89–370

108TH CONGRESS REPT. 108–262 " HOUSE OF REPRESENTATIVES ! 1st Session Part 2

APPROVING THE ‘‘COMPACT OF FREE ASSOCIATION, AS AMENDED BETWEEN THE GOVERNMENT OF THE UNITED STATES OF AMERICA AND 

THE GOVERNMENT OF THE FEDERATED STATES OF MICRONESIA’’, AND 

THE ‘‘COMPACT OF FREE ASSOCIATION, AS AMENDED BETWEEN THE 

GOVERNMENT OF THE UNITED STATES OF AMERICA AND THE GOVERNMENT OF THE REPUBLIC OF THE MARSHALL ISLANDS’’, AND OTHERWISE TO AMEND PUBLIC LAW 99–239, AND TO APPROPRIATE FOR THE 

PURPOSES OF AMENDED PUBLIC LAW 99–239 FOR FISCAL YEARS ENDING ON OR BEFORE SEPTEMBER 30, 2023, AND FOR OTHER PURPOSES 

SEPTEMBER 15, 2003.—Ordered to be printed 

Mr. POMBO, from the Committee on Resources, 

submitted the following 

R E P O R T 

[To accompany H.J. Res. 63]

The Committee on Resources, to whom was referred the joint resolution (H.J. Res. 63) to approve the ‘‘Compact of Free Association, 

as amended between the Government of the United States of America and the Government of the Federated States of Micronesia’’, 

and the ‘‘Compact of Free Association, as amended between the 

Government of the United States of America and the Government 

of the Republic of the Marshall Islands’’, and otherwise to amend 

Public Law 99–239, and to appropriate for the purposes of amended Public Law 99–239 for fiscal years ending on or before September 30, 2023, and for other purposes, having considered the 

same, report favorably thereon with an amendment and recommend that the joint resolution as amended do pass. 

The amendment is as follows: 

Strike all after the resolving clause and insert the following:

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 

(a) SHORT TITLE.—This joint resolution, together with the Table of Contents in 

subsection (b) of this section, may be cited as the ‘‘Compact of Free Association 

Amendments Act of 2003’’. 

(b) TABLE OF CONTENTS.—The table of contents for this joint resolution is as follows:

TITLE I—APPROVAL OF U.S.-FSM COMPACT AND U.S.-RMI COMPACT; INTERPRETATION OF, AND 

UNITED STATES POLICIES REGARDING, U.S.-FSM COMPACT AND U.S.-RMI COMPACT; SUPPLEMENTAL PROVISIONS 

Sec. 101. Approval of U.S.-FSM Compact of Free Association and U.S.-RMI Compact of Free Association. 

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(a) Federated States of Micronesia. 

(b) Republic of the Marshall Islands. 

(c) References to the Compact, the U.S.-FSM Compact and the U.S.-RMI Compact; References 

to Subsidiary Agreements or Separate Agreements. 

(d) Amendment, Change, or Termination in the U.S.-FSM Compact and the U.S.-RMI Compact 

and Certain Agreements. 

(e) Subsidiary Agreement Deemed Bilateral. 

(f) Entry Into Force of Future Amendments to Subsidiary Agreements. 

Sec. 102. Agreements With Federated States of Micronesia. 

(a) Law Enforcement Assistance. 

(b) Agreement on Audits. 

Sec. 103. Agreements With and Other Provisions Related to the Republic of the Marshall Islands. 

(a) Law Enforcement Assistance. 

(b) EJIT. 

(c) Kwajalein. 

(d) Section 177 Agreement. 

(e) Nuclear Test Effects. 

(f) Espousal Provisions. 

(g) DOE Radiological Health Care Program; USDA Agricultural and Food Programs. 

(h) Rongelap. 

(i) Four Atoll Health Care Program. 

(j) Enjebi Community Trust Fund. 

(k) Bikini Atoll Cleanup. 

(l) Agreement on Audits. 

Sec. 104. Interpretation of and United States Policy Regarding U.S.-FSM Compact and U.S.-RMI Compact. 

(a) Human Rights. 

(b) Immigration and Passport Security. 

(c) Nonalienation of Lands. 

(d) Nuclear Waste Disposal. 

(e) Impact of Compacts on Guam, the State of Hawaii, the Commonwealth of the Northern Mariana Islands, and American Samoa; Related Authorization and Continuing Appropriation. 

(f) Sense of Congress Concerning Funding of Public Infrastructure. 

(g) Foreign Loans. 

(h) Reports and Reviews. 

(i) Construction of Section 141(f). 

Sec. 105. Supplemental Provisions. 

(a) Domestic Program Requirements. 

(b) Relations With the Federated States of Micronesia and the Republic of the Marshall Islands. 

(c) Judicial Training. 

(d) Continuing Trust Territory Authorization. 

(e) Survivability; Actions Incompatible with United States Authority. 

(f) Noncompliance Sanctions. 

(g) Continuing Programs and Laws. 

(h) College of Micronesia. 

(i) Trust Territory Debts to U.S. Federal Agencies. 

(j) Technical Assistance. 

(k) Prior Service Benefits Program. 

(l) Indefinite Land Use Payments. 

(m) Communicable Disease Control Program. 

(n) User Fees. 

(o) Treatment of Judgments of Courts of the Federated States of Micronesia, the Republic of the 

Marshall Islands, and the Republic of Palau. 

(p) Inflation Adjustment. 

Sec. 106. Construction Contract Assistance. 

(a) Assistance to U.S. Firms. 

(b) Authorization of Appropriations. 

Sec. 107. Prohibition. 

Sec. 108. Compensatory Adjustments. 

(a) Additional Programs and Services. 

(b) Further Amounts. 

Sec. 109. Authorization and Continuing Appropriation. 

Sec. 110. Payment of Citizens of the Federated States of Micronesia, the Republic of the Marshall Islands, and 

the Republic of Palau Employed by the Government of the United States in the Continental United 

States. 

TITLE II—COMPACTS OF FREE ASSOCIATION WITH THE FEDERATED STATES OF MICRONESIA AND 

THE REPUBLIC OF THE MARSHALL ISLANDS 

Sec. 201. Compacts of Free Association, as Amended Between the Government of the United States and the 

Government of the Federated States of Micronesia and Between the Government of the United States 

and the Government of the Republic of the Marshall Islands. 

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(a) Compact of Free Association as amended between the Government of the United States of 

America and the Government of the Federated States of Micronesia. 

Title One—Governmental Relations 

Article I—Self-Government. 

Article II—Foreign Affairs. 

Article III—Communications. 

Article IV—Immigration. 

Article V—Representation. 

Article VI—Environmental Protection. 

Article VII—General Legal Provisions. 

Title Two—Economic Relations

Article I—Grant Assistance. 

Article II—Services and Program Assistance. 

Article III—Administrative Provisions. 

Article IV—Trade. 

Article V—Finance and Taxation. 

Title Three—Security and Defense Relations 

Article I—Authority and Responsibility. 

Article II—Defense Facilities and Operating Rights. 

Article III—Defense Treaties and International Security Agreements. 

Article IV—Service in Armed Forces of the United States. 

Article V—General Provisions. 

Title Four—General Provisions 

Article I—Approval and Effective Date. 

Article II—Conference and Dispute Resolution. 

Article III—Amendment. 

Article IV—Termination. 

Article V—Survivability. 

Article VI—Definition of Terms. 

Article VII—Concluding Provisions. 

(b) Compact of Free Association as amended between the Government of the United States of 

America and the Government of the Republic of the Marshall Islands. 

Title One—Governmental Relations 

Article I—Self-Government. 

Article II—Foreign Affairs. 

Article III—Communications. 

Article IV—Immigration. 

Article V—Representation. 

Article VI—Environmental Protection. 

Article VII—General Legal Provisions. 

Title Two—Economic Relations 

Article I—Grant Assistance. 

Article II—Services and Program Assistance. 

Article III—Administrative Provisions. 

Article IV—Trade. 

Article V—Finance and Taxation. 

Title Three—Security and Defense Relations 

Article I—Authority and Responsibility. 

Article II—Defense Facilities and Operating Rights. 

Article III—Defense Treaties and International Security Agreements. 

Article IV—Service in Armed Forces of the United States. 

Article V—General Provisions. 

Title Four—General Provisions 

Article I—Approval and Effective Date. 

Article II—Conference and Dispute Resolution. 

Article III—Amendment. 

Article IV—Termination. 

Article V—Survivability. 

Article VI—Definition of Terms. 

Article VII—Concluding Provisions. 

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TITLE I—APPROVAL OF U.S.-FSM COMPACT 

AND U.S.-RMI COMPACT; INTERPRETATION 

OF, AND U.S. POLICIES REGARDING, U.S.-FSM 

COMPACT AND U.S.-RMI COMPACT; SUPPLEMENTAL PROVISIONS 

SEC. 101. APPROVAL OF U.S.-FSM COMPACT OF FREE ASSOCIATION AND THE U.S.-RMI COMPACT OF FREE ASSOCIATION; REFERENCES TO SUBSIDIARY AGREEMENTS OR SEPARATE AGREEMENTS.*COM007*

(a) FEDERATED STATES OF MICRONESIA.—The Compact of Free Association, as 

amended with respect to the Federated States of Micronesia and signed by the 

United States and the Government of the Federated States of Micronesia and set 

forth in Title II (section 201(a)) of this joint resolution, is hereby approved, and Congress hereby consents to the subsidiary agreements and amended subsidiary agreements listed in section 462 of the U.S.-FSM Compact. Subject to the provisions of 

this joint resolution, the President is authorized to agree, in accordance with section 

411 of the U.S.-FSM Compact, to an effective date for and thereafter to implement 

such U.S.-FSM Compact. 

(b) REPUBLIC OF THE MARSHALL ISLANDS.—The Compact of Free Association, as 

amended with respect to the Republic of the Marshall Islands and signed by the 

United States and the Government of the Republic of the Marshall Islands and set 

forth in Title II (section 201(b)) of this joint resolution, is hereby approved, and Congress hereby consents to the subsidiary agreements and amended subsidiary agreements listed in section 462 of the U.S.-RMI Compact. Subject to the provisions of 

this joint resolution, the President is authorized to agree, in accordance with section 

411 of the U.S.-RMI Compact, to an effective date for and thereafter to implement 

such U.S.-RMI Compact. 

(c) REFERENCES TO THE COMPACT, THE U.S.-FSM COMPACT, AND THE U.S.-RMI 

COMPACT; REFERENCES TO SUBSIDIARY AGREEMENTS OR SEPARATE AGREEMENTS.—

(1) Any reference in this joint resolution (except references in title II) to ‘‘the 

Compact’’ shall be treated as a reference to the Compact of Free Association set 

forth in title II of Public Law 99–239, January 14, 1986 (99 Stat. 1770). Any 

reference in this joint resolution to the ‘‘U.S.-FSM Compact’’ shall be treated as 

a reference to the Compact of Free Association, as amended between the Government of the United States of America and the Government of the Federated 

States of Micronesia and set forth in Title II (section 201(a)) of this joint resolution. Any reference in this joint resolution to the ‘‘U.S.-RMI Compact’’ shall be 

treated as a reference to the Compact of Free Association, as amended between 

the Government of the United States of America and the Government of the Republic of the Marshall Islands and set forth in Title II (section 201(b)) of this 

joint resolution. 

(2) Any reference to the term ‘‘subsidiary agreements’’ or ‘‘separate agreements’’ in this joint resolution shall be treated as a reference to agreements listed in section 462 of the U.S.-FSM Compact and the U.S.-RMI Compact, and any 

other agreements that the United States may from time to time enter into with 

either the government of the Federated States of Micronesia or the government 

of the Republic of the Marshall Islands, or with both such governments in accordance with the provisions of the U.S.-FSM Compact and the U.S.-RMI Compact. 

(d) AMENDMENT, CHANGE, OR TERMINATION IN THE U.S.-FSM COMPACT AND U.S.-

RMI COMPACT AND CERTAIN AGREEMENTS.—

(1) Any amendment, change, or termination by mutual agreement or by unilateral action of the Government of the United States of all or any part of the 

U.S.-FSM Compact or U.S.-RMI Compact shall not enter into force until after 

Congress has incorporated it in an Act of Congress. 

(2) The provisions of paragraph (1) shall apply—

(A) to all actions of the Government of the United States under the U.S.-

FSM Compact or U.S.-RMI Compact including, but not limited to, actions 

taken pursuant to sections 431, 441, or 442; 

(B) to any amendment, change, or termination in the Agreement Between 

the Government of the United States and the Government of the Federated 

States of Micronesia Regarding Friendship, Cooperation and Mutual Security Concluded Pursuant to Sections 321 and 323 of the Compact of Free 

Association referred to in section 462(a)(2) of the U.S.-FSM Compact and 

the Agreement Between the Government of the United States and the Government of the Marshall Islands Regarding Mutual Security Concluded 

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Pursuant to Sections 321 and 323 of the Compact of Free Association referred to in section 462(a)(5) of the U.S.-RMI Compact; 

(C) to any amendment, change, or termination of the agreements concluded pursuant to Compact section 177, and section 215(a) of the U.S.-

FSM Compact and section 216(a) of the U.S.-RMI Compact, the terms of 

which are incorporated by reference into the U.S.-FSM Compact and the 

U.S.-RMI Compact; and 

(D) to the following subsidiary agreements, or portions thereof: Articles 

III, IV and X of the agreement referred to in section 462(b)(6) of the U.S.-

RMI Compact: 

(i) Article III and IV of the agreement referred to in section 462(b)(6) 

of the U.S.-FSM Compact. 

(ii) Articles VI, XV, and XVII of the agreement referred to in section 

462(b)(7) of the U.S.-FSM Compact and U.S.-RMI Compact. 

(e) SUBSIDIARY AGREEMENTS DEEMED BILATERAL.—For purposes of implementation of the U.S.-FSM Compact and the U.S.-RMI Compact and this joint resolution, 

the Agreement Concluded Pursuant to Section 234 of the Compact of Free Association and referred to in section 462(a)(1) of the U.S.-FSM Compact and section 

462(a)(4) of the U.S.-RMI Compact shall be deemed to be a bilateral agreement between the United States and each other party to such subsidiary agreement. The 

consent or concurrence of any other party shall not be required for the effectiveness 

of any actions taken by the United States in conjunction with either the Federated 

States of Micronesia or the Republic of the Marshall Islands which are intended to 

affect the implementation, modification, suspension, or termination of such subsidiary agreement (or any provision thereof) as regards the mutual responsibilities 

of the United States and the party in conjunction with whom the actions are taken. 

(f) ENTRY INTO FORCE OF FUTURE AMENDMENTS TO SUBSIDIARY AGREEMENTS.—

No agreement between the United States and the government of either the Federated States of Micronesia or the Republic of the Marshall Islands which would 

amend, change, or terminate any subsidiary agreement or portion thereof, other 

than those set forth is subsection (d) of this section shall enter into force until after 

the President has transmitted such agreement to the President of the Senate and 

the Speaker of the House of Representatives together with an explanation of the 

agreement and the reasons therefor. In the case of the agreement referred to in section 462(b)(3) of the U.S.-FSM Compact and the U.S.-RMI Compact, such transmittal shall include a specific statement by the Secretary of Labor as to the necessity of such amendment, change, or termination, and the impact thereof. 

SEC. 102. AGREEMENTS WITH FEDERATED STATES OF MICRONESIA. 

(a) LAW ENFORCEMENT ASSISTANCE.—Pursuant to sections 222 and 224 of the 

U.S.-FSM Compact, the United States shall provide nonreimbursable technical and 

training assistance as appropriate, including training and equipment for postal inspection of illicit drugs and other contraband, to enable the Government of the Federated States of Micronesia to develop and adequately enforce laws of the Federated 

States of Micronesia and to cooperate with the United States in the enforcement of 

criminal laws of the United States. Funds appropriated pursuant to section 105(j) 

of this title may be used to reimburse State or local agencies providing such assistance. 

(b) AGREEMENT ON AUDITS.—The Comptroller General (and his duly authorized 

representatives) shall have the authorities necessary to carry out his responsibilities 

under section 232 of the U.S.-FSM Compact and the agreement referred to in section 462(b)(4) of the U.S.-FSM Compact, including the following authorities: 

(1) GENERAL AUTHORITY OF THE COMPTROLLER GENERAL TO AUDIT.—

(A) The Comptroller General of the United States (and his duly authorized representatives) shall have the authority to audit—

(i) all grants, program assistance, and other assistance provided to 

the Government of the Federated States of Micronesia under Articles 

I and II of Title Two of the U.S.-FSM Compact; and 

(ii) any other assistance provided by the Government of the United 

States to the Government of the Federated States of Micronesia. 

Such authority shall include authority for the Comptroller General to conduct or cause to be conducted any of the audits provided for in section 232 

of the U.S.-FSM Compact. The authority provided in this paragraph shall 

continue for at least ten years after the last such grant has been made or 

assistance has been provided. 

(B) The Comptroller General (and his duly authorized representatives) 

shall also have authority to review any audit conducted by or on behalf of 

the Government of the United States. In this connection, the Comptroller 

General shall have access to such personnel and to such records, docuVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00005 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
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ments, working papers, automated data and files, and other information 

relevant to such review. 

(2) COMPTROLLER GENERAL ACCESS TO RECORDS.—

(A) In carrying out paragraph (1), the Comptroller General (and his duly 

authorized representatives) shall have such access to the personnel and 

(without cost) to records, documents, working papers, automated data and 

files, and other information relevant to such audits. The Comptroller General may duplicate any such records, documents, working papers, automated data and files, or other information relevant to such audits. 

(B) Such records, documents, working papers, automated data and files, 

and other information regarding each such grant or other assistance shall 

be maintained for at least ten years after the date such grant or assistance 

was provided and in a manner that permits such grants, assistance, and 

payments to be accounted for distinct from any other funds of the Government of the Federated States of Micronesia. 

(3) STATUS OF COMPTROLLER GENERAL REPRESENTATIVES.—The Comptroller 

General and his duly authorized representatives shall be immune from civil and 

criminal process relating to words spoken or written and all acts performed by 

them in their official capacity and falling within their functions, except insofar 

as such immunity may be expressly waived by the Government of the United 

States. The Comptroller General and his duly authorized representatives shall 

not be liable to arrest or detention pending trial, except in the case of a grave 

crime and pursuant to a decision by a competent judicial authority, and such 

persons shall enjoy immunity from seizure of personal property, immigration restrictions, and laws relating to alien registration, fingerprinting, and the registration of foreign agents. Such persons shall enjoy the same taxation exemptions as are set forth in Article 34 of the Vienna Convention on Diplomatic Relations. The privileges, exemptions and immunities accorded under this paragraph are not for the personal benefit of the individuals concerned but are to 

safeguard the independent exercise of their official functions. Without prejudice 

to those privileges, exemptions and immunities, it is the duty of all such persons to respect the laws and regulations of the Government of the Federated 

States of Micronesia. 

(4) AUDITS DEFINED.—As used in this subsection, the term ‘‘audits’’ includes 

financial, program, and management audits, including determining—

(A) whether the Government of the Federated States of Micronesia has 

met the requirements set forth in the U.S.-FSM Compact, or any related 

agreement entered into under the U.S.-FSM Compact, regarding the purposes for which such grants and other assistance are to be used; and 

(B) the propriety of the financial transactions of the Government of the 

Federated States of Micronesia pursuant to such grants or assistance. 

(5) COOPERATION BY FEDERATED STATES OF MICRONESIA.—The Government of 

the Federated States of Micronesia will cooperate fully with the Comptroller 

General of the United States in the conduct of such audits as the Comptroller 

General determines necessary to enable the Comptroller General to fully discharge his responsibilities under this joint resolution. 

SEC. 103. AGREEMENTS WITH AND OTHER PROVISIONS RELATED TO THE REPUBLIC OF THE 

MARSHALL ISLANDS. 

(a) LAW ENFORCEMENT ASSISTANCE.—Pursuant to sections 222 and 224 of the 

U.S.-RMI Compact, the United States shall provide non-reimbursable technical and 

training assistance as appropriate, including training and equipment for postal inspection of illicit drugs and other contraband, to enable the Government of the Marshall Islands to develop and adequately enforce laws of the Marshall Islands and 

to cooperate with the United States in the enforcement of criminal laws of the 

United States. Funds appropriated pursuant to section 105(j) of this title may be 

used to reimburse State or local agencies providing such assistance. 

