Data reconciliation analysts.--$151,000 for 2 data 
        reconciliation analysts to review apparel shipments.
            (4) Special agents.--$300,000 for 2 special agents to be 
        assigned to Customs headquarters to be available to provide 
        technical assistance to sub-Saharan African countries in the 
        performance of investigations and other enforcement initiatives.

[[Page 116 STAT. 991]]

      Subtitle B--Office of the United States Trade Representative

SEC. 361. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--Section 141(g)(1) of the Trade Act of 1974 (19 
U.S.C. 2171(g)(1)) is amended--
            (1) in subparagraph (A)--
                    (A) in the matter preceding clause (i), by striking 
                ``not to exceed'';
                    (B) by striking clause (i), and inserting the 
                following:
            ``(i) $32,300,000 for fiscal year 2003.''; and
                    (C) by striking clause (ii), and inserting the 
                following:
            ``(ii) $33,108,000 for fiscal year 2004.''; and
            (2) in subparagraph (B)--
                    (A) in clause (i), by adding ``and'' at the end;
                    (B) by striking clause (ii); and
                    (C) by redesignating clause (iii) as clause (ii).

    (b) Submission of Out-Year Budget Projections.--Section 141(g) of 
the Trade Act of 1974 (19 U.S.C. 2171(g)) is amended by adding at the 
end the following:
    ``(3) By <<NOTE: Deadline.>> not later than the date on which the 
President submits to Congress the budget of the United States Government 
for a fiscal year, the United States Trade Representative shall submit 
to the Committee on Ways and Means of the House of Representatives and 
the Committee on Finance of the Senate the projected amount of funds for 
the succeeding fiscal year that will be necessary for the Office to 
carry out its functions.''.

    (c) Additional Staff for Office of Assistant U.S. Trade 
Representative for Congressional Affairs.--
            (1) In general.--There is authorized to be appropriated such 
        sums as may be necessary for fiscal year 2003 for the salaries 
        and expenses of two additional legislative specialist employee 
        positions within the Office of the Assistant United States Trade 
        Representative for Congressional Affairs.
            (2) Availability.--Amounts appropriated pursuant to the 
        authorization of appropriations under paragraph (1) are 
        authorized to remain available until expended.

        Subtitle C--United States International Trade Commission

SEC. 371. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--Section 330(e)(2)(A) of the Tariff Act of 1930 (19 
U.S.C. 1330(e)(2)(A)) is amended--
            (1) by striking clause (i), and inserting the following:
            ``(i) $54,000,000 for fiscal year 2003.''; and
            (2) by striking clause (ii), and inserting the following:
            ``(ii) $57,240,000 for fiscal year 2004.''.

    (b) Submission of Out-Year Budget Projections.--Section 330(e) of 
the Tariff Act of 1930 (19 U.S.C. 1330(e)(2)) is amended by adding at 
the end the following:
    ``(4) <<NOTE: Deadline.>> By not later than the date on which the 
President submits to Congress the budget of the United States Government 
for a fiscal year, the Commission shall submit to the Committee on

[[Page 116 STAT. 992]]

Ways and Means of the House of Representatives and the Committee on 
Finance of the Senate the projected amount of funds for the succeeding 
fiscal year that will be necessary for the Commission to carry out its 
functions.''.

                   Subtitle D--Other trade provisions

SEC. 381. INCREASE IN AGGREGATE VALUE OF ARTICLES EXEMPT FROM DUTY 
            ACQUIRED ABROAD BY UNITED STATES RESIDENTS.

    (a) In General.--Subheading 9804.00.65 of the Harmonized Tariff 
Schedule of the United States is amended in the article description 
column by striking ``$400'' and inserting ``$800''.
    (b) Effective Date.--The amendment made by subsection (a) shall take 
effect 90 days after the date of the enactment of this Act.

SEC. 382. REGULATORY AUDIT PROCEDURES.

    Section 509(b) of the Tariff Act of 1930 (19 U.S.C. 1509(b)) is 
amended by adding at the end the following:
            ``(6)(A) If during the course of any audit concluded under 
        this subsection, the Customs Service identifies overpayments of 
        duties or fees or over-declarations of quantities or values that 
        are within the time period and scope of the audit that the 
        Customs Service has defined, then in calculating the loss of 
        revenue or monetary penalties under section 592, the Customs 
        Service shall treat the overpayments or over-declarations on 
        finally liquidated entries as an offset to any underpayments or 
        underdeclarations also identified on finally liquidated entries, 
        if such overpayments or over-declarations were not made by the 
        person being audited for the purpose of violating any provision 
        of law.
            ``(B) Nothing in this paragraph shall be construed to 
        authorize a refund not otherwise authorized under section 
        520.''.

SEC. 383. PAYMENT OF DUTIES AND FEES.

    Section 505(a) of the Tariff Act of 1930 (19 U.S.C. 1505(a)) is 
amended to read as follows:
    ``(a) Deposit of Estimated Duties and Fees.--Unless the entry is 
subject to a periodic payment or the merchandise is entered for 
warehouse or transportation, or under bond, the importer of record shall 
deposit with the Customs Service at the time of entry, or at such later 
time as the Secretary may prescribe by regulation (but not later than 10 
working days after entry or release) the amount of duties and fees 
estimated to be payable on such merchandise. As 
soon <<NOTE: Deadline.>> as a periodic payment module of the Automated 
Commercial Environment is developed, but no later than October 1, 2004, 
a participating importer of record, or the importer's filer, may deposit 
estimated duties and fees for entries of merchandise no later than the 
15th day of the month following the month in which the merchandise is 
entered or released, whichever comes first.''.

[[Page 116 STAT. 993]]

            DIVISION B--BIPARTISAN TRADE PROMOTION AUTHORITY

  TITLE XXI--TRADE <<NOTE: Bipartisan Trade Promotion Authority Act of 
2002.>> PROMOTION AUTHORITY

SEC. 2101. <<NOTE: 19 USC 3801.>> SHORT TITLE AND FINDINGS.

    (a) Short Title.--This title may be cited as the ``Bipartisan Trade 
Promotion Authority Act of 2002''.
    (b) Findings.--The Congress makes the following findings:
            (1) The expansion of international trade is vital to the 
        national security of the United States. Trade is critical to the 
        economic growth and strength of the United States and to its 
        leadership in the world. Stable trading relationships promote 
        security and prosperity. Trade agreements today serve the same 
        purposes that security pacts played during the Cold War, binding 
        nations together through a series of mutual rights and 
        obligations. Leadership by the United States in international 
        trade fosters open markets, democracy, and peace throughout the 
        world.
            (2) The national security of the United States depends on 
        its economic security, which in turn is founded upon a vibrant 
        and growing industrial base. Trade expansion has been the engine 
        of economic growth. Trade agreements maximize opportunities for 
        the critical sectors and building blocks of the economy of the 
        United States, such as information technology, 
        telecommunications and other leading technologies, basic 
        industries, capital equipment, medical equipment, services, 
        agriculture, environmental technology, and intellectual 
        property. Trade will create new opportunities for the United 
        States and preserve the unparalleled strength of the United 
        States in economic, political, and military affairs. The United 
        States, secured by expanding trade and economic opportunities, 
        will meet the challenges of the twenty-first century.
            (3) Support for continued trade expansion requires that 
        dispute settlement procedures under international trade 
        agreements not add to or diminish the rights and obligations 
        provided in such agreements. Therefore--
                    (A) the recent pattern of decisions by dispute 
                settlement panels of the WTO and the Appellate Body to 
                impose obligations and restrictions on the use of 
                antidumping, countervailing, and safeguard measures by 
                WTO members under the Antidumping Agreement, the 
                Agreement on Subsidies and Countervailing Measures, and 
                the Agreement on Safeguards has raised concerns; and
                    (B) the Congress is concerned that dispute 
                settlement panels of the WTO and the Appellate Body 
                appropriately apply the standard of review contained in 
                Article 17.6 of the Antidumping Agreement, to provide 
                deference to a permissible interpretation by a WTO 
                member of provisions of that Agreement, and to the 
                evaluation by a WTO member of the facts where that 
                evaluation is unbiased and objective and the 
                establishment of the facts is proper.

[[Page 116 STAT. 994]]

SEC. 2102. <<NOTE: 19 USC 3802.>> TRADE NEGOTIATING OBJECTIVES.

    (a) Overall Trade Negotiating Objectives.--The overall trade 
negotiating objectives of the United States for agreements subject to 
the provisions of section 2103 are--
            (1) to obtain more open, equitable, and reciprocal market 
        access;
            (2) to obtain the reduction or elimination of barriers and 
        distortions that are directly related to trade and that decrease 
        market opportunities for United States exports or otherwise 
        distort United States trade;
            (3) to further strengthen the system of international 
        trading disciplines and procedures, including dispute 
        settlement;
            (4) to foster economic growth, raise living standards, and 
        promote full employment in the United States and to enhance the 
        global economy;
            (5) to ensure that trade and environmental policies are 
        mutually supportive and to seek to protect and preserve the 
        environment and enhance the international means of doing so, 
        while optimizing the use of the world's resources;
            (6) to promote respect for worker rights and the rights of 
        children consistent with core labor standards of the ILO (as 
        defined in section 2113(6)) and an understanding of the 
        relationship between trade and worker rights;
            (7) to seek provisions in trade agreements under which 
        parties to those agreements strive to ensure that they do not 
        weaken or reduce the protections afforded in domestic 
        environmental and labor laws as an encouragement for trade;
            (8) to ensure that trade agreements afford small businesses 
        equal access to international markets, equitable trade benefits, 
        and expanded export market opportunities, and provide for the 
        reduction or elimination of trade barriers that 
        disproportionately impact small businesses; and
            (9) to promote universal ratification and full compliance 
        with ILO Convention No. 182 Concerning the Prohibition and 
        Immediate Action for the Elimination of the Worst Forms of Child 
        Labor.

    (b) Principal Trade Negotiating Objectives.--
            (1) Trade barriers and distortions.--The principal 
        negotiating objectives of the United States regarding trade 
        barriers and other trade distortions are--
                    (A) to expand competitive market opportunities for 
                United States exports and to obtain fairer and more open 
                conditions of trade by reducing or eliminating tariff 
                and nontariff barriers and policies and practices of 
                foreign governments directly related to trade that 
                decrease market opportunities for United States exports 
                or otherwise distort United States trade; and
                    (B) to obtain reciprocal tariff and nontariff 
                barrier elimination agreements, with particular 
                attention to those tariff categories covered in section 
                111(b) of the Uruguay Round Agreements Act (19 U.S.C. 
                3521(b)).
            (2) Trade in services.--The principal negotiating objective 
        of the United States regarding trade in services is to reduce or 
        eliminate barriers to international trade in services, including 
        regulatory and other barriers that deny national treatment and 
        market access or unreasonably restrict the establishment or 
        operations of service suppliers.

[[Page 116 STAT. 995]]

            (3) Foreign investment.--Recognizing that United States law 
        on the whole provides a high level of protection for investment, 
        consistent with or greater than the level required by 
        international law, the principal negotiating objectives of the 
        United States regarding foreign investment are to reduce or 
        eliminate artificial or trade-distorting barriers to foreign 
        investment, while ensuring 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, and to secure for investors important rights 
        comparable to those that would be available under United States 
        legal principles and practice, by--
                    (A) reducing or eliminating exceptions to the 
                principle of national treatment;
                    (B) freeing the transfer of funds relating to 
                investments;
                    (C) reducing or eliminating performance 
                requirements, forced technology transfers, and other 
                unreasonable barriers to the establishment and operation 
                of investments;
                    (D) seeking to establish standards for expropriation 
                and compensation for expropriation, consistent with 
                United States legal principles and practice;
                    (E) seeking to establish standards for fair and 
                equitable treatment consistent with United States legal 
                principles and practice, including the principle of due 
                process;
                    (F) providing meaningful procedures for resolving 
                investment disputes;
                    (G) seeking to improve mechanisms used to resolve 
                disputes between an investor and a government through--
                          (i) mechanisms to eliminate frivolous claims 
                      and to deter the filing of frivolous claims;
                          (ii) procedures to ensure the efficient 
                      selection of arbitrators and the expeditious 
                      disposition of claims;
                          (iii) procedures to enhance opportunities for 
                      public input into the formulation of government 
                      positions; and
                          (iv) providing for an appellate body or 
                      similar mechanism to provide coherence to the 
                      interpretations of investment provisions in trade 
                      agreements; and
                    (H) ensuring the fullest measure of transparency in 
                the dispute settlement mechanism, to the extent 
                consistent with the need to protect information that is 
                classified or business confidential, by--
                          (i) ensuring that all requests for dispute 
                      settlement are promptly made public;
                          (ii) ensuring that--
                                    (I) all proceedings, submissions, 
                                findings, and decisions are promptly 
                                made public; and
                                    (II) all hearings are open to the 
                                public; and
                          (iii) establishing a mechanism for acceptance 
                      of amicus curiae submissions from businesses, 
                      unions, and nongovernmental organizations.
            (4) Intellectual property.--The principal negotiating 
        objectives of the United States regarding trade-related 
        intellectual property are--
                    (A) to further promote adequate and effective 
                protection of intellectual property rights, including 
                through--

[[Page 116 STAT. 996]]

                          (i)(I) ensuring accelerated and full 
                      implementation of the Agreement on Trade-Related 
                      Aspects of Intellectual Property Rights referred 
                      to in section 101(d)(15) of the Uruguay Round 
                      Agreements Act (19 U.S.C. 3511(d)(15)), 
                      particularly with respect to meeting enforcement 
                      obligations under that agreement; and
                          (II) ensuring that the provisions of any 
                      multilateral or bilateral trade agreement 
                      governing intellectual property rights that is 
                      entered into by the United States reflect a 
                      standard of protection similar to that found in 
                      United States law;
                          (ii) providing strong protection for new and 
                      emerging technologies and new methods of 
                      transmitting and distributing products embodying 
                      intellectual property;
                          (iii) preventing or eliminating discrimination 
                      with respect to matters affecting the 
                      availability, acquisition, scope, maintenance, 
                      use, and enforcement of intellectual property 
                      rights;
                          (iv) ensuring that standards of protection and 
                      enforcement keep pace with technological 
                      developments, and in particular ensuring that 
                      rightholders have the legal and technological 
                      means to control the use of their works through 
                      the Internet and other global communication media, 
                      and to prevent the unauthorized use of their 
                      works; and
                          (v) providing strong enforcement of 
                      intellectual property rights, including through 
                      accessible, expeditious, and effective civil, 
                      administrative, and criminal enforcement 
                      mechanisms;
                    (B) to secure fair, equitable, and nondiscriminatory 
                market access opportunities for United States persons 
                that rely upon intellectual property protection; and
                    (C) to respect the Declaration on the TRIPS 
                Agreement and Public Health, adopted by the World Trade 
                Organization at the Fourth Ministerial Conference at 
                Doha, Qatar on November 14, 2001.
            (5) Transparency.--The principal negotiating objective of 
        the United States with respect to transparency is to obtain 
        wider and broader application of the principle of transparency 
        through--
                    (A) increased and more timely public access to 
                information regarding trade issues and the activities of 
                international trade institutions;
                    (B) increased openness at the WTO and other 
                international trade fora by increasing public access to 
                appropriate meetings, proceedings, and submissions, 
                including with regard to dispute settlement and 
                investment; and
                    (C) increased and more timely public access to all 
                notifications and supporting documentation submitted by 
                parties to the WTO.
            (6) Anti-corruption.--The principal negotiating objectives 
        of the United States with respect to the use of money or other 
        things of value to influence acts, decisions, or omissions of 
        foreign governments or officials or to secure any improper 
        advantage in a manner affecting trade are--

[[Page 116 STAT. 997]]

                    (A) to obtain high standards and appropriate 
                domestic enforcement mechanisms applicable to persons 
                from all countries participating in the applicable trade 
                agreement that prohibit such attempts to influence acts, 
                decisions, or omissions of foreign governments; and
                    (B) to ensure that such standards do not place 
                United States persons at a competitive disadvantage in 
                international trade.
            (7) Improvement of the wto and multilateral trade 
        agreements.--The principal negotiating objectives of the United 
        States regarding the improvement of the World Trade 
        Organization, the Uruguay Round Agreements, and other 
        multilateral and bilateral trade agreements are--
                    (A) to achieve full implementation and extend the 
                coverage of the World Trade Organization and such 
                agreements to products, sectors, and conditions of trade 
                not adequately covered; and
                    (B) to expand country participation in and 
                enhancement of the Information Technology Agreement and 
                other trade agreements.
            (8) Regulatory practices.--The principal negotiating 
        objectives of the United States regarding the use of government 
        regulation or other practices by foreign governments to provide 
        a competitive advantage to their domestic producers, service 
        providers, or investors and thereby reduce market access for 
        United States goods, services, and investments are--
                    (A) to achieve increased transparency and 
                opportunity for the participation of affected parties in 
                the development of regulations;
                    (B) to require that proposed regulations be based on 
                sound science, cost-benefit analysis, risk assessment, 
                or other objective evidence;
                    (C) to establish consultative mechanisms among 
                parties to trade agreements to promote increased 
                transparency in developing guidelines, rules, 
                regulations, and laws for government procurement and 
                other regulatory regimes; and
                    (D) to achieve the elimination of government 
                measures such as price controls and reference pricing 
                which deny full market access for United States 
                products.
            (9) Electronic commerce.--The principal negotiating 
        objectives of the United States with respect to electronic 
        commerce are--
                    (A) to ensure that current obligations, rules, 
                disciplines, and commitments under the World Trade 
                Organization apply to electronic commerce;
                    (B) to ensure that--
                          (i) electronically delivered goods and 
                      services receive no less favorable treatment under 
                      trade rules and commitments than like products 
                      delivered in physical form; and
                          (ii) the classification of such goods and 
                      services ensures the most liberal trade treatment 
                      possible;
                    (C) to ensure that governments refrain from 
                implementing trade-related measures that impede 
                electronic commerce;
                    (D) where legitimate policy objectives require 
                domestic regulations that affect electronic commerce, to 
                obtain

[[Page 116 STAT. 998]]

                commitments that any such regulations are the least 
                restrictive on trade, nondiscriminatory, and 
                transparent, and promote an open market environment; and
                    (E) to extend the moratorium of the World Trade 
                Organization on duties on electronic transmissions.
            (10) Reciprocal trade in agriculture.--(A) The principal 
        negotiating objective of the United States with respect to 
        agriculture is to obtain competitive opportunities for United 
        States exports of agricultural commodities in foreign markets 
        substantially equivalent to the competitive opportunities 
        afforded foreign exports in United States markets and to achieve 
        fairer and more open conditions of trade in bulk, specialty 
        crop, and value-added commodities by--
                    (i) reducing or eliminating, by a date certain, 
                tariffs or other charges that decrease market 
                opportunities for United States exports--
                          (I) giving priority to those products that are 
                      subject to significantly higher tariffs or subsidy 
                      regimes of major producing countries; and
                          (II) providing reasonable adjustment periods 
                      for United States import-sensitive products, in 
                      close consultation with the Congress on such 
                      products before initiating tariff reduction 
                      negotiations;
                    (ii) reducing tariffs to levels that are the same as 
                or lower than those in the United States;
                    (iii) reducing or eliminating subsidies that 
                decrease market opportunities for United States exports 
                or unfairly distort agriculture markets to the detriment 
                of the United States;
                    (iv) allowing the preservation of programs that 
                support family farms and rural communities but do not 
                distort trade;
                    (v) developing disciplines for domestic support 
                programs, so that production that is in excess of 
                domestic food security needs is sold at world prices;
                    (vi) eliminating government policies that create 
                price-depressing surpluses;
                    (vii) eliminating state trading enterprises whenever 
                possible;
                    (viii) developing, strengthening, and clarifying 
                rules and effective dispute settlement mechanisms to 
                eliminate practices that unfairly decrease United States 
                market access opportunities or distort agricultural 
                markets to the detriment of the United States, 
                particularly with respect to import-sensitive products, 
                including--
                          (I) unfair or trade-distorting activities of 
                      state trading enterprises and other administrative 
                      mechanisms, with emphasis on requiring price 
                      transparency in the operation of state trading 
                      enterprises and such other mechanisms in order to 
                      end cross subsidization, price discrimination, and 
                      price undercutting;
                          (II) unjustified trade restrictions or 
                      commercial requirements, such as labeling, that 
                      affect new technologies, including biotechnology;
                          (III) unjustified sanitary or phytosanitary 
                      restrictions, including those not based on 
                      scientific principles in contravention of the 
                      Uruguay Round Agreements;

[[Page 116 STAT. 999]]

                          (IV) other unjustified technical barriers to 
                      trade; and
                          (V) restrictive rules in the administration of 
                      tariff rate quotas;
                    (ix) eliminating practices that adversely affect 
                trade in perishable or cyclical products, while 
                improving import relief mechanisms to recognize the 
                unique characteristics of perishable and cyclical 
                agriculture;
                    (x) ensuring that import relief mechanisms for 
                perishable and cyclical agriculture are as accessible 
                and timely to growers in the United States as those 
                mechanisms that are used by other countries;
                    (xi) taking into account whether a party to the 
                negotiations has failed to adhere to the provisions of 
                already existing trade agreements with the United States 
                or has circumvented obligations under those agreements;
                    (xii) taking into account whether a product is 
                subject to market distortions by reason of a failure of 
                a major producing country to adhere to the provisions of 
                already existing trade agreements with the United States 
                or by the circumvention by that country of its 
                obligations under those agreements;
                    (xiii) otherwise ensuring that countries that accede 
                to the World Trade Organization have made meaningful 
                market liberalization commitments in agriculture;
                    (xiv) taking into account the impact that agreements 
                covering agriculture to which the United States is a 
                party, including the North American Free Trade 
                Agreement, have on the United States agricultural 
                industry;
                    (xv) maintaining bona fide food assistance programs 
                and preserving United States market development and 
                export credit programs; and
                    (xvi) striving to complete a general multilateral 
                round in the World Trade Organization by January 1, 
                2005, and seeking the broadest market access possible in 
                multilateral, regional, and bilateral negotiations, 
                recognizing the effect that simultaneous sets of 
                negotiations may have on United States import-sensitive 
                commodities (including those subject to tariff-rate 
                quotas).
            (B)(i) Before commencing negotiations with respect to 
        agriculture, the United States Trade Representative, in 
        consultation with the Congress, shall seek to develop a position 
        on the treatment of seasonal and perishable agricultural 
        products to be employed in the negotiations in order to develop 
        an international consensus on the treatment of seasonal or 
        perishable agricultural products in investigations relating to 
        dumping and safeguards and in any other relevant area.
            (ii) During any negotiations on agricultural subsidies, the 
        United States Trade Representative shall seek to establish the 
        common base year for calculating the Aggregated Measurement of 
        Support (as defined in the Agreement on Agriculture) as the end 
        of each country's Uruguay Round implementation period, as 
        reported in each country's Uruguay Round market access schedule.
            (iii) The negotiating objective provided in subparagraph (A) 
        applies with respect to agricultural matters to be addressed in 
        any trade agreement entered into under section 2103(a)

[[Page 116 STAT. 1000]]

        or (b), including any trade agreement entered into under section 
        2103(a) or (b) that provides for accession to a trade agreement 
        to which the United States is already a party, such as the North 
        American Free Trade Agreement and the United States-Canada Free 
        Trade Agreement.
            (11) Labor and the environment.--The principal negotiating 
        objectives of the United States with respect to labor and the 
        environment are--
                    (A) to ensure that a party to a trade agreement with 
                the United States does not fail to effectively enforce 
                its environmental or labor laws, through a sustained or 
                recurring course of action or inaction, in a manner 
                affecting trade between the United States and that party 
                after entry into force of a trade agreement between 
                those countries;
                    (B) to recognize that parties to a trade agreement 
                retain the right to exercise discretion with respect to 
                investigatory, prosecutorial, regulatory, and compliance 
                matters and to make decisions regarding the allocation 
                of resources to enforcement with respect to other labor 
                or environmental matters determined to have higher 
                priorities, and to recognize that a country is 
                effectively enforcing its laws if a course of action or 
                inaction reflects a reasonable exercise of such 
                discretion, or results from a bona fide decision 
                regarding the allocation of resources, and no 
                retaliation may be authorized based on the exercise of 
                these rights or the right to establish domestic labor 
                standards and levels of environmental protection;
                    (C) to strengthen the capacity of United States 
                trading partners to promote respect for core labor 
                standards (as defined in section 2113(6));
                    (D) to strengthen the capacity of United States 
                trading partners to protect the environment through the 
                promotion of sustainable development;
                    (E) to reduce or eliminate government practices or 
                policies that unduly threaten sustainable development;
                    (F) to seek market access, through the elimination 
                of tariffs and nontariff barriers, for United States 
                environmental technologies, goods, and services; and
                    (G) to ensure that labor, environmental, health, or 
                safety policies and practices of the parties to trade 
                agreements with the United States do not arbitrarily or 
                unjustifiably discriminate against United States exports 
                or serve as disguised barriers to trade.
            (12) Dispute settlement and enforcement.--The principal 
        negotiating objectives of the United States with respect to 
        dispute settlement and enforcement of trade agreements are--
                    (A) to seek provisions in trade agreements providing 
                for resolution of disputes between governments under 
                those trade agreements in an effective, timely, 
                transparent, equitable, and reasoned manner, requiring 
                determinations based on facts and the principles of the 
                agreements, with the goal of increasing compliance with 
                the agreements;
                    (B) to seek to strengthen the capacity of the Trade 
                Policy Review Mechanism of the World Trade Organization 
                to review compliance with commitments;

[[Page 116 STAT. 1001]]

                    (C) to seek adherence by panels convened under the 
                Dispute Settlement Understanding and by the Appellate 
                Body to the standard of review applicable under the 
                Uruguay Round Agreement involved in the dispute, 
                including greater deference, where appropriate, to the 
                fact-finding and technical expertise of national 
                investigating authorities;
                    (D) to seek provisions encouraging the early 
                identification and settlement of disputes through 
                consultation;
                    (E) to seek provisions to encourage the provision of 
                trade-expanding compensation if a party to a dispute 
                under the agreement does not come into compliance with 
                its obligations under the agreement;
                    (F) to seek provisions to impose a penalty upon a 
                party to a dispute under the agreement that--
                          (i) encourages compliance with the obligations 
                      of the agreement;
                          (ii) is appropriate to the parties, nature, 
                      subject matter, and scope of the violation; and
                          (iii) has the aim of not adversely affecting 
                      parties or interests not party to the dispute 
                      while maintaining the effectiveness of the 
                      enforcement mechanism; and
                    (G) to seek provisions that treat United States 
                principal negotiating objectives equally with respect 
                to--
                          (i) the ability to resort to dispute 
                      settlement under the applicable agreement;
                          (ii) the availability of equivalent dispute 
                      settlement procedures; and
                          (iii) the availability of equivalent remedies.
            (13) WTO extended negotiations.--The principal negotiating 
        objectives of the United States regarding trade in civil 
        aircraft are those set forth in section 135(c) of the Uruguay 
        Round Agreements Act (19 U.S.C. 3355(c)) and regarding rules of 
        origin are the conclusion of an agreement described in section 
        132 of that Act (19 U.S.C. 3552).
            (14) Trade remedy laws.--The principal negotiating 
        objectives of the United States with respect to trade remedy 
        laws are--
                    (A) to preserve the ability of the United States to 
                enforce rigorously its trade laws, including the 
                antidumping, countervailing duty, and safeguard laws, 
                and avoid agreements that lessen the effectiveness of 
                domestic and international disciplines on unfair trade, 
                especially dumping and subsidies, or that lessen the 
                effectiveness of domestic and international safeguard 
                provisions, in order to ensure that United States 
                workers, agricultural producers, and firms can compete 
                fully on fair terms and enjoy the benefits of reciprocal 
                trade concessions; and
                    (B) to address and remedy market distortions that 
                lead to dumping and subsidization, including 
                overcapacity, cartelization, and market-access barriers.
            (15) Border taxes.--The principal negotiating objective of 
        the United States regarding border taxes is to obtain a revision 
        of the WTO rules with respect to the treatment of border 
        adjustments for internal taxes to redress the disadvantage to 
        countries relying primarily on direct taxes for revenue rather 
        than indirect taxes.

[[Page 116 STAT. 1002]]

            (16) Textile Negotiations.--The principal negotiating 
        objectives of the United States with respect to trade in 
        textiles and apparel articles are to obtain competitive 
        opportunities for United States exports of textiles and apparel 
        in foreign markets substantially equivalent to the competitive 
        opportunities afforded foreign exports in United States markets 
        and to achieve fairer and more open conditions of trade in 
        textiles and apparel.
            (17) Worst Forms of Child Labor.--The principal negotiating 
        objective of the United States with respect to the trade-related 
        aspects of the worst forms of child labor are to seek 
        commitments by parties to trade agreements to vigorously enforce 
        their own laws prohibiting the worst forms of child labor.

    (c) Promotion of <<NOTE: President.>> Certain Priorities.--In order 
to address and maintain United States competitiveness in the global 
economy, the President shall--
            (1) seek greater cooperation between the WTO and the ILO;
            (2) seek to establish consultative mechanisms among parties 
        to trade agreements to strengthen the capacity of United States 
        trading partners to promote respect for core labor standards (as 
        defined in section 2113(6)) and to promote compliance with ILO 
        Convention No. 182 Concerning the Prohibition and Immediate 
        Action for the Elimination of the Worst Forms of Child Labor, 
        and report to the Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the Senate on 
        the content and operation of such mechanisms;
            (3) seek to establish 
        consultative <<NOTE: Reports.>> mechanisms among parties to 
        trade agreements to strengthen the capacity of United States 
        trading partners to develop and implement standards for the 
        protection of the environment and human health based on sound 
        science, and report to the Committee on Ways and Means of the 
        House of Representatives and the Committee on Finance of the 
        Senate on the content and operation of such mechanisms;
            (4) conduct environmental reviews of future trade and 
        investment agreements, consistent with Executive Order 13141 of 
        November 16, 1999, and its relevant guidelines, and report to 
        the Committee on Ways and Means of the House of Representatives 
        and the Committee on Finance of the Senate on such reviews;
            (5) review the impact of future trade agreements on United 
        States employment, including labor markets, modeled after 
        Executive Order 13141 to the extent appropriate in establishing 
        procedures and criteria, report to the Committee on Ways and 
        Means of the House of Representatives and the Committee on 
        Finance of the Senate on such review, and make that report 
        available to the public;
            (6) take into account other legitimate United States 
        domestic objectives including, but not limited to, the 
        protection of legitimate health or safety, essential security, 
        and consumer interests and the law and regulations related 
        thereto;
            (7) direct the Secretary of Labor to consult with any 
        country seeking a trade agreement with the United States 
        concerning that country's labor laws and provide technical 
        assistance to that country if needed;

[[Page 116 STAT. 1003]]

            (8) in connection with any trade negotiations entered into 
        under this Act, submit to the Committee on Ways and Means of the 
        House of Representatives and the Committee on Finance of the 
        Senate a meaningful labor rights report of the country, or 
        countries, with respect to which the President is negotiating, 
        on a time frame determined in accordance with section 
        2107(b)(2)(E);
            (9) with respect to any trade agreement which the President 
        seeks to implement under trade authorities procedures, submit to 
        the Congress a report describing the extent to which the country 
        or countries that are parties to the agreement have in effect 
        laws governing exploitative child labor;
            (10) continue to promote consideration of multilateral 
        environmental agreements and consult with parties to such 
        agreements regarding the consistency of any such agreement that 
        includes trade measures with existing environmental exceptions 
        under Article XX of the GATT 1994;
            (11) report to the Committee on <<NOTE: Reports.>> Ways and 
        Means of the House of Representatives and the Committee on 
        Finance of the Senate, not later than 12 months after the 
        imposition of a penalty or remedy by the United States permitted 
        by a trade agreement to which this title applies, on the 
        effectiveness of the penalty or remedy applied under United 
        States law in enforcing United States rights under the trade 
        agreement; and
            (12) seek to establish consultative mechanisms among parties 
        to trade agreements to examine the trade consequences of 
        significant and unanticipated currency movements and to 
        scrutinize whether a foreign government engaged in a pattern of 
        manipulating its currency to promote a competitive advantage in 
        international trade.

The report under paragraph (11) shall address whether the penalty or 
remedy was effective in changing the behavior of the targeted party and 
whether the penalty or remedy had any adverse impact on parties or 
interests not party to the dispute.
    (d) Consultations.--
            (1) Consultations with congressional advisers.--In the 
        course of negotiations conducted under this title, the United 
        States Trade Representative shall consult closely and on a 
        timely basis with, and keep fully apprised of the negotiations, 
        the Congressional Oversight Group convened under section 2107 
        and all committees of the House of Representatives and the 
        Senate with jurisdiction over laws that would be affected by a 
        trade agreement resulting from the negotiations.
            (2) Consultation before agreement initialed.--In the course 
        of negotiations conducted under this title, the United States 
        Trade Representative shall--
                    (A) consult closely and on a timely basis (including 
                immediately before initialing an agreement) with, and 
                keep fully apprised of the negotiations, the 
                congressional advisers for trade policy and negotiations 
                appointed under section 161 of the Trade Act of 1974 (19 
                U.S.C. 2211), the Committee on Ways and Means of the 
                House of Representatives, the Committee on Finance of 
                the Senate, and the Congressional Oversight Group 
                convened under section 2107; and

[[Page 116 STAT. 1004]]

                    (B) with regard to any negotiations and agreement 
                relating to agricultural trade, also consult closely and 
                on a timely basis (including immediately before 
                initialing an agreement) with, and keep fully apprised 
                of the negotiations, the Committee on Agriculture of the 
                House of Representatives and the Committee on 
                Agriculture, Nutrition, and Forestry of the Senate.

    (e) Adherence to Obligations Under Uruguay Round Agreements.--In 
determining whether to enter into negotiations with a particular 
country, the President shall take into account the extent to which that 
country has implemented, or has accelerated the implementation of, its 
obligations under the Uruguay Round Agreements.

SEC. 2103. <<NOTE: 19 USC 3803.>> TRADE AGREEMENTS AUTHORITY.

    (a) Agreements Regarding Tariff Barriers.--
            (1) In general.--Whenever the President determines that one 
        or more existing duties or other import restrictions of any 
        foreign country or the United States are unduly burdening and 
        restricting the foreign trade of the United States and that the 
        purposes, policies, priorities, and objectives of this title 
        will be promoted thereby, the President--
                    (A) may enter into trade agreements with foreign 
                countries before--
                          (i) June 1, 2005; or
                          (ii) June 1, 2007, if trade authorities 
                      procedures are extended under subsection (c); and
                    (B) may, subject to paragraphs (2) and (3), 
                proclaim--
                          (i) such modification or continuance of any 
                      existing duty,
                          (ii) such continuance of existing duty-free or 
                      excise treatment, or
                          (iii) such additional duties,
                as the President determines to be required or 
                appropriate to carry out any such trade agreement.
        The President <<NOTE: President. Notification.>> shall notify 
        the Congress of the President's intention to enter into an 
        agreement under this subsection.
            (2) Limitations.--No proclamation may be made under 
        paragraph (1) that--
                    (A) reduces any rate of duty (other than a rate of 
                duty that does not exceed 5 percent ad valorem on the 
                date of the enactment of this Act) to a rate of duty 
                which is less than 50 percent of the rate of such duty 
                that applies on such date of enactment;
                    (B) reduces the rate of duty below that applicable 
                under the Uruguay Round Agreements, on any import 
                sensitive agricultural product; or
                    (C) increases any rate of duty above the rate that 
                applied on the date of the enactment of this Act.
            (3) Aggregate reduction; exemption from staging.--
                    (A) Aggregate reduction.--Except as provided in 
                subparagraph (B), the aggregate reduction in the rate of 
                duty on any article which is in effect on any day 
                pursuant to a trade agreement entered into under 
                paragraph (1) shall not exceed the aggregate reduction 
                which would have been in effect on such day if--

[[Page 116 STAT. 1005]]

                          (i) a reduction of 3 percent ad valorem or a 
                      reduction of one-tenth of the total reduction, 
                      whichever is greater, had taken effect on the 
                      effective date of the first reduction proclaimed 
                      under paragraph (1) to carry out such agreement 
                      with respect to such article; and
                          (ii) a reduction equal to the amount 
                      applicable under clause (i) had taken effect at 1-
                      year intervals after the effective date of such 
                      first reduction.
                    (B) Exemption from staging.--No staging is required 
                under subparagraph (A) with respect to a duty reduction 
                that is proclaimed under paragraph (1) for an article of 
                a kind that is not produced in the United States. The 
                United States International Trade Commission shall 
                advise the President of the identity of articles that 
                may be exempted from staging under this subparagraph.
            (4) Rounding.--If the President determines that such action 
        will simplify the computation of reductions under paragraph (3), 
        the President may round an annual reduction by an amount equal 
        to the lesser of--
                    (A) the difference between the reduction without 
                regard to this paragraph and the next lower whole 
                number; or
                    (B) one-half of 1 percent ad valorem.
            (5) Other limitations.--A rate of duty reduction that may 
        not be proclaimed by reason of paragraph (2) may take effect 
        only if a provision authorizing such reduction is included 
        within an implementing bill provided for under section 2105 and 
        that bill is enacted into law.
            (6) Other tariff modifications.--Notwithstanding paragraphs 
        (1)(B), (2)(A), (2)(C), and (3) through (5), and subject to the 
        consultation and layover requirements of section 115 of the 
        Uruguay Round Agreements Act, the President may proclaim the 
        modification of any duty or staged rate reduction of any duty 
        set forth in Schedule XX, as defined in section 2(5) of that 
        Act, if the United States agrees to such modification or staged 
        rate reduction in a negotiation for the reciprocal elimination 
        or harmonization of duties under the auspices of the World Trade 
        Organization.
            (7) Authority under uruguay round agreements act not 
        affected.--Nothing in this subsection shall limit the authority 
        provided to the President under section 111(b) of the Uruguay 
        Round Agreements Act (19 U.S.C. 3521(b)).

    (b) Agreements Regarding Tariff and Nontariff Barriers.--
            (1) In general.--(A) Whenever the President determines 
        that--
                    (i) one or more existing duties or any other import 
                restriction of any foreign country or the United States 
                or any other barrier to, or other distortion of, 
                international trade unduly burdens or restricts the 
                foreign trade of the United States or adversely affects 
                the United States economy, or
                    (ii) the imposition of any such barrier or 
                distortion is likely to result in such a burden, 
                restriction, or effect,
        and that the purposes, policies, priorities, and objectives of 
        this title will be promoted thereby, the President may enter 
        into a trade agreement described in subparagraph (B) during the 
        period described in subparagraph (C).