(b) EJIT.—

(1) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that the President of the United States shall negotiate with the Government of the Marshall Islands an agreement whereby, without prejudice as 

to any claims which have been or may be asserted by any party as to rightful 

title and ownership of any lands on Ejit, the Government of the Marshall Islands shall assure that lands on Ejit used as of January 1, 1985, by the people 

of Bikini, will continue to be available without charge for their use, until such 

time as Bikini is restored and inhabitable and the continued use of Ejit is no 

longer necessary, unless a Marshall Islands court of competent jurisdiction finally determines that there are legal impediments to continued use of Ejit by 

the people of Bikini. 

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(2) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that if the impediments described in paragraph (1) do arise, the 

United States will cooperate with the Government of the Marshall Islands in 

assisting any person adversely affected by such judicial determination to remain 

on Ejit, or in locating suitable and acceptable alternative lands for such person’s use. (3) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that paragraph (1) shall not be applied in a manner which would prevent the Government of the Marshall Islands from acting in accordance with 

its constitutional processes to resolve title and ownership claims with respect 

to such lands or from taking substitute or additional measures to meet the 

needs of the people of Bikini with their democratically expressed consent and 

approval. 

(c) KWAJALEIN.— (1) It is the policy of the United States that payment of funds by the Government of the Marshall Islands to the landowners of Kwajalein Atoll in accordance with the land use agreement dated October 19, 1982, or as amended or 

superceded, and any related allocation agreements, is required in order to ensure that the Government of the United States will be able to fulfill its obligation and responsibilities under Title Three of the Compact and the subsidiary 

agreements concluded pursuant to the Compact. 

(2)(A) If the Government of the Marshall Islands fails to make payments in 

accordance with paragraph (1), the Government of the United States shall initiate procedures under section 313 of the Compact and consult with the Government of the Marshall Islands with respect to the basis for the nonpayment of 

funds. 

(B) The United States shall expeditiously resolve the matter of any nonpayment of funds required under paragraph (1) pursuant to section 313 of the 

Compact and the authority and responsibility of the Government of the United 

States for security and defense matters in or relating to the Marshall Islands. 

(C) This paragraph shall be enforced in accordance with section 105(f)(2). 

(3) Until such time as the Government of the Marshall Islands and the landowners of Kwajalein Atoll have concluded an agreement amending or 

superceding the land use agreement dated October 19, 1982, any amounts paid 

by the United States to the Government of the Marshall Islands in excess of 

the amounts required to be paid pursuant to the land use agreement dated October 19, 1982, shall be paid into, and held in, an interest bearing account in 

a United States financial institution by the Government of the Republic of the 

Marshall Islands. 

(4)(A) The Government of the Republic of the Marshall Islands shall notify 

the Government of the United States when an agreement amending or 

superceding the land use agreement dated October 19, 1982, is concluded. 

(B) If no agreement amending or superceding the land use agreement dated 

October 19, 1982, is concluded by the date five years after the date of enactment 

of this resolution, the President shall report to Congress on the intentions of 

the United States with respect to the use of Kwajalein Atoll after 2016, and on 

any plans to relocate activities carried out at Kwajalein Atoll. 

(d) SECTION 177 AGREEMENT.—

(1) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that in furtherance of the purposes of Article I of the Subsidiary 

Agreement for Implementation of Section 177 of the Compact, the payment of 

the amount specified therein shall be made by the United States under Article 

I of the Agreement between the Government of the United States and the Government of the Marshall Islands for the Implementation of section 177 of the 

Compact (hereafter in this subsection referred to as the ‘‘Section 177 Agreement’’) only after the Government of the Marshall Islands has notified the 

President of the United States as to which investment management firm has 

been selected by such Government to act as Fund Manager under Article I of 

the Section 177 Agreement. 

(2) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that in the event that the President determines that an investment 

management firm selected by the Government of the Marshall Islands does not 

meet the requirements specified in Article I of the Section 177 Agreement, the 

United States shall invoke the conference and dispute resolution procedures of 

Article II of Title Four of the Compact. Pending the resolution of such a dispute 

and until a qualified Fund Manager has been designated, the Government of 

the Marshall Islands shall place the funds paid by the United States pursuant 

to Article I of the Section 177 Agreement into an interest-bearing escrow account. Upon designation of a qualified Fund Manager, all funds in the escrow 

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account shall be transferred to the control of such Fund Manager for management pursuant to the Section 177 Agreement. 

(3) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that if the Government of the Marshall Islands determines that some 

other investment firm should act as Fund Manager in place of the firm first (or 

subsequently) selected by such Government, the Government of the Marshall Islands shall so notify the President of the United States, identifying the firm selected by such Government to become Fund Manager, and the President shall 

proceed to evaluate the qualifications of such identified firm. 

(4) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that at the end of 15 years after the effective date of the Compact, the 

firm then acting as Fund Manager shall transfer to the Government of the Marshall Islands, or to such account as such Government shall so notify the Fund 

Manager, all remaining funds and assets being managed by the Fund Manager 

under the Section 177 Agreement. 

(e) NUCLEAR TEST EFFECTS.—In the joint resolution of January 14, 1986 (Public 

Law 99–239) Congress provided that in approving the Compact, the Congress understands and intends that the peoples of Bikini, Enewetak, Rongelap, and Utrik, who 

were affected by the United States nuclear weapons testing program in the Marshall Islands, will receive the amounts of $75,000,000 (Bikini); $48,750,000 

(Enewetak); $37,500,000 (Rongelap); and $22,500,000 (Utrik), respectively, which 

amounts shall be paid out of proceeds from the fund established under Article I, section 1 of the subsidiary agreement for the implementation of section 177 of the Compact. The amounts specified in this subsection shall be in addition to any amounts 

which may be awarded to claimants pursuant to Article IV of the subsidiary agreement for the implementation of Section 177 of the Compact. Nothing in this subsection creates any rights or obligations beyond those provided for in the original 

enacted version of Public Law 99–239. 

(f) ESPOUSAL PROVISIONS.—

(1) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that it is the intention of the Congress of the United States that the 

provisions of section 177 of the Compact of Free Association and the Agreement 

between the Government of the United States and the Government of the Marshall Islands for the Implementation of Section 177 of the Compact (hereafter 

in this subsection referred to as the ‘‘Section 177 Agreement’’) constitute a full 

and final settlement of all claims described in Articles X and XI of the Section 

177 Agreement, and that any such claims be terminated and barred except insofar as provided for in the Section 177 Agreement. 

(2) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that in furtherance of the intention of Congress as stated in paragraph 

(1) of this subsection, the Section 177 Agreement is hereby ratified and approved. It is the explicit understanding and intent of Congress that the jurisdictional limitations set forth in Article XII of such Agreement are enacted solely 

and exclusively to accomplish the objective of Article X of such Agreement and 

only as a clarification of the effect of Article X, and are not to be construed or 

implemented separately from Article X. 

(g) DOE RADIOLOGICAL HEALTH CARE PROGRAM; USDA AGRICULTURAL AND FOOD

PROGRAMS.—

(1) Notwithstanding any other provision of law, upon the request of the Government of the Republic of the Marshall Islands, the President (either through 

an appropriate department or agency of the United States or by contract with 

a United States firm) shall continue to provide special medical care and 

logistical support thereto for the remaining members of the population of 

Rongelap and Utrik who were exposed to radiation resulting from the 1954 

United States thermo-nuclear ‘‘Bravo’’ test, pursuant to Public Laws 95–134 

and 96–205. 

(2)(A) In the joint resolution of January 14, 1986 (Public Law 99–239), Congress provided that notwithstanding any other provision of law, upon the request of the Government of the Marshall Islands, for the first fifteen years after 

the effective date of the Compact, the President (either through an appropriate 

department or agency of the United States or by contract with a United States 

firm or by a grant to the Government of the Republic of the Marshall Islands 

which may further contract only with a United States firm or a Republic of the 

Marshall Islands firm, the owners, officers and majority of the employees of 

which are citizens of the United States or the Republic of the Marshall Islands) 

shall provide technical and other assistance—

(i) without reimbursement, to continue the planting and agricultural 

maintenance program on Enewetak, as provided in subparagraph (C); 

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(ii) without reimbursement, to continue the food programs of the Bikini 

and Enewetak people described in section 1(d) of Article II of the Subsidiary 

Agreement for the Implementation of Section 177 of the Compact and for 

continued waterborne transportation of agricultural products to Enewetak 

including operations and maintenance of the vessel used for such purposes. 

(B) The President shall ensure the assistance provided under these programs 

reflects the changes in the population since the inception of such programs. 

(C)(i) The planting and agricultural maintenance program on Enewetak shall be funded at a level of not less than $1,300,000 per year, as adjusted for inflation under section 218 of the U.S.-RMI Compact. 

(ii) There is hereby authorized and appropriated to the Secretary of the Interior, out of any funds in the Treasury not otherwise appropriated, to remain 

available until expended, for each fiscal year from 2004 through 2023, 

$1,300,000, as adjusted for inflation under section 218 of the U.S.-RMI Compact, to carry out the planting and agricultural maintenance program. 

(3) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that payments under this subsection shall be provided to such extent 

or in such amounts as are necessary for services and other assistance provided 

pursuant to this subsection. It is the sense of Congress that after the periods 

of time specified in paragraphs (1) and (2) of this subsection, consideration will 

be given to such additional funding for these programs as may be necessary. 

(h) RONGELAP.—

(1) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that because Rongelap was directly affected by fallout from a 1954 

United States thermonuclear test and because the Rongelap people remain unconvinced that it is safe to continue to live on Rongelap Island, it is the intent 

of Congress to take such steps (if any) as may be necessary to overcome the effects of such fallout on the habitability of Rongelap Island, and to restore 

Rongelap Island, if necessary, so that it can be safely inhabited. Accordingly, 

it is the expectation of the Congress that the Government of the Marshall Islands shall use such portion of the funds specified in Article II, section 1(e) of 

the subsidiary agreement for the implementation of section 177 of the Compact 

as are necessary for the purpose of contracting with a qualified scientist or 

group of scientists to review the data collected by the Department of Energy relating to radiation levels and other conditions on Rongelap Island resulting from 

the thermonuclear test. It is the expectation of the Congress that the Government of the Marshall Islands, after consultation with the people of Rongelap, 

shall select the party to review such data, and shall contract for such review 

and for submission of a report to the President of the United States and the 

Congress as to the results thereof. 

(2) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that the purpose of the review referred to in paragraph (1) of this subsection shall be to establish whether the data cited in support of the conclusions 

as to the habitability of Rongelap Island, as set forth in the Department of Energy report entitled: ‘‘The Meaning of Radiation for Those Atolls in the Northern Part of the Marshall Islands That Were Surveyed in 1978’’, dated November 

1982, are adequate and whether such conclusions are fully supported by the 

data. If the party reviewing the data concludes that such conclusions as to habitability are fully supported by adequate data, the report to the President of the 

United States and the Congress shall so state. If the party reviewing the data 

concludes that the data are inadequate to support such conclusions as to habitability or that such conclusions as to habitability are not fully supported by the 

data, the Government of the Marshall Islands shall contract with an appropriate scientist or group of scientists to undertake a complete survey of radiation and other effects of the nuclear testing program relating to the habitability of Rongelap Island. Such sums as are necessary for such survey and report concerning the results thereof and as to steps needed to restore the habitability of Rongelap Island are authorized to be made available to the Government of the Marshall Islands. 

(3) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that it is the intent of Congress that such steps (if any) as are necessary to restore the habitability of Rongelap Island and return the Rongelap 

people to their homeland will be taken by the United States in consultation 

with the Government of the Marshall Islands and, in accordance with its authority under the Constitution of the Marshall Islands, the Rongelap local government council. 

(i) FOUR ATOLL HEALTH CARE PROGRAM.—

(1) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that services provided by the United States Public Health Service or 

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any other United States agency pursuant to section 1(a) of Article II of the 

Agreement for the Implementation of Section 177 of the Compact (hereafter in 

this subsection referred to as the ‘‘Section 177 Agreement’’) shall be only for 

services to the people of the Atolls of Bikini, Enewetak, Rongelap, and Utrik 

who were affected by the consequences of the United States nuclear testing program, pursuant to the program described in Public Law 95–134 (91 Stat. 1159) 

and Public Law 96–205 (94 Stat. 84) and their descendants (and any other persons identified as having been so affected if such identification occurs in the 

manner described in such public laws). Nothing in this subsection shall be construed as prejudicial to the views or policies of the Government of the Marshall 

Islands as to the persons affected by the consequences of the United States nuclear testing program. 

(2) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that at the end of the first year after the effective date of the Compact 

and at the end of each year thereafter, the providing agency or agencies shall 

return to the Government of the Marshall Islands any unexpended funds to be 

returned to the Fund Manager (as described in Article I of the Section 177 

Agreement) to be covered into the Fund to be available for future use. 

(3) In the joint resolution of January 14, 1986 (Public Law 99–239) Congress 

provided that the Fund Manager shall retain the funds returned by the Government of the Marshall Islands pursuant to paragraph (2) of this subsection, shall 

invest and manage such funds, and at the end of 15 years after the effective 

date of the Compact, shall make from the total amount so retained and the proceeds thereof annual disbursements sufficient to continue to make payments for 

the provision of health services as specified in paragraph (1) of this subsection 

to such extent as may be provided in contracts between the Government of the 

Marshall Islands and appropriate United States providers of such health services. 

(j) ENJEBI COMMUNITY TRUST FUND.—In the joint resolution of January 14, 1986 

(Public Law 99–239) Congress provided that notwithstanding any other provision of 

law, the Secretary of the Treasury shall establish on the books of the Treasury of 

the United States a fund having the status specified in Article V of the subsidiary 

agreement for the implementation of Section 177 of the Compact, to be known as 

the ‘‘Enjebi Community Trust Fund’’ (hereafter in this subsection referred to as the 

‘‘Fund’’), and shall credit to the Fund the amount of $7,500,000. Such amount, which 

shall be ex gratia, shall be in addition to and not charged against any other funds 

provided for in the Compact and its subsidiary agreements, this joint resolution, or 

any other Act. Upon receipt by the President of the United States of the agreement 

described in this subsection, the Secretary of the Treasury, upon request of the Government of the Marshall Islands, shall transfer the Fund to the Government of the 

Marshall Islands, provided that the Government of the Marshall Islands agrees as 

follows: 

(1) ENJEBI TRUST AGREEMENT.—In the joint resolution of January 14, 1986 

(Public Law 99–239) Congress provided that the Government of the Marshall 

Islands and the Enewetak Local Government Council, in consultation with the 

people of Enjebi, shall provide for the creation of the Enjebi Community Trust 

Fund and the employment of the manager of the Enewetak Fund established 

pursuant to the Section 177 Agreement as trustee and manager of the Enjebi 

Community Trust Fund, or, should the manager of the Enewetak Fund not be 

acceptable to the people of Enjebi, another United States investment manager 

with substantial experience in the administration of trusts and with funds 

under management in excess of 250 million dollars. 

(2) MONITOR CONDITIONS.—In the joint resolution of January 14, 1986 (Public 

Law 99–239) Congress provided that upon the request of the Government of the 

Marshall Islands, the United States shall monitor the radiation and other conditions on Enjebi and within one year of receiving such a request shall report to 

the Government of the Marshall Islands when the people of Enjebi may resettle 

Enjebi under circumstances where the radioactive contamination at Enjebi, including contamination derived from consumption of locally grown food products, 

can be reduced or otherwise controlled to meet whole body Federal radiation 

protection standards for the general population, including mean annual dose 

and mean 30-year cumulative dose standards. 

(3) RESETTLEMENT OF ENJEBI.—In the joint resolution of January 14, 1986 

(Public Law 99–239) Congress provided that in the event that the United States 

determines that the people of Enjebi can within 25 years of January 14, 1986, 

resettle Enjebi under the conditions set forth in paragraph (2) of this subsection, then upon such determination there shall be available to the people of 

Enjebi from the Fund such amounts as are necessary for the people of Enjebi 

to do the following, in accordance with a plan developed by the Enewetak Local 

11

Government Council and the people of Enjebi, and concurred with by the Government of the Marshall Islands to assure consistency with the government’s 

overall economic development plan: 

(A) Establish a community on Enjebi Island for the use of the people of 

Enjebi. 

(B) Replant Enjebi with appropriate food-bearing and other vegetation. 

(4) RESETTLEMENT OF OTHER LOCATION.—In the joint resolution of January 

14, 1986 (Public Law 99–239) Congress provided that in the event that the 

United States determines that within 25 years of January 14, 1986, the people 

of Enjebi cannot resettle Enjebi without exceeding the radiation standards set 

forth in paragraph (2) of this subsection, then the fund manager shall be directed by the trust instrument to distribute the Fund to the people of Enjebi 

for their resettlement at some other location in accordance with a plan, developed by the Enewetak Local Government Council and the people of Enjebi and 

concurred with by the Government of the Marshall Islands, to assure consistency with the government’s overall economic development plan. 

(5) INTEREST FROM FUND.—In the joint resolution of January 14, 1986 (Public 

Law 99–239) Congress provided that prior to and during the distribution of the 

corpus of the Fund pursuant to paragraphs (3) and (4) of this subsection, the 

people of Enjebi may, if they so request, receive the interest earned by the Fund 

on no less frequent a basis than quarterly. 

(6) DISCLAIMER OF LIABILITY.—In the joint resolution of January 14, 1986 

(Public Law 99–239) Congress provided that neither under the laws of the Marshall Islands nor under the laws of the United States, shall the Government 

of the United States be liable for any loss or damage to person or property in 

respect to the resettlement of Enjebi by the people of Enjebi, pursuant to the 

provision of this subsection or otherwise. 

(k) BIKINI ATOLL CLEANUP.—

(1) DECLARATION OF POLICY.—In the joint resolution of January 14, 1986 

(Public Law 99–239), the Congress determined and declared that it is the policy 

of the United States, to be supported by the full faith and credit of the United 

States, that because the United States, through its nuclear testing and other 

activities, rendered Bikini Atoll unsafe for habitation by the people of Bikini, 

the United States will fulfill its responsibility for restoring Bikini Atoll to habitability, as set forth in paragraph (2) and (3) of this subsection. 

(2) CLEANUP FUNDS.—The joint resolution of January 14, 1986 (Public Law 

99–239) authorized to be appropriated such sums as necessary to implement the 

settlement agreement of March 15, 1985, in The People of Bikini, et al. against 

United States of America, et al., Civ. No. 84–0425 (D. Ha.). 

(3) CONDITIONS OF FUNDING.—In the joint resolution of January 14, 1986 

(Public Law 99–239) the Congress provided that the funds referred to in paragraph (2) were to be made available pursuant to Article VI, Section 1 of the 

Compact Section 177 Agreement upon completion of the events set forth in the 

settlement agreement referred to in paragraph (2) of this subsection. 

(l) AGREEMENT ON AUDITS.—The Comptroller General (and his duly authorized 

representatives) shall have the authorities necessary to carry out his responsibilities 

under section 232 of the U.S.-RMI Compact and the agreement referred to in section 

462(b)(4) of the U.S.-RMI Compact, including the following authorities: 

(1) GENERAL AUTHORITY OF THE COMPTROLLER GENERAL TO AUDIT.—

(A) The Comptroller General of the United States (and his duly authorized representatives) shall have the authority to audit—

(i) all grants, program assistance, and other assistance provided to 

the Government of the Republic of the Marshall Islands under Articles 

I and II of Title Two of the U.S.-RMI Compact; and 

(ii) any other assistance provided by the Government of the United 

States to the Government of the Republic of the Marshall Islands. 

Such authority shall include authority for the Comptroller General to conduct or cause to be conducted any of the audits provided for in section 232 

of the U.S.-RMI Compact. The authority provided in this paragraph shall 

continue for at least three years after the last such grant has been made 

or assistance has been provided. 

(B) The Comptroller General (and his duly authorized representatives) 

shall also have authority to review any audit conducted by or on behalf of 

the Government of the United States. In this connection, the Comptroller 

General shall have access to such personnel and to such records, documents, working papers, automated data and files, and other information 

relevant to such review. 

(2) COMPTROLLER GENERAL ACCESS TO RECORDS.—

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(A) In carrying out paragraph (1), the Comptroller General (and his duly 

authorized representatives) shall have such access to the personnel and 

(without cost) to records, documents, working papers, automated data and 

files, and other information relevant to such audits. The Comptroller General may duplicate any such records, documents, working papers, automated data and files, or other information relevant to such audits. 