[[Page 116 STAT. 1006]]

            (B) The President may enter into a trade agreement under 
        subparagraph (A) with foreign countries providing for--
                    (i) the reduction or elimination of a duty, 
                restriction, barrier, or other distortion described in 
                subparagraph (A); or
                    (ii) the prohibition of, or limitation on the 
                imposition of, such barrier or other distortion.
            (C) The President may enter into a trade agreement under 
        this paragraph before--
                    (i) June 1, 2005; or
                    (ii) June 1, 2007, if trade authorities procedures 
                are extended under subsection (c).
            (2) Conditions.--A trade agreement may be entered into under 
        this subsection only if such agreement makes progress in meeting 
        the applicable objectives described in section 2102(a) and (b) 
        and the President satisfies the conditions set forth in section 
        2104.
            (3) Bills qualifying for trade authorities procedures.--(A) 
        The provisions of section 151 of the Trade Act of 1974 (in this 
        title referred to as ``trade authorities procedures'') apply to 
        a bill of either House of Congress which contains provisions 
        described in subparagraph (B) to the same extent as such section 
        151 applies to implementing bills under that section. A bill to 
        which this paragraph applies shall hereafter in this title be 
        referred to as an ``implementing bill''.
            (B) The provisions referred to in subparagraph (A) are--
                    (i) a provision approving a trade agreement entered 
                into under this subsection and approving the statement 
                of administrative action, if any, proposed to implement 
                such trade agreement; and
                    (ii) if changes in existing laws or new statutory 
                authority are required to implement such trade agreement 
                or agreements, provisions, necessary or appropriate to 
                implement such trade agreement or agreements, either 
                repealing or amending existing laws or providing new 
                statutory authority.

    (c) Extension Disapproval Process for Congressional Trade 
Authorities Procedures.--
            (1) In general.--Except as provided in section 2105(b)--
                    (A) the trade authorities procedures apply to 
                implementing bills submitted with respect to trade 
                agreements entered into under subsection (b) before July 
                1, 2005; and
                    (B) the trade authorities procedures shall be 
                extended to implementing bills submitted with respect to 
                trade agreements entered into under subsection (b) after 
                June 30, 2005, and before July 1, 2007, if (and only 
                if)--
                          (i) the President requests such extension 
                      under paragraph (2); and
                          (ii) neither House of the Congress adopts an 
                      extension disapproval resolution under paragraph 
                      (5) before June 1, 2005.
            (2) Report to congress by the president.-- 
        <<NOTE: Deadline.>> If the President is of the opinion that the 
        trade authorities procedures should be extended to implementing 
        bills described in paragraph (1)(B), the President shall submit 
        to the Congress, not later than March 1, 2005, a written report 
        that contains a request for such extension, together with--

[[Page 116 STAT. 1007]]

                    (A) a description of all trade agreements that have 
                been negotiated under subsection (b) and the anticipated 
                schedule for submitting such agreements to the Congress 
                for approval;
                    (B) a description of the progress that has been made 
                in negotiations to achieve the purposes, policies, 
                priorities, and objectives of this title, and a 
                statement that such progress justifies the continuation 
                of negotiations; and
                    (C) a statement of the reasons why the extension is 
                needed to complete the negotiations.
            (3) Other reports to congress.-- 
        <<NOTE: President. Deadlines.>> 
                    (A) Report by the advisory committee.--The President 
                shall promptly inform the Advisory Committee for Trade 
                Policy and Negotiations established under section 135 of 
                the Trade Act of 1974 (19 U.S.C. 2155) of the 
                President's decision to submit a report to the Congress 
                under paragraph (2). The Advisory Committee shall submit 
                to the Congress as soon as practicable, but not later 
                than May 1, 2005, a written report that contains--
                          (i) its views regarding the progress that has 
                      been made in negotiations to achieve the purposes, 
                      policies, priorities, and objectives of this 
                      title; and
                          (ii) a statement of its views, and the reasons 
                      therefor, regarding whether the extension 
                      requested under paragraph (2) should be approved 
                      or disapproved.
                    (B) Report by itc.--The President shall promptly 
                inform the International Trade Commission of the 
                President's decision to submit a report to the Congress 
                under paragraph (2). The International Trade Commission 
                shall submit to the Congress as soon as practicable, but 
                not later than May 1, 2005, a written report that 
                contains a review and analysis of the economic impact on 
                the United States of all trade agreements implemented 
                between the date of enactment of this Act and the date 
                on which the President decides to seek an extension 
                requested under paragraph (2).
            (4) Status of reports.--The reports submitted to the 
        Congress under paragraphs (2) and (3), or any portion of such 
        reports, may be classified to the extent the President 
        determines appropriate.
            (5) Extension disapproval resolutions.--(A) For purposes of 
        paragraph (1), the term ``extension disapproval resolution'' 
        means a resolution of either House of the Congress, the sole 
        matter after the resolving clause of which is as follows: ``That 
        the ____ disapproves the request of the President for the 
        extension, under section 2103(c)(1)(B)(i) of the Bipartisan 
        Trade Promotion Authority Act of 2002, of the trade authorities 
        procedures under that Act to any implementing bill submitted 
        with respect to any trade agreement entered into under section 
        2103(b) of that Act after June 30, 2005.'', with the blank space 
        being filled with the name of the resolving House of the 
        Congress.
            (B) Extension disapproval resolutions--
                    (i) may be introduced in either House of the 
                Congress by any member of such House; and

[[Page 116 STAT. 1008]]

                    (ii) shall be referred, in the House of 
                Representatives, to the Committee on Ways and Means and, 
                in addition, to the Committee on Rules.
            (C) The provisions of section 152(d) and (e) of the Trade 
        Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating to the floor 
        consideration of certain resolutions in the House and Senate) 
        apply to extension disapproval resolutions.
            (D) It is not in order for--
                    (i) the Senate to consider any extension disapproval 
                resolution not reported by the Committee on Finance;
                    (ii) the House of Representatives to consider any 
                extension disapproval resolution not reported by the 
                Committee on Ways and Means and, in addition, by the 
                Committee on Rules; or
                    (iii) either House of the Congress to consider an 
                extension disapproval resolution after June 30, 2005.

    (d) Commencement of Negotiations.--In order to contribute to the 
continued economic expansion of the United States, the President shall 
commence negotiations covering tariff and nontariff barriers affecting 
any industry, product, or service sector, and expand existing sectoral 
agreements to countries that are not parties to those agreements, in 
cases where the President determines that such negotiations are feasible 
and timely and would benefit the United States. Such sectors include 
agriculture, commercial services, intellectual property rights, 
industrial and capital goods, government procurement, information 
technology products, environmental technology and services, medical 
equipment and services, civil aircraft, and infrastructure products. In 
so doing, the President shall take into account all of the principal 
negotiating objectives set forth in section 2102(b).

SEC. 2104. <<NOTE: 19 USC 3804.>> CONSULTATIONS AND ASSESSMENT.

    (a) Notice <<NOTE: President.>> and Consultation Before 
Negotiation.--The President, with respect to any agreement that is 
subject to the provisions of section 2103(b), shall--
            (1) provide, at least 90 calendar days before initiating 
        negotiations, written notice to the Congress of the President's 
        intention to enter into the negotiations and set forth therein 
        the date the President intends to initiate such negotiations, 
        the specific United States objectives for the negotiations, and 
        whether the President intends to seek an agreement, or changes 
        to an existing agreement;
            (2) before and after submission of the notice, consult 
        regarding the negotiations with the Committee on Finance of the 
        Senate and the Committee on Ways and Means of the House of 
        Representatives, such other committees of the House and Senate 
        as the President deems appropriate, and the Congressional 
        Oversight group convened under section 2107; and
            (3) upon the request of a majority of the members of the 
        Congressional Oversight Group under section 2107(c), meet with 
        the Congressional Oversight Group before initiating the 
        negotiations or at any other time concerning the negotiations.

    (b) Negotiations Regarding Agriculture.--
            (1) In general.--Before initiating or continuing 
        negotiations the subject matter of which is directly related to 
        the subject matter under section 2102(b)(10)(A)(i) with any 
        country,

[[Page 116 STAT. 1009]]

        the President shall assess whether United States tariffs on 
        agricultural products that were bound under the Uruguay Round 
        Agreements are lower than the tariffs bound by that country. In 
        addition, the President shall consider whether the tariff levels 
        bound and applied throughout the world with respect to imports 
        from the United States are higher than United States tariffs and 
        whether the negotiation provides an opportunity to address any 
        such disparity. The President shall consult with the Committee 
        on Ways and Means and the Committee on Agriculture of the House 
        of Representatives and the Committee on Finance and the 
        Committee on Agriculture, Nutrition, and Forestry of the Senate 
        concerning the results of the assessment, whether it is 
        appropriate for the United States to agree to further tariff 
        reductions based on the conclusions reached in the assessment, 
        and how all applicable negotiating objectives will be met.
            (2) Special consultations on import sensitive products.--(A) 
        Before initiating negotiations with regard to agriculture, and, 
        with respect to the Free Trade Area for the Americas and 
        negotiations with regard to agriculture under the auspices of 
        the World Trade Organization, as soon as practicable after the 
        enactment of this Act, the United States Trade Representative 
        shall--
                    (i) identify those agricultural products subject to 
                tariff-rate quotas on the date of enactment of this Act, 
                and agricultural products subject to tariff reductions 
                by the United States as a result of the Uruguay Round 
                Agreements, for which the rate of duty was reduced on 
                January 1, 1995, to a rate which was not less than 97.5 
                percent of the rate of duty that applied to such article 
                on December 31, 1994;
                    (ii) consult with the Committee on Ways and Means 
                and the Committee on Agriculture of the House of 
                Representatives and the Committee on Finance and the 
                Committee on Agriculture, Nutrition, and Forestry of the 
                Senate concerning--
                          (I) whether any further tariff reductions on 
                      the products identified under clause (i) should be 
                      appropriate, taking into account the impact of any 
                      such tariff reduction on the United States 
                      industry producing the product concerned;
                          (II) whether the products so identified face 
                      unjustified sanitary or phytosanitary 
                      restrictions, including those not based on 
                      scientific principles in contravention of the 
                      Uruguay Round Agreements; and
                          (III) whether the countries participating in 
                      the negotiations maintain export subsidies or 
                      other programs, policies, or practices that 
                      distort world trade in such products and the 
                      impact of such programs, policies, and practices 
                      on United States producers of the products;
                    (iii) request that the International Trade 
                Commission prepare an assessment of the probable 
                economic effects of any such tariff reduction on the 
                United States industry producing the product concerned 
                and on the United States economy as a whole; and

[[Page 116 STAT. 1010]]

                    (iv) upon complying with clauses (i), (ii), and 
                (iii), notify the Committee on Ways and Means and the 
                Committee on Agriculture of the House of Representatives 
                and the Committee on Finance and the Committee on 
                Agriculture, Nutrition, and Forestry of the Senate of 
                those products identified under clause (i) for which the 
                Trade Representative intends to seek tariff 
                liberalization in the negotiations and the reasons for 
                seeking such tariff liberalization.
            (B) If, after negotiations described in subparagraph (A) are 
        commenced--
                    (i) the United States Trade Representative 
                identifies any additional agricultural product described 
                in subparagraph (A)(i) for tariff reductions which were 
                not the subject of a notification under subparagraph 
                (A)(iv), or
                    (ii) any additional agricultural product described 
                in subparagraph (A)(i) is the subject of a request for 
                tariff reductions by a party to the negotiations,
        the Trade Representative shall, as soon as practicable, notify 
        the committees referred to in subparagraph (A)(iv) of those 
        products and the reasons for seeking such tariff reductions.
            (3) Negotiations regarding the fishing industry.--Before 
        initiating, or continuing, negotiations which directly relate to 
        fish or shellfish trade with any country, the President shall 
        consult with the Committee on Ways and Means and the Committee 
        on Resources of the House of Representatives, and the Committee 
        on Finance and the Committee on Commerce, Science, and 
        Transportation of the Senate, and shall keep the Committees 
        apprised of negotiations on an ongoing and timely basis.

    (c) Negotiations Regarding Textiles.--Before initiating or 
continuing negotiations the subject matter of which is directly related 
to textiles and apparel products with any country, the President shall 
assess whether United States tariffs on textile and apparel products 
that were bound under the Uruguay Round Agreements are lower than the 
tariffs bound by that country and whether the negotiation provides an 
opportunity to address any such disparity. The President shall consult 
with the Committee on Ways and Means of the House of Representatives and 
the Committee on Finance of the Senate concerning the results of the 
assessment, whether it is appropriate for the United States to agree to 
further tariff reductions based on the conclusions reached in the 
assessment, and how all applicable negotiating objectives will be met.
    (d) Consultation With Congress Before Agreements Entered Into.--
            (1) Consultation.--Before entering into any trade agreement 
        under section 2103(b), the President shall consult with--
                    (A) the Committee on Ways and Means of the House of 
                Representatives and the Committee on Finance of the 
                Senate;
                    (B) each other committee of the House and the 
                Senate, and each joint committee of the Congress, which 
                has jurisdiction over legislation involving subject 
                matters which would be affected by the trade agreement; 
                and
                    (C) the Congressional Oversight Group convened under 
                section 2107.
            (2) Scope.--The consultation described in paragraph (1) 
        shall include consultation with respect to--

[[Page 116 STAT. 1011]]

                    (A) the nature of the agreement;
                    (B) how and to what extent the agreement will 
                achieve the applicable purposes, policies, priorities, 
                and objectives of this title; and
                    (C) the implementation of the agreement under 
                section 2105, including the general effect of the 
                agreement on existing laws.
            (3) Report <<NOTE: President. Deadlines.>> regarding united 
        states trade remedy laws.--
                    (A) Changes in certain trade laws.--The President, 
                at least 180 calendar days before the day on which the 
                President enters into a trade agreement under section 
                2103(b), shall report to the Committee on Ways and Means 
                of the House of Representatives and the Committee on 
                Finance of the Senate--
                          (i) the range of proposals advanced in the 
                      negotiations with respect to that agreement, that 
                      may be in the final agreement, and that could 
                      require amendments to title VII of the Tariff Act 
                      of 1930 or to chapter 1 of title II of the Trade 
                      Act of 1974; and
                          (ii) how these proposals relate to the 
                      objectives described in section 2102(b)(14).
                    (B) Certain agreements.--With respect to a trade 
                agreement entered into with Chile or Singapore, the 
                report referred to in subparagraph (A) shall be 
                submitted by the President at least 90 calendar days 
                before the day on which the President enters into that 
                agreement.
                    (C) Resolutions.--(i) At any time after the 
                transmission of the report under subparagraph (A), if a 
                resolution is introduced with respect to that report in 
                either House of Congress, the procedures set forth in 
                clauses (iii) through (vi) shall apply to that 
                resolution if--
                          (I) no other resolution with respect to that 
                      report has previously been reported in that House 
                      of Congress by the Committee on Ways and Means or 
                      the Committee on Finance, as the case may be, 
                      pursuant to those procedures; and
                          (II) no procedural disapproval resolution 
                      under section 2105(b) introduced with respect to a 
                      trade agreement entered into pursuant to the 
                      negotiations to which the report under 
                      subparagraph (A) relates has previously been 
                      reported in that House of Congress by the 
                      Committee on Ways and Means or the Committee on 
                      Finance, as the case may be.
                    (ii) For purposes of this subparagraph, the term 
                ``resolution'' means only a resolution of either House 
                of Congress, the matter after the resolving clause of 
                which is as follows: ``That the ____ finds that the 
                proposed changes to United States trade remedy laws 
                contained in the report of the President transmitted to 
                the Congress on ____ under section 2104(d)(3) of the 
                Bipartisan Trade Promotion Authority Act of 2002 with 
                respect to ____, are inconsistent with the negotiating 
                objectives described in section 2102(b)(14) of that 
                Act.'', with the first blank space being filled with the 
                name of the resolving House of Congress, the second 
                blank space being filled with the appropriate date of 
                the

[[Page 116 STAT. 1012]]

                report, and the third blank space being filled with the 
                name of the country or countries involved.
                    (iii) Resolutions in the House of Representatives--
                          (I) may be introduced by any Member of the 
                      House;
                          (II) shall be referred to the Committee on 
                      Ways and Means and, in addition, to the Committee 
                      on Rules; and
                          (III) may not be amended by either Committee.
                    (iv) Resolutions in the Senate--
                          (I) may be introduced by any Member of the 
                      Senate;
                          (II) shall be referred to the Committee on 
                      Finance; and
                          (III) may not be amended.
                    (iv) It is not in order for the House of 
                Representatives to consider any resolution that is not 
                reported by the Committee on Ways and Means and, in 
                addition, by the Committee on Rules.
                    (v) It is not in order for the Senate to consider 
                any resolution that is not reported by the Committee on 
                Finance.
                    (vi) The provisions of section 152(d) and (e) of the 
                Trade Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating 
                to floor consideration of certain resolutions in the 
                House and Senate) shall apply to resolutions.

    (e) Advisory Committee Reports.--The <<NOTE: Deadlines.>> report 
required under section 135(e)(1) of the Trade Act of 1974 regarding any 
trade agreement entered into under section 2103(a) or (b) of this Act 
shall be provided to the President, the Congress, and the United States 
Trade Representative not later than 30 days after the date on which the 
President notifies the Congress under section 2103(a)(1) or 
2105(a)(1)(A) of the President's intention to enter into the agreement.

    (f) ITC Assessment.--
            (1) In general.--The President, <<NOTE: President.>> at 
        least 90 calendar days before the day on which the President 
        enters into a trade agreement under section 2103(b), shall 
        provide the International Trade Commission (referred to in this 
        subsection as ``the Commission'') with the details of the 
        agreement as it exists at that time and request the Commission 
        to prepare and submit an assessment of the agreement as 
        described in paragraph (2). Between the time the President makes 
        the request under this paragraph and the time the Commission 
        submits the assessment, the President shall keep the Commission 
        current with respect to the details of the agreement.
            (2) ITC assessment.--Not <<NOTE: Reports.>> later than 90 
        calendar days after the President enters into the agreement, the 
        Commission shall submit to the President and the Congress a 
        report assessing the likely impact of the agreement on the 
        United States economy as a whole and on specific industry 
        sectors, including the impact the agreement will have on the 
        gross domestic product, exports and imports, aggregate 
        employment and employment opportunities, the production, 
        employment, and competitive position of industries likely to be 
        significantly affected by the agreement, and the interests of 
        United States consumers.

[[Page 116 STAT. 1013]]

            (3) Review of empirical literature.--In preparing the 
        assessment, the Commission shall review available economic 
        assessments regarding the agreement, including literature 
        regarding any substantially equivalent proposed agreement, and 
        shall provide in its assessment a description of the analyses 
        used and conclusions drawn in such literature, and a discussion 
        of areas of consensus and divergence between the various 
        analyses and conclusions, including those of the Commission 
        regarding the agreement.

SEC. 2105. <<NOTE: 19 USC 3805.>> IMPLEMENTATION OF TRADE AGREEMENTS.

    (a) In General.--
            (1) Notification and <<NOTE: President.>> submission.--Any 
        agreement entered into under section 2103(b) shall enter into 
        force with respect to the United States if (and only if)--
                    (A) the President, <<NOTE: Federal Register, 
                publication.>> at least 90 calendar days before the day 
                on which the President enters into the trade agreement, 
                notifies the House of Representatives and the Senate of 
                the President's intention to enter into the agreement, 
                and promptly thereafter publishes notice of such 
                intention in the Federal Register;
                    (B) within 60 days after entering into the 
                agreement, the President submits to the Congress a 
                description of those changes to existing laws that the 
                President considers would be required in order to bring 
                the United States into compliance with the agreement;
                    (C) after entering into the agreement, the President 
                submits to the Congress, on a day on which both Houses 
                of Congress are in session, a copy of the final legal 
                text of the agreement, together with--
                          (i) a draft of an implementing bill described 
                      in section 2103(b)(3);
                          (ii) a statement of any administrative action 
                      proposed to implement the trade agreement; and
                          (iii) the supporting information described in 
                      paragraph (2); and
                    (D) the implementing bill is enacted into law.
            (2) Supporting information.--The supporting information 
        required under paragraph (1)(C)(iii) consists of--
                    (A) an explanation as to how the implementing bill 
                and proposed administrative action will change or affect 
                existing law; and
                    (B) a statement--
                          (i) asserting that the agreement makes 
                      progress in achieving the applicable purposes, 
                      policies, priorities, and objectives of this 
                      title; and
                          (ii) setting forth the reasons of the 
                      President regarding--
                                    (I) how and to what extent the 
                                agreement makes progress in achieving 
                                the applicable purposes, policies, and 
                                objectives referred to in clause (i);
                                    (II) whether and how the agreement 
                                changes provisions of an agreement 
                                previously negotiated;
                                    (III) how the agreement serves the 
                                interests of United States commerce;

[[Page 116 STAT. 1014]]

                                    (IV) how the implementing bill meets 
                                the standards set forth in section 
                                2103(b)(3); and
                                    (V) how and to what extent the 
                                agreement makes progress in achieving 
                                the applicable purposes, policies, and 
                                objectives referred to in section 
                                2102(c) regarding the promotion of 
                                certain priorities.
            (3) Reciprocal benefits.--In order to ensure that a foreign 
        country that is not a party to a trade agreement entered into 
        under section 2103(b) does not receive benefits under the 
        agreement unless the country is also subject to the obligations 
        under the agreement, the implementing bill submitted with 
        respect to the agreement shall provide that the benefits and 
        obligations under the agreement apply only to the parties to the 
        agreement, if such application is consistent with the terms of 
        the agreement. The implementing bill may also provide that the 
        benefits and obligations under the agreement do not apply 
        uniformly to all parties to the agreement, if such application 
        is consistent with the terms of the agreement.
            (4) Disclosure of commitments.--Any agreement or other 
        understanding with a foreign government or governments (whether 
        oral or in writing) that--
                    (A) relates to a trade agreement with respect to 
                which the Congress enacts an implementing bill under 
                trade authorities procedures, and
                    (B) is not disclosed to the Congress before an 
                implementing bill with respect to that agreement is 
                introduced in either House of Congress,
        shall not be considered to be part of the agreement approved by 
        the Congress and shall have no force and effect under United 
        States law or in any dispute settlement body.

    (b) Limitations on Trade Authorities Procedures.--
            (1) For lack of notice or consultations.--
                    (A) In general.--The trade authorities procedures 
                shall not apply to any implementing bill submitted with 
                respect to a trade agreement or trade agreements entered 
                into under section 2103(b) if during the 60-day period 
                beginning on the date that one House of Congress agrees 
                to a procedural disapproval resolution for lack of 
                notice or consultations with respect to such trade 
                agreement or agreements, the other House separately 
                agrees to a procedural disapproval resolution with 
                respect to such trade agreement or agreements.
                    (B) Procedural disapproval resolution.--(i) For 
                purposes of this paragraph, the term ``procedural 
                disapproval resolution'' means a resolution of either 
                House of Congress, the sole matter after the resolving 
                clause of which is as follows: ``That the President has 
                failed or refused to notify or consult in accordance 
                with the Bipartisan Trade Promotion Authority Act of 
                2002 on negotiations with respect to ____________ and, 
                therefore, the trade authorities procedures under that 
                Act shall not apply to any implementing bill submitted 
                with respect to such trade agreement or agreements.'', 
                with the blank space being filled with a description of 
                the trade agreement or agreements with respect to which 
                the President is considered to have failed or refused to 
                notify or consult.

[[Page 116 STAT. 1015]]

                    (ii) For purposes of clause (i), the President has 
                ``failed or refused to notify or consult in accordance 
                with the Bipartisan Trade Promotion Authority Act of 
                2002'' on negotiations with respect to a trade agreement 
                or trade agreements if--
                          (I) the President has failed or refused to 
                      consult (as the case may be) in accordance with 
                      section 2104 or 2105 with respect to the 
                      negotiations, agreement, or agreements;
                          (II) guidelines under section 2107(b) have not 
                      been developed or met with respect to the 
                      negotiations, agreement, or agreements;
                          (III) the President has not met with the 
                      Congressional Oversight Group pursuant to a 
                      request made under section 2107(c) with respect to 
                      the negotiations, agreement, or agreements; or
                          (IV) the agreement or agreements fail to make 
                      progress in achieving the purposes, policies, 
                      priorities, and objectives of this title.
            (2) Procedures for considering resolutions.--(A) Procedural 
        disapproval resolutions--
                    (i) in the House of Representatives--
                          (I) may be introduced by any Member of the 
                      House;
                          (II) shall be referred to the Committee on 
                      Ways and Means and, in addition, to the Committee 
                      on Rules; and
                          (III) may not be amended by either Committee; 
                      and
                    (ii) in the Senate--
                          (I) may be introduced by any Member of the 
                      Senate;
                          (II) shall be referred to the Committee on 
                      Finance; and
                          (III) may not be amended.
            (B) The provisions of section 152(d) and (e) of the Trade 
        Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating to the floor 
        consideration of certain resolutions in the House and Senate) 
        apply to a procedural disapproval resolution introduced with 
        respect to a trade agreement if no other procedural disapproval 
        resolution with respect to that trade agreement has previously 
        been reported in that House of Congress by the Committee on Ways 
        and Means or the Committee on Finance, as the case may be, and 
        if no resolution described in section 2104(d)(3)(C)(ii) with 
        respect to that trade agreement has been reported in that House 
        of Congress by the Committee on Ways and Means or the Committee 
        on Finance, as the case may be, pursuant to the procedures set 
        forth in clauses (iii) through (vi) of such section 
        2104(d)(3)(C).
            (C) It is not in order for the House of Representatives to 
        consider any procedural disapproval resolution not reported by 
        the Committee on Ways and Means and, in addition, by the 
        Committee on Rules.
            (D) It is not in order for the Senate to consider any 
        procedural disapproval resolution not reported by the Committee 
        on Finance.

[[Page 116 STAT. 1016]]

            (3) For failure to meet other requirements.--
        Not <<NOTE: Deadline. Reports.>> later than December 31, 2002, 
        the Secretary of Commerce, in consultation with the Secretary of 
        State, the Secretary of the Treasury, the Attorney General, and 
        the United States Trade Representative, shall transmit to the 
        Congress a report setting forth the strategy of the executive 
        branch to address concerns of the Congress regarding whether 
        dispute settlement panels and the Appellate Body of the WTO have 
        added to obligations, or diminished rights, of the United 
        States, as described in section 2101(b)(3). Trade authorities 
        procedures shall not apply to any implementing bill with respect 
        to an agreement negotiated under the auspices of the WTO unless 
        the Secretary of Commerce has issued such report in a timely 
        manner.

    (c) Rules of House of Representatives and Senate.--Subsection (b) of 
this section, section 2103(c), aand section 2104(d)(3)(C) are enacted by 
the Congress--
            (1) as an exercise of the rulemaking power of the House of 
        Representatives and the Senate, respectively, and as such are 
        deemed a part of the rules of each House, respectively, and such 
        procedures supersede other rules only to the extent that they 
        are inconsistent with such other rules; and
            (2) with the full recognition of the constitutional right of 
        either House to change the rules (so far as relating to the 
        procedures of that House) at any time, in the same manner, and 
        to the same extent as any other rule of that House.

SEC. 2106. <<NOTE: 19 USC 3806.>> TREATMENT OF CERTAIN TRADE AGREEMENTS 
            FOR WHICH NEGOTIATIONS HAVE ALREADY BEGUN.

    (a) Certain Agreements.--Notwithstanding the prenegotiation 
notification and consultation requirement described in section 2104(a), 
if an agreement to which section 2103(b) applies--
            (1) is entered into under the auspices of the World Trade 
        Organization,
            (2) is entered into with Chile,
            (3) is entered into with Singapore, or
            (4) establishes a Free Trade Area for the Americas,

and results from negotiations that were commenced before the date of the 
enactment of this Act, subsection (b) shall apply.
    (b) Treatment of Agreements.--In the case of any agreement to which 
subsection (a) applies--
            (1) the applicability of the trade authorities procedures to 
        implementing bills shall be determined without regard to the 
        requirements of section 2104(a) (relating only to 90 days notice 
        prior to initiating negotiations), and any procedural 
        disapproval resolution under section 2105(b)(1)(B) shall not be 
        in order on the basis of a failure or refusal to comply with the 
        provisions of section 2104(a); and
            (2) the President shall, <<NOTE: President.>> as soon as 
        feasible after the enactment of this Act--
                    (A) notify the Congress of the negotiations 
                described in subsection (a), the specific United States 
                objectives in the negotiations, and whether the 
                President is seeking a new agreement or changes to an 
                existing agreement; and
                    (B) before and after submission of the notice, 
                consult regarding the negotiations with the committees 
                referred

[[Page 116 STAT. 1017]]

                to in section 2104(a)(2) and the Congressional Oversight 
                Group convened under section 2107.

SEC. 2107. <<NOTE: 19 USC 3807.>> CONGRESSIONAL OVERSIGHT GROUP.

    (a) Members and Functions.--
            (1) In general.--By <<NOTE: Deadline.>> not later than 60 
        days after the date of the enactment of this Act, and not later 
        than 30 days after the convening of each Congress, the chairman 
        of the Committee on Ways and Means of the House of 
        Representatives and the chairman of the Committee on Finance of 
        the Senate shall convene the Congressional Oversight Group.
            (2) Membership from the house.--In each Congress, the 
        Congressional Oversight Group shall be comprised of the 
        following Members of the House of Representatives:
                    (A) The chairman and ranking member of the Committee 
                on Ways and Means, and 3 additional members of such 
                Committee (not more than 2 of whom are members of the 
                same political party).
                    (B) The chairman and ranking member, or their 
                designees, of the committees of the House of 
                Representatives which would have, under the Rules of the 
                House of Representatives, jurisdiction over provisions 
                of law affected by a trade agreement negotiations for 
                which are conducted at any time during that Congress and 
                to which this title would apply.
            (3) Membership from the senate.--In each Congress, the 
        Congressional Oversight Group shall also be comprised of the 
        following members of the Senate:
                    (A) The chairman and ranking member of the Committee 
                on Finance and 3 additional members of such Committee 
                (not more than 2 of whom are members of the same 
                political party).
                    (B) The chairman and ranking member, or their 
                designees, of the committees of the Senate which would 
                have, under the Rules of the Senate, jurisdiction over 
                provisions of law affected by a trade agreement 
                negotiations for which are conducted at any time during 
                that Congress and to which this title would apply.
            (4) Accreditation.--Each member of the Congressional 
        Oversight Group described in paragraph (2)(A) and (3)(A) shall 
        be accredited by the United States Trade Representative on 
        behalf of the President as an official adviser to the United 
        States delegation in negotiations for any trade agreement to 
        which this title applies. Each member of the Congressional 
        Oversight Group described in paragraph (2)(B) and (3)(B) shall 
        be accredited by the United States Trade Representative on 
        behalf of the President as an official adviser to the United 
        States delegation in the negotiations by reason of which the 
        member is in the Congressional Oversight Group. The 
        Congressional Oversight Group shall consult with and provide 
        advice to the Trade Representative regarding the formulation of 
        specific objectives, negotiating strategies and positions, the 
        development of the applicable trade agreement, and compliance 
        and enforcement of the negotiated commitments under the trade 
        agreement.
            (5) Chair.--The Congressional Oversight Group shall be 
        chaired by the Chairman of the Committee on Ways and Means

[[Page 116 STAT. 1018]]

        of the House of Representatives and the Chairman of the 
        Committee on Finance of the Senate.

    (b) Guidelines.--
            (1) Purpose and revision.--The United States Trade 
        Representative, in consultation with the chairmen and ranking 
        minority members of the Committee on Ways and Means of the House 
        of Representatives and the Committee on Finance of the Senate--
                    (A) shall, within 120 days after the date of the 
                enactment of this Act, develop written guidelines to 
                facilitate the useful and timely exchange of information 
                between the Trade Representative and the Congressional 
                Oversight Group convened under this section; and
                    (B) may make such revisions to the guidelines as may 
                be necessary from time to time.
            (2) Content.--The guidelines developed under paragraph (1) 
        shall provide for, among other things--
                    (A) regular, detailed briefings of the Congressional 
                Oversight Group regarding negotiating objectives, 
                including the promotion of certain priorities referred 
                to in section 2102(c), and positions and the status of 
                the applicable negotiations, beginning as soon as 
                practicable after the Congressional Oversight Group is 
                convened, with more frequent briefings as trade 
                negotiations enter the final stage;
                    (B) access by members of the Congressional Oversight 
                Group, and staff with proper security clearances, to 
                pertinent documents relating to the negotiations, 
                including classified materials;
                    (C) the closest practicable coordination between the 
                Trade Representative and the Congressional Oversight 
                Group at all critical periods during the negotiations, 
                including at negotiation sites;
                    (D) after the applicable trade agreement is 
                concluded, consultation regarding ongoing compliance and 
                enforcement of negotiated commitments under the trade 
                agreement; and
                    (E) the time frame for submitting the report 
                required under section 2102(c)(8).

    (c) Request for Meeting.--Upon the request of a majority of the 
Congressional Oversight Group, the President shall meet with the 
Congressional Oversight Group before initiating negotiations with 
respect to a trade agreement, or at any other time concerning the 
negotiations.

SEC. 2108. <<NOTE: 19 USC 3808.>> ADDITIONAL IMPLEMENTATION AND 
            ENFORCEMENT REQUIREMENTS.

    (a) In General.--At <<NOTE: President.>> the time the President 
submits to the Congress the final text of an agreement pursuant to 
section 2105(a)(1)(C), the President shall also submit a plan for 
implementing and enforcing the agreement. The implementation and 
enforcement plan shall include the following:
            (1) Border personnel requirements.--A description of 
        additional personnel required at border entry points, including 
        a list of additional customs and agricultural inspectors.
            (2) Agency staffing requirements.--A description of 
        additional personnel required by Federal agencies responsible 
        for monitoring and implementing the trade agreement,

[[Page 116 STAT. 1019]]

        including personnel required by the Office of the United States 
        Trade Representative, the Department of Commerce, the Department 
        of Agriculture (including additional personnel required to 
        implement sanitary and phytosanitary measures in order to obtain 
        market access for United States exports), the Department of the 
        Treasury, and such other agencies as may be necessary.
            (3) Customs infrastructure requirements.--A description of 
        the additional equipment and facilities needed by the United 
        States Customs Service.
            (4) Impact on state and local governments.--A description of 
        the impact the trade agreement will have on State and local 
        governments as a result of increases in trade.
            (5) Cost analysis.--An analysis of the costs associated with 
        each of the items listed in paragraphs (1) through (4).

    (b) Budget Submission.--The <<NOTE: President.>> President shall 
include a request for the resources necessary to support the plan 
described in subsection (a) in the first budget that the President 
submits to the Congress after the submission of the plan.

SEC. 2109. <<NOTE: 19 USC 3809.>> COMMITTEE STAFF.

    The grant of trade promotion authority under this title is likely to 
increase the activities of the primary committees of jurisdiction in the 
area of international trade. In addition, the creation of the 
Congressional Oversight Group under section 2107 will increase the 
participation of a broader number of Members of Congress in the 
formulation of United States trade policy and oversight of the 
international trade agenda for the United States. The primary committees 
of jurisdiction should have adequate staff to accommodate these 
increases in activities.

SEC. 2110. CONFORMING AMENDMENTS.

    (a) In General.--Title I of the Trade Act of 1974 (19 U.S.C. 2111 et 
seq.) is amended as follows:
            (1) Implementing bill.--
                    (A) Section 151(b)(1) (19 U.S.C. 2191(b)(1)) is 
                amended by striking ``section 1103(a)(1) of the Omnibus 
                Trade and Competitiveness Act of 1988, or section 282 of 
                the Uruguay Round Agreements Act'' and inserting 
                ``section 282 of the Uruguay Round Agreements Act, or 
                section 2105(a)(1) of the Bipartisan Trade Promotion 
                Authority Act of 2002''.
                    (B) Section 151(c)(1) (19 U.S.C. 2191(c)(1)) is 
                amended by striking ``or section 282 of the Uruguay 
                Round Agreements Act'' and inserting ``, section 282 of 
                the Uruguay Round Agreements Act, or section 2105(a)(1) 
                of the Bipartisan Trade Promotion Authority Act of 
                2002''.
            (2) Advice from international trade commission.--Section 131 
        (19 U.S.C. 2151) is amended--
                    (A) in subsection (a)--
                          (i) in paragraph (1), by striking ``section 
                      123 of this Act or section 1102 (a) or (c) of the 
                      Omnibus Trade and Competitiveness Act of 1988,'' 
                      and inserting ``section 123 of this Act or section 
                      2103(a) or (b) of the Bipartisan Trade Promotion 
                      Authority Act of 2002,''; and
                          (ii) in paragraph (2), by striking ``section 
                      1102 (b) or (c) of the Omnibus Trade and 
                      Competitiveness

[[Page 116 STAT. 1020]]

                      Act of 1988'' and inserting ``section 2103(b) of 
                      the Bipartisan Trade Promotion Authority Act of 
                      2002'';
                    (B) in subsection (b), by striking ``section 
                1102(a)(3)(A)'' and inserting ``section 2103(a)(3)(A) of 
                the Bipartisan Trade Promotion Authority Act of 2002''; 
                and
                    (C) in subsection (c), by striking ``section 1102 of 
                the Omnibus Trade and Competitiveness Act of 1988,'' and 
                inserting ``section 2103 of the Bipartisan Trade 
                Promotion Authority Act of 2002,''.
            (3) Hearings and advice.--Sections 132, 133(a), and 134(a) 
        (19 U.S.C. 2152, 2153(a), and 2154(a)) are each amended by 
        striking ``section 1102 of the Omnibus Trade and Competitiveness 
        Act of 1988,'' each place it appears and inserting ``section 
        2103 of the Bipartisan Trade Promotion Authority Act of 2002,''.
            (4) Prerequisites for offers.--Section 134(b) (19 U.S.C. 
        2154(b)) is amended by striking ``section 1102 of the Omnibus 
        Trade and Competitiveness Act of 1988'' and inserting ``section 
        2103 of the Bipartisan Trade Promotion Authority Act of 2002''.
            (5) Advice from private and public sectors.--Section 135 (19 
        U.S.C. 2155) is amended--
                    (A) in subsection (a)(1)(A), by striking ``section 
                1102 of the Omnibus Trade and Competitiveness Act of 
                1988'' and inserting ``section 2103 of the Bipartisan 
                Trade Promotion Authority Act of 2002'';
                    (B) in subsection (e)(1)--
                          (i) by striking ``section 1102 of the Omnibus 
                      Trade and Competitiveness Act of 1988'' each place 
                      it appears and inserting ``section 2103 of the 
                      Bipartisan Trade Promotion Authority Act of 
                      2002''; and
                          (ii) by striking ``section 1103(a)(1)(A) of 
                      such Act of 1988'' and inserting ``section 
                      2105(a)(1)(A) of the Bipartisan Trade Promotion 
                      Authority Act of 2002''; and
                    (C) in subsection (e)(2), by striking ``section 1101 
                of the Omnibus Trade and Competitiveness Act of 1988'' 
                and inserting ``section 2102 of the Bipartisan Trade 
                Promotion Authority Act of 2002''.
            (6) Transmission of agreements to congress.--Section 162(a) 
        (19 U.S.C. 2212(a)) is amended by striking ``or under section 
        1102 of the Omnibus Trade and Competitiveness Act of 1988'' and 
        inserting ``or under section 2103 of the Bipartisan Trade 
        Promotion Authority Act of 2002''.