(B) Such records, documents, working papers, automated data and files, 

and other information regarding each such grant or other assistance shall 

be maintained for at least three years after the date such grant or assistance was provided and in a manner that permits such grants, assistance 

and payments to be accounted for distinct from any other funds of the Government of the Republic of the Marshall Islands. 

(3) STATUS OF COMPTROLLER GENERAL REPRESENTATIVES.—The Comptroller 

General and his duly authorized representatives shall be immune from civil and 

criminal process relating to words spoken or written and all acts performed by 

them in their official capacity and falling within their functions, except insofar 

as such immunity may be expressly waived by the Government of the United 

States. The Comptroller General and his duly authorized representatives shall 

not be liable to arrest or detention pending trial, except in the case of a grave 

crime and pursuant to a decision by a competent judicial authority, and such 

persons shall enjoy immunity from seizure of personal property, immigration restrictions, and laws relating to alien registration, fingerprinting, and the registration of foreign agents. Such persons shall enjoy the same taxation exemptions as are set forth in Article 34 of the Vienna Convention on Diplomatic Relations. The privileges, exemptions and immunities accorded under this paragraph are not for the personal benefit of the individuals concerned but are to 

safeguard the independent exercise of their official functions. Without prejudice 

to those privileges, exemptions and immunities, it is the duty of all such persons to respect the laws and regulations of the Government of the Republic of 

the Marshall Islands. 

(4) AUDITS DEFINED.—As used in this subsection, the term ‘‘audits’’ includes 

financial, program, and management audits, including determining— (A) whether the Government of the Republic of the Marshall Islands has 

met the requirements set forth in the U.S.-RMI Compact, or any related 

agreement entered into under the U.S.-RMI Compact, regarding the purposes for which such grants and other assistance are to be used; and 

(B) the propriety of the financial transactions of the Government of the 

Republic of the Marshall Islands pursuant to such grants or assistance. 

(5) COOPERATION BY THE REPUBLIC OF THE MARSHALL ISLANDS.—The Government of the Republic of the Marshall Islands will cooperate fully with the 

Comptroller General of the United States in the conduct of such audits as the 

Comptroller General determines necessary to enable the Comptroller General to 

fully discharge his responsibilities under this joint resolution. 

SEC. 104. INTERPRETATION OF AND UNITED STATES POLICY REGARDING U.S.-FSM COMPACT 

AND U.S.-RMI COMPACT. 

(a) HUMAN RIGHTS.—In approving the U.S.-FSM Compact and the U.S.-RMI Compact, the Congress notes the conclusion in the Statement of Intent of the Report of 

The Future Political Status Commission of the Congress of Micronesia in July, 1969, 

that ‘‘our recommendation of a free associated state is indissolubly linked to our desire for such a democratic, representative, constitutional government’’ and notes 

that such desire and intention are reaffirmed and embodied in the Constitutions of 

the Federated States of Micronesia and the Republic of the Marshall Islands. The 

Congress also notes and specifically endorses the preamble to the U.S.-FSM Compact and the U.S.-RMI Compact, which affirms that the governments of the parties 

to the U.S.-FSM Compact and the U.S.-RMI Compact are founded upon respect for 

human rights and fundamental freedoms for all. The Secretary of State shall include in the annual reports on the status of internationally recognized human rights 

in foreign countries, which are submitted to the Congress pursuant to sections 116 

and 502B of the Foreign Assistance Act of 1961 (22 U.S.C. 2151n, 2304), a full and 

complete report regarding the status of internationally recognized human rights in 

the Federated States of Micronesia and the Republic of the Marshall Islands. 

(b) IMMIGRATION AND PASSPORT SECURITY.—

(1) NATURALIZED CITIZENS.—The rights of a bona fide naturalized citizen of 

the Federated States of Micronesia or the Republic of the Marshall Islands to 

enter the United States, to lawfully engage therein in occupations, and to establish residence therein as a nonimmigrant, to the extent such rights are provided 

under section 141 of the U.S.-FSM Compact and U.S.-RMI Compact, shall not 

be deemed to extend to any such naturalized citizen with respect to whom circumstances associated with the acquisition of the status of a naturalized citizen 

13

are such as to allow a reasonable inference, on the part of appropriate officials 

of the United States and subject to United States procedural requirements, that 

such naturalized status was acquired primarily in order to obtain such rights. 

(2) PASSPORTS.—It is the intent of Congress that up to $250,000 of the grant 

assistance provided to the Federated States of Micronesia pursuant to section 

211(a)(4) of the U.S.-FSM Compact, and up to $250,000 of the grant assistance 

provided to the Republic of the Marshall Islands pursuant to section 211(a)(4) 

of the U.S.-RMI Compact (or a greater amount of the section 211(a)(4) grant, 

if mutually agreed between the Government of the United States and the government of the Federated States of Micronesia or the government of the Republic of the Marshall Islands), be used for the purpose of increasing the machinereadability and security of passports issued by such jurisdictions. It is the intent of Congress that funds be obligated by September 30, 2004 and in the 

amount and manner specified by the Secretary of State in consultation with the 

Secretary of Homeland Security and, respectively, with the government of the 

Federated States of Micronesia and the government of the Republic of the Marshall Islands. The United States Government is authorized to require that passports used for the purpose of seeking admission under section 141 of the U.S.-

FSM Compact and the U.S.-RMI Compact contain the security enhancements 

funded by such assistance. 

(3) INFORMATION-SHARING.—It is the intent of Congress that the governments 

of the Federated States of Micronesia and the Republic of the Marshall Islands 

develop, prior to October 1, 2004, the capability to provide reliable and timely 

information as may reasonably be required by the Government of the United 

States in enforcing criminal and security-related grounds of inadmissibility and 

deportability under the Immigration and Nationality Act, as amended, and shall 

provide such information to the Government of the United States. 

(4) TRANSITION; CONSTRUCTION OF SECTIONS 141(A)(3) AND 141(A)(4) OF THE U.S.-

FSM COMPACT AND U.S.-RMI COMPACT.—The words ‘‘the effective date of this 

Compact, as amended’’ in sections 141(a)(3) and 141(a)(4) of the U.S.-FSM Compact and the U.S.-RMI Compact shall be construed to read, ‘‘on the day prior 

to the enactment by the United States Congress of the Amended Compact Act.’’. 

(c) NONALIENATION OF LANDS.—The Congress endorses and encourages the maintenance of the policies of the Government of the Federated States of Micronesia and 

the Government of the Republic of the Marshall Islands to regulate, in accordance 

with their Constitutions and laws, the alienation of permanent interests in real 

property so as to restrict the acquisition of such interests to persons of Federated 

States of Micronesia citizenship and the Republic of the Marshall Islands citizenship, respectively.

(d) NUCLEAR WASTE DISPOSAL.—In approving the U.S.-FSM Compact and the 

U.S.-RMI Compact, the Congress understands that the Government of the Federated States of Micronesia and the Government of the Republic of the Marshall Islands will not permit any other government or any nongovernmental party to conduct, in the Republic of the Marshall Islands or in the Federated States of Micronesia, any of the activities specified in subsection (a) of section 314 of the U.S.-FSM 

Compact and the U.S.-RMI Compact.

(e) IMPACT OF COMPACTS ON GUAM, THE STATE OF HAWAII, THE COMMONWEALTH

OF THE NORTHERN MARIANA ISLANDS, AND AMERICAN SAMOA; RELATED AUTHORIZATION AND CONTINUING APPROPRIATION.—

(1) RECONCILIATION OF UNREIMBURSED IMPACT EXPENSES.—

(A) IN GENERAL.—Notwithstanding any other provision of law, the President, to address previously accrued and unreimbursed impact expenses, 

may at the request of the Governor of Guam or the Governor of the Commonwealth of the Northern Mariana Islands, reduce, release, or waive all 

or part of any amounts owed by the Government of Guam or the Government of the Commonwealth of the Northern Mariana Islands (or either government’s autonomous agencies or instrumentalities), respectively, to any 

department, agency, independent agency, office, or instrumentality of the 

United States. 

(B) TERMS AND CONDITIONS.—

(i) SUBSTANTIATION OF IMPACT COSTS.—Not later than 120 days after 

the date of the enactment of this resolution, the Governor of Guam and 

the Governor of the Commonwealth of the Northern Mariana Islands 

shall each submit to the Secretary of the Interior a report, prepared in 

consultation with an independent accounting firm, substantiating unreimbursed impact expenses claimed for the period from January 14, 

1986, through September 30, 2003. Upon request of the Secretary of 

the Interior, the Governor of Guam and the Governor of the Commonwealth of the Northern Mariana Islands shall each submit to the SecVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00013 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
14

retary of the Interior copies of all documents upon which the report 

submitted by that Governor under this clause was based. 

(ii) CONGRESSIONAL NOTIFICATION.—The President shall notify Congress of his intent to exercise the authority granted in subparagraph 

(A). 

(iii) CONGRESSIONAL REVIEW AND COMMENT.— Any reduction, release, 

or waiver under this Act shall not take effect until 60 days after the 

President notifies Congress of his intent to approve a request of the 

Governor of Guam or the Governor of the Commonwealth of the Northern Mariana Islands. In exercising his authority under this section and 

in determining whether to give final approval to a request, the President shall take into consideration comments he may receive after Congressional review. 

(iv) EXPIRATION.—The authority granted in subparagraph (A) shall 

expire on February 28, 2005. 

(2) STATEMENT OF CONGRESSIONAL INTENT.—In approving the Compacts, it is 

not the intent of the Congress to cause any adverse consequences for Guam, the 

State of Hawaii, the Commonwealth of the Northern Mariana Islands, and 

American Samoa. 

(3) ANNUAL REPORTS AND RECOMMENDATIONS.—One year after the date of enactment of this joint resolution, and at one year intervals thereafter, the Governors of Guam, the State of Hawaii, the Commonwealth of the Northern Mariana Islands, and American Samoa may provide to the Secretary of the Interior 

by February 1 of each year their comments with respect to the impacts of the 

Compacts on their respective jurisdiction. The Secretary of the Interior, upon 

receipt of any such comments, shall report to the Congress not later than May 

1 of each year to include the following: 

(A) The Governor’s comments on the impacts of the Compacts as well as 

the Administration’s analysis of such impact. 

(B) Any adverse consequences resulting from the Compacts and recommendations for corrective action to eliminate those consequences. 

(C) Matters relating to trade, taxation, immigration, labor laws, minimum wages, health, educational, social, and public safety services and infrastructure, and environmental regulation. 

(D) With regard to immigration, statistics concerning the number of persons availing themselves of the rights described in section 141(a) of the 

Compact during the year covered by each report. 

(E) With regard to trade, the reports shall include an analysis of the impact on the economy of American Samoa resulting from imports of canned 

tuna into the United States from the Federated States of Micronesia, and 

the Republic of the Marshall Islands. 

(4) COMMITMENT OF CONGRESS TO REDRESS ADVERSE CONSEQUENCES.—The 

Congress hereby declares that, if any adverse consequences to Guam, the State 

of Hawaii, the Commonwealth of the Northern Mariana Islands, or American 

Samoa result from implementation of the Compacts, the Congress will act sympathetically and expeditiously to redress those adverse consequences. 

(5) QUALIFIED NONIMMIGRANT.—For the purposes of this section, the term 

‘‘qualified nonimmigrant’’ means person admitted to the United States pursuant 

to: 

(A) section 141 of the Compact of Free Association between the United 

States and the Government of the Federated States of Micronesia set forth 

in Title I; 

(B) section 141 of the Compact of Free Association between the United 

States and the Government of the Republic of the Marshall Islands set 

forth in Title I; or 

(C) section 141 of the Compact of Free Association between the United 

States and the Government of the Republic of Palau. 

(6) AUTHORIZATION AND CONTINUING APPROPRIATION.—There are hereby authorized and appropriated to the Secretary of the Interior, for each fiscal year 

beginning after September 30, 2003 through 2023, $30,000,000 for grants to the 

governments of Guam, the State of Hawaii, the Commonwealth of the Northern 

Mariana Islands, and American Samoa as a result of increased demands placed 

on educational, social, or public safety services or infrastructure related to such 

services due to the presence in Guam, the State of Hawaii, the Commonwealth 

of the Northern Mariana Islands, or American Samoa of qualified nonimmigrants from the Federated States of Micronesia, the Republic of the Marshall Islands, or the Republic of Palau. 

(A) AWARDING.—The grants shall be—

15

(i) awarded and administered by the Department of the Interior, Office of Insular Affairs, or any successor thereto, in accordance with regulations, policies and procedures applicable to grants so awarded and 

administered; and 

(ii) used only for health, educational, social, or public safety services, 

or infrastructure related to such services, specifically affected by qualified nonimmigrants. 

(B) ENUMERATION.—For purposes of carrying out this section, the Secretary of the Interior shall provide for a periodic census of qualified nonimmigrants in Guam, the State of Hawaii, the Commonwealth of the Northern Mariana Islands, and American Samoa. The enumeration— (i) shall be provided by the Secretary of the Interior beginning in fiscal year 2004 and thereafter in calendar years 2005, 2010, 2015, and 

2020; 

(ii) shall be supervised by the United States Bureau of the Census 

and any other supporting organization(s) as the Secretary of the Interior may select; and 

(iii) after fiscal year 2003, shall be funded by the Secretary of the Interior by deducting such sums as are necessary from funds appropriated pursuant to the authorization contained in paragraph (6) of this 

subsection. 

(C) ALLOCATION.—The Secretary of the Interior shall allocate to each of 

the governments of Guam, the State of Hawaii, the Commonwealth of the 

Northern Mariana Islands, and American Samoa, on the basis of the results 

of the most recent enumeration, grants in an aggregate amount equal to the 

total amount of funds appropriated under paragraph (6) of this subsection, 

as reduced by any deductions authorized by subparagraph (iii) of subparagraph (B) of paragraph (6) of this subsection, multiplied by a ratio derived 

by dividing the number of qualified nonimmigrants in such affected jurisdiction by the total number of qualified nonimmigrants in the governments 

of Guam, the Commonwealth of the Northern Mariana Islands, and American Samoa. 

(7) AUTHORIZATION OF APPROPRIATIONS FOR GRANTS.—There are hereby authorized to the Secretary of the Interior for each of fiscal years 2004 through 

2023 such sums as may be necessary for grants to the governments of Guam, 

the State of Hawaii, the Commonwealth of the Northern Mariana Islands, and 

American Samoa, as a result of increased demands placed on educational, social, or public safety services or infrastructure related to service due to the presence in Guam, Hawaii, the Commonwealth of the Northern Mariana Islands, 

and American Samoa of qualified nonimmigrants from the Federated States of 

Micronesia, the Republic of the Marshall Islands, and the Republic of Palau. 

(8) AUTHORIZATION OF APPROPRIATIONS FOR THE REIMBURSEMENT OF HEALTH

CARE SERVICES.—

(A) AUTHORIZATION.—In addition to amounts appropriated pursuant to 

the authorization provided in section 221(b) of Article II of Title Two of the 

U.S.-FSM Compact and the U.S.-RMI Compact, there are hereby authorized 

to be appropriated to the Secretary of the Interior such sums as may be 

necessary to reimburse designated health care providers for qualifying 

health care costs for medical debt referral claims for health care services 

furnished before October 1, 2003. 

(B) DESIGNATED HEALTH CARE PROVIDERS.—For purposes of subparagraph 

(A), the term ‘‘designated health care provider’’ means an institutional provider of health care services (such as a public or private hospital) located 

in Hawaii, Guam, the Commonwealth of the Northern Mariana Islands, or 

American Samoa. 

(C) QUALIFYING HEALTH CARE COSTS.—For purposes of subparagraph (A), 

the term ‘‘qualifying health care costs’’ means costs that the Secretary determines are incurred by a designated health care provider for health care 

services furnished in Hawaii, Guam, the Commonwealth of the Northern 

Mariana Islands, and American Samoa (as the case may be) to a citizen of 

the Republic of the Marshall Islands, the Federated States of Micronesia, 

or the Republic of Palau pursuant to medical referral programs in the Federated States of Micronesia and the Republic of the Marshall Islands. 

(9) USE OF DOD MEDICAL FACILITIES AND NATIONAL HEALTH SERVICE CORPS.—

(A) DOD MEDICAL FACILITIES.—The Secretary of Defense shall make 

available, on a space available and reimbursable basis, the medical facilities 

of the Department of Defense for use by citizens of the Federated States 

of Micronesia, the Republic of the Marshall Islands, and the Republic of 

Palau who are properly referred to the facilities by government authorities 

16

responsible for provision of medical services in the Federated States of Micronesia, the Republic of the Marshall Islands, the Republic of Palau and 

the affected jurisdictions. 

(B) NATIONAL HEALTH SERVICE CORPS.—The Secretary of Health and 

Human Services shall continue to make the services of the National Health 

Service Corps available to the residents of the Federated States of Micronesia and the Republic of the Marshall Islands to the same extent and for 

so long as such services are authorized to be provided to persons residing 

in any other areas within or outside the United States. 

(C) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this paragraph such sums as are necessary for each 

fiscal year. 

(f) SENSE OF CONGRESS CONCERNING FUNDING OF PUBLIC INFRASTRUCTURE.—It is 

the sense of Congress that— (1) not less than 30 percent of the United States annual grant assistance provided under section 211 of the Compact of Free Association, as amended, between the Government of the United States of America and the Government of 

the Federated States of Micronesia, and not less than 30 percent of the total 

amount of section 211 funds allocated to each of the states of the Federated 

States of Micronesia, shall be invested in infrastructure improvements in accordance with the list of specific projects included in the plan described in section 211(a)(6)(i) and for maintenance in accordance with section 211(a)(6)(ii); 

and 

(2) not less than 30 percent of the United States annual grant assistance provided under section 211 of the Compact of Free Association, as amended, between the Government of the United States of America and the Government of 

the Republic of the Marshall Islands, shall be used for infrastructure improvement and maintenance in accordance with section 211(d). 

(g) FOREIGN LOANS.—The Congress hereby reaffirms the United States position 

that the United States Government is not responsible for foreign loans or debt obtained by the Governments of the Federated States of Micronesia and the Republic 

of the Marshall Islands. 

(h) REPORTS AND REVIEWS.—

(1) REPORT BY THE PRESIDENT.—Not later than the end of the first full calendar year following enactment of this resolution, and not later than December 

31 of each year thereafter, the President shall submit a report to Congress regarding the Federated States of Micronesia and the Republic of the Marshall 

Islands. The report shall include, at a minimum, the following with regard to: 

(A) General social, political, and economic conditions, including estimates 

of economic growth, per capita income, and migration rates. 

(B) The use and effectiveness of United States financial and program assistance. 

(C) The status of economic policy reforms in the Federated States of Micronesia and the Republic of the Marshall Islands. 

(D) The status of the efforts by the Federated States of Micronesia and 

the Republic of the Marshall Islands to attract foreign investment and to 

increase indigenous business activity. 

(E) Recommendations on ways to increase the effectiveness of United 

States assistance. 

(2) REVIEW.—During the year of the fifth and fifteenth anniversaries of the 

date of enactment of this resolution, the Government of the United States and 

the Government of the Federated States of Micronesia, and the Government of 

the Republic of the Marshall Islands, shall formally review the terms of their 

respective Compacts and shall consider the overall nature and development of 

their relationship. In these formal reviews, the governments shall consider the 

operating requirements of the Government of the Federated States of Micronesia and the Government of the Republic of the Marshall Islands and their 

progress in meeting the development objectives set forth in their respective development plans. The governments may agree to commit themselves to take 

specific measures in response to the findings resulting from the reviews. The 

President shall include the findings resulting from the reviews, and any recommendations for actions to respond to such findings, in the annual reports to 

Congress for the years following the reviews. 

(3) BY THE COMPTROLLER GENERAL.—Not later than the date that is 3 years 

after the date of enactment of this joint resolution, and every 5 years thereafter, 

the Comptroller General of the United States shall submit to Congress a report 

on the Federated States of Micronesia and the Republic of the Marshall Islands, 

including the topics set forth in paragraph (1) and the effectiveness of administrative oversight by the United States. 

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(i) CONSTRUCTION OF SECTION 141(f).—Section 141(f)(2) of the Compact of Free Association between the Government of the United States of America and the Government of the Federated States of Micronesia and of the Compact of Free Association 

between the Government of the United States of America and the Government of 

the Republic of the Marshall Islands, shall be construed as though ‘‘, except that 

any such regulations that would have a significant effect on the admission, stay and 

employment privileges provided under this section shall not become effective until 

90 days after the date of transmission of the regulations to the Committee on Energy and Natural Resources and the Committee on the Judiciary of the Senate and 

the Committee on Resources, the Committee on International Relations, and the 

Committee on the Judiciary of the House of Representatives’’ was inserted after 

‘‘may by regulations prescribe’’. 

SEC. 105. SUPPLEMENTAL PROVISIONS. 

(a) DOMESTIC PROGRAM REQUIREMENTS.—Except as may otherwise be provided in 

this joint resolution, all United States Federal programs and services extended to 

or operated in the Federated States of Micronesia or the Republic of the Marshall 

Islands are and shall remain subject to all applicable criteria, standards, reporting 

requirements, auditing procedures, and other rules and regulations applicable to 

such programs when operating in the United States (including its territories and 

commonwealths). 

(b) RELATIONS WITH THE FEDERATED STATES OF MICRONESIA AND THE REPUBLIC

OF THE MARSHALL ISLANDS.—

(1) Appropriations made pursuant to Article I of Title Two and subsection 

(a)(2) of section 221 of Article II of Title Two of the U.S.-FSM Compact and the 

U.S.-RMI Compact shall be made to the Secretary of the Interior, who shall 

have the authority necessary to fulfill his responsibilities for monitoring and 

managing the funds so appropriated consistent with the U.S.-FSM Compact and 

the U.S.-RMI Compact, including the agreements referred to in section 462(b)(4) 

of the U.S.-FSM Compact and U.S.-RMI Compact (relating to Fiscal Procedures) 

and the agreements referred to in section 462(b)(5) of the U.S.-FSM Compact 

and the U.S.-RMI Compact (regarding the Trust Fund). 

(2) Appropriations made pursuant to subsections (a)(1) and (a)(3) through (6) 

of section 221 of Article II of Title Two of the U.S.-FSM Compact and subsection 

(a)(1) and (a)(3) through (5) of the U.S.-RMI Compact shall be made directly to 

the agencies named in those subsections. 

(3) Appropriations for services and programs referred to in subsection (b) of 

section 221 of Article II of Title Two of the U.S.-FSM Compact or U.S.-RMI 

Compact and appropriations for services and programs referred to in sections 

105(f) and 108(a) of this joint resolution shall be made to the relevant agencies 

in accordance with the terms of the appropriations for such services and programs. 

(4) Federal agencies providing programs and services to the Federated States 

of Micronesia and the Republic of the Marshall Islands shall coordinate with 

the Secretaries of the Interior and State regarding provision of such programs 

and services. The Secretaries of the Interior and State shall consult with appropriate officials of the Asian Development Bank and with the Secretary of the 

Treasury regarding overall economic conditions in the Federated States of Micronesia and the Republic of the Marshall Islands and regarding the activities 

of other donors of assistance to the Federated States of Micronesia and the Republic of the Marshall Islands. 

(5) United States Government employees in either the Federated States of Micronesia or the Republic of the Marshall Islands are subject to the authority of 

the United States Chief of Mission, including as elaborated in section 207 of the 

Foreign Service Act and the President’s Letter of Instruction to the United 

States Chief of Mission and any order or directive of the President in effect from 

time to time. 

(6)(A) The President is hereby authorized to appoint an Interagency Group on 

Freely Associated States’ Affairs to provide policy guidance and recommendations on implementation of the U.S.-FSM Compact and the U.S.-RMI Compact 

to Federal departments and agencies. 

(B) It is the sense of Congress that the Secretary of State, the Secretary of 

Interior, and the Secretary of the Treasury should be represented on the Interagency Group. 

(7)(A)(i) The three United States appointees (United States chair plus two 

members) to the Joint Economic Management Committee provided for in section 

213 of the U.S.-FSM Compact and Article III of the U.S.-FSM Fiscal Procedures 

Agreement referred to in section 462(b)(4) of the U.S.-FSM Compact shall be 

United States Government officers or employees. 

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(ii) It is the sense of Congress that the appointees should be designated from 

the Department of State, the Department of the Interior, and the Department 

of the Treasury. 

(iii) Section 213 of the U.S.-FSM Compact shall be construed to read as 

though the phrase, ‘‘and on the implementation of economic policy reforms designed to encourage private sector investment,’’ were inserted after ‘‘with particular focus on those parts of the plan dealing with the sectors identified in 

subsection (a) of section 211’’. (B)(i) The three United States appointees (United States chair plus two members) to the Joint Economic Management and Financial Accountability Committee provided for in section 214 of the U.S.-RMI Compact and Article III of 

the U.S.-RMI Fiscal Procedures Agreement referred to in section 462(b)(4) of the 

U.S.-RMI Compact shall be United States Government officers or employees. 

(ii) It is the sense of Congress that the appointees should be designated from 

the Department of State, the Department of the Interior, and the Department 

of the Treasury. 

(iii) Section 214 of the U.S.-RMI Compact shall be construed to read as 

though the phrase, ‘‘and on the implementation of economic policy reforms designed to encourage private sector investment,’’ were inserted after ‘‘with particular focus on those parts of the framework dealing with the sectors and areas 

identified in subsection (a) of section 211’’. 

(8) It is the sense of Congress that the Secretary of State and the Secretary 

of the Interior shall assure that there are personnel resources committed in the 

appropriate numbers and locations to ensure effective oversight of United States 

financial and program assistance. 

(9) The United States voting members (United States chair plus two or more 

members) of the Trust Fund Committee appointed by the Government of the 

United States pursuant to Article 7 of the Trust Fund Agreement implementing 

section 215 of the U.S.-FSM Compact and referred to in section 462(b)(5) of the 

U.S.-FSM Compact and any alternates designated by the Government of the 

United States shall be United States Government officers or employees. The 

United States voting members (United States chair plus two or more members) 

of the Trust Fund Committee appointed by the Government of the United 

States pursuant to Article 7 of the Trust Fund Agreement implementing section 

216 of the U.S.-RMI Compact and referred to in section 462(b)(5) of the U.S.-

RMI Compact and any alternates designated by the Government of the United 

States shall be United States Government officers or employees. It is the sense 

of Congress that the appointees should be designated from the Department of 

State, the Department of the Interior, and the Department of the Treasury. 

(10) The Trust Fund Committee provided for in Article 7 of the U.S.-FSM 

Trust Fund Agreement implementing section 215 of the U.S.-FSM Compact 

shall be a non-profit corporation incorporated under the laws of the District of 

Columbia. To the extent that any law, rule, regulation or ordinance of the District of Columbia, or of any State or political subdivision thereof in which the 

Trust Fund Committee is incorporated or doing business, impedes or otherwise 

interferes with the performance of the functions of the Trust Fund Committee 

pursuant to this joint resolution, such law, rule, regulation, or ordinance shall 

be deemed to be preempted by this joint resolution. The Trust Fund Committee 

provided for in Article 7 of the U.S.-RMI Trust Fund Agreement implementing 

section 216 of the U.S.-RMI Compact shall be a non-profit corporation incorporated under the laws of the District of Columbia. To the extent that any law, 

rule, regulation or ordinance of the District of Columbia, or of any State or political subdivision thereof in which the Trust Fund Committee is incorporated 

or doing business, impedes or otherwise interferes with the performance of the 

functions of the Trust Fund Committee pursuant to this joint resolution, such 

law, rule, regulation, or ordinance shall be deemed to be preempted by this joint 

resolution. 

(c) JUDICIAL TRAINING.—(1) In addition to amounts provided under section 

211(a)(4) of the U.S.-FSM Compact and the U.S.-RMI Compact, the President shall 

annually provide $250,000 to the Government of the Federated States of Micronesia 

and $50,000 to the Government of the Republic of the Marshall Islands to provide 

training for judges and officials of the judiciary. 

(2) There is hereby authorized and appropriated to the Secretary of the Interior, 

out of any funds in the Treasury not otherwise appropriated, to remain available 

until expended, for each fiscal year from 2004 through 2023, $300,000, as adjusted 

for inflation under section 217 of the U.S.-FSM Compact and section 218 of the U.S.-

RMI Compact, to carry out the purposes of this section. 

(d) CONTINUING TRUST TERRITORY AUTHORIZATION.—The authorization provided 

by the Act of June 30, 1954, as amended (68 Stat. 330) shall remain available after 

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the effective date of the Compact with respect to the Federated States of Micronesia 

and the Republic of the Marshall Islands for the following purposes: 

(1) Prior to October 1, 1986, for any purpose authorized by the Compact or 

the joint resolution of January 14, 1986 (Public Law 99–239). 

(2) Transition purposes, including but not limited to, completion of projects 

and fulfillment of commitments or obligations; termination of the Trust Territory Government and termination of the High Court; health and education as 

a result of exceptional circumstances; ex gratia contributions for the populations 

of Bikini, Enewetak, Rongelap, and Utrik; and technical assistance and training 

in financial management, program administration, and maintenance of infrastructure, except that, for purposes of an orderly reduction of United States programs and services in the Federated States of Micronesia, the Marshall Islands, 

and the Republic of Palau, United States programs or services not specifically 

authorized by the Compact of Free Association or by other provisions of law 

may continue but, unless reimbursed by the respective freely associated state, 

not in excess of the following amounts: 

(A) For fiscal year 1987, an amount not to exceed 75 per centum of the 

total amount appropriated for such programs for fiscal year 1986. 

(B) For fiscal year 1988, an amount not to exceed 50 per centum of the 

total amount appropriated for such programs for fiscal year 1986. 

(C) For fiscal year 1989, an amount not to exceed 25 per centum of the 

total amount appropriated for such programs for fiscal year 1986. 

(e) SURVIVABILITY.—In furtherance of the provisions of Title Four, Article V, sections 452 and 453 of the U.S.-FSM Compact and the U.S.-RMI Compact, any provisions of the U.S.-FSM Compact or the U.S.-RMI Compact which remain effective 

after the termination of the U.S.-FSM Compact or U.S.-RMI Compact by the act of 

any party thereto and which are affected in any manner by provisions of this title 

shall remain subject to such provisions.

(f) NONCOMPLIANCE SANCTIONS; ACTIONS INCOMPATIBLE WITH UNITED STATES AUTHORITY.—The Congress expresses its understanding that the Governments of the 

Federated States of Micronesia and the Republic of the Marshall Islands will not 

act in a manner incompatible with the authority and responsibility of the United 

States for security and defense matters in or related to the Federated States of Micronesia or the Republic of the Marshall Islands pursuant to the U.S.-FSM Compact 

or the U.S.-RMI Compact, including the agreements referred to in sections 462(a)(2) 

of the U.S.-FSM Compact and 462(a)(5) of the U.S.-RMI Compact. The Congress further expresses its intention that any such act on the part of either such Government 

will be viewed by the United States as a material breach of the U.S.-FSM Compact 

or U.S.-RMI Compact. The Government of the United States reserves the right in 

the event of such a material breach of the U.S.-FSM Compact by the Government 

of the Federated States of Micronesia or the U.S.-RMI Compact by the Government 

of the Republic of the Marshall Islands to take action, including (but not limited 

to) the suspension in whole or in part of the obligations of the Government of the 

United States to that Government. 

(g) CONTINUING PROGRAMS AND LAWS.—

(1) FEDERATED STATES OF MICRONESIA AND REPUBLIC OF THE MARSHALL ISLANDS.—In addition to the programs and services set forth in section 221 of the 

Compact, and pursuant to section 222 of the Compact, the programs and services of the following agencies shall be made available to the Federated States 

of Micronesia and to the Republic of the Marshall Islands: 

(A) The Government of the United States shall continue to make available to eligible institutions in the Federated States of Micronesia and the 

Republic of the Marshall Islands, and to students enrolled in such eligible 

institutions and in institutions in the United States and its territories, for 

fiscal years 2004 through 2023, grants under subpart 1 of part A of title 

IV of the Higher Education Act of 1965 (20 U.S.C. 1070a et seq.) on the 

same basis that such grants continue to be available to institutions and students in the United States. 

(B) Except as provided in clause (i), for fiscal years 2004 through 2023, 

the Governments of the Federated States of Micronesia and the Republic 

of the Marshall Islands shall not receive grants under any formula-grant 

program administered by the Secretary of Education. In place of such 

grants, the Government of the Federated States of Micronesia shall receive, 

as a supplement to the education sector grant under section 211(a)(1), 

$20,018,514 annually and the Government of the Republic of the Marshall 

Islands shall receive, as a supplement to the education sector grant under 

section 211(a)(1), $9,405,335 annually. Both of these supplemental amounts 

shall be adjusted for inflation under section 217 of the U.S.-FSM Compact 

and section 218 of the U.S.-RMI Compact. 

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(C) The Governments of the Federated States of Micronesia and the Republic of the Marshall Islands shall continue to be eligible for competitive 

grants administered by the Secretary of Education to the extent that such 

grants continue to be available to State and local governments in the 

United States. 

(D) The Federal Emergency Management Agency, in the following manner: Paragraph (6) of section 221(a) of the U.S.-FSM Compact and paragraph (5) of section 221(a) of the U.S.-RMI Compact shall each be construed 

and applied as if each provision reads as follows: ‘‘The Department of 

Homeland Security, Federal Emergency Management Agency disaster assistance programs and public assistance programs for public and private 

non-profit infrastructure and programs provided by the United States Agency for International Development, Office of Foreign Disaster Assistance, at 

levels equivalent to those available on the day preceding the effective date 

of the Compacts, to remain available until the later of— (i) the 10-year period beginning on the date of enactment of the Compacts; or 

(ii) the date on which the Disaster Assistance Emergency Fund referred to in section 211(d) of the U.S.-FSM Compact and section 211(e) 

of the U.S.-RMI Compact attains a balance of $4,000,000. 

(E) The Legal Services Corporation. 

(F) The Public Health Service. 

(G) The Rural Housing Service (formerly, the Farmers Home Administration) in the Marshall Islands and each of the four States of the Federated 

States of Micronesia. In lieu of continuation of the program in the Federated States of Micronesia, the President may agree to transfer to the Government of the Federated States of Micronesia without cost, the portfolio 

of the Rural Housing Service applicable to the Federated States of Micronesia and provide such technical assistance in management of the portfolio 

as may be requested by the Federated States of Micronesia. 

(2) TORT CLAIMS.—The provisions of section 178 of the U.S.-FSM Compact and 

the U.S.-RMI Compact regarding settlement and payment of tort claims shall 

apply to employees of any Federal agency of the Government of the United 

States (and to any other person employed on behalf of any Federal agency of 

the Government of the United States on the basis of a contractual, cooperative, 

or similar agreement) which provides any service or carries out any other function pursuant to or in furtherance of any provisions of the U.S.-FSM Compact 

or the U.S.-RMI Compact or this joint resolution, except for provisions of Title 

Three of the Compact and of the subsidiary agreements related to such Title, 

in such area to which such Agreement formerly applied. 

(3) PCB CLEANUP.—The programs and services of the Environmental Protection Agency regarding PCBs shall, to the extent applicable, as appropriate, and 

in accordance with applicable law, be construed to be made available to such 

islands. 

(h) COLLEGE OF MICRONESIA.—Until otherwise provided by Act of Congress, or 

until termination of the U.S.-FSM Compact and the U.S.-RMI Compact, the College 

of Micronesia shall retain its status as a land-grant institution and its eligibility for 

all benefits and programs available to such land-grant institutions. 

(i) TRUST TERRITORY DEBTS TO U.S. FEDERAL AGENCIES.—Neither the Government of the Federated States of Micronesia nor the Government of the Marshall Islands shall be required to pay to any department, agency, independent agency, office, or instrumentality of the United States any amounts owed to such department, 

agency, independent agency, office, or instrumentality by the Government of the 

Trust Territory of the Pacific Islands as of the effective date of the Compact. There 

is authorized to be appropriated such sums as may be necessary to carry out the 

purposes of this subsection. 

(j) TECHNICAL ASSISTANCE.—Technical assistance may be provided pursuant to 

section 224 of the U.S.-FSM Compact or the U.S.-RMI Compact by Federal agencies 

and institutions of the Government of the United States to the extent such assistance may be provided to States, territories, or units of local government. Such assistance by the Forest Service, the Natural Resources Conservation Service, (acting 

through the Resource Convservation and Development Program) the USDA Resource Conservation and Development Program, the Fish and Wildlife Service, the 

National Marine Fisheries Service, the United States Coast Guard, and the Advisory Council on Historic Preservation, the Department of the Interior, and other 

agencies providing assistance under the National Historic Preservation Act (80 Stat. 

915; 16 U.S.C. 470–470t), shall be on a nonreimbursable basis. During the period 

the U.S.-FSM Compact and the U.S.-RMI Compact are in effect, the grant programs 

under the National Historic Preservation Act shall continue to apply to the FedVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00020 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
21

erated States of Micronesia and the Republic of the Marshall Islands in the same 

manner and to the same extent as prior to the approval of the Compact. Any funds 

provided pursuant to sections 102(a), 103(a), 103(b), 103(f), 103(g), 103(h), 103(j), 

105(c), 105(g), 105(h), 105(i), 105(j), 105(k), 105(l), and 105(m) of this joint resolution 

shall be in addition to and not charged against any amounts to be paid to either 

the Federated States of Micronesia or the Republic of the Marshall Islands pursuant 

to the U.S.-FSM Compact, the U.S.-RMI Compact, or their related subsidiary agreements. 

(k) PRIOR SERVICE BENEFITS PROGRAM.—Notwithstanding any other provision of 

law, persons who on January 1, 1985, were eligible to receive payment under the 

Prior Service Benefits Program established within the Social Security System of the 

Trust Territory of the Pacific Islands because of their services performed for the 

United States Navy or the Government of the Trust Territory of the Pacific Islands 

prior to July 1, 1968, shall continue to receive such payments on and after the effective date of the Compact. 

(l) INDEFINITE LAND USE PAYMENTS.—There are authorized to be appropriated 

such sums as may be necessary to complete repayment by the United States of any 

debts owed for the use of various lands in the Federated States of Micronesia and 

the Marshall Islands prior to January 1, 1985. 

(m) COMMUNICABLE DISEASE CONTROL PROGRAM.—There are authorized to be appropriated for grants to the Government of the Federated States of Micronesia and 

the Government of the Republic of the Marshall Islands, such sums as may be necessary for purposes of establishing or continuing programs for the control and prevention of communicable diseases, including (but not limited to) cholera and Hansen’s Disease. The Secretary of the Interior shall assist the Government of the Federated States of Micronesia and the Government of the Republic of the Marshall Islands in designing and implementing such a program. 

(n) USER FEES.—Any person in the Federated States of Micronesia or the Republic 

of the Marshall Islands shall be liable for user fees, if any, for services provided in 

the Federated States of Micronesia or the Republic of the Marshall Islands by the 

Government of the United States to the same extent as any person in the United 

States would be liable for fees, if any, for such services in the United States. 

(o) TREATMENT OF JUDGMENTS OF COURTS OF THE FEDERATED STATES OF MICRONESIA, THE REPUBLIC OF THE MARSHALL ISLANDS, AND THE REPUBLIC OF PALAU.—

No judgment, whenever issued, of a court of the Federated States of Micronesia, the 

Republic of the Marshall Islands, or the Republic of Palau, against the United 

States, its departments and agencies, or officials of the United States or any other 

individuals acting on behalf of the United States within the scope of their official 

duty, shall be honored by the United States, or be subject to recognition or enforcement in a court in the United States, unless the judgment is consistent with the 

interpretation by the United States of international agreements relevant to the 

judgment. In determining the consistency of a judgment with an international 

agreement, due regard shall be given to assurances made by the Executive Branch 

to the Congress of the United States regarding the proper interpretation of the 

international agreement. 

(p) INFLATION ADJUSTMENT.—As of Fiscal Year 2015, if United States Gross Domestic Product Implicit Price Deflator average for Fiscal Years 2009 through 2014 

is greater than the United States Gross Domestic Product Implicit Price Deflator 

average for Fiscal Years 2004 through 2008 (as reported in the Survey of Current 

Business or subsequent publication and compiled by the Department of Interior), 

then section 217 of the U.S.–FSM Compact and paragraph 5 of Article II of the 

U.S.–FSM Fiscal Procedures Agreement and section 218 of the U.S.–RMI Compact 

and paragraph 5 of Article II of the U.S.–RMI Fiscal Procedures Agreement shall 

be construed as if ‘‘the full’’ appeared in place of ‘‘two-thirds of the’’ each place those 

words appear. 

SEC. 106. CONSTRUCTION CONTRACT ASSISTANCE. 