    (b) Application of Certain <<NOTE: 19 USC 3810.>> Provisions.--For 
purposes of applying sections 125, 126, and 127 of the Trade Act of 1974 
(19 U.S.C. 2135, 2136(a), and 2137)--
            (1) any trade agreement entered into under section 2103 
        shall be treated as an agreement entered into under section 101 
        or 102, as appropriate, of the Trade Act of 1974 (19 U.S.C. 2111 
        or 2112); and
            (2) any proclamation or Executive order issued pursuant to a 
        trade agreement entered into under section 2103 shall be treated 
        as a proclamation or Executive order issued pursuant to a trade 
        agreement entered into under section 102 of the Trade Act of 
        1974.

[[Page 116 STAT. 1021]]

SEC. 2111. <<NOTE: 19 USC 3811.>> REPORT ON IMPACT OF TRADE PROMOTION 
            AUTHORITY.

    (a) In General.--Not <<NOTE: Deadline.>> later than 1 year after the 
date of enactment of this Act, the International Trade Commission shall 
report to the Committee on Finance of the Senate and the Committee on 
Ways and Means of the House of Representatives regarding the economic 
impact on the United States of the trade agreements described in 
subsection (b).

    (b) Agreements.--The trade agreements described in this subsection 
are the following:
            (1) The United States-Israel Free Trade Agreement.
            (2) The United States-Canada Free Trade Agreement.
            (3) The North American Free Trade Agreement.
            (4) The Uruguay Round Agreements.
            (5) The Tokyo Round of Multilateral Trade Negotiations.

SEC. 2112. <<NOTE: 19 USC 3812.>> INTERESTS OF SMALL BUSINESS.

    The Assistant United States Trade Representative for Industry and 
Telecommunications shall be responsible for ensuring that the interests 
of small business are considered in all trade negotiations in accordance 
with the objective described in section 2102(a)(8). It is the sense of 
the Congress that the small business functions should be reflected in 
the title of the Assistant United States Trade Representative assigned 
the responsibility for small business.

SEC. 2113. <<NOTE: 19 USC 3813.>> DEFINITIONS.

    In this title:
            (1) Agreement on agriculture.--The term ``Agreement on 
        Agriculture'' means the agreement referred to in section 
        101(d)(2) of the Uruguay Round Agreements Act (19 U.S.C. 
        3511(d)(2)).
            (2) Agreement on safeguards.--The term ``Agreement on 
        Safeguards means the agreement referred to in section 101(d)(12) 
        of the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(12)).
            (2) Agreement on subsidies and countervailing measures.--The 
        term ``Agreement on Subsidies and Countervailing Measures'' 
        means the agreement referred to in section 101(d)(13) of the 
        Uruguay Round Agreements Act (19 U.S.C. 3511(d)(13)).
            (4) Antidumping agreement.--The term ``Antidumping 
        Agreement`` means the Agreement on Implementation of Article VI 
        of the General Agreement on Tariffs and Trade 1994 referred to 
        in section 101(d)(7) of the Uruguay Round Agreements Act (19 
        U.S.C. 3511(d)(7)).
            (5) Appellate body.--The term ``Appellate Body'' means the 
        Appellate Body established under Article 17.1 of the Dispute 
        Settlement Understanding.
            (6) Core labor standards.--The term ``core labor standards'' 
        means--
                    (A) the right of association;
                    (B) the right to organize and bargain collectively;
                    (C) a prohibition on the use of any form of forced 
                or compulsory labor;
                    (D) a minimum age for the employment of children; 
                and

[[Page 116 STAT. 1022]]

                    (E) acceptable conditions of work with respect to 
                minimum wages, hours of work, and occupational safety 
                and health.
            (7) Dispute settlement understanding.--The term ``Dispute 
        Settlement Understanding'' means the Understanding on Rules and 
        Procedures Governing the Settlement of Disputes referred to in 
        section 101(d)(16) of the Uruguay Round Agreements Act.
            (8) GATT 1994.--The term ``GATT 1994'' has the meaning given 
        that term in section 2 of the Uruguay Round Agreements Act (19 
        U.S.C. 3501).
            (9) ILO.--The term ``ILO'' means the International Labor 
        Organization.
            (10) Import sensitive agricultural product.--The term 
        ``import sensitive agricultural product'' means an agricultural 
        product--
                    (A) with respect to which, as a result of the 
                Uruguay Round Agreements the rate of duty was the 
                subject of tariff reductions by the United States and, 
                pursuant to such Agreements, was reduced on January 1, 
                1995, to a rate that was not less than 97.5 percent of 
                the rate of duty that applied to such article on 
                December 31, 1994; or
                    (B) which was subject to a tariff-rate quota on the 
                date of the enactment of this Act.
            (11) United states person.--The term ``United States 
        person'' means--
                    (A) a United States citizen;
                    (B) a partnership, corporation, or other legal 
                entity organized under the laws of the United States; 
                and
                    (C) a partnership, corporation, or other legal 
                entity that is organized under the laws of a foreign 
                country and is controlled by entities described in 
                subparagraph (B) or United States citizens, or both.
            (12) Uruguay round agreements.--The term ``Uruguay Round 
        Agreements'' has the meaning given that term in section 2(7) of 
        the Uruguay Round Agreements Act (19 U.S.C. 3501(7)).
            (13) World trade organization; wto.--The terms ``World Trade 
        Organization'' and ``WTO'' mean the organization established 
        pursuant to the WTO Agreement.
            (14) WTO agreement.--The term ``WTO Agreement'' means the 
        Agreement Establishing the World Trade Organization entered into 
        on April 15, 1994.
            (15) WTO member.--The term ``WTO member'' has the meaning 
        given that term in section 2(10) of the Uruguay Round Agreements 
        Act (19 U.S.C. 3501(10)).

[[Page 116 STAT. 1023]]

                 DIVISION C--ANDEAN TRADE PREFERENCE ACT

 TITLE XXXI--ANDEAN <<NOTE: Andean Trade Promotion and Drug Eradication 
Act.>> TRADE PREFERENCE

SEC. 3101. <<NOTE: 19 USC 3201 note.>> SHORT TITLE.

    This title may be cited as the ``Andean Trade Promotion and Drug 
Eradication Act''.

SEC. 3102. <<NOTE: 19 USC 3201 note.>> FINDINGS.

    Congress makes the following findings:
            (1) Since the Andean Trade Preference Act was enacted in 
        1991, it has had a positive impact on United States trade with 
        Bolivia, Colombia, Ecuador, and Peru. Two-way trade has doubled, 
        with the United States serving as the leading source of imports 
        and leading export market for each of the Andean beneficiary 
        countries. This has resulted in increased jobs and expanded 
        export opportunities in both the United States and the Andean 
        region.
            (2) The Andean Trade Preference Act has been a key element 
        in the United States counternarcotics strategy in the Andean 
        region, promoting export diversification and broad-based 
        economic development that provides sustainable economic 
        alternatives to drug-crop production, strengthening the 
        legitimate economies of Andean countries and creating viable 
        alternatives to illicit trade in coca.
            (3) Notwithstanding the success of the Andean Trade 
        Preference Act, the Andean region remains threatened by 
        political and economic instability and fragility, vulnerable to 
        the consequences of the drug war and fierce global competition 
        for its legitimate trade.
            (4) The continuing instability in the Andean region poses a 
        threat to the security interests of the United States and the 
        world. This problem has been partially addressed through foreign 
        aid, such as Plan Colombia, enacted by Congress in 2000. 
        However, foreign aid alone is not sufficient. Enhancement of 
        legitimate trade with the United States provides an alternative 
        means for reviving and stabilizing the economies in the Andean 
        region.
            (5) The Andean Trade Preference Act constitutes a tangible 
        commitment by the United States to the promotion of prosperity, 
        stability, and democracy in the beneficiary countries.
            (6) Renewal and enhancement of the Andean Trade Preference 
        Act will bolster the confidence of domestic private enterprise 
        and foreign investors in the economic prospects of the region, 
        ensuring that legitimate private enterprise can be the engine of 
        economic development and political stability in the region.
            (7) Each of the Andean beneficiary countries is committed to 
        conclude negotiation of a Free Trade Area of the Americas by the 
        year 2005, as a means of enhancing the economic security of the 
        region.
            (8) Temporarily enhancing trade benefits for Andean 
        beneficiary countries will promote the growth of free enterprise

[[Page 116 STAT. 1024]]

        and economic opportunity in these countries and serve the 
        security interests of the United States, the region, and the 
        world.

SEC. 3103. ARTICLES ELIGIBLE FOR PREFERENTIAL TREATMENT.

    (a) Eligibility of Certain Articles.--Section 204 of the Andean 
Trade Preference Act (19 U.S.C. 3203) is amended--
            (1) by striking subsection (c) and redesignating subsections 
        (d) through (g) as subsections (c) through (f), respectively; 
        and
            (2) by amending subsection (b) to read as follows:

    ``(b) Exceptions and Special Rules.--
            ``(1) Certain articles that are not import-sensitive.--The 
        President may proclaim duty-free treatment under this title for 
        any article described in subparagraph (A), (B), (C), or (D) that 
        is the growth, product, or manufacture of an ATPDEA beneficiary 
        country, that is imported directly into the customs territory of 
        the United States from an ATPDEA beneficiary country, and that 
        meets the requirements of this section, if the President 
        determines that such article is not import-sensitive in the 
        context of imports from ATPDEA beneficiary countries:
                    ``(A) Footwear not designated at the time of the 
                effective date of this title as eligible for purposes of 
                the generalized system of preferences under title V of 
                the Trade Act of 1974.
                    ``(B) Petroleum, or any product derived from 
                petroleum, provided for in headings 2709 and 2710 of the 
                HTS.
                    ``(C) Watches and watch parts (including cases, 
                bracelets and straps), of whatever type including, but 
                not limited to, mechanical, quartz digital or quartz 
                analog, if such watches or watch parts contain any 
                material which is the product of any country with 
                respect to which HTS column 2 rates of duty apply.
                    ``(D) Handbags, luggage, flat goods, work gloves, 
                and leather wearing apparel that were not designated on 
                August 5, 1983, as eligible articles for purposes of the 
                generalized system of preferences under title V of the 
                Trade Act of 1974.
            ``(2) Exclusions.--Subject to paragraph (3), duty-free 
        treatment under this title may not be extended to--
                    ``(A) textiles and apparel articles which were not 
                eligible articles for purposes of this title on January 
                1, 1994, as this title was in effect on that date;
                    ``(B) rum and tafia classified in subheading 2208.40 
                of the HTS;
                    ``(C) sugars, syrups, and sugar-containing products 
                subject to over-quota duty rates under applicable 
                tariff-rate quotas; or
                    ``(D) tuna prepared or preserved in any manner in 
                airtight containers, except as provided in paragraph 
                (4).
            ``(3) Apparel articles and certain textile articles.--
                    ``(A) In general.--Apparel articles that are 
                imported directly into the customs territory of the 
                United States from an ATPDEA beneficiary country shall 
                enter the United States free of duty and free of any 
                quantitative restrictions, limitations, or consultation 
                levels, but only if such articles are described in 
                subparagraph (B).

[[Page 116 STAT. 1025]]

                    ``(B) Covered articles.--The apparel articles 
                referred to in subparagraph (A) are the following:
                          ``(i) Apparel articles assembled from products 
                      of the united states or atpdea beneficiary 
                      countries or products not available in commercial 
                      quantities.--Apparel articles sewn or otherwise 
                      assembled in 1 or more ATPDEA beneficiary 
                      countries, or the United States, or both, 
                      exclusively from any one or any combination of the 
                      following:
                                    ``(I) Fabrics or fabric components 
                                wholly formed, or components knit-to-
                                shape, in the United States, from yarns 
                                wholly formed in the United States or 1 
                                or more ATPDEA beneficiary countries 
                                (including fabrics not formed from 
                                yarns, if such fabrics are classifiable 
                                under heading 5602 or 5603 of the HTS 
                                and are formed in the United States). 
                                Apparel articles shall qualify under 
                                this subclause only if all dyeing, 
                                printing, and finishing of the fabrics 
                                from which the articles are assembled, 
                                if the fabrics are knit fabrics, is 
                                carried out in the United States. 
                                Apparel articles shall qualify under 
                                this subclause only if all dyeing, 
                                printing, and finishing of the fabrics 
                                from which the articles are assembled, 
                                if the fabrics are woven fabrics, is 
                                carried out in the United States.
                                    ``(II) Fabrics or fabric components 
                                formed or components knit-to-shape, in 1 
                                or more ATPDEA beneficiary countries, 
                                from yarns wholly formed in 1 or more 
                                ATPDEA beneficiary countries, if such 
                                fabrics (including fabrics not formed 
                                from yarns, if such fabrics are 
                                classifiable under heading 5602 or 5603 
                                of the HTS and are formed in 1 or more 
                                ATPDEA beneficiary countries) or 
                                components are in chief value of llama, 
                                alpaca, or vicuna.
                                    ``(III) Fabrics or yarns, to the 
                                extent that apparel articles of such 
                                fabrics or yarns would be eligible for 
                                preferential treatment, without regard 
                                to the source of the fabrics or yarns, 
                                under Annex 401 of the NAFTA.
                          ``(ii) Additional fabrics.--At the request of 
                      any interested party, the President is authorized 
                      to proclaim additional fabrics and yarns as 
                      eligible for preferential treatment under clause 
                      (i)(III) if--
                                    ``(I) the President determines that 
                                such fabrics or yarns cannot be supplied 
                                by the domestic industry in commercial 
                                quantities in a timely manner;
                                    ``(II) the President has obtained 
                                advice regarding the proposed action 
                                from the appropriate advisory committee 
                                established under section 135 of the 
                                Trade Act of 1974 (19 U.S.C. 2155) and 
                                the United States International Trade 
                                Commission;
                                    ``(III) within 60 days after the 
                                request, the President has submitted a 
                                report to the Committee on Ways and 
                                Means of the House of Representatives 
                                and the Committee on Finance of the 
                                Senate

[[Page 116 STAT. 1026]]

                                that sets forth the action proposed to 
                                be proclaimed and the reasons for such 
                                action, and the advice obtained under 
                                subclause (II);
                                    ``(IV) a period of 60 calendar days, 
                                beginning with the first day on which 
                                the President has met the requirements 
                                of subclause (III), has expired; and
                                    ``(V) the President has consulted 
                                with such committees regarding the 
                                proposed action during the period 
                                referred to in subclause (III).
                          ``(iii) Apparel articles assembled in 1 or 
                      more atpdea beneficiary countries from regional 
                      fabrics or regional components.--(I) Subject to 
                      the limitation set forth in subclause (II), 
                      apparel articles sewn or otherwise assembled in 1 
                      or more ATPDEA beneficiary countries from fabrics 
                      or from fabric components formed or from 
                      components knit-to-shape, in 1 or more ATPDEA 
                      beneficiary countries, from yarns wholly formed in 
                      the United States or 1 or more ATPDEA beneficiary 
                      countries (including fabrics not formed from 
                      yarns, if such fabrics are classifiable under 
                      heading 5602 or 5603 of the HTS and are formed in 
                      1 or more ATPDEA beneficiary countries), whether 
                      or not the apparel articles are also made from any 
                      of the fabrics, fabric components formed, or 
                      components knit-to-shape described in clause (i) 
                      (unless the apparel articles are made exclusively 
                      from any of the fabrics, fabric components formed, 
                      or components knit-to-shape described in clause 
                      (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 4 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 2 percent for 
                      the 1-year period beginning October 1, 2002, 
                      increased in each of the 4 succeeding 1-year 
                      periods by equal increments, so that for the 
                      period beginning October 1, 2006, the applicable 
                      percentage does not exceed 5 percent.
                          ``(iv) Handloomed, handmade, and folklore 
                      articles.--A handloomed, handmade, or folklore 
                      article of an ATPDEA beneficiary country 
                      identified under subparagraph (C) that is 
                      certified as such by the competent authority of 
                      such beneficiary country.
                          ``(v) Certain other apparel articles.--
                                    ``(I) General rule.--Any apparel 
                                article classifiable under subheading 
                                6212.10 of the HTS, except for articles 
                                entered under clause (i), (ii), (iii), 
                                or (iv), if the article is both cut and 
                                sewn or otherwise assembled in the 
                                United States, or one or more ATPDEA 
                                beneficiary countries, or both.