(a) ASSISTANCE TO U.S. FIRMS.—In order to assist the Governments of the Federated States of Micronesia and of the Republic of the Marshall Islands through private sector firms which may be awarded contracts for construction or major repair 

of capital infrastructure within the Federated States of Micronesia or the Republic 

of the Marshall Islands, the United States shall consult with the Governments of 

the Federated States of Micronesia and the Republic of the Marshall Islands with 

respect to any such contracts, and the United States shall enter into agreements 

with such firms whereby such firms will, consistent with applicable requirements 

of such Governments—

(1) to the maximum extent possible, employ citizens of the Federated States 

of Micronesia and the Republic of the Marshall Islands; 

22

(2) to the extent that necessary skills are not possessed by citizens of the Federated States of Micronesia and the Republic of the Marshall Islands, provide 

on the job training, with particular emphasis on the development of skills relating to operation of machinery and routine and preventative maintenance of machinery and other facilities; and 

(3) provide specific training or other assistance in order to enable the Government to engage in long-term maintenance of infrastructure. 

Assistance by such firms pursuant to this section may not exceed 20 percent of the 

amount of the contract and shall be made available only to such firms which meet 

the definition of United States firm under the nationality rule for suppliers of services of the Agency for International Development (hereafter in this section referred 

to as ‘‘United States firms’’). There are authorized to be appropriated such sums as 

may be necessary for the purposes of this subsection. 

(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated 

such sums as may be necessary to cover any additional costs incurred by the Government of the Federated States of Micronesia or the Republic of the Marshall Islands if such Governments, pursuant to an agreement entered into with the United 

States, apply a preference on the award of contracts to United States firms, provided that the amount of such preference does not exceed 10 percent of the amount 

of the lowest qualified bid from a non-United States firm for such contract. 

SEC. 107. PROHIBITION. 

The provisions of chapter 11 of title 18, United States Code, shall apply in full 

to any individual who has served as the United States negotiator of amendments 

to the Compact or its subsidiary agreements or of related agreements or who is or 

was an officer or employee of the Office in the Department of State responsible for 

negotiating amendments to the Compact or its subsidiary agreements or who is or 

was assigned or detailed to that Office or who served on the interagency group coordinating United States policy on the Compact negotiations.

SEC. 108. COMPENSATORY ADJUSTMENTS. 

(a) ADDITIONAL PROGRAMS AND SERVICES.—In addition to the programs and services set forth in section 221 of the U.S.–FSM Compact and the U.S.–RMI Compact, 

and pursuant to section 222 of the U.S.–FSM Compact and the U.S.–RMI Compact, 

the services and programs of the following United States agencies shall be made 

available to the Federated States of Micronesia and the Republic of the Marshall 

Islands: the Small Business Administration, Economic Development Administration, 

and the Rural Utilities Services (formerly Rural Electrification Administration); the 

programs and services of the Department of Labor under the Workforce Investment 

Act of 1998; the programs and services of the Department of Commerce relating to 

tourism and to marine resource development; and the Federal Deposit Insurance 

Corporation, provided however, that eligibility to qualify for services and programs 

of the Federal Deposit Insurance Corporation, shall cease to apply on September 30, 

2005. Any institution qualified for Federal Deposit Insurance Corporation services 

and programs on or before September 30, 2005, shall remain eligible for such programs and services for the term and pursuant to such conditions as set forth in the 

Federal Program and Services Agreement described in Section 231 of the U.S.–RMI 

Compact and U.S.–FSM Compact. 

(b) FURTHER AMOUNTS.—

(1) The joint resolution of January 14, 1986 (Public Law 99–239) provided 

that the governments of the Federated States of Micronesia and the Marshall 

Islands may submit to Congress reports concerning the overall financial and 

economic impacts on such areas resulting from the effect of Title IV of that joint 

resolution upon Title Two of the Compact. There were authorized to be appropriated for fiscal years beginning after September 30, 1990, such amounts as 

necessary, but not to exceed $40 million for the Federated States of Micronesia 

and $20 million for the Marshall Islands, as provided in appropriation acts, to 

further compensate the governments of such islands (in addition to the compensation provided in subsections (a) and (b) of section 111 of the joint resolution of January 14, 1986 (Public Law 99–239) for adverse impacts, if any, on 

the finances and economies of such areas resulting from the effect of Title IV 

of that joint resolution upon Title Two of the Compact. The joint resolution of 

January 14, 1986 (Public Law 99–239) further provided that at the end of the 

initial fifteen-year term of the Compact, should any portion of the total amount 

of funds authorized in subsection 111 of that resolution not have been appropriated, such amount not yet appropriated may be appropriated, without regard 

to divisions between amounts authorized in subsection 111 for the Federated 

States of Micronesia and for the Marshall Islands, based on either or both such 

government’s showing of such adverse impact, if any, as provided in that subsection. 

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(2) The governments of the Federated States of Micronesia and the Republic 

of the Marshall Islands may each submit no more than one report or request 

for further compensation under section 111 of the joint resolution of January 

14, 1986 (Public Law 99–239) and any such report or request must be submitted 

by September 30, 2009. Only adverse economic effect occurring during the initial fifteen-year term of the Compact may be considered for compensation under 

section 111 of the joint resolution of January 14, 1986 (Public Law 99–239). 

SEC. 109. AUTHORIZATION AND CONTINUING APPROPRIATION. 

(a) There are authorized and appropriated to the Department of the Interior, out 

of any money in the Treasury not otherwise appropriated, to remain available until 

expended, such sums as are necessary to carry out the purposes of sections 211, 

212(b), 215, and 217 of the U.S.-FSM Compact and sections 211, 212, 213(b), 216, 

and 218 of the U.S.-RMI Compact, in this and subsequent years. 

(b) There are authorized to be appropriated to the Departments, agencies, and instrumentalities named in paragraphs (1) and (3) through (6) of section 221(a) of the 

U.S.-FSM Compact and paragraphs (1) and (3) through (5) of section 221(a) of the 

U.S.-RMI Compact, such sums as are necessary to carry out the purposes of sections 

221(a) of the U.S.-FSM Compact and the U.S.-RMI Compact, to remain available 

until expended. 

SEC. 110. PAYMENT OF CITIZENS OF THE FEDERATED STATES OF MICRONESIA, THE REPUBLIC OF THE MARSHALL ISLANDS, AND THE REPUBLIC OF PALAU EMPLOYED BY 

THE GOVERNMENT OF THE UNITED STATES IN THE CONTINENTAL UNITED 

STATES. 

Section 605 of Public Law 107–67 (the Treasury and General Government Appropriations Act, 2002; 5 U.S.C. 3101 note) is amended by striking ‘‘or the Republic of 

the Philippines,’’ in the last sentence and inserting the following: ‘‘the Republic of 

the Philippines, the Federated States of Micronesia, the Republic of the Marshall 

Islands, or the Republic of Palau,’’.

TITLE II—COMPACTS OF FREE ASSOCIATION 

WITH THE FEDERATED STATES OF MICRONESIA AND THE REPUBLIC OF THE MARSHALL ISLANDS 

SEC. 201. COMPACTS OF FREE ASSOCIATION, AS AMENDED BETWEEN THE GOVERNMENT OF 

THE UNITED STATES OF AMERICA AND THE GOVERNMENT OF THE FEDERATED 

STATES OF MICRONESIA AND BETWEEN THE GOVERNMENT OF THE UNITED 

STATES OF AMERICA AND THE GOVERNMENT OF THE REPUBLIC OF THE MARSHALL ISLANDS. 

(a) COMPACT OF FREE ASSOCIATION, AS AMENDED, BETWEEN THE GOVERNMENT OF

THE UNITED STATES OF AMERICA AND THE GOVERNMENT OF THE FEDERATED STATES

OF MICRONESIA.—

PREAMBLE 

THE GOVERNMENT OF THE UNITED STATES OF AMERICA AND THE 

GOVERNMENT OF THE FEDERATED STATES OF MICRONESIA 

Affirming that their Governments and their relationship as Governments are 

founded upon respect for human rights and fundamental freedoms for all, and that 

the people of the Federated States of Micronesia have the right to enjoy self-government; and 

Affirming the common interests of the United States of America and the Federated States of Micronesia in creating and maintaining their close and mutually 

beneficial relationship through the free and voluntary association of their respective 

Governments; and 

Affirming the interest of the Government of the United States in promoting the 

economic advancement and budgetary self-reliance of the Federated States of Micronesia; and 

Recognizing that their relationship until the entry into force on November 3, 1986 

of the Compact was based upon the International Trusteeship System of the United 

Nations Charter, and in particular Article 76 of the Charter; and that pursuant to 

Article 76 of the Charter, the people of the Federated States of Micronesia have progressively developed their institutions of self-government, and that in the exercise 

of their sovereign right to self-determination they, through their freely-expressed 

24

wishes, have adopted a Constitution appropriate to their particular circumstances; 

and 

Recognizing that the Compact reflected their common desire to terminate the 

Trusteeship and establish a government-to-government relationship which was in 

accordance with the new political status based on the freely expressed wishes of the 

people of the Federated States of Micronesia and appropriate to their particular circumstances; and 

Recognizing that the people of the Federated States of Micronesia have and retain 

their sovereignty and their sovereign right to self-determination and the inherent 

right to adopt and amend their own Constitution and form of government and that 

the approval of the entry of the Government of the Federated States of Micronesia 

into the Compact by the people of the Federated States of Micronesia constituted 

an exercise of their sovereign right to self-determination; and 

Recognizing the common desire of the people of the United States and the people 

of the Federated States of Micronesia to maintain their close government-to-government relationship, the United States and the Federated States of Micronesia: 

NOW, THEREFORE, MUTUALLY AGREE to continue and strengthen their relationship of free association by amending the Compact, which continues to provide 

a full measure of self-government for the people of the Federated States of Micronesia; and 

FURTHER AGREE that the relationship of free association derives from and is 

as set forth in this Compact, as amended, by the Governments of the United States 

and the Federated States of Micronesia; and that, during such relationship of free 

association, the respective rights and responsibilities of the Government of the 

United States and the Government of the Federated States of Micronesia in regard 

to this relationship of free association derive from and are as set forth in this Compact, as amended. 

TITLE ONE 

GOVERNMENTAL RELATIONS 

Article I 

Self-Government 

Section 111

The people of the Federated States of Micronesia, acting through the Government 

established under their Constitution, are self-governing. 

Article II 

Foreign Affairs 

Section 121

(a) The Government of the Federated States of Micronesia has the capacity to conduct foreign affairs and shall do so in its own name and right, except as otherwise 

provided in this Compact, as amended. 

(b) The foreign affairs capacity of the Government of the Federated States of Micronesia includes: 

(1) the conduct of foreign affairs relating to law of the sea and marine resources matters, including the harvesting, conservation, exploration or exploitation of living and non-living resources from the sea, seabed or subsoil to the 

full extent recognized under international law; 

(2) the conduct of its commercial, diplomatic, consular, economic, trade, banking, postal, civil aviation, communications, and cultural relations, including negotiations for the receipt of developmental loans and grants and the conclusion 

of arrangements with other governments and international and intergovernmental organizations, including any matters specially benefiting its individual 

citizens. 

(c) The Government of the United States recognizes that the Government of the 

Federated States of Micronesia has the capacity to enter into, in its own name and 

right, treaties and other international agreements with governments and regional 

and international organizations. 

(d) In the conduct of its foreign affairs, the Government of the Federated States 

of Micronesia confirms that it shall act in accordance with principles of international law and shall settle its international disputes by peaceful means. 

Section 122

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The Government of the United States shall support applications by the Government of the Federated States of Micronesia for membership or other participation 

in regional or international organizations as may be mutually agreed. 

Section 123

(a) In recognition of the authority and responsibility of the Government of the 

United States under Title Three, the Government of the Federated States of Micronesia shall consult, in the conduct of its foreign affairs, with the Government of the 

United States. 

(b) In recognition of the foreign affairs capacity of the Government of the Federated States of Micronesia, the Government of the United States, in the conduct 

of its foreign affairs, shall consult with the Government of the Federated States of 

Micronesia on matters that the Government of the United States regards as relating 

to or affecting the Government of the Federated States of Micronesia. 

Section 124

The Government of the United States may assist or act on behalf of the Government of the Federated States of Micronesia in the area of foreign affairs as may 

be requested and mutually agreed from time to time.The Government of the United 

States shall not be responsible to third parties for the actions of the Government 

of the Federated States of Micronesia undertaken with the assistance or through the 

agency of the Government of the United States pursuant to this section unless expressly agreed. 

Section 125

The Government of the United States shall not be responsible for nor obligated 

by any actions taken by the Government of the Federated States of Micronesia in 

the area of foreign affairs, except as may from time to time be expressly agreed. 

Section 126

At the request of the Government of the Federated States of Micronesia and subject to the consent of the receiving state, the Government of the United States shall 

extend consular assistance on the same basis as for citizens of the United States 

to citizens of the Federated States of Micronesia for travel outside the Federated 

States of Micronesia, the United States and its territories and possessions. 

Section 127

Except as otherwise provided in this Compact, as amended, or its related agreements, all obligations, responsibilities, rights and benefits of the Government of the 

United States as Administering Authority which resulted from the application pursuant to the Trusteeship Agreement of any treaty or other international agreement 

to the Trust Territory of the Pacific Islands on November 2, 1986, are, as of that 

date, no longer assumed and enjoyed by the Government of the United States. 

Article III 

Communications 

Section 131

(a) The Government of the Federated States of Micronesia has full authority and 

responsibility to regulate its domestic and foreign communications, and the Government of the United States shall provide communications assistance as mutually 

agreed. 

(b) On May 24, 1993, the Government of the Federated States of Micronesia elected to undertake all functions previously performed by the Government of the United 

States with respect to domestic and foreign communications, except for those functions set forth in a separate agreement entered into pursuant to this section of the 

Compact, as amended. 

Section 132

The Government of the Federated States of Micronesia shall permit the Government of the United States to operate telecommunications services in the Federated 

States of Micronesia to the extent necessary to fulfill the obligations of the Government of the United States under this Compact, as amended, in accordance with the 

terms of separate agreements entered into pursuant to this section of the Compact, 

as amended. 

Article IV 

Immigration 

Section 141

(a) In furtherance of the special and unique relationship that exists between the 

United States and the Federated States of Micronesia, under the Compact, as 

amended, any person in the following categories may be admitted to lawfully engage 

in occupations, and establish residence as a nonimmigrant in the United States and 

26

its territories and possessions (the ‘‘United States’’) without regard to paragraph (5) 

or (7)(B)(i)(II) of section 212(a) of the Immigration and Nationality Act, as amended, 

8 U.S.C. 1182(a)(5) or (7)(B)(i)(II): 

(1) a person who, on November 2, 1986, was a citizen of the Trust Territory 

of the Pacific Islands, as defined in Title 53 of the Trust Territory Code in force 

on January 1, 1979, and has become and remains a citizen of the Federated 

States of Micronesia; 

(2) a person who acquires the citizenship of the Federated States of Micronesia at birth, on or after the effective date of the Constitution of the Federated 

States of Micronesia; 

(3) an immediate relative of a person referred to in paragraphs (1) or (2) of 

this section, provided that such immediate relative is a naturalized citizen of 

the Federated States of Micronesia who has been an actual resident there for 

not less than five years after attaining such naturalization and who holds a certificate of actual residence, and further provided, that, in the case of a spouse, 

such spouse has been married to the person referred to in paragraph (1) or (2) 

of this section for at least five years, and further provided, that the Government 

of the United States is satisfied that such naturalized citizen meets the requirement of subsection (b) of section 104 of Public Law 99–239 as it was in effect 

on the day prior to the effective date of this Compact, as amended; 

(4) a naturalized citizen of the Federated States of Micronesia who was an 

actual resident there for not less than five years after attaining such naturalization and who satisfied these requirements as of April 30, 2003, who continues 

to be an actual resident and holds a certificate of actual residence, and whose 

name is included in a list furnished by the Government of the Federated States 

of Micronesia to the Government of the United States no later than the effective 

date of the Compact, as amended, in form and content acceptable to the Government of the United States, provided, that the Government of the United States 

is satisfied that such naturalized citizen meets the requirement of subsection 

(b) of section 104 of Public Law 99–239 as it was in effect on the day prior to 

the effective date of this Compact, as amended; or 

(5) an immediate relative of a citizen of the Federated States of Micronesia, 

regardless of the immediate relative’s country of citizenship or period of residence in the Federated States of Micronesia, if the citizen of the Federated 

States of Micronesia is serving on active duty in any branch of the United 

States Armed Forces, or in the active reserves. 

(b) Notwithstanding subsection (a) of this section, a person who is coming to the 

United States pursuant to an adoption outside the United States, or for the purpose 

of adoption in the United States, is ineligible for admission under the Compact and 

the Compact, as amended. This subsection shall apply to any person who is or was 

an applicant for admission to the United States on or after March 1, 2003, including 

any applicant for admission in removal proceedings (including appellate proceedings) on or after March 1, 2003, regardless of the date such proceedings were 

commenced. This subsection shall have no effect on the ability of the Government 

of the United States or any United States State or local government to commence 

or otherwise take any action against any person or entity who has violated any law 

relating to the adoption of any person. 

(c) Notwithstanding subsection (a) of this section, no person who has been or is 

granted citizenship in the Federated States of Micronesia, or has been or is issued 

a Federated States of Micronesia passport pursuant to any investment, passport 

sale, or similar program has been or shall be eligible for admission to the United 

States under the Compact or the Compact, as amended. 

(d) A person admitted to the United States under the Compact, or the Compact, 

as amended, shall be considered to have the permission of the Government of the 

United States to accept employment in the United States. An unexpired Federated 

States of Micronesia passport with unexpired documentation issued by the Government of the United States evidencing admission under the Compact or the Compact, 

as amended, shall be considered to be documentation establishing identity and employment authorization under section 274A(b)(1)(B) of the Immigration and Nationality Act, as amended, 8 U.S.C. 1324a(b)(1)(B). The Government of the United 

States will take reasonable and appropriate steps to implement and publicize this 

provision, and the Government of the Federated States of Micronesia will also take 

reasonable and appropriate steps to publicize this provision. 

(e) For purposes of the Compact and the Compact, as amended: 

(1) the term ‘‘residence’’ with respect to a person means the person’s principal, 

actual dwelling place in fact, without regard to intent, as provided in section 

101(a)(33) of the Immigration and Nationality Act, as amended, 8 U.S.C. 

1101(a)(33), and variations of the term ‘‘residence,’’ including ‘‘resident’’ and ‘‘reside,’’ shall be similarly construed; 

27

(2) the term ‘‘actual residence’’ means physical presence in the Federated 

States of Micronesia during eighty-five percent of the five-year period of residency required by section 141(a)(3) and (4); 

(3) the term ‘‘certificate of actual residence’’ means a certificate issued to a 

naturalized citizen by the Government of the Federated States of Micronesia 

stating that the citizen has complied with the actual residence requirement of 

section 141(a)(3) or (4); 

(4) the term ‘‘nonimmigrant’’ means an alien who is not an ‘‘immigrant’’ as 

defined in section 101(a)(15) of such Act, 8 U.S.C. 1101(a)(15); and 

(5) the term ‘‘immediate relative’’ means a spouse, or unmarried son or unmarried daughter less than 21 years of age. 

(f) The Immigration and Nationality Act, as amended, shall apply to any person 

admitted or seeking admission to the United States (other than a United States possession or territory where such Act does not apply) under the Compact or the Compact, as amended, and nothing in the Compact or the Compact, as amended, shall 

be construed to limit, preclude, or modify the applicability of, with respect to such 

person: 

(1) any ground of inadmissibility or deportability under such Act (except sections 212(a)(5) and 212(a)(7)(B)(i)(II) of such Act, as provided in subsection (a) 

of this section), and any defense thereto, provided that, section 237(a)(5) of such 

Act shall be construed and applied as if it reads as follows: ‘‘any alien who has 

been admitted under the Compact, or the Compact, as amended, who cannot

show that he or she has sufficient means of support in the United States, is 

deportable’’; 

(2) the authority of the Government of the United States under section 

214(a)(1) of such Act to provide that admission as a nonimmigrant shall be for 

such time and under such conditions as the Government of the United States 

may by regulations prescribe; 

(3) Except for the treatment of certain documentation for purposes of section 

274A(b)(1)(B) of such Act as provided by subsection (d) of this section of the 

Compact, as amended, any requirement under section 274A, including but not 

limited to section 274A(b)(1)(E); 

(4) Section 643 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996, Public Law 104–208, and actions taken pursuant to section 

643; and 

(5) the authority of the Government of the United States otherwise to administer and enforce the Immigration and Nationality Act, as amended, or other 

United States law. 