[[Page 116 STAT. 1027]]

                                    ``(II) Limitation.--During the 1-
                                year period beginning on October 1, 
                                2003, and during each of the 3 
                                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.
                                    ``(III) Development of procedure to 
                                ensure compliance.--The United States 
                                Customs Service shall develop and 
                                implement methods and procedures to 
                                ensure ongoing compliance with the 
                                requirement set forth in subclause (II). 
                                If the Customs Service finds that a 
                                producer or an entity controlling 
                                production has not satisfied such 
                                requirement in a 1-year period, then 
                                apparel articles described in subclause 
                                (I) of that producer or entity shall be 
                                ineligible for preferential treatment 
                                under this paragraph during any 
                                succeeding 1-year period until the 
                                aggregate cost of fabrics (exclusive of 
                                all findings and trimmings) formed in 
                                the United States that are used in the 
                                production of such articles of that 
                                producer or entity entered during the 
                                preceding 1-year period is at least 85 
                                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.
                          ``(vi) Special rules.--
                                    ``(I) Exception for findings and 
                                trimmings.--An article otherwise 
                                eligible for preferential treatment 
                                under this paragraph shall not be 
                                ineligible for such treatment because 
                                the article contains findings or 
                                trimmings of foreign origin, if such 
                                findings and trimmings do not exceed 25 
                                percent of the cost of the components of 
                                the assembled product. Examples of 
                                findings and trimmings are sewing 
                                thread, hooks and eyes, snaps, buttons, 
                                `bow buds', decorative lace, trim, 
                                elastic strips, zippers, including 
                                zipper tapes and labels, and other 
                                similar products.
                                    ``(II) Certain interlining.--(aa) An 
                                article otherwise eligible for 
                                preferential treatment under this 
                                paragraph shall not be ineligible for 
                                such treatment because the article 
                                contains certain interlinings of foreign 
                                origin, if the value of such

[[Page 116 STAT. 1028]]

                                interlinings (and any findings and 
                                trimmings) does not exceed 25 percent of 
                                the cost of the components of the 
                                assembled article.
                                    ``(bb) Interlinings eligible for the 
                                treatment described in division (aa) 
                                include only a chest type plate, `hymo' 
                                piece, or `sleeve header', of woven or 
                                weft-inserted warp knit construction and 
                                of coarse animal hair or man-made 
                                filaments.
                                    ``(cc) The treatment described in 
                                this subclause shall terminate if the 
                                President makes a determination that 
                                United States manufacturers are 
                                producing such interlinings in the 
                                United States in commercial quantities.
                                    ``(III) De minimis rule.--An article 
                                that would otherwise be ineligible for 
                                preferential treatment under this 
                                subparagraph because the article 
                                contains yarns not wholly formed in the 
                                United States or in one or more ATPDEA 
                                beneficiary countries shall not be 
                                ineligible for such treatment if the 
                                total weight of all such yarns is not 
                                more than 7 percent of the total weight 
                                of the good.
                                    ``(IV) Special origin rule.--An 
                                article otherwise eligible for 
                                preferential treatment under clause (i) 
                                or (iii) shall not be ineligible for 
                                such treatment because the article 
                                contains nylon filament yarn (other than 
                                elastomeric yarn) that is classifiable 
                                under subheading 5402.10.30, 5402.10.60, 
                                5402.31.30, 5402.31.60, 5402.32.30, 
                                5402.32.60, 5402.41.10, 5402.41.90, 
                                5402.51.00, or 5402.61.00 of the HTS 
                                from a country that is a party to an 
                                agreement with the United States 
                                establishing a free trade area, which 
                                entered into force before January 1, 
                                1995.
                          ``(vii) Textile luggage.--Textile luggage--
                                    ``(I) assembled in an ATPDEA 
                                beneficiary country from fabric wholly 
                                formed and cut in the United States, 
                                from yarns wholly formed in the United 
                                States, that is entered under subheading 
                                9802.00.80 of the HTS; or
                                    ``(II) assembled from fabric cut in 
                                an ATPDEA beneficiary country from 
                                fabric wholly formed in the United 
                                States from yarns wholly formed in the 
                                United States.
                    ``(C) Handloomed, handmade, and folklore articles.--
                For purposes of subparagraph (B)(iv), the President 
                shall consult with representatives of the ATPDEA 
                beneficiary countries concerned for the purpose of 
                identifying particular textile and apparel goods that 
                are mutually agreed upon as being handloomed, handmade, 
                or folklore goods of a kind described in section 2.3(a), 
                (b), or (c) of the Annex or Appendix 3.1.B.11 of the 
                Annex.
                    ``(D) Penalties for transshipment.--
                          ``(i) Penalties for exporters.--If the 
                      President determines, based on sufficient 
                      evidence, that an exporter has engaged in 
                      transshipment with respect to apparel articles 
                      from an ATPDEA beneficiary country, then the 
                      President shall deny all benefits

[[Page 116 STAT. 1029]]

                      under this title to such exporter, and any 
                      successor of such exporter, for a period of 2 
                      years.
                          ``(ii) Penalties for countries.--Whenever the 
                      President finds, based on sufficient evidence, 
                      that transshipment has occurred, the President 
                      shall request that the ATPDEA beneficiary country 
                      or countries through whose territory the 
                      transshipment has occurred take all necessary and 
                      appropriate actions to prevent such transshipment. 
                      If the President determines that a country is not 
                      taking such actions, the President shall reduce 
                      the quantities of apparel articles that may be 
                      imported into the United States from such country 
                      by the quantity of the transshipped articles 
                      multiplied by 3, to the extent consistent with the 
                      obligations of the United States under the WTO.
                          ``(iii) Transshipment described.--
                      Transshipment within the meaning of this 
                      subparagraph has occurred when preferential 
                      treatment under subparagraph (A) has been claimed 
                      for an apparel article on the basis of material 
                      false information concerning the country of 
                      origin, manufacture, processing, or assembly of 
                      the article or any of its components. For purposes 
                      of this clause, false information is material if 
                      disclosure of the true information would mean or 
                      would have meant that the article is or was 
                      ineligible for preferential treatment under 
                      subparagraph (A).
                    ``(E) Bilateral emergency actions.--
                          ``(i) In general.--The President may take 
                      bilateral emergency tariff actions of a kind 
                      described in section 4 of the Annex with respect 
                      to any apparel article imported from an ATPDEA 
                      beneficiary country if the application of tariff 
                      treatment under subparagraph (A) to such article 
                      results in conditions that would be cause for the 
                      taking of such actions under such section 4 with 
                      respect to a like article described in the same 8-
                      digit subheading of the HTS that is imported from 
                      Mexico.
                          ``(ii) Rules relating to bilateral emergency 
                      action.--For purposes of applying bilateral 
                      emergency action under this subparagraph--
                                    ``(I) the requirements of paragraph 
                                (5) of section 4 of the Annex (relating 
                                to providing compensation) shall not 
                                apply;
                                    ``(II) the term `transition period' 
                                in section 4 of the Annex shall mean the 
                                period ending December 31, 2006; and
                                    ``(III) the requirements to consult 
                                specified in section 4 of the Annex 
                                shall be treated as satisfied if the 
                                President requests consultations with 
                                the ATPDEA beneficiary country in 
                                question and the country does not agree 
                                to consult within the time period 
                                specified under section 4 of the Annex.
            ``(4) Tuna.--
                    ``(A) General rule.--Tuna that is harvested by 
                United States vessels or ATPDEA beneficiary country 
                vessels, that is prepared or preserved in any manner, in 
                an ATPDEA

[[Page 116 STAT. 1030]]

                beneficiary country, in foil or other flexible airtight 
                containers weighing with their contents not more than 
                6.8 kilograms each, and that is imported directly into 
                the customs territory of the United States from an 
                ATPDEA beneficiary country, shall enter the United 
                States free of duty and free of any quantitative 
                restrictions.
                    ``(B) Definitions.--In this paragraph--
                          ``(i) United states vessel.--A `United States 
                      vessel' is a vessel having a certificate of 
                      documentation with a fishery endorsement under 
                      chapter 121 of title 46, United States Code.
                          ``(ii) ATPDEA vessel.--An `ATPDEA vessel' is a 
                      vessel--
                                    ``(I) which is registered or 
                                recorded in an ATPDEA beneficiary 
                                country;
                                    ``(II) which sails under the flag of 
                                an ATPDEA beneficiary country;
                                    ``(III) which is at least 75 percent 
                                owned by nationals of an ATPDEA 
                                beneficiary country or by a company 
                                having its principal place of business 
                                in an ATPDEA beneficiary country, of 
                                which the manager or managers, chairman 
                                of the board of directors or of the 
                                supervisory board, and the majority of 
                                the members of such boards are nationals 
                                of an ATPDEA beneficiary country and of 
                                which, in the case of a company, at 
                                least 50 percent of the capital is owned 
                                by an ATPDEA beneficiary country or by 
                                public bodies or nationals of an ATPDEA 
                                beneficiary country;
                                    ``(IV) of which the master and 
                                officers are nationals of an ATPDEA 
                                beneficiary country; and
                                    ``(V) of which at least 75 percent 
                                of the crew are nationals of an ATPDEA 
                                beneficiary country.
            ``(5) Customs procedures.--
                    ``(A) In general.--
                          ``(i) Regulations.--Any importer that claims 
                      preferential treatment under paragraph (1), (3), 
                      or (4) shall comply with customs procedures 
                      similar in all material respects to the 
                      requirements of Article 502(1) of the NAFTA as 
                      implemented pursuant to United States law, in 
                      accordance with regulations promulgated by the 
                      Secretary of the Treasury.
                          ``(ii) Determination.--
                                    ``(I) In general.--In order to 
                                qualify for the preferential treatment 
                                under paragraph (1), (3), or (4) and for 
                                a Certificate of Origin to be valid with 
                                respect to any article for which such 
                                treatment is claimed, there shall be in 
                                effect a determination by the President 
                                that each country described in subclause 
                                (II)--
                                            ``(aa) has implemented and 
                                        follows, or
                                            ``(bb) is making substantial 
                                        progress toward implementing and 
                                        following,
                                procedures and requirements similar in 
                                all material respects to the relevant 
                                procedures and requirements under 
                                chapter 5 of the NAFTA.

[[Page 116 STAT. 1031]]

                                    ``(II) Country described.--A country 
                                is described in this subclause if it is 
                                an ATPDEA beneficiary country--
                                            ``(aa) from which the 
                                        article is exported; or
                                            ``(bb) in which materials 
                                        used in the production of the 
                                        article originate or in which 
                                        the article or such materials 
                                        undergo production that 
                                        contributes to a claim that the 
                                        article is eligible for 
                                        preferential treatment under 
                                        paragraph (1), (3), or (4).
                    ``(B) Certificate of origin.--The Certificate of 
                Origin that otherwise would be required pursuant to the 
                provisions of subparagraph (A) shall not be required in 
                the case of an article imported under paragraph (1), 
                (3), or (4) if such Certificate of Origin would not be 
                required under Article 503 of the NAFTA (as implemented 
                pursuant to United States law), if the article were 
                imported from Mexico.
                    ``(C) Report on cooperation of atpdea countries 
                concerning circumvention.--The United States 
                Commissioner of Customs shall conduct a study analyzing 
                the extent to which each ATPDEA beneficiary country--
                          ``(i) has cooperated fully with the United 
                      States, consistent with its domestic laws and 
                      procedures, in instances of circumvention or 
                      alleged circumvention of existing quotas on 
                      imports of textile and apparel goods, to establish 
                      necessary relevant facts in the places of import, 
                      export, and, where applicable, transshipment, 
                      including investigation of circumvention 
                      practices, exchanges of documents, correspondence, 
                      reports, and other relevant information, to the 
                      extent such information is available;
                          ``(ii) has taken appropriate measures, 
                      consistent with its domestic laws and procedures, 
                      against exporters and importers involved in 
                      instances of false declaration concerning 
                      quantities, description, classification, or origin 
                      of textile and apparel goods; and
                          ``(iii) has penalized the individuals and 
                      entities involved in any such circumvention, 
                      consistent with its domestic laws and procedures, 
                      and has worked closely to seek the cooperation of 
                      any third country to prevent such circumvention 
                      from taking place in that third country.
                The Commissioner <<NOTE: Deadline. Reports.>>  of 
                Customs shall submit to the Congress, not later than 
                October 1, 2003, a report on the study conducted under 
                this subparagraph.
            ``(6) Definitions.--In this subsection--
                    ``(A) Annex.--The term `the Annex' means Annex 300-B 
                of the NAFTA.
                    ``(B) ATPDEA beneficiary country.--The term `ATPDEA 
                beneficiary country' means any `beneficiary country', as 
                defined in section 203(a)(1) of this title, which the 
                President designates as an ATPDEA beneficiary country, 
                taking into account the criteria contained in 
                subsections (c) and (d) of section 203 and other 
                appropriate criteria, including the following:

[[Page 116 STAT. 1032]]

                          ``(i) Whether the beneficiary country has 
                      demonstrated a commitment to--
                                    ``(I) undertake its obligations 
                                under the WTO, including those 
                                agreements listed in section 101(d) of 
                                the Uruguay Round Agreements Act, on or 
                                ahead of schedule; and
                                    ``(II) participate in negotiations 
                                toward the completion of the FTAA or 
                                another free trade agreement.
                          ``(ii) The extent to which the country 
                      provides protection of intellectual property 
                      rights consistent with or greater than the 
                      protection afforded under the Agreement on Trade-
                      Related Aspects of Intellectual Property Rights 
                      described in section 101(d)(15) of the Uruguay 
                      Round Agreements Act.
                          ``(iii) The extent to which the country 
                      provides internationally recognized worker rights, 
                      including--
                                    ``(I) the right of association;
                                    ``(II) the right to organize and 
                                bargain collectively;
                                    ``(III) a prohibition on the use of 
                                any form of forced or compulsory labor;
                                    ``(IV) a minimum age for the 
                                employment of children; and
                                    ``(V) acceptable conditions of work 
                                with respect to minimum wages, hours of 
                                work, and occupational safety and 
                                health.
                          ``(iv) Whether the country has implemented its 
                      commitments to eliminate the worst forms of child 
                      labor, as defined in section 507(6) of the Trade 
                      Act of 1974.
                          ``(v) The extent to which the country has met 
                      the counternarcotics certification criteria set 
                      forth in section 490 of the Foreign Assistance Act 
                      of 1961 (22 U.S.C. 2291j) for eligibility for 
                      United States assistance.
                          ``(vi) The extent to which the country has 
                      taken steps to become a party to and implements 
                      the Inter-American Convention Against Corruption.
                          ``(vii) The extent to which the country--
                                    ``(I) applies transparent, 
                                nondiscriminatory, and competitive 
                                procedures in government procurement 
                                equivalent to those contained in the 
                                Agreement on Government Procurement 
                                described in section 101(d)(17) of the 
                                Uruguay Round Agreements Act; and
                                    ``(II) contributes to efforts in 
                                international fora to develop and 
                                implement international rules in 
                                transparency in government procurement.
                          ``(viii) The extent to which the country has 
                      taken steps to support the efforts of the United 
                      States to combat terrorism.
                    ``(C) NAFTA.--The term `NAFTA' means the North 
                American Free Trade Agreement entered into between the 
                United States, Mexico, and Canada on December 17, 1992.

[[Page 116 STAT. 1033]]

                    ``(D) WTO.--The term `WTO' has the meaning given 
                that term in section 2 of the Uruguay Round Agreements 
                Act (19 U.S.C. 3501).
                    ``(E) ATPDEA.--The term `ATPDEA' means the Andean 
                Trade Promotion and Drug Eradication Act.
                    ``(F) FTAA.--The term `FTAA' means the Free Trade 
                Area for the Americas.''.

    (b) Determination Regarding Retention of Designation.--Section 
203(e)(1) of the Andean Trade Preference Act (19 U.S.C. 3202(e)(1)) is 
amended--
            (1) by redesignating subparagraphs (A) and (B) as clauses 
        (i) and (ii), respectively;
            (2) by inserting ``(A)'' after ``(1)''; and
            (3) by adding at the end the following:

    ``(B) The President may, after the requirements of paragraph (2) 
have been met--
            ``(i) withdraw or suspend the designation of any country as 
        an ATPDEA beneficiary country, or
            ``(ii) withdraw, suspend, or limit the application of 
        preferential treatment under section 204(b)(1), (3), or (4) to 
        any article of any country,

if, after such designation, the President determines that, as a result 
of changed circumstances, the performance of such country is not 
satisfactory under the criteria set forth in section 204(b)(6)(B).''.
    (c) Conforming Amendments.--(1) Section 202 of the Andean Trade 
Preference Act (19 U.S.C. 3201) is amended by inserting ``(or other 
preferential treatment)'' after ``treatment''.
    (2) Section 204(a) of the Andean Trade Preference Act (19 U.S.C. 
3203(a)) is amended--
            (A) in paragraph (1)--
                    (i) by inserting ``(or otherwise provided for)'' 
                after ``eligibility''; and
                    (ii) by inserting ``(or preferential treatment)'' 
                after ``duty-free treatment''; and
            (B) in paragraph (2), by striking ``subsection (a)'' and 
        inserting ``paragraph (1)''.

    (d) <<NOTE: 19 USC 3202 note.>> Petitions for Review.--
            (1) In general.--Not <<NOTE: Deadline. Regulations.>> later 
        than 180 days after the date of the enactment of this Act, the 
        President shall promulgate regulations regarding the review of 
        eligibility of articles and countries under the Andean Trade 
        Preference Act, consistent with section 203(e) of such Act, as 
        amended by this title.
            (2) Content of regulations.--The regulations shall be 
        similar to the regulations regarding eligibility under the 
        generalized system of preferences under title V of the Trade Act 
        of 1974 with respect to the timetable for reviews and content, 
        and shall include procedures for requesting withdrawal, 
        suspension, or limitations of preferential duty treatment under 
        the Andean Trade Preference Act, conducting reviews of such 
        requests, and implementing the results of the reviews.

    (e) Reporting Requirements.--Section 203(f) of the Andean Trade 
Preference Act (19 U.S.C. 3202(f)) is amended to read as follows:
    ``(f) Reporting Requirements.--

[[Page 116 STAT. 1034]]

            ``(1) In general.--Not <<NOTE: Deadline.>> later than April 
        30, 2003, and every 2 years thereafter during the period this 
        title is in effect, the United States Trade Representative shall 
        submit to the Congress a report regarding the operation of this 
        title, including--
                    ``(A) with respect to subsections (c) and (d), the 
                results of a general review of beneficiary countries 
                based on the considerations described in such 
                subsections; and
                    ``(B) the performance of each beneficiary country or 
                ATPEA beneficiary country, as the case may be, under the 
                criteria set forth in section 204(b)(6)(B).
            ``(2) Public comment.--Before <<NOTE: Federal Register, 
        publication.>> submitting the report described in paragraph (1), 
        the United States Trade Representative shall publish a notice in 
        the Federal Register requesting public comments on whether 
        beneficiary countries are meeting the criteria listed in section 
        204(b)(6)(B).''.

SEC. 3104. TERMINATION.

    (a) In General.--Section 208 of the Andean Trade Preference Act (19 
U.S.C. 3206) is amended to read as follows:

``SEC. 208. TERMINATION OF PREFERENTIAL TREATMENT.

    ``No duty-free treatment or other preferential treatment extended to 
beneficiary countries under this title shall remain in effect after 
December 31, 2006.''.
    (b) Retroactive <<NOTE: 19 USC 3206 note.>> Application for Certain 
Liquidations and Reliquidations.--
            (1) In general.--Notwithstanding section 514 of the Tariff 
        Act of 1930 or any other provision of law, and subject to 
        paragraph (3), the entry--
                    (A) of any article to which duty-free treatment (or 
                preferential treatment) under the Andean Trade 
                Preference Act (19 U.S.C. 3201 et seq.) would have 
                applied if the entry had been made on December 4, 2001, 
                and
                    (B) that was made after December 4, 2001, and before 
                the date of the enactment of this Act,
        shall be liquidated or reliquidated as if such duty-free 
        treatment (or preferential treatment) applied, and the Secretary 
        of the Treasury shall refund any duty paid with respect to such 
        entry.
            (2) Entry.--As used in this subsection, the term ``entry'' 
        includes a withdrawal from warehouse for consumption.
            (3) Requests.--Liquidation or reliquidation may be made 
        under paragraph (1) with respect to an entry only if a request 
        therefor is filed with the Customs Service, within 180 days 
        after the date of the enactment of this Act, that contains 
        sufficient information to enable the Customs Service--
                    (A) to locate the entry; or
                    (B) to reconstruct the entry if it cannot be 
                located.

SEC. 3105. REPORT ON FREE TRADE AGREEMENT WITH ISRAEL.

    (a) Report to Congress.--The United States Trade Representative 
shall review the implementation of the United States-Israel Free Trade 
Agreement and shall submit to the Speaker of the House of 
Representatives, the President of the Senate, the Committee on Ways and 
Means of the House of Representatives, and the Committee on Finance of 
the Senate a report on the results of such review.

[[Page 116 STAT. 1035]]

    (b) Contents of Report.--The report under subsection (a) shall 
include the following:
            (1) A review of the terms of the United States-Israel Free 
        Trade Agreement, particularly the terms with respect to market 
        access commitments.
            (2) A review of subsequent agreements which may have been 
        reached between the parties to the Agreement and of unilateral 
        concessions of additional benefits received by each party from 
        the other.
            (3) A review of any current negotiations between the parties 
        to the Agreement with respect to implementation of the Agreement 
        and other pertinent matters.
            (4) An assessment of the degree of fulfillment of 
        obligations under the Agreement by the United States and Israel.
            (5) An assessment of improvements in structuring future 
        trade agreements that should be considered based on the 
        experience of the United States under the Agreement.