(g) Any authority possessed by the Government of the United States under this 

section of the Compact or the Compact, as amended, may also be exercised by the 

Government of a territory or possession of the United States where the Immigration 

and Nationality Act, as amended, does not apply, to the extent such exercise of authority is lawful under a statute or regulation of such territory or possession that 

is authorized by the laws of the United States. 

(h) Subsection (a) of this section does not confer on a citizen of the Federated 

States of Micronesia the right to establish the residence necessary for naturalization 

under the Immigration and Nationality Act, as amended, or to petition for benefits 

for alien relatives under that Act. Subsection (a) of this section, however, shall not 

prevent a citizen of the Federated States of Micronesia from otherwise acquiring 

such rights or lawful permanent resident alien status in the United States. 

Section 142

(a) Any citizen or national of the United States may be admitted, to lawfully engage in occupations, and reside in the Federated States of Micronesia, subject to the 

rights of the Government of the Federated States of Micronesia to deny entry to or 

deport any such citizen or national as an undesirable alien. Any determination of 

inadmissibility or deportability shall be based on reasonable statutory grounds and 

shall be subject to appropriate administrative and judicial review within the Federated States of Micronesia. If a citizen or national of the United States is a spouse 

of a citizen of the Federated States of Micronesia, the Government of the Federated 

States of Micronesia shall allow the United States citizen spouse to establish residence. Should the Federated States of Micronesia citizen spouse predecease the 

United States citizen spouse during the marriage, the Government of the Federated 

States of Micronesia shall allow the United States citizen spouse to continue to reside in the Federated States of Micronesia. 

(b) In enacting any laws or imposing any requirements with respect to citizens 

and nationals of the United States entering the Federated States of Micronesia 

under subsection (a) of this section, including any grounds of inadmissibility or deportability, the Government of the Federated States of Micronesia shall accord to 

28

such citizens and nationals of the United States treatment no less favorable than 

that accorded to citizens of other countries. 

(c) Consistent with subsection (a) of this section, with respect to citizens and nationals of the United States seeking to engage in employment or invest in the Federated States of Micronesia, the Government of the Federated States of Micronesia 

shall adopt immigration-related procedures no less favorable than those adopted by 

the Government of the United States with respect to citizens of the Federated 

States of Micronesia seeking employment in the United States. 

Section 143

Any person who relinquishes, or otherwise loses, his United States nationality or 

citizenship, or his Federated States of Micronesia citizenship, shall be ineligible to 

receive the privileges set forth in sections 141 and 142. Any such person may apply 

for admission to the United States or the Federated States of Micronesia, as the 

case may be, in accordance with any other applicable laws of the United States or 

the Federated States of Micronesia relating to immigration of aliens from other 

countries. The laws of the Federated States of Micronesia or the United States, as 

the case may be, shall dictate the terms and conditions of any such person’s stay. 

Article V 

Representation 

Section 151

Relations between the Government of the United States and the Government of 

the Federated States of Micronesia shall be conducted in accordance with the Vienna Convention on Diplomatic Relations. In addition to diplomatic missions and 

representation, the Governments may establish and maintain other offices and designate other representatives on terms and in locations as may be mutually agreed. 

Section 152

(a) Any citizen or national of the United States who, without authority of the 

United States, acts as the agent of the Government of the Federated States of Micronesia with regard to matters specified in the provisions of the Foreign Agents 

Registration Act of 1938, as amended (22 U.S.C. 611 et seq.), that apply with respect to an agent of a foreign principal shall be subject to the requirements of such 

Act. Failure to comply with such requirements shall subject such citizen or national 

to the same penalties and provisions of law as apply in the case of the failure of 

such an agent of a foreign principal to comply with such requirements. For purposes 

of the Foreign Agents Registration Act of 1938, the Federated States of Micronesia 

shall be considered to be a foreign country. 

(b) Subsection (a) of this section shall not apply to a citizen or national of the 

United States employed by the Government of the Federated States of Micronesia 

with respect to whom the Government of the Federated States of Micronesia from 

time to time certifies to the Government of the United States that such citizen or 

national is an employee of the Federated States of Micronesia whose principal duties are other than those matters specified in the Foreign Agents Registration Act 

of 1938, as amended, that apply with respect to an agent of a foreign principal. The 

agency or officer of the United States receiving such certifications shall cause them 

to be filed with the Attorney General, who shall maintain a publicly available list 

of the persons so certified. 

Article VI 

Environmental Protection 

Section 161

The Governments of the United States and the Federated States of Micronesia declare that it is their policy to promote efforts to prevent or eliminate damage to the 

environment and biosphere and to enrich understanding of the natural resources of 

the Federated States of Micronesia. In order to carry out this policy, the Government of the United States and the Government of the Federated States of Micronesia agree to the following mutual and reciprocal undertakings. 

(a) The Government of the United States: 

(1) shall continue to apply the environmental controls in effect on November 

2, 1986 to those of its continuing activities subject to section 161(a)(2), unless 

and until those controls are modified under sections 161(a)(3) and 161(a)(4); 

(2) shall apply the National Environmental Policy Act of 1969, 83 Stat. 852, 

42 U.S.C. 4321 et seq., to its activities under the Compact, as amended, and 

its related agreements as if the Federated States of Micronesia were the United 

States; 

29

(3) shall comply also, in the conduct of any activity requiring the preparation 

of an Environmental Impact Statement under section 161(a)(2), with standards 

substantively similar to those required by the following laws of the United 

States, taking into account the particular environment of the Federated States 

of Micronesia: the Endangered Species Act of 1973, as amended, 87 Stat. 884, 

16 U.S.C. 1531 et seq.; the Clean Air Act, as amended, 77 Stat. 392, 42 U.S.C. 

Supp. 7401 et seq.; the Clean Water Act (Federal Water Pollution Control Act), 

as amended, 86 Stat. 896, 33 U.S.C. 1251 et seq.; Title I of the Marine Protection, Research and Sanctuaries Act of 1972 (the Ocean Dumping Act), 33 U.S.C. 

1411 et seq.; the Toxic Substances Control Act, as amended, 15 U.S.C. 2601 et 

seq.; the Solid Waste Disposal Act, as amended, 42 U.S.C. 6901 et seq.; and 

such other environmental protection laws of the United States and of the Federated States of Micronesia, as may be mutually agreed from time to time with 

the Government of the Federated States of Micronesia; and 

(4) shall develop, prior to conducting any activity requiring the preparation 

of an Environmental Impact Statement under section 161(a)(2), written standards and procedures, as agreed with the Government of the Federated States 

of Micronesia, to implement the substantive provisions of the laws made applicable to U.S. Government activities in the Federated States of Micronesia, pursuant to section 161(a)(3). 

(b) The Government of the Federated States of Micronesia shall continue to develop and implement standards and procedures to protect its environment. As a reciprocal obligation to the undertakings of the Government of the United States 

under this Article, the Federated States of Micronesia, taking into account its particular environment, shall continue to develop and implement standards for environmental protection substantively similar to those required of the Government of the 

United States by section 161(a)(3) prior to its conducting activities in the Federated 

States of Micronesia, substantively equivalent to activities conducted there by the 

Government of the United States and, as a further reciprocal obligation, shall enforce those standards. 

(c) Section 161(a), including any standard or procedure applicable thereunder, and 

section 161(b) may be modified or superseded in whole or in part by agreement of 

the Government of the United States and the Government of the Federated States 

of Micronesia. 

(d) In the event that an Environmental Impact Statement is no longer required 

under the laws of the United States for major Federal actions significantly affecting 

the quality of the human environment, the regulatory regime established under sections 161(a)(3) and 161(a)(4) shall continue to apply to such activities of the Government of the United States until amended by mutual agreement. 

(e) The President of the United States may exempt any of the activities of the 

Government of the United States under this Compact, as amended, and its related 

agreements from any environmental standard or procedure which may be applicable 

under sections 161(a)(3) and 161(a)(4) if the President determines it to be in the 

paramount interest of the Government of the United States to do so, consistent with 

Title Three of this Compact, as amended, and the obligations of the Government of 

the United States under international law. Prior to any decision pursuant to this 

subsection, the views of the Government of the Federated States of Micronesia shall 

be sought and considered to the extent practicable. If the President grants such an 

exemption, to the extent practicable, a report with his reasons for granting such exemption shall be given promptly to the Government of the Federated States of Micronesia. 

(f) The laws of the United States referred to in section 161(a)(3) shall apply to 

the activities of the Government of the United States under this Compact, as 

amended, and its related agreements only to the extent provided for in this section. 

Section 162

The Government of the Federated States of Micronesia may bring an action for 

judicial review of any administrative agency action or any activity of the Government of the United States pursuant to section 161(a) for enforcement of the obligations of the Government of the United States arising thereunder. The United States 

District Court for the District of Hawaii and the United States District Court for 

the District of Columbia shall have jurisdiction over such action or activity, and over 

actions brought under section 172(b) which relate to the activities of the Government of the United States and its officers and employees, governed by section 161, 

provided that: 

(a) Such actions may only be civil actions for any appropriate civil relief other 

than punitive damages against the Government of the United States or, where 

required by law, its officers in their official capacity; no criminal actions may 

arise under this section. 

30

(b) Actions brought pursuant to this section may be initiated only by the Government of the Federated States of Micronesia. 

(c) Administrative agency actions arising under section 161 shall be reviewed 

pursuant to the standard of judicial review set forth in 5 U.S.C. 706. 

(d) The United States District Court for the District of Hawaii and the United 

States District Court for the District of Columbia shall have jurisdiction to issue 

all necessary processes, and the Government of the United States agrees to submit itself to the jurisdiction of the court; decisions of the United States District 

Court shall be reviewable in the United States Court of Appeals for the Ninth 

Circuit or the United States Court of Appeals for the District of Columbia, respectively, or in the United States Supreme Court as provided by the laws of 

the United States. 

(e) The judicial remedy provided for in this section shall be the exclusive remedy for the judicial review or enforcement of the obligations of the Government 

of the United States under this Article and actions brought under section 172(b) 

which relate to the activities of the Government of the United States and its 

officers and employees governed by section 161. 

(f) In actions pursuant to this section, the Government of the Federated 

States of Micronesia shall be treated as if it were a United States citizen. 

Section 163

(a) For the purpose of gathering data necessary to study the environmental effects 

of activities of the Government of the United States subject to the requirements of 

this Article, the Government of the Federated States of Micronesia shall be granted 

access to facilities operated by the Government of the United States in the Federated States of Micronesia, to the extent necessary for this purpose, except to the 

extent such access would unreasonably interfere with the exercise of the authority 

and responsibility of the Government of the United States under Title Three. 

(b) The Government of the United States, in turn, shall be granted access to the 

Federated States of Micronesia for the purpose of gathering data necessary to discharge its obligations under this Article, except to the extent such access would unreasonably interfere with the exercise of the authority and responsibility of the Government of the Federated States of Micronesia under Title One, and to the extent 

necessary for this purpose shall be granted access to documents and other information to the same extent similar access is provided the Government of the Federated 

States of Micronesia under the Freedom of Information Act, 5 U.S.C. 552. 

(c) The Government of the Federated States of Micronesia shall not impede efforts 

by the Government of the United States to comply with applicable standards and 

procedures. 

Article VII 

General Legal Provisions 

Section 171

Except as provided in this Compact, as amended, or its related agreements, the 

application of the laws of the United States to the Trust Territory of the Pacific Islands by virtue of the Trusteeship Agreement ceased with respect to the Federated 

States of Micronesia on November 3, 1986, the date the Compact went into effect. 

Section 172

(a) Every citizen of the Federated States of Micronesia who is not a resident of 

the United States shall enjoy the rights and remedies under the laws of the United 

States enjoyed by any non-resident alien. 

(b) The Government of the Federated States of Micronesia and every citizen of the 

Federated States of Micronesia shall be considered to be a ‘‘person’’ within the 

meaning of the Freedom of Information Act, 5 U.S.C. 552, and of the judicial review 

provisions of the Administrative Procedure Act, 5 U.S.C. 701–706, except that only 

the Government of the Federated States of Micronesia may seek judicial review 

under the Administrative Procedure Act or judicial enforcement under the Freedom 

of Information Act when such judicial review or enforcement relates to the activities 

of the Government of the United States governed by sections 161 and 162. 

Section 173

The Governments of the United States and the Federated States of Micronesia 

agree to adopt and enforce such measures, consistent with this Compact, as amended, and its related agreements, as may be necessary to protect the personnel, property, installations, services, programs and official archives and documents maintained by the Government of the United States in the Federated States of Micronesia pursuant to this Compact, as amended, and its related agreements and by the 

Government of the Federated States of Micronesia in the United States pursuant 

to this Compact, as amended, and its related agreements. 

31

Section 174

Except as otherwise provided in this Compact, as amended, and its related agreements: 

(a) The Government of the Federated States of Micronesia, and its agencies 

and officials, shall be immune from the jurisdiction of the court of the United 

States, and the Government of the United States, and its agencies and officials, 

shall be immune from the jurisdiction of the courts of the Federated States of 

Micronesia. 

(b) The Government of the United States accepts responsibility for and shall 

pay: 

(1) any unpaid money judgment rendered by the High Court of the Trust 

Territory of the Pacific Islands against the Government of the United 

States with regard to any cause of action arising as a result of acts or omissions of the Government of the Trust Territory of the Pacific Islands or the 

Government of the United States prior to November 3, 1986; 

(2) any claim settled by the claimant and the Government of the Trust 

Territory of the Pacific Islands but not paid as of the November 3, 1986; 

and 

(3) settlement of any administrative claim or of any action before a court 

of the Trust Territory of the Pacific Islands or the Government of the 

United States, arising as a result of acts or omissions of the Government 

of the Trust Territory of the Pacific Islands or the Government of the 

United States. 

(c) Any claim not referred to in section 174(b) and arising from an act or omission of the Government of the Trust Territory of the Pacific Islands or the Government of the United States prior to the effective date of the Compact shall 

be adjudicated in the same manner as a claim adjudicated according to section 

174(d). In any claim against the Government of the Trust Territory of the Pacific Islands, the Government of the United States shall stand in the place of 

the Government of the Trust Territory of the Pacific Islands. A judgment on any 

claim referred to in section 174(b) or this subsection, not otherwise satisfied by 

the Government of the United States, may be presented for certification to the 

United States Court of Appeals for the Federal Circuit, or its successor courts, 

which shall have jurisdiction therefore, notwithstanding the provisions of 28 

U.S.C. 1502, and which court’s decisions shall be reviewable as provided by the 

laws of the United States. The United States Court of Appeals for the Federal 

Circuit shall certify such judgment, and order payment thereof, unless it finds, 

after a hearing, that such judgment is manifestly erroneous as to law or fact, 

or manifestly excessive. In either of such cases the United States Court of Appeals for the Federal Circuit shall have jurisdiction to modify such judgment. 

(d) The Government of the Federated States of Micronesia shall not be immune from the jurisdiction of the courts of the United States, and the Government of the United States shall not be immune from the jurisdiction of the 

courts of the Federated States of Micronesia in any civil case in which an exception to foreign state immunity is set forth in the Foreign Sovereign Immunities 

Act (28 U.S.C. 1602 et seq.) or its successor statutes. 

Section 175

(a) A separate agreement, which shall come into effect simultaneously with this 

Compact, as amended, and shall have the force of law, shall govern mutual assistance and cooperation in law enforcement matters, including the pursuit, capture, 

imprisonment and extradition of fugitives from justice and the transfer of prisoners, 

as well as other law enforcement matters. In the United States, the laws of the 

United States governing international extradition, including 18 U.S.C. 3184, 3186 

and 3188–95, shall be applicable to the extradition of fugitives under the separate 

agreement, and the laws of the United States governing the transfer of prisoners, 

including 18 U.S.C. 4100–15, shall be applicable to the transfer of prisoners under 

the separate agreement; and 

(b) A separate agreement, which shall come into effect simultaneously with this 

Compact, as amended, and shall have the force of law, shall govern requirements 

relating to labor recruitment practices, including registration, reporting, suspension 

or revocation of authorization to recruit persons for employment in the United 

States, and enforcement for violations of such requirements. 

Section 176

The Government of the Federated States of Micronesia confirms that final judgments in civil cases rendered by any court of the Trust Territory of the Pacific Islands shall continue in full force and effect, subject to the constitutional power of 

the courts of the Federated States of Micronesia to grant relief from judgments in 

appropriate cases. 

Section 177

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Section 177 of the Compact entered into force with respect to the Federated States 

of Micronesia on November 3, 1986 as follows: ‘‘(a) The Government of the United States accepts the responsibility for compensation owing to citizens of the Marshall Islands, or the Federated States of 

Micronesia, or Palau for loss or damage to property and person of the citizens 

of the Marshall Islands, or the Federated States of Micronesia, resulting from 

the nuclear testing program which the Government of the United States conducted in the Northern Marshall Islands between June 30, 1946, and August 

18, 1958. ‘‘(b) The Government of the United States and the Government of the Marshall Islands shall set forth in a separate agreement provisions for the just and 

adequate settlement of all such claims which have arisen in regard to the Marshall Islands and its citizens and which have not as yet been compensated or 

which in the future may arise, for the continued administration by the Government of the United States of direct radiation related medical surveillance and 

treatment programs and radiological monitoring activities and for such additional programs and activities as may be mutually agreed, and for the assumption by the Government of the Marshall Islands of responsibility for enforcement of limitations on the utilization of affected areas developed in cooperation 

with the Government of the United States and for the assistance by the Government of the United States in the exercise of such responsibility as may be mutually agreed. This separate agreement shall come into effect simultaneously with 

this Compact and shall remain in effect in accordance with its own terms. 

‘‘(c) The Government of the United States shall provide to the Government 

of the Marshall Islands, on a grant basis, the amount of $150 million to be paid 

and distributed in accordance with the separate agreement referred to in this 

Section, and shall provide the services and programs set forth in this separate 

agreement, the language of which is incorporated into this Compact.’’

The Compact, as amended, makes no changes to, and has no effect upon, Section 

177 of the Compact, nor does the Compact, as amended, change or affect the separate agreement referred to in Section 177 of the Compact including Articles IX and 

X of that separate agreement, and measures taken by the parties thereunder. 

Section 178

(a) The Federal agencies of the Government of the United States that provide the 

services and related programs in the Federated States of Micronesia pursuant to 

Title Two are authorized to settle and pay tort claims arising in the Federated 

States of Micronesia from the activities of such agencies or from the acts or omissions of the employees of such agencies. Except as provided in section 178(b), the 

provisions of 28 U.S.C. 2672 and 31 U.S.C. 1304 shall apply exclusively to such administrative settlements and payments. 

(b) Claims under section 178(a) that cannot be settled under section 178(a) shall 

be disposed of exclusively in accordance with Article II of Title Four. Arbitration 

awards rendered pursuant to this subsection shall be paid out of funds under 31 

U.S.C. 1304. 

(c) The Government of the United States and the Government of the Federated 

States of Micronesia shall, in the separate agreement referred to in section 231, provide for: 

(1) the administrative settlement of claims referred to in section 178(a), including designation of local agents in each State of the Federated States of Micronesia; such agents to be empowered to accept, investigate and settle such 

claims, in a timely manner, as provided in such separate agreements; and 

(2) arbitration, referred to in section 178(b), in a timely manner, at a site convenient to the claimant, in the event a claim is not otherwise settled pursuant 

to section 178(a). 

(d) The provisions of section 174(d) shall not apply to claims covered by this section. 

(e) Except as otherwise explicitly provided by law of the United States, neither 

the Government of the United States, its instrumentalities, nor any person acting 

on behalf of the Government of the United States, shall be named a party in any 

action based on, or arising out of, the activity or activities of a recipient of any grant 

or other assistance provided by the Government of the United States (or the activity 

or activities of the recipient’s agency or any other person or entity acting on behalf 

of the recipient). 

Section 179

(a) The courts of the Federated States of Micronesia shall not exercise criminal 

jurisdiction over the Government of the United States, or its instrumentalities. 

(b) The courts of the Federated States of Micronesia shall not exercise criminal 

jurisdiction over any person if the Government of the United States provides notification to the Government of the Federated States of Micronesia that such person 

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was acting on behalf of the Government of the United States, for actions taken in 

furtherance of section 221 or 224 of this amended Compact, or any other provision 

of law authorizing financial, program, or service assistance to the Federated States 

of Micronesia. 

TITLE TWO 

ECONOMIC RELATIONS 

Article I 

Grant Assistance 

Section 211 - Sector Grants 

(a) In order to assist the Government of the Federated States of Micronesia in its 

efforts to promote the economic advancement, budgetary self-reliance, and economic 

self-sufficiency of its people, and in recognition of the special relationship that exists 

between the Federated States of Micronesia and the United States, the Government 

of the United States shall provide assistance on a sector grant basis for a period 

of twenty years in the amounts set forth in section 216, commencing on the effective 

date of this Compact, as amended. Such grants shall be used for assistance in the 

sectors of education, health care, private sector development, the environment, public sector capacity building, and public infrastructure, or for other sectors as mutually agreed, with priorities in the education and health care sectors. For each year 

such sector grant assistance is made available, the proposed division of this amount 

among these sectors shall be certified to the Government of the United States by 

the Government of the Federated States of Micronesia and shall be subject to the 

concurrence of the Government of the United States. In such case, the Government 

of the United States shall disburse the agreed upon amounts and monitor the use 

of such sector grants in accordance with the provisions of this Article and the Agreement Concerning Procedures for the Implementation of United States Economic Assistance Provided in the Compact, as Amended, of Free Association Between the 

Government of the United States of America and the Government of the Federated 

States of Micronesia (‘‘Fiscal Procedures Agreement’’) which shall come into effect 

simultaneously with this Compact, as amended. The provision of any United States 

assistance under the Compact, as amended, the Fiscal Procedures Agreement, the 

Trust Fund Agreement, or any other subsidiary agreement to the Compact, as 

amended, shall constitute ‘‘a particular distribution . . . required by the terms or 

special nature of the assistance’’ for purposes of Article XII, section 1(b) of the Constitution of the Federated States of Micronesia.

(1) EDUCATION.—United States grant assistance shall be made available in 

accordance with the plan described in subsection (c) of this section to support 

and improve the educational system of the Federated States of Micronesia and 

develop the human, financial, and material resources necessary for the Government of the Federated States of Micronesia to perform these services. Emphasis 

should be placed on advancing a quality basic education system. 

(2) HEALTH.—United States grant assistance shall be made available in accordance with the plan described in subsection (c) of this section to support and 

improve the delivery of preventive, curative and environmental care and develop the human, financial, and material resources necessary for the Government of the Federated States of Micronesia to perform these services. 

(3) PRIVATE SECTOR DEVELOPMENT.—United States grant assistance shall be 

made available in accordance with the plan described in subsection (c) of this 

section to support the efforts of the Government of the Federated States of Micronesia to attract foreign investment and increase indigenous business activity 

by vitalizing the commercial environment, ensuring fair and equitable application of the law, promoting adherence to core labor standards, and maintaining 

progress toward privatization of state-owned and partially state-owned enterprises, and engaging in other reforms. 

(4) CAPACITY BUILDING IN THE PUBLIC SECTOR.—United States grant assistance shall be made available in accordance with the plan described in subsection (c) of this section to support the efforts of the Government of the Federated States of Micronesia to build effective, accountable and transparent national, state, and local government and other public sector institutions and systems. 

(5) ENVIRONMENT.—United States grant assistance shall be made available in 

accordance with the plan described in subsection (c) of this section to increase 

environmental protection; conserve and achieve sustainable use of natural reVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00033 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
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sources; and engage in environmental infrastructure planning, design construction and operation. 

(6) PUBLIC INFRASTRUCTURE.— (i) U.S. annual grant assistance shall be made available in accordance 

with a list of specific projects included in the plan described in subsection 

(c) of this section to assist the Government of the Federated States of Micronesia in its efforts to provide adequate public infrastructure. 

(ii) INFRASTRUCTURE AND MAINTENANCE FUND.—Five percent of the annual public infrastructure grant made available under paragraph (i) of this 

subsection shall be set aside, with an equal contribution from the Government of the Federated States of Micronesia, as a contribution to an Infrastructure Maintenance Fund (IMF). Administration of the Infrastructure 

Maintenance Fund shall be governed by the Fiscal Procedures Agreement. 

(b) HUMANITARIAN ASSISTANCE.—Federated States of Micronesia Program. In recognition of the special development needs of the Federated States of Micronesia, the 

Government of the United States shall make available to the Government of the 

Federated States of Micronesia, on its request and to be deducted from the grant 

amount made available under subsection (a) of this section, a Humanitarian Assistance - Federated States of Micronesia (‘‘HAFSM’’) Program with emphasis on 

health, education, and infrastructure (including transportation), projects. The terms 

and conditions of the HAFSM shall be set forth in the Agreement Regarding the 

Military Use and Operating Rights of the Government of the United States in the 

Government of the Federated States of Micronesia Concluded Pursuant to Sections 

321 and 323 of the Compact of Free Association, as Amended which shall come into 

effect simultaneously with the amendments to this Compact. 

(c) DEVELOPMENT PLAN.—The Government of the Federated States of Micronesia 

shall prepare and maintain an official overall development plan. The plan shall be 

strategic in nature, shall be continuously reviewed and updated through the annual 

budget process, and shall make projections on a multi-year rolling basis. Each of the 

sectors named in subsection (a) of this section, or other sectors as mutually agreed, 

shall be accorded specific treatment in the plan. Insofar as grants funds are involved, the plan shall be subject to the concurrence of the Government of the United 

States. 

(d) DISASTER ASSISTANCE EMERGENCY FUND.—An amount of two hundred thousand dollars ($200,000) shall be provided annually, with an equal contribution from 

the Government of the Federated States of Micronesia, as a contribution to a ‘‘Disaster Assistance Emergency Fund (DAEF).’’ Any funds from the DAEF may be used 

only for assistance and rehabilitation resulting from disasters and emergencies. The 

funds will be accessed upon declaration by the Government of the Federated States 

of Micronesia, with the concurrence of the United States Chief of Mission to the 

Federated States of Micronesia. The Administration of the DAEF shall be governed 

by the Fiscal Procedures Agreement. 

Section 212 - Accountability. 

(a) Regulations and policies normally applicable to United States financial assistance to its state and local governments, as reflected in the Fiscal Procedures Agreement, shall apply to each sector grant described in section 211, and to grants administered under section 221 below, except as modified in the separate agreements referred to in section 231 of this Compact, as amended, or by United States law. The 

Government of the United States, after annual consultations with the Federated 

States of Micronesia, may attach reasonable terms and conditions, including annual 

performance indicators that are necessary to ensure effective use of United States 

assistance and reasonable progress toward achieving program objectives. The Government of the United States may seek appropriate remedies for noncompliance 

with the terms and conditions attached to the assistance, or for failure to comply 

with section 234, including withholding assistance. 

(b) The Government of the United States shall, for each fiscal year of the twenty 

years during which assistance is to be provided on a sector grant basis under section 

211, grant the Government of the Federated States of Micronesia an amount equal 

to the lesser of (i) one half of the reasonable, properly documented cost incurred during each fiscal year to conduct the annual audit required under Article VIII (2) of 

the Fiscal Procedures Agreement or (ii) $500,000. Such amount will not be adjusted 

for inflation under section 217 or otherwise. 

Section 213 - Joint Economic Management Committee 

The Governments of the United States and the Federated States of Micronesia 

shall establish a Joint Economic Management Committee, composed of a U.S. chair, 

two other members from the Government of the United States and two members 

from the Government of the Federated States of Micronesia. The Joint Economic 

Management Committee shall meet at least once each year to review the audits and 

reports required under this Title, evaluate the progress made by the Federated 

35

States of Micronesia in meeting the objectives identified in its plan described in subsection (c) of section 211, with particular focus on those parts of the plan dealing 

with the sectors identified in subsection (a) of section 211, identify problems encountered, and recommend ways to increase the effectiveness of U.S. assistance made 

available under this Title. The establishment and operations of the Joint Economic 

Management Committee shall be governed by the Fiscal Procedures Agreement. 

Section 214 - Annual Report 

The Government of the Federated States of Micronesia shall report annually to 

the President of the United States on the use of United States sector grant assistance and other assistance and progress in meeting mutually agreed program and 

economic goals. The Joint Economic Management Committee shall review and comment on the report and make appropriate recommendations based thereon. 

Section 215 - Trust Fund 

(a) The United States shall contribute annually for twenty years from the effective 

date of this Compact, as amended, in the amounts set forth in section 216 into a 

Trust Fund established in accordance with the Agreement Between the Government 

of the United States of America and the Government of the Federated States of Micronesia Implementing Section 215 and Section 216 of the Compact, as Amended, 

Regarding a Trust Fund (‘‘Trust Fund Agreement’’). Upon termination of the annual 

financial assistance under section 211, the proceeds of the fund shall thereafter be 

used for the purposes described in section 211 or as otherwise mutually agreed. 

(b) The United States contribution into the Trust Fund described in subsection(a) 

of this section is conditioned on the Government of the Federated States of Micronesia contributing to the Trust Fund at least $30 million, prior to September 30, 

2004. Any funds received by the Federated States of Micronesia under section 111 

(d) of Public Law 99–239 (January 14, 1986), or successor provisions, would be contributed to the Trust Fund as a Federated States of Micronesia contribution. 

(c) The terms regarding the investment and management of funds and use of the 

income of the Trust Fund shall be set forth in the separate Trust Fund Agreement 

described in subsection (a) of this section. Funds derived from United States investment shall not be subject to Federal or state taxes in the United States or the Federated States of Micronesia. The Trust Fund Agreement shall also provide for annual reports to the Government of the United States and to the Government of the 

Federated States of Micronesia. The Trust Fund Agreement shall provide for appropriate distributions of trust fund proceeds to the Federated States of Micronesia and 

for appropriate remedies for the failure of the Federated States of Micronesia to use 

income of the Trust Fund for the annual grant purposes set forth in section 211. 

These remedies may include the return to the United States of the present market 

value of its contributions to the Trust Fund and the present market value of any 

undistributed income on the contributions of the United States. If this Compact, as 

amended, is terminated, the provisions of sections 451 through 453 of this Compact, 

as amended, shall govern treatment of any U.S. contributions to the Trust Fund or 

accrued interest thereon. 

Section 216 - Sector Grant Funding and Trust Fund Contributions 

The funds described in sections 211, 212(b) and 215 shall be made available as 

follows:

[In millions of dollars] 

Fiscal year Annual Grants 

Section 211

Audit Grant

Section 212(b) 

(amount up to) 

Trust Fund

Section 215 Total 

2004 ............................ 76.2 .5 16 92.7

2005 ............................ 76.2 .5 16 92.7

2006 ............................ 76.2 .5 16 92.7

2007 ............................ 75.4 .5 16.8 92.7

2008 ............................ 74.6 .5 17.6 92.7

2009 ............................ 73.8 .5 18.4 92.7

2010 ............................ 73 .5 19.2 92.7

2011 ............................ 72.2 .5 20 92.7

2012 ............................ 71.4 .5 20.8 92.7

2013 ............................ 70.6 .5 21.6 92.7

2014 ............................ 69.8 .5 22.4 92.7

2015 ............................ 69 .5 23.2 92.7

2016 ............................ 68.2 .5 24 92.7

2017 ............................ 67.4 .5 24.8 92.7

2018 ............................ 66.6 .5 25.6 92.7

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[In millions of dollars] 

Fiscal year Annual Grants 

Section 211

Audit Grant

Section 212(b) 

(amount up to) 

Trust Fund

Section 215 Total 

2019 ............................ 65.8 .5 26.4 92.7

2020 ............................ 65 .5 27.2 92.7

2021 ............................ 64.2 .5 28 92.7

2022 ............................ 63.4 .5 28.8 92.7

2023 ............................ 62.6 .5 29.6 92.7

Section 217 - Inflation Adjustment 

Except for the amounts provided for audits under section 212(b), the amounts 

stated in this Title shall be adjusted for each United States Fiscal Year by the percent that equals two-thirds of the percent change in the United States Gross Domestic Product Implicit Price Deflator, or 5 percent, whichever is less in any one year, 

using the beginning of Fiscal Year 2004 as a base. 

Section 218 - Carry-Over of Unused Funds 

If in any year the funds made available by the Government of the United States 

for that year pursuant to this Article are not completely obligated by the Government of the Federated States of Micronesia, the unobligated balances shall remain 

available in addition to the funds to be provided in subsequent years. 

Article II 

Services and Program Assistance 

Section 221

(a) SERVICES.—The Government of the United States shall make available to the 

Federated States of Micronesia, in accordance with and to the extent provided in 

the Federal Programs and Services Agreement referred to in section 231, the services and related programs of: 

(1) the United States Weather Service; 

(2) the United States Postal Service; 

(3) the United States Federal Aviation Administration; 

(4) the United States Department of Transportation; 

(5) the Federal Deposit Insurance Corporation (for the benefit only of the 

Bank of the Federated States of Micronesia), and 

(6) the Department of Homeland Security, and the United States Agency for 

International Development, Office of Foreign Disaster Assistance. 

Upon the effective date of this Compact, as amended, the United States Departments and Agencies named or having responsibility to provide these services and 

related programs shall have the authority to implement the relevant provisions of 

the Federal Programs and Services Agreement referred to in section 231. 

(b) PROGRAMS.— (1) With the exception of the services and programs covered by subsection (a) 

of this section, and unless the Congress of the United States provides otherwise, 

the Government of the United States shall make available to the Federated 

States of Micronesia the services and programs that were available to the Federated States of Micronesia on the effective date of this Compact, as amended, 

to the extent that such services and programs continue to be available to State 

and local governments of the United States. As set forth in the Fiscal Procedures Agreement, funds provided under subsection (a) of section 211 will be considered to be local revenues of the Government of the Federated States of Micronesia when used as the local share required to obtain Federal programs and 

services. 

(2) Unless provided otherwise by U.S. law, the services and programs described in paragraph (1) of this subsection shall be extended in accordance with 

the terms of the Federal Programs and Services Agreement referred to in section 231. 

(c) The Government of the United States shall have and exercise such authority 

as is necessary to carry out its responsibilities under this Title and the separate 

agreements referred to in amended section 231, including the authority to monitor 

and administer all service and program assistance provided by the United States 

to the Federated States of Micronesia. The Federal Programs and Services Agreement referred to in amended section 231 shall also set forth the extent to which 

services and programs shall be provided to the Federated States of Micronesia. 

(d) Except as provided elsewhere in this Compact, as amended, under any separate agreement entered into under this Compact, as amended, or otherwise under 

U.S. law, all Federal domestic programs extended to or operating in the Federated 

States of Micronesia shall be subject to all applicable criteria, standards, reporting 

37

requirements, auditing procedures, and other rules and regulations applicable to 

such programs and services when operating in the United States. 

(e) The Government of the United States shall make available to the Federated 

States of Micronesia alternate energy development projects, studies, and conservation measures to the extent provided for the Freely Associated States in the laws 

of the United States. 

Section 222

The Government of the United States and the Government of the Federated 

States of Micronesia may agree from time to time to extend to the Federated States 

of Micronesia additional United States grant assistance, services and programs, as 

provided under the laws of the United States. Unless inconsistent with such laws, 

or otherwise specifically precluded by the Government of the United States at the 

time such additional grant assistance, services, or programs are extended, the Federal Programs and Services Agreement referred to section 231 shall apply to any 

such assistance, services or programs. 

Section 223

The Government of the Federated States of Micronesia shall make available to 

the Government of the United States at no cost such land as may be necessary for 

the operations of the services and programs provided pursuant to this Article, and 

such facilities as are provided by the Government of the Federated States of Micronesia at no cost to the Government of the United States as of the effective date of 

this Compact, as amended, or as may be mutually agreed thereafter. 

Section 224

The Government of the Federated States of Micronesia may request, from time 

to time, technical assistance from the Federal agencies and institutions of the Government of the United States, which are authorized to grant such technical assistance in accordance with its laws. If technical assistance is granted pursuant to such 

a request, the Government of the United States shall provide the technical assistance in a manner which gives priority consideration to the Federated States of Micronesia over other recipients not a part of the United States, its territories or possessions, and equivalent consideration to the Federated States of Micronesia with 

respect to other states in Free Association with the United States. Such assistance 

shall be made available on a reimbursable or non-reimbursable basis to the extent 

provided by United States law. 

Article III 

Administrative Provisions 

Section 231

The specific nature, extent and contractual arrangements of the services and programs provided for in section 221 of this Compact, as amended, as well as the legal 

status of agencies of the Government of the United States, their civilian employees 

and contractors, and the dependents of such personnel while present in the Federated States of Micronesia, and other arrangements in connection with the assistance, services, or programs furnished by the Government of the United States, are 

set forth in a Federal Programs and Services Agreement which shall come into effect simultaneously with this Compact, as amended. 

Section 232

The Government of the United States, in consultation with the Government of the 

Federated States of Micronesia, shall determine and implement procedures for the 

periodic audit of all grants and other assistance made under Article I of this Title 

and of all funds expended for the services and programs provided under Article II 

of this Title. Further, in accordance with the Fiscal Procedures Agreement described 

in subsection (a) of section 211, the Comptroller General of the United States shall 

have such powers and authorities as described in sections 102 (c) and 110 (c) of Public Law 99–239, 99 Stat. 1777–78, and 99 Stat. 1799 (January 14, 1986). 

Section 233

Approval of this Compact, as amended, by the Government of the United States, 

in accordance with its constitutional processes, shall constitute a pledge by the 

United States that the sums and amounts specified as sector grants in section 211 

of this Compact, as amended, shall be appropriated and paid to the Federated 

States of Micronesia for such period as those provisions of this Compact, as amended, remain in force, subject to the terms and conditions of this Title and related subsidiary agreements. 

Section 234

The Government of the Federated States of Micronesia pledges to cooperate with, 

permit, and assist if reasonably requested, designated and authorized representatives of the Government of the United States charged with investigating whether 

38

Compact funds, or any other assistance authorized under this Compact, as amended, have, or are being, used for purposes other than those set forth in this Compact, 

as amended, or its subsidiary agreements. In carrying out this investigative authority, such United States Government representatives may request that the Government of the Federated States of Micronesia subpoena documents and records and 

compel testimony in accordance with the laws and Constitution of the Federated 

States of Micronesia. Such assistance by the Government of the Federated States 

of Micronesia to the Government of the United States shall not be unreasonably 

withheld. The obligation of the Government of the Federated States of Micronesia 

to fulfill its pledge herein is a condition to its receiving payment of such funds or 

other assistance authorized under this Compact, as amended. The Government of 

the United States shall pay any reasonable costs for extraordinary services executed 

by the Government of the Federated States of Micronesia in carrying out the provisions of this section. 

Article IV 

Trade 

Section 241

The Federated States of Micronesia is not included in the customs territory of the 

United States. 

Section 242

The President shall proclaim the following tariff treatment for articles imported 

from the Federated States of Micronesia which shall apply during the period of effectiveness of this title: 

(a) Unless otherwise excluded, articles imported from the Federated States of 

Micronesia, subject to the limitations imposed under section 503(b) of title V of 

the Trade Act of 1974 (19 U.S.C. 2463(b)), shall be exempt from duty. 

(b) Only tuna in airtight containers provided for in heading 1604.14.22 of the 

Harmonized Tariff Schedule of the United States that is imported from the Federated States of Micronesia and the Republic of the Marshall Islands during 

any calendar year not to exceed 10 percent of apparent United States consumption of tuna in airtight containers during the immediately preceding calendar 

year, as reported by the National Marine Fisheries Service, shall be exempt 

from duty; but the quantity of tuna given duty-free treatment under this paragraph for any calendar year shall be counted against the aggregated quantity 

of tuna in airtight containers that is dutiable under rate column numbered 1 

of such heading 1604.14.22 for that calendar year. 

(c) The duty-free treatment provided under subsection (a) shall not apply to—

(1) watches, clocks, and timing apparatus provided for in Chapter 91, excluding heading 9113, of the Harmonized Tariff Schedule of the United 

States; 

(2) buttons (whether finished or not finished) provided for in items 

9606.21.40 and 9606.29.20 of such Schedule; 

(3) textile and apparel articles which are subject to textile agreements; 

and 

(4) footwear, handbags, luggage, flat goods, work gloves, and leather 

wearing apparel which were not eligible articles for purposes of title V of 

the Trade Act of 1974 (19 U.S.C. 2461, et seq.) on April 1, 1984. 