    (c) Timing of Report.--The United States Trade Representative shall 
submit the report under subsection (a) not later than 6 months after the 
date of the enactment of this Act.
    (d) Definition.--In this section, the terms ``United States-Israel 
Free Trade Agreement'' and ``Agreement'' means the Agreement on the 
Establishment of a Free Trade Area between the Government of the United 
States of America and the Government of Israel entered into on April 22, 
1985.

SEC. 3106. MODIFICATION OF DUTY TREATMENT FOR TUNA.

    Subheading 1604.14.20 of the Harmonized Tariff Schedule of the 
United States is amended--
            (1) in the article description, by striking ``20 percent of 
        the United States pack of canned tuna'' and inserting ``4.8 
        percent of apparent United States consumption of tuna in 
        airtight containers''; and
            (2) by redesignating such subheading as subheading 
        1604.14.22.

SEC. 3107. TRADE BENEFITS UNDER THE CARIBBEAN BASIN ECONOMIC RECOVERY 
            ACT.

    (a) In General.--Section 213(b)(2)(A) of the Carribean Basin 
Economic Recovery Act (19 U.S.C. 2703(b)(2)(A)) is amended as follows:
            (1) Clause (i) is amended--
                    (A) by striking the matter preceding subclause (I) 
                and inserting the following:
                          ``(i) Apparel articles assembled in one or 
                      more cbtpa beneficiary countries.--Apparel 
                      articles sewn or otherwise assembled in one or 
                      more CBTPA beneficiary countries from fabrics 
                      wholly formed and cut, or from components knit-to-
                      shape, in the United States from yarns wholly 
                      formed in the United States, (including fabrics 
                      not formed from yarns, if such fabrics are 
                      classifiable under heading 5602 or 5603 of the HTS 
                      and are wholly formed and cut in the United 
                      States) that are--''; and
                    (B) by adding at the end the following:
                      ``Apparel articles entered on or after September 
                      1, 2002, shall qualify under the preceding 
                      sentence only if all dyeing, printing, and 
                      finishing of the fabrics

[[Page 116 STAT. 1036]]

                      from which the articles are assembled, if the 
                      fabrics are knit fabrics, is carried out in the 
                      United States. Apparel articles entered on or 
                      after September 1, 2002, shall qualify under the 
                      first sentence of this clause only if all dyeing, 
                      printing, and finishing of the fabrics from which 
                      the articles are assembled, if the fabrics are 
                      woven fabrics, is carried out in the United 
                      States.''.
            (2) Clause (ii) is amended to read as follows:
                          ``(ii) Other apparel articles assembled in one 
                      or more cbtpa beneficiary countries.--Apparel 
                      articles sewn or otherwise assembled in one or 
                      more CBTPA beneficiary countries with thread 
                      formed in the United States from fabrics wholly 
                      formed in the United States and cut in one or more 
                      CBTPA beneficiary countries from yarns wholly 
                      formed in the United States, or from components 
                      knit-to-shape in the United States from yarns 
                      wholly formed in the United States, or both 
                      (including fabrics not formed from yarns, if such 
                      fabrics are classifiable under heading 5602 or 
                      5603 of the HTS and are wholly formed in the 
                      United States). Apparel articles entered on or 
                      after September 1, 2002, shall qualify under the 
                      preceding sentence only if all dyeing, printing, 
                      and finishing of the fabrics from which the 
                      articles are assembled, if the fabrics are knit 
                      fabrics, is carried out in the United States. 
                      Apparel articles entered on or after September 1, 
                      2002, shall qualify under the first sentence of 
                      this clause only if all dyeing, printing, and 
                      finishing of the fabrics from which the articles 
                      are assembled, if the fabrics are woven fabrics, 
                      is carried out in the United States.''.
            (3) Clause (iii)(II) is amended to read as follows:
                          ``(II) The amount referred to in subclause (I) 
                      is as follows:
                                    ``(aa) 500,000,000 square meter 
                                equivalents during the 1-year period 
                                beginning on October 1, 2002.
                                    ``(bb) 850,000,000 square meter 
                                equivalents during the 1-year period 
                                beginning on October 1, 2003.
                                    ``(cc) 970,000,000 square meter 
                                equivalents in each succeeding 1-year 
                                period through September 30, 2008.''.
            (4) Clause (iii)(IV) is amended to read as follows:
                          ``(IV) The amount referred to in subclause 
                      (III) is as follows:
                                    ``(aa) 4,872,000 dozen during the 1-
                                year period beginning on October 1, 
                                2001.
                                    ``(bb) 9,000,000 dozen during the 1-
                                year period beginning on October 1, 
                                2002.
                                    ``(cc) 10,000,000 dozen during the 
                                1-year period beginning on October 1, 
                                2003.
                                    ``(dd) 12,000,000 dozen in each 
                                succeeding 1-year period through 
                                September 30, 2008.''.
            (5) Clause (iv) is amended to read as follows:
                          ``(iv) Certain other apparel articles.--

[[Page 116 STAT. 1037]]

                                    ``(I) General rule.--Subject to 
                                subclause (II), any apparel article 
                                classifiable under subheading 6212.10 of 
                                the HTS, except for articles entered 
                                under clause (i), (ii), (iii), (v), or 
                                (vi), if the article is both cut and 
                                sewn or otherwise assembled in the 
                                United States, or one or more CBTPA 
                                beneficiary countries, or both.
                                    ``(II) Limitation.--During the 1-
                                year period beginning on October 1, 
                                2001, and during each of the 6 
                                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 
                                subparagraph (B) 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.
                                    ``(III) Development of procedure to 
                                ensure compliance.--The United States 
                                Customs Service shall develop and 
                                implement methods and procedures to 
                                ensure ongoing compliance with the 
                                requirement set forth in subclause (II). 
                                If the Customs Service finds that a 
                                producer or an entity controlling 
                                production has not satisfied such 
                                requirement in a 1-year period, then 
                                apparel articles described in subclause 
                                (I) of that producer or entity shall be 
                                ineligible for preferential treatment 
                                under subparagraph (B) during any 
                                succeeding 1-year period until the 
                                aggregate cost of fabrics (exclusive of 
                                all findings and trimmings) formed in 
                                the United States that are used in the 
                                production of such articles of that 
                                producer or entity entered during the 
                                preceding 1-year period is at least 85 
                                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.''.
            (6) Clause (vii) is amended by adding at the end the 
        following new subclause:
                                    ``(V) Thread.--An article otherwise 
                                eligible for preferential treatment 
                                under this paragraph shall not be 
                                ineligible for such treatment because 
                                the thread used to assemble the article 
                                is dyed, printed, or finished in one or 
                                more CBTPA beneficiary countries.''.
            (7) Section <<NOTE: 19 USC 2703.>> 213(b)(2)(A) of such Act 
        is further amended by adding at the end the following new 
        clause:

[[Page 116 STAT. 1038]]

                          ``(ix) Apparel articles assembled in one or 
                      more cbtpa beneficiary countries from united 
                      states and cbtpa beneficiary country components.--
                      Apparel articles sewn or otherwise assembled in 
                      one or more CBTPA beneficiary countries with 
                      thread formed in the United States from components 
                      cut in the United States and in one or more CBTPA 
                      beneficiary countries from fabric wholly formed in 
                      the United States from yarns wholly formed in the 
                      United States, or from components knit-to-shape in 
                      the United States and one or more CBTPA 
                      beneficiary countries from yarns wholly formed in 
                      the United States, or both (including fabrics not 
                      formed from yarns, if such fabrics are 
                      classifiable under heading 5602 or 5603 of the 
                      HTS). Apparel articles shall qualify under this 
                      clause only if they meet the requirements of 
                      clause (i) or (ii) (as the case may be) with 
                      respect to dyeing, printing, and finishing of knit 
                      and woven fabrics from which the articles are 
                      assembled.''.

    (b) Effective <<NOTE: 19 USC 2703 note.>> Date of Certain 
Provisions.--The amendment made by subsection (a)(3) shall take effect 
on October 1, 2002.

SEC. 3108. TRADE BENEFITS UNDER THE AFRICAN GROWTH AND OPPORTUNITY ACT.

    (a) In General.--Section 112(b) of the African Growth and 
Opportunity Act (19 U.S.C. 3721(b)) is amended as follows:
            (1) Paragraph (1) is amended by amending the matter 
        preceding subparagraph (A) to read as follows:
            ``(1) Apparel articles assembled in one or more beneficiary 
        sub-saharan african countries.--Apparel articles sewn or 
        otherwise assembled in one or more beneficiary sub-Saharan 
        African countries from fabrics wholly formed and cut, or from 
        components knit-to-shape, in the United States from yarns wholly 
        formed in the United States, (including fabrics not formed from 
        yarns, if such fabrics are classifiable under heading 5602 or 
        5603 of the Harmonized Tariff Schedule of the United States and 
        are wholly formed and cut in the United States) that are--''.
            (2) Paragraph (2) is amended to read as follows:
            ``(2) Other apparel articles assembled in one or more 
        beneficiary sub-saharan african countries.--Apparel articles 
        sewn or otherwise assembled in one or more beneficiary sub-
        Saharan African countries with thread formed in the United 
        States from fabrics wholly formed in the United States and cut 
        in one or more beneficiary sub-Saharan African countries from 
        yarns wholly formed in the United States, or from components 
        knit-to-shape in the United States from yarns wholly formed in 
        the United States, or both (including fabrics not formed from 
        yarns, if such fabrics are classifiable under heading 5602 or 
        5603 of the Harmonized Tariff Schedule of the United States and 
        are wholly formed in the United States).''.
            (3) Paragraph (3) is amended--
                    (A) by amending the matter preceding subparagraph 
                (A) to read as follows:
            ``(3) Apparel articles from regional fabric or yarns.--
        Apparel articles wholly assembled in one or more beneficiary 
        sub-Saharan African countries from fabric wholly formed in

[[Page 116 STAT. 1039]]

        one or more beneficiary sub-Saharan African countries from yarns 
        originating either in the United States or one or more 
        beneficiary sub-Saharan African countries (including fabrics not 
        formed from yarns, if such fabrics are classified under heading 
        5602 or 5603 of the Harmonized Tariff Schedule of the United 
        States and are wholly formed in one or more beneficiary sub-
        Saharan African countries), or from components knit-to-shape in 
        one or more beneficiary sub-Saharan African countries from yarns 
        originating either in the United States or one or more 
        beneficiary sub-Saharan African countries, or apparel articles 
        wholly formed on seamless knitting machines in a beneficiary 
        sub-Saharan African country from yarns originating either in the 
        United States or one or more beneficiary sub-Saharan African 
        countries, subject to the following:''; and
                    (B) by amending subparagraph (B) to read as follows:
                    ``(B) Special rule for lesser developed countries.--
                          ``(i) In general.--Subject to subparagraph 
                      (A), preferential treatment under this paragraph 
                      shall be extended through September 30, 2004, for 
                      apparel articles wholly assembled, or knit-to-
                      shape and wholly assembled, or both, in one or 
                      more lesser developed beneficiary sub-Saharan 
                      African countries regardless of the country of 
                      origin of the fabric or the yarn used to make such 
                      articles.
                          ``(ii) Lesser developed beneficiary sub-
                      saharan african country.--For purposes of clause 
                      (i), the term `lesser developed beneficiary sub-
                      Saharan African country' means--
                                    ``(I) a beneficiary sub-Saharan 
                                African country that had a per capita 
                                gross national product of less than 
                                $1,500 in 1998, as measured by the 
                                International Bank for Reconstruction 
                                and Development;
                                    ``(II) Botswana; and
                                    ``(III) Namibia.''.
            (4) Paragraph (4)(B) is amended by striking ``18.5'' and 
        inserting ``21.5''.
            (5) Section <<NOTE: 19 USC 3121.>> 112(b) of such Act is 
        further amended by adding at the end the following new 
        paragraph:
            ``(7) Apparel articles assembled in one or more beneficiary 
        sub-saharan african countries from united states and beneficiary 
        sub-saharan african country components.--Apparel articles sewn 
        or otherwise assembled in one or more beneficiary sub-Saharan 
        African countries with thread formed in the United States from 
        components cut in the United States and one or more beneficiary 
        sub-Saharan African countries from fabric wholly formed in the 
        United States from yarns wholly formed in the United States, or 
        from components knit-to-shape in the United States and one or 
        more beneficiary sub-Saharan African countries from yarns wholly 
        formed in the United States, or both (including fabrics not 
        formed from yarns, if such fabrics are classifiable under 
        heading 5602 or 5603 of the Harmonized Tariff Schedule of the 
        United States).''.

    (b) Increase in <<NOTE: 19 USC 3121 note.>> Limitation on Certain 
Benefits.--The applicable percentage under clause (ii) of section 
112(b)(3)(A) of

[[Page 116 STAT. 1040]]

the African Growth and Opportunity Act (19 U.S.C. 3721(b)(3)(A)) shall 
be increased--
            (1) by 2.17 percent for the 1-year period beginning on 
        October 1, 2002, and
            (2) by equal increments in each succeeding 1-year period 
        provided for in such clause, so that for the 1-year period 
        beginning October 1, 2007, the applicable percentage is 
        increased by 3.5 percent,

except that such increase shall not apply with respect to articles 
eligible under subparagraph (B) of section 112(b)(3) of that Act.

      DIVISION D--EXTENSION OF CERTAIN PREFERENTIAL TRADE TREATMENT

        TITLE XLI--EXTENSION OF GENERALIZED SYSTEM OF PREFERENCES

SEC. 4101. EXTENSION OF GENERALIZED SYSTEM OF PREFERENCES.

    (a) Extension of Duty-Free Treatment Under System.--Section 505 of 
the Trade Act of 1974 (19 U.S.C. 2465(a)) is amended by striking 
``September 30, 2001'' and inserting ``December 31, 2006''.
    (b) Retroactive <<NOTE: 19 USC 2465 note.>> Application for Certain 
Liquidations and Reliquidations.--
            (1) In general.--Notwithstanding section 514 of the Tariff 
        Act of 1930 or any other provision of law, and subject to 
        paragraph (2), the entry--
                    (A) of any article to which duty-free treatment 
                under title V of the Trade Act of 1974 would have 
                applied if the entry had been made on September 30, 
                2001,
                    (B) that was made after September 30, 2001, and 
                before the date of the enactment of this Act, and
                    (C) to which duty-free treatment under title V of 
                that Act did not apply,
        shall be liquidated or reliquidated as free of duty, and the 
        Secretary of the Treasury shall refund any duty paid with 
        respect to such entry.
            (2) Requests.--Liquidation or reliquidation may be made 
        under paragraph (1) with respect to an entry only if a request 
        therefor is filed with the Customs Service, within 180 days 
        after the date of the enactment of this Act, that contains 
        sufficient information to enable the Customs Service--
                    (A) to locate the entry; or
                    (B) to reconstruct the entry if it cannot be 
                located.
            (3) Definition.--As used in this subsection, the term 
        ``entry'' includes a withdrawal from warehouse for consumption.

SEC. 4102. AMENDMENTS TO GENERALIZED SYSTEM OF PREFERENCES.

    (a) Eligibility for Generalized System of Preferences.--Section 
502(b)(2)(F) of the Trade Act of 1974 (19 U.S.C. 2462(b)(2)(F)) is 
amended by striking the period at the end and inserting ``or such 
country has not taken steps to support the efforts of the United States 
to combat terrorism.''.

[[Page 116 STAT. 1041]]

    (b) Definition of Internationally Recognized Worker Rights.--Section 
507(4) of the Trade Act of 1974 (19 U.S.C. 2467(4)) is amended by 
amending subparagraph (D) to read as follows:
                    ``(D) a minimum age for the employment of children, 
                and a prohibition on the worst forms of child labor, as 
                defined in paragraph (6); and''.

                  DIVISION E--MISCELLANEOUS PROVISIONS

                  TITLE L--MISCELLANEOUS TRADE BENEFITS

                       Subtitle A--Wool Provisions

SEC. 5101. <<NOTE: Wool Manufacturer Payment Clarification and Technical 
            Corrections Act.>> WOOL PROVISIONS.

    (a) Short Title.--This section may be cited as the ``Wool 
Manufacturer Payment Clarification and Technical Corrections Act''.
    (b) Clarification of Temporary Duty Suspension.--Heading 9902.51.13 
of the Harmonized Tariff Schedule of the United States is amended by 
inserting ``average'' before ``diameters''.
    (c) Payments to Manufacturers of Certain Wool Products.--
            (1) Payments.--Section 505 of the Trade and Development Act 
        of 2000 (Public Law 106-200; 114 Stat. 303) is amended as 
        follows:
                    (A) Subsection (a) is amended--
                          (i) by striking ``In each of the calendar 
                      years'' and inserting ``For each of the calendar 
                      years''; and
                          (ii) by striking ``for a refund of duties'' 
                      and all that follows through the end of the 
                      subsection and inserting ``for a payment equal to 
                      an amount determined pursuant to subsection 
                      (d)(1).''.
                    (B) Subsection (b) is amended to read as follows:

    ``(b) Wool Yarn.--
            ``(1) Importing manufacturers.--For each of the calendar 
        years 2000, 2001, and 2002, a manufacturer of worsted wool 
        fabrics who imports wool yarn of the kind described in heading 
        5107.10 or 9902.51.13 of the Harmonized Tariff Schedule of the 
        United States shall be eligible for a payment equal to an amount 
        determined pursuant to subsection (d)(2).
            ``(2) Nonimporting manufacturers.--For each of the calendar 
        years 2001 and 2002, any other manufacturer of worsted wool 
        fabrics of imported wool yarn of the kind described in heading 
        5107.10 or 9902.51.13 of the Harmonized Tariff Schedule of the 
        United States shall be eligible for a payment equal to an amount 
        determined pursuant to subsection (d)(2).''.
                    (C) Subsection (c) is amended to read as follows:

    ``(c) Wool Fiber and Wool Top.--
            ``(1) Importing manufacturers.--For each of the calendar 
        years 2000, 2001, and 2002, a manufacturer of wool yarn or wool 
        fabric who imports wool fiber or wool top of the kind described 
        in heading 5101.11, 5101.19, 5101.21, 5101.29,

[[Page 116 STAT. 1042]]

        5101.30, 5103.10, 5103.20, 5104.00, 5105.21, 5105.29, or 
        9902.51.14 of the Harmonized Tariff Schedule of the United 
        States shall be eligible for a payment equal to an amount 
        determined pursuant to subsection (d)(3).
            ``(2) Nonimporting manufacturers.--For each of the calendar 
        years 2001 and 2002, any other manufacturer of wool yarn or wool 
        fabric of imported wool fiber or wool top of the kind described 
        in heading 5101.11, 5101.19, 5101.21, 5101.29, 5101.30, 5103.10, 
        5103.20, 5104.00, 5105.21, 5105.29, or 9902.51.14 of the 
        Harmonized Tariff Schedule of the United States shall be 
        eligible for a payment equal to an amount determined pursuant to 
        subsection (d)(3).''.
                    (D) Section 505 is further amended by striking 
                subsection (d) and inserting the following new 
                subsections:

    ``(d) Amount of Annual Payments to Manufacturers.--
            ``(1) Manufacturers of men's suits, etc. of imported worsted 
        wool fabrics.--
                    ``(A) Eligible to receive more than $5,000.--Each 
                annual payment to manufacturers described in subsection 
                (a) who, according to the records of the Customs Service 
                as of September 11, 2001, are eligible to receive more 
                than $5,000 for each of the calendar years 2000, 2001, 
                and 2002, shall be in an amount equal to one-third of 
                the amount determined by multiplying $30,124,000 by a 
                fraction--
                          ``(i) the numerator of which is the amount 
                      attributable to the duties paid on eligible wool 
                      products imported in calendar year 1999 by the 
                      manufacturer making the claim, and
                          ``(ii) the denominator of which is the total 
                      amount attributable to the duties paid on eligible 
                      wool products imported in calendar year 1999 by 
                      all the manufacturers described in subsection (a) 
                      who, according to the records of the Customs 
                      Service as of September 11, 2001, are eligible to 
                      receive more than $5,000 for each such calendar 
                      year under this section as it was in effect on 
                      that date.
                    ``(B) Eligible wool products.--For purposes of 
                subparagraph (A), the term `eligible wool products' 
                refers to imported worsted wool fabrics described in 
                subsection (a).
                    ``(C) Others.--All manufacturers described in 
                subsection (a), other than the manufacturers to which 
                subparagraph (A) applies, shall each receive an annual 
                payment in an amount equal to one-third of the amount 
                determined by dividing $1,665,000 by the number of all 
                such other manufacturers.
            ``(2) Manufacturers of worsted wool fabrics of imported wool 
        yarn.--
                    ``(A) Importing manufacturers.--Each annual payment 
                to an importing manufacturer described in subsection 
                (b)(1) shall be in an amount equal to one-third of the 
                amount determined by multiplying $2,202,000 by a 
                fraction--
                          ``(i) the numerator of which is the amount 
                      attributable to the duties paid on eligible wool 
                      products

[[Page 116 STAT. 1043]]

                      imported in calendar year 1999 by the importing 
                      manufacturer making the claim, and
                          ``(ii) the denominator of which is the total 
                      amount attributable to the duties paid on eligible 
                      wool products imported in calendar year 1999 by 
                      all the importing manufacturers described in 
                      subsection (b)(1).
                    ``(B) Eligible wool products.--For purposes of 
                subparagraph (A), the term `eligible wool products' 
                refers to imported wool yarn described in subsection 
                (b)(1).
                    ``(C) Nonimporting manufacturers.--Each annual 
                payment to a nonimporting manufacturer described in 
                subsection (b)(2) shall be in an amount equal to one-
                half of the amount determined by multiplying $141,000 by 
                a fraction--
                          ``(i) the numerator of which is the amount 
                      attributable to the purchases of imported eligible 
                      wool products in calendar year 1999 by the 
                      nonimporting manufacturer making the claim, and
                          ``(ii) the denominator of which is the total 
                      amount attributable to the purchases of imported 
                      eligible wool products in calendar year 1999 by 
                      all the nonimporting manufacturers described in 
                      subsection (b)(2).
            ``(3) Manufacturers of wool yarn or wool fabric of imported 
        wool fiber or wool top.--
                    ``(A) Importing manufacturers.--Each annual payment 
                to an importing manufacturer described in subsection 
                (c)(1) shall be in an amount equal to one-third of the 
                amount determined by multiplying $1,522,000 by a 
                fraction--
                          ``(i) the numerator of which is the amount 
                      attributable to the duties paid on eligible wool 
                      products imported in calendar year 1999 by the 
                      importing manufacturer making the claim, and
                          ``(ii) the denominator of which is the total 
                      amount attributable to the duties paid on eligible 
                      wool products imported in calendar year 1999 by 
                      all the importing manufacturers described in 
                      subsection (c)(1).
                    ``(B) Eligible wool products.--For purposes of 
                subparagraph (A), the term `eligible wool products' 
                refers to imported wool fiber or wool top described in 
                subsection (c)(1).
                    ``(C) Nonimporting manufacturers.--Each annual 
                payment to a nonimporting manufacturer described in 
                subsection (c)(2) shall be in an amount equal to one-
                half of the amount determined by multiplying $597,000 by 
                a fraction--
                          ``(i) the numerator of which is the amount 
                      attributable to the purchases of imported eligible 
                      wool products in calendar year 1999 by the 
                      nonimporting manufacturer making the claim, and
                          ``(ii) the denominator of which is the amount 
                      attributable to the purchases of imported eligible 
                      wool products in calendar year 1999 by all the 
                      nonimporting manufacturers described in subsection 
                      (c)(2).
            ``(4) Letters of intent.--Except for the nonimporting 
        manufacturers described in subsections (b)(2) and (c)(2) who may 
        make claims under this section by virtue of the enactment

[[Page 116 STAT. 1044]]

        of the Wool Manufacturer Payment Clarification and Technical 
        Corrections Act, only manufacturers who, according to the 
        records of the Customs Service, filed with the Customs Service 
        before September 11, 2001, letters of intent to establish 
        eligibility to be claimants are eligible to make a claim for a 
        payment under this section.
            ``(5) Amount attributable to purchases by nonimporting 
        manufacturers.--
                    ``(A) Amount attributable.--For purposes of 
                paragraphs (2)(C) and (3)(C), the amount attributable to 
                the purchases of imported eligible wool products in 
                calendar year 1999 by a nonimporting manufacturer shall 
                be the amount the nonimporting manufacturer paid for 
                eligible wool products in calendar year 1999, as 
                evidenced by invoices. The nonimporting manufacturer 
                shall make such calculation and submit the resulting 
                amount to the Customs Service, within 45 days after the 
                date of enactment of the Wool Manufacturer Payment 
                Clarification and Technical Corrections Act, in a signed 
                affidavit that attests that the information contained 
                therein is true and accurate to the best of the 
                affiant's belief and knowledge. The nonimporting 
                manufacturer shall retain the records upon which the 
                calculation is based for a period of five years 
                beginning on the date the affidavit is submitted to the 
                Customs Service.
                    ``(B) Eligible wool product.--For purposes of 
                subparagraph (A)--
                          ``(i) the eligible wool product for 
                      nonimporting manufacturers of worsted wool fabrics 
                      is wool yarn of the kind described in heading 
                      5107.10 or 9902.51.13 of the Harmonized Tariff 
                      Schedule of the United States purchased in 
                      calendar year 1999; and
                          ``(ii) the eligible wool products for 
                      nonimporting manufacturers of wool yarn or wool 
                      fabric are wool fiber or wool top of the kind 
                      described in heading 5101.11, 5101.19, 5101.21, 
                      5101.29, 5101.30, 5103.10, 5103.20, 5104.00, 
                      5105.21, 5105.29, or 9902.51.14 of such Schedule 
                      purchased in calendar year 1999.
            ``(6) Amount attributable to duties paid.--For purposes of 
        paragraphs (1), (2)(A), and (3)(A), the amount attributable to 
        the duties paid by a manufacturer shall be the amount shown on 
        the records of the Customs Service as of September 11, 2001, 
        under this section as then in effect.
            ``(7) Schedule of payments; reallocations.--
                    ``(A) Schedule.--Of the payments described in 
                paragraphs (1), (2)(A), and (3)(A), the Customs Service 
                shall make the first and second installments on or 
                before the date that is 45 days after the date of 
                enactment of the Wool Manufacturer Payment Clarification 
                and Technical Corrections Act, and the third installment 
                on or before April 15, 2003. Of the payments described 
                in paragraphs (2)(C) and (3)(C), the Customs Service 
                shall make the first installment on or before the date 
                that is 120 days after the date of enactment of the Wool 
                Manufacturer Payment Clarification and Technical 
                Corrections Act, and the second installment on or before 
                April 15, 2003.

[[Page 116 STAT. 1045]]

                    ``(B) Reallocations.--In the event that a 
                manufacturer that would have received payment under 
                subparagraph (A) or (C) of paragraph (1), (2), or (3) 
                ceases to be qualified for such payment as such a 
                manufacturer, the amounts otherwise payable to the 
                remaining manufacturers under such subparagraph shall be 
                increased on a pro rata basis by the amount of the 
                payment such manufacturer would have received.
            ``(8) Reference.--For purposes of paragraphs (1)(A) and (6), 
        the `records of the Customs Service as of September 11, 2001' 
        are the records of the Wool Duty Unit of the Customs Service on 
        September 11, 2001, as adjusted by the Customs Service to the 
        extent necessary to carry out this section. The amounts so 
        adjusted are not subject to administrative or judicial review.

    ``(e) Affidavits by Manufacturers.--
            ``(1) Affidavit required.--A manufacturer may not receive a 
        payment under this section for calendar year 2000, 2001, or 
        2002, as the case may be, unless that manufacturer has submitted 
        to the Customs Service for that calendar year a signed affidavit 
        that attests that, during that calendar year, the affiant was a 
        manufacturer in the United States described in subsection (a), 
        (b), or (c).
            ``(2) Timing.--An <<NOTE: Deadlines.>> affidavit under 
        paragraph (1) shall be valid--
                    ``(A) in the case of a manufacturer described in 
                paragraph (1), (2)(A), or (3)(A) of subsection (d) 
                filing a claim for a payment for calendar year 2000 or 
                2001, or both, only if the affidavit is postmarked no 
                later than 15 days after the date of enactment of the 
                Wool Manufacturer Payment Clarification and Technical 
                Corrections Act; and
                    ``(B) in the case of a claim for a payment for 
                calendar year 2002, only if the affidavit is postmarked 
                no later than March 1, 2003.

    ``(f) Offsets.--Notwithstanding any other provision of this section, 
any amount otherwise payable under subsection (d) to a manufacturer in 
calendar year 2001 and, where applicable, in calendar years 2002 and 
2003, shall be reduced by the amount of any payment received by that 
manufacturer under this section before the enactment of the Wool 
Manufacturer Payment Clarification and Technical Corrections Act.
    ``(g) Definition.--For purposes of this section, the manufacturer is 
the party that owns--
            ``(1) imported worsted wool fabric, of the kind described in 
        heading 9902.51.11 or 9902.51.12 of the Harmonized Tariff 
        Schedule of the United States, at the time the fabric is cut and 
        sewn in the United States into men's or boys' suits, suit-type 
        jackets, or trousers;
            ``(2) imported wool yarn, of the kind described in heading 
        5107.01 or 9902.51.13 of such Schedule, at the time the yarn is 
        processed in the United States into worsted wool fabric; or
            ``(3) imported wool fiber or wool top, of the kind described 
        in heading 5101.11, 5101.19, 5101.21, 5101.29, 5101.30, 5103.10, 
        5103.20, 5104.00, 5105.21, 5105.29, or 9902.51.14 of such 
        Schedule, at the time the wool fiber or wool top is processed in 
        the United States into wool yarn.''.

[[Page 116 STAT. 1046]]

            (2) Funding.--There is authorized to be appropriated and is 
        hereby appropriated, out of amounts in the General Fund of the 
        Treasury not otherwise appropriated, $36,251,000 to carry out 
        the amendments made by paragraph (1).

SEC. 5102. DUTY SUSPENSION ON WOOL.

    (a) Extension of Temporary Duty Reductions.--
            (1) Heading 9902.51.11.--Heading 9902.51.11 of the 
        Harmonized Tariff Schedule of the United States is amended by 
        striking ``2003'' and inserting ``2005''.
            (2) Heading 9902.51.12.--Heading 9902.51.12 of the 
        Harmonized Tariff Schedule of the United States is amended--
                    (A) by striking ``2003'' and inserting ``2005''; and
                    (B) by striking ``6%'' and inserting ``Free''.
            (3) Heading 9902.51.13.--Heading 9902.51.13 of the 
        Harmonized Tariff Schedule of the United States is amended by 
        striking ``2003'' and inserting ``2005''.
            (4) Heading 9902.51.14.--Heading 9902.51.14 of the 
        Harmonized Tariff Schedule of the United States is amended by 
        striking ``2003'' and inserting ``2005''.

    (b) Limitation on Quantity of Imports.--
            (1) Note 15.--U.S. Note 15 to subchapter II of chapter 99 of 
        the Harmonized Tariff Schedule of the United States is amended--
                    (A) by striking ``from January 1 to December 31 of 
                each year, inclusive''; and
                    (B) by striking ``, or such other'' and inserting 
                the following: ``in calendar year 2001, 3,500,000 square 
                meter equivalents in calendar year 2002, and 4,500,000 
                square meter equivalents in calendar year 2003 and each 
                calendar year thereafter, or such greater''.
            (2) Note 16.--U.S. Note 16 to subchapter II of chapter 99 of 
        the Harmonized Tariff Schedule of the United States is amended--
                    (A) by striking ``from January 1 to December 31 of 
                each year, inclusive''; and
                    (B) by striking ``, or such other'' and inserting 
                the following: ``in calendar year 2001, 2,500,000 square 
                meter equivalents in calendar year 2002, and 3,500,000 
                square meter equivalents in calendar year 2003 and each 
                calendar year thereafter, or such greater''.

    (c) Extension of Duty Refunds and Wool Research Trust Fund.--
            (1) In general.--The United States Customs Service shall pay 
        each manufacturer that receives a payment under section 505 of 
        the Trade and Development Act of 2000 (Public Law 106-200) for 
        calendar year 2002, and that provides an affidavit that it 
        remains a manufacturer in the United States as of January 1 of 
        the year of the payment, 2 additional payments, each payment 
        equal to the payment received for calendar year 2002 as follows:
                    (A) The first payment to be made after January 1, 
                2004, but on or before April 15, 2004.
                    (B) The second payment to be made after January 1, 
                2005, but on or before April 15, 2005.

[[Page 116 STAT. 1047]]

            (2) Conforming amendment.--Section 506(f) <<NOTE: 7 USC 7101 
        note.>> of the Trade and Development Act of 2000 (Public Law 
        106-200) is amended by striking ``2004'' and inserting ``2006''.
            (3) Authorization.--There is authorized to be appropriated 
        and is hereby appropriated out of amounts in the general fund of 
        the Treasury not otherwise appropriated such sums as are 
        necessary to carry out the provisions of this subsection.

    (d) Effective Date.--The amendment made by subsection (a)(2)(B) 
applies to goods entered, or withdrawn from warehouse for consumption, 
on or after January 1, 2002.

                      Subtitle B--Other Provisions

SEC. 5201. <<NOTE: 19 USC 3539.>> FUND FOR WTO DISPUTE SETTLEMENTS.

    (a) Establishment of Fund.--There is established in the Treasury a 
fund for the payment of settlements under this section.
    (b) Authority of USTR to Pay Settlements.--Amounts in the fund 
established under subsection (a) shall be available, as provided in 
appropriations Acts, only for the payment by the United States Trade 
Representative of the amount of the total or partial settlement of any 
dispute pursuant to proceedings under the auspices of the World Trade 
Organization, if--
            (1) in the case of a total or partial settlement in an 
        amount of not more than $10,000,000, the Trade Representative 
        certifies to the Secretary of the Treasury that the settlement 
        is in the best interests of the United States; and
            (2) in the case of a total or partial settlement in an 
        amount of more than $10,000,000, the Trade Representative 
        certifies to the Congress that the settlement is in the best 
        interests of the United States.

    (c) Appropriations.--There are authorized to be appropriated to the 
fund established under subsection (a)--
            (1) $50,000,000; and
            (2) amounts equivalent to amounts recovered by the United 
        States pursuant to the settlement of disputes pursuant to 
        proceedings under the auspices of the World Trade Organization.

Amounts appropriated to the fund are authorized to remain available 
until expended.
    (d) Management of fund.--Sections 9601 and 9602(b) of the Internal 
Revenue Code of 1986 shall apply to the fund established under 
subsection (a) to the same extent as such provisions apply to trust 
funds established under subchapter A of chapter 98 of such Code.

SEC. 5202. CERTAIN STEAM OR OTHER VAPOR GENERATING BOILERS USED IN 
            NUCLEAR FACILITIES.

    (a) In General.--Subheading 9902.84.02 of the Harmonized Tariff 
Schedule of the United States is amended--
            (1) by striking ``4.9%'' and inserting ``Free''; and
            (2) by striking ``12/31/2003'' and inserting ``12/31/2006''.

    (b) Effective Date.--
            (1) In general.--The amendments made by subsection (a) shall 
        apply to goods entered, or withdrawn from warehouse for 
        consumption, on or after January 1, 2002.

[[Page 116 STAT. 1048]]

            (2) Retroactive application.--Notwithstanding section 514 of 
        the Tariff Act of 1930 or any other provision of law, and 
        subject to paragraph (4), the entry of any article--
                    (A) that was made on or after January 1, 2002, and
                    (B) to which duty-free treatment would have applied 
                if the amendment made by this section had been in effect 
                on the date of such entry,
        shall be liquidated or reliquidated as if such duty-free 
        treatment applied, and the Secretary of the Treasury shall 
        refund any duty paid with respect to such entry.
            (3) Entry.--As used in this subsection, the term ``entry'' 
        includes a withdrawal from warehouse for consumption.
            (4) Requests.--Liquidation or reliquidation may be made 
        under paragraph (2) with respect to an entry only if a request 
        therefor is filed with the Customs Service, within 180 days 
        after the date of the enactment of this Act, that contains 
        sufficient information to enable the Customs Service--
                    (A) to locate the entry; or
                    (B) to reconstruct the entry if it cannot be 
                located.

SEC. 5203. SUGAR TARIFF-RATE QUOTA CIRCUMVENTION.

    (a) In General.--Chapter 17 of the Harmonized Tariff Schedule of the 
United States is amended in the superior text to subheading 1702.90.05 
by striking ``Containing'' and all that follows through ``solids:'' and 
inserting the following:
        ``Containing soluble non-sugar solids (excluding any foreign 
        substances, including but not limited to molasses, that may have 
        been added to or developed in the product) equal to 6 percent or 
        less by weight of the total soluble solids:''.

    (b) Monitoring for Circumvention.--The Secretary of Agriculture and 
the Commissioner of Customs shall continuously monitor imports of sugar 
and sugar-containing products provided for in chapters 17, 18, 19, and 
21 of the Harmonized Tariff Schedule of the United States, other than 
molasses imported for use in animal feed or the production of rum and 
articles prepared for marketing to the ultimate consumer in the form and 
package in which imported, for indications that an article is being used 
to circumvent a tariff-rate quota provided for in those chapters. The 
Secretary and Commissioner shall specifically examine imports of 
articles provided for in subheading 1703.10.30 of the Harmonized Tariff 
Schedule of the United States.

[[Page 116 STAT. 1049]]

    (c) Reports and Recommendations.--The <<NOTE: Deadline.>> Secretary 
and the Commissioner shall report their findings to Congress and the 
President not later than 180 days after the date of enactment of this 
Act and every 6 months thereafter. The reports shall include data and a 
description of developments and trends in the composition of trade of 
articles provided for in the chapters of the Harmonized Tariff Schedule 
of the United States identified in subsection (b) and any indications of 
circumvention that may exist. The reports shall also include 
recommendations for ending such circumvention, including recommendations 
for legislation.

    Approved August 6, 2002.

LEGISLATIVE HISTORY--H.R. 3009 (S. 2485):
---------------------------------------------------------------------------

HOUSE REPORTS: Nos. 107-290 (Comm. on Ways and Means) and 107-624 (Comm. 
of Conference).
SENATE REPORTS: No. 107-126 (Comm. on Finance).
CONGRESSIONAL RECORD:
                                                        Vol. 147 (2001):
                                    Nov. 16, considered and passed 
                                        House.
                                                        Vol. 148 (2002):
                                    May 1, 2, 6, 8-10, 13-17, 20-23, 
                                        considered and passed Senate, 
                                        amended.
                                    June 26, House concurred in Senate 
                                        amendement with an amendment 
                                        pursuant to H. Res. 450.
                                    July 26, House agreed to conference 
                                        report.
                                    Aug. 1, Senate agreed to conference 
                                        report.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 38 (2002):
            Aug. 6, Presidential remarks.

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