(d) If the cost or value of materials produced in the customs territory of the 

United States is included with respect to an eligible article which is a product 

of the Federated States of Micronesia, an amount not to exceed 15 percent of 

the appraised value of the article at the time it is entered that is attributable 

to such United States cost or value may be applied for duty assessment purposes toward determining the percentage referred to in section 503(a)(2) of title 

V of the Trade Act of 1974. 

Section 243

Articles imported from the Federated States of Micronesia which are not exempt 

from duty under subsections (a), (b), (c), and (d) of section 242 shall be subject to 

the rates of duty set forth in column numbered 1-general of the Harmonized Tariff 

Schedule of the United States (HTSUS). 

Section 244

(a) All products of the United States imported into the Federated States of Micronesia shall receive treatment no less favorable than that accorded like products of 

any foreign country with respect to customs duties or charges of a similar nature 

and with respect to laws and regulations relating to importation, exportation, taxation, sale, distribution, storage or use. 

39

(b) The provisions of subsection (a) shall not apply to advantages accorded by the 

Federated States of Micronesia by virtue of their full membership in the Pacific Island Countries Trade Agreement (PICTA), done on August 18, 2001, to those governments listed in Article 26 of PICTA, as of the date the Compact, as amended, 

is signed. 

(c) Prior to entering into consultations on, or concluding, a free trade agreement 

with governments not listed in Article 26 of PICTA, the Federated States of Micronesia shall consult with the United States regarding whether or how subsection (a) 

of section 244 shall be applied. 

Article V 

Finance and Taxation 

Section 251

The currency of the United States is the official circulating legal tender of the 

Federated States of Micronesia. Should the Government of the Federated States of 

Micronesia act to institute another currency, the terms of an appropriate currency 

transitional period shall be as agreed with the Government of the United States. 

Section 252

The Government of the Federated States of Micronesia may, with respect to 

United States persons, tax income derived from sources within its respective jurisdiction, property situated therein, including transfers of such property by gift or at 

death, and products consumed therein, in such manner as the Government of the 

Federated States of Micronesia deems appropriate. The determination of the source 

of any income, or the situs of any property, shall for purposes of this Compact be 

made according to the United States Internal Revenue Code. 

Section 253

A citizen of the Federated States of Micronesia, domiciled therein, shall be exempt 

from estate, gift, and generation-skipping transfer taxes imposed by the Government of the United States, provided that such citizen of the Federated States of Micronesia is neither a citizen nor a resident of the United States. 

Section 254

(a) In determining any income tax imposed by the Government of the Federated 

States of Micronesia, the Government of the Federated States of Micronesia shall 

have authority to impose tax upon income derived by a resident of the Federated 

States of Micronesia from sources without the Federated States of Micronesia, in the 

same manner and to the same extent as the Government of the Federated States 

of Micronesia imposes tax upon income derived from within its own jurisdiction. If 

the Government of the Federated States of Micronesia exercises such authority as 

provided in this subsection, any individual resident of the Federated States of Micronesia who is subject to tax by the Government of the United States on income 

which is also taxed by the Government of the Federated States of Micronesia shall 

be relieved of liability to the Government of the United States for the tax which, 

but for this subsection, would otherwise be imposed by the Government of the 

United States on such income. However, the relief from liability to the United 

States Government referred to in the preceding sentence means only relief in the 

form of the foreign tax credit (or deduction in lieu thereof) available with respect 

to the income taxes of a possession of the United States, and relief in the form of 

the exclusion under section 911 of the Internal Revenue Code of 1986. For purposes 

of this section, the term ‘‘resident of the Federated States of Micronesia’’ shall be 

deemed to include any person who was physically present in the Federated States 

of Micronesia for a period of 183 or more days during any taxable year. 

(b) If the Government of the Federated States of Micronesia subjects income to 

taxation substantially similar to that imposed by the Trust Territory Code in effect 

on January 1, 1980, such Government shall be deemed to have exercised the authority described in section 254(a). 

Section 255

For purposes of section 274(h)(3)(A) of the United States Internal Revenue Code 

of 1986, the term ‘‘North American Area’’ shall include the Federated States of Micronesia. 

40

TITLE THREE 

SECURITY AND DEFENSE RELATIONS 

Article I 

Authority and Responsibility 

Section 311

(a) The Government of the United States has full authority and responsibility for 

security and defense matters in or relating to the Federated States of Micronesia. 

(b) This authority and responsibility includes: 

(1) the obligation to defend the Federated States of Micronesia and its people 

from attack or threats thereof as the United States and its citizens are defended; 

(2) the option to foreclose access to or use of the Federated States of Micronesia by military personnel or for the military purposes of any third country; 

and 

(3) the option to establish and use military areas and facilities in the Federated States of Micronesia, subject to the terms of the separate agreements referred to in sections 321 and 323. 

(c) The Government of the United States confirms that it shall act in accordance 

with the principles of international law and the Charter of the United Nations in 

the exercise of this authority and responsibility. 

Section 312

Subject to the terms of any agreements negotiated in accordance with sections 321 

and 323, the Government of the United States may conduct within the lands, waters 

and airspace of the Federated States of Micronesia the activities and operations necessary for the exercise of its authority and responsibility under this Title. 

Section 313

(a) The Government of the Federated States of Micronesia shall refrain from actions that the Government of the United States determines, after appropriate consultation with that Government, to be incompatible with its authority and responsibility for security and defense matters in or relating to the Federated States of Micronesia. 

(b) The consultations referred to in this section shall be conducted expeditiously 

at senior levels of the two Governments, and the subsequent determination by the 

Government of the United States referred to in this section shall be made only at 

senior interagency levels of the Government of the United States. 

(c) The Government of the Federated States of Micronesia shall be afforded, on 

an expeditious basis, an opportunity to raise its concerns with the United States 

Secretary of State personally and the United States Secretary of Defense personally 

regarding any determination made in accordance with this section. 

Section 314

(a) Unless otherwise agreed, the Government of the United States shall not, in 

the Federated States of Micronesia:

(1) test by detonation or dispose of any nuclear weapon, nor test, dispose of, 

or discharge any toxic chemical or biological weapon; or 

(2) test, dispose of, or discharge any other radioactive, toxic chemical or biological materials in an amount or manner which would be hazardous to public 

health or safety. 

(b) Unless otherwise agreed, other than for transit or overflight purposes or during time of a national emergency declared by the President of the United States, 

a state of war declared by the Congress of the United States or as necessary to defend against an actual or impending armed attack on the United States, the Federated States of Micronesia or the Republic of the Marshall Islands, the Government 

of the United States shall not store in the Federated States of Micronesia or the 

Republic of the Marshall Islands any toxic chemical weapon, nor any radioactive 

materials nor any toxic chemical materials intended for weapons use. 

(c) Radioactive, toxic chemical, or biological materials not intended for weapons 

use shall not be affected by section 314(b). 

(d) No material or substance referred to in this section shall be stored in the Federated States of Micronesia except in an amount and manner which would not be 

hazardous to public health or safety. In determining what shall be an amount or 

manner which would be hazardous to public health or safety under this section, the 

Government of the United States shall comply with any applicable mutual agreement, international guidelines accepted by the Government of the United States, 

and the laws of the United States and their implementing regulations. 

41

(e) Any exercise of the exemption authority set forth in section 161(e) shall have 

no effect on the obligations of the Government of the United States under this section or on the application of this subsection. 

(f) The provisions of this section shall apply in the areas in which the Government 

of the Federated States of Micronesia exercises jurisdiction over the living resources 

of the seabed, subsoil or water column adjacent to its coasts. 

Section 315

The Government of the United States may invite members of the armed forces 

of other countries to use military areas and facilities in the Federated States of Micronesia, in conjunction with and under the control of United States Armed Forces. 

Use by units of the armed forces of other countries of such military areas and facilities, other than for transit and overflight purposes, shall be subject to consultation 

with and, in the case of major units, approval of the Government of the Federated 

States of Micronesia. 

Section 316

The authority and responsibility of the Government of the United States under 

this Title may not be transferred or otherwise assigned. 

Article II 

Defense Facilities and Operating Rights 

Section 321

(a) Specific arrangements for the establishment and use by the Government of the 

United States of military areas and facilities in the Federated States of Micronesia 

are set forth in separate agreements, which shall remain in effect in accordance 

with the terms of such agreements. 

(b) If, in the exercise of its authority and responsibility under this Title, the Government of the United States requires the use of areas within the Federated States 

of Micronesia in addition to those for which specific arrangements are concluded 

pursuant to section 321(a), it may request the Government of the Federated States 

of Micronesia to satisfy those requirements through leases or other arrangements. 

The Government of the Federated States of Micronesia shall sympathetically consider any such request and shall establish suitable procedures to discuss it with and 

provide a prompt response to the Government of the United States. 

(c) The Government of the United States recognizes and respects the scarcity and 

special importance of land in the Federated States of Micronesia. In making any requests pursuant to section 321(b), the Government of the United States shall follow 

the policy of requesting the minimum area necessary to accomplish the required security and defense purpose, of requesting only the minimum interest in real property necessary to support such purpose, and of requesting first to satisfy its requirement through public real property, where available, rather than through private 

real property. 

Section 322

The Government of the United States shall provide and maintain fixed and floating aids to navigation in the Federated States of Micronesia at least to the extent 

necessary for the exercise of its authority and responsibility under this Title. 

Section 323

The military operating rights of the Government of the United States and the 

legal status and contractual arrangements of the United States Armed Forces, their 

members, and associated civilians, while present in the Federated States of Micronesia are set forth in separate agreements, which shall remain in effect in accordance with the terms of such agreements. 

Article III 

Defense Treaties and International Security Agreements 

Section 331

Subject to the terms of this Compact, as amended, and its related agreements, the 

Government of the United States, exclusively, has assumed and enjoys, as to the 

Federated States of Micronesia, all obligations, responsibilities, rights and benefits 

of: 

(a) Any defense treaty or other international security agreement applied by the 

Government of the United States as Administering Authority of the Trust Territory 

of the Pacific Islands as of November 2, 1986. 

(b) Any defense treaty or other international security agreement to which the 

Government of the United States is or may become a party which it determines to 

be applicable in the Federated States of Micronesia. Such a determination by the 

42

Government of the United States shall be preceded by appropriate consultation with 

the Government of the Federated States of Micronesia. 

Article IV 

Service in Armed Forces of the United States 

Section 341

Any person entitled to the privileges set forth in Section 141 (with the exception 

of any person described in section 141(a)(5) who is not a citizen of the Federated 

States of Micronesia) shall be eligible to volunteer for service in the Armed Forces 

of the United States, but shall not be subject to involuntary induction into military 

service of the United States as long as such person has resided in the United States 

for a period of less than one year, provided that no time shall count towards this 

one year while a person admitted to the United States under the Compact, or the 

Compact, as amended, is engaged in full-time study in the United States. Any person described in section 141(a)(5) who is not a citizen of the Federated States of Micronesia shall be subject to United States laws relating to selective service. 

Section 342

The Government of the United States shall have enrolled, at any one time, at 

least one qualified student from the Federated States of Micronesia, as may be nominated by the Government of the Federated States of Micronesia, in each of: 

(a) The United States Coast Guard Academy pursuant to 14 U.S.C. 195. 

(b) The United States Merchant Marine Academy pursuant to 46 U.S.C. 

1295(b)(6), provided that the provisions of 46 U.S.C. 1295b(b)(6)(C) shall not apply 

to the enrollment of students pursuant to section 342(b) of this Compact, as amended. 

Article V 

General Provisions 

Section 351

(a) The Government of the United States and the Government of the Federated 

States of Micronesia shall continue to maintain a Joint Committee empowered to 

consider disputes arising under the implementation of this Title and its related 

agreements. 

(b) The membership of the Joint Committee shall comprise selected senior officials 

of the two Governments. The senior United States military commander in the Pacific area shall be the senior United States member of the Joint Committee. For the 

meetings of the Joint Committee, each of the two Governments may designate additional or alternate representatives as appropriate for the subject matter under consideration. 

(c) Unless otherwise mutually agreed, the Joint Committee shall meet annually 

at a time and place to be designated, after appropriate consultation, by the Government of the United States. The Joint Committee also shall meet promptly upon request of either of its members. The Joint Committee shall follow such procedures, 

including the establishment of functional subcommittees, as the members may from 

time to time agree. Upon notification by the Government of the United States, the 

Joint Committee of the United States and the Federated States of Micronesia shall 

meet promptly in a combined session with the Joint Committee established and 

maintained by the Government of the United States and the Republic of the Marshall Islands to consider matters within the jurisdiction of the two Joint Committees. 

(d) Unresolved issues in the Joint Committee shall be referred to the Governments for resolution, and the Government of the Federated States of Micronesia 

shall be afforded, on an expeditious basis, an opportunity to raise its concerns with 

the United States Secretary of Defense personally regarding any unresolved issue 

which threatens its continued association with the Government of the United 

States. 

Section 352

In the exercise of its authority and responsibility under Title Three, the Government of the United States shall accord due respect to the authority and responsibility of the Government of the Federated States of Micronesia under Titles One, 

Two and Four and to the responsibility of the Government of the Federated States 

of Micronesia to assure the well-being of its people. 

Section 353

(a) The Government of the United States shall not include the Government of the 

Federated States of Micronesia as a named party to a formal declaration of war, 

without that Government’s consent. 

43

(b) Absent such consent, this Compact, as amended, is without prejudice, on the 

ground of belligerence or the existence of a state of war, to any claims for damages 

which are advanced by the citizens, nationals or Government of the Federated 

States of Micronesia, which arise out of armed conflict subsequent to November 3, 

1986, and which are: 

(1) petitions to the Government of the United States for redress; or 

(2) claims in any manner against the government, citizens, nationals or entities of any third country. 

(c) Petitions under section 353(b)(1) shall be treated as if they were made by citizens of the United States. 

Section 354

(a) The Government of the United States and the Government of the Federated 

States of Micronesia are jointly committed to continue their security and defense relations, as set forth in this Title. Accordingly, it is the intention of the two countries 

that the provisions of this Title shall remain binding as long as this Compact, as 

amended, remains in effect, and thereafter as mutually agreed, unless earlier terminated by mutual agreement pursuant to section 441, or amended pursuant to Article 

III of Title Four. If at any time the Government of the United States, or the Government of the Federated States of Micronesia, acting unilaterally, terminates this 

Title, such unilateral termination shall be considered to be termination of the entire 

Compact, in which case the provisions of section 442 and 452 (in the case of termination by the Government of the United States) or sections 443 and 453 (in the case 

of termination by the Government of the Federated States of Micronesia), with the 

exception of paragraph (3) of subsection (a) of section 452 or paragraph (3) of subsection (a) of section 453, as the case may be, shall apply. 

(b) The Government of the United States recognizes, in view of the special relationship between the Government of the United States and the Government of the 

Federated States of Micronesia, and in view of the existence of the separate agreement regarding mutual security concluded with the Government of the Federated 

States of Micronesia pursuant to sections 321 and 323, that, even if this Title should 

terminate, any attack on the Federated States of Micronesia during the period in 

which such separate agreement is in effect, would constitute a threat to the peace 

and security of the entire region and a danger to the United States. In the event 

of such an attack, the Government of the United States would take action to meet 

the danger to the United States and to the Federated States of Micronesia in accordance with its constitutional processes. 

(c) As reflected in Article 21(1)(b) of the Trust Fund Agreement, the Government 

of the United States and the Government of the Federated States of Micronesia further recognize, in view of the special relationship between their countries, that even 

if this Title should terminate, the Government of the Federated States of Micronesia 

shall refrain from actions which the Government of the United States determines, 

after appropriate consultation with that Government, to be incompatible with its authority and responsibility for security and defense matters in or relating to the Federated States of Micronesia or the Republic of the Marshall Islands. 

TITLE FOUR 

GENERAL PROVISIONS 

Article I 

Approval and Effective Date 

Section 411

Pursuant to section 432 of the Compact and subject to subsection (e) of section 

461 of the Compact, as amended, the Compact, as amended, shall come into effect 

upon mutual agreement between the Government of the United States and the Government of the Federated States of Micronesia subsequent to completion of the following: 

(a) Approval by the Government of the Federated States of Micronesia in accordance with its constitutional processes. 

(b) Approval by the Government of the United States in accordance with its 

constitutional processes. 

Article II 

Conference and Dispute Resolution 

Section 421

44

The Government of the United States shall confer promptly at the request of the 

Government of the Federated States of Micronesia and that Government shall confer promptly at the request of the Government of the United States on matters relating to the provisions of this Compact, as amended, or of its related agreements. 

Section 422

In the event the Government of the United States or the Government of the Federated States of Micronesia, after conferring pursuant to section 421, determines 

that there is a dispute and gives written notice thereof, the two Governments shall 

make a good faith effort to resolve the dispute between themselves. 

Section 423

If a dispute between the Government of the United States and the Government 

of the Federated States of Micronesia cannot be resolved within 90 days of written 

notification in the manner provided in section 422, either party to the dispute may 

refer it to arbitration in accordance with section 424. 

Section 424

Should a dispute be referred to arbitration as provided for in section 423, an Arbitration Board shall be established for the purpose of hearing the dispute and rendering a decision which shall be binding upon the two parties to the dispute unless 

the two parties mutually agree that the decision shall be advisory. Arbitration shall 

occur according to the following terms: 

(a) An Arbitration Board shall consist of a Chairman and two other members, 

each of whom shall be a citizen of a party to the dispute. Each of the two Governments which is a party to the dispute shall appoint one member to the Arbitration 

Board. If either party to the dispute does not fulfill the appointment requirements 

of this section within 30 days of referral of the dispute to arbitration pursuant to 

section 423, its member on the Arbitration Board shall be selected from its own 

standing list by the other party to the dispute. Each Government shall maintain a 

standing list of 10 candidates. The parties to the dispute shall jointly appoint a 

Chairman within 15 days after selection of the other members of the Arbitration 

Board. Failing agreement on a Chairman, the Chairman shall be chosen by lot from 

the standing lists of the parties to the dispute within 5 days after such failure. 

(b) Unless otherwise provided in this Compact, as amended, or its related agreements, the Arbitration Board shall have jurisdiction to hear and render its final determination on all disputes arising exclusively under Articles I, II, III, IV and V of 

Title One, Title Two, Title Four, and their related agreements. 

(c) Each member of the Arbitration Board shall have one vote. Each decision of 

the Arbitration Board shall be reached by majority vote. 

(d) In determining any legal issue, the Arbitration Board may have reference to 

international law and, in such reference, shall apply as guidelines the provisions set

forth in Article 38 of the Statute of the International Court of Justice. 

(e) The Arbitration Board shall adopt such rules for its proceedings as it may 

deem appropriate and necessary, but such rules shall not contravene the provisions 

of this Compact, as amended. Unless the parties provide otherwise by mutual agreement, the Arbitration Board shall endeavor to render its decision within 30 days 

after the conclusion of arguments. The Arbitration Board shall make findings of fact 

and conclusions of law and its members may issue dissenting or individual opinions. 

Except as may be otherwise decided by the Arbitration Board, one-half of all costs 

of the arbitration shall be borne by the Government of the United States and the 

remainder shall be borne by the Government of the Federated States of Micronesia. 

Article III 

Amendment 

Section 431

The provisions of this Compact, as amended, may be further amended by mutual 

agreement of the Government of the United States and the Government of the Federated States of Micronesia, in accordance with their respective constitutional processes. 

Article IV 

Termination 

Section 441

This Compact, as amended, may be terminated by mutual agreement of the Government of the Federated States of Micronesia and the Government of the United 

States, in accordance with their respective constitutional processes. Such mutual 

termination of this Compact, as amended, shall be without prejudice to the continVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00044 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
45

ued application of section 451 of this Compact, as amended, and the provisions of 

the Compact, as amended, set forth therein. 

Section 442

Subject to section 452, this Compact, as amended, may be terminated by the Government of the United States in accordance with its constitutional processes. Such 

termination shall be effective on the date specified in the notice of termination by 

the Government of the United States but not earlier than six months following delivery of such notice. The time specified in the notice of termination may be extended. Such termination of this Compact, as amended, shall be without prejudice 

to the continued application of section 452 of this Compact, as amended, and the 

provisions of the Compact, as amended, set forth therein. 

Section 443

This Compact, as amended, shall be terminated by the Government of the Federated States of Micronesia, pursuant to its constitutional processes, subject to section 453 if the people represented by that Government vote in a plebiscite to terminate the Compact, as amended, or by another process permitted by the FSM constitution and mutually agreed between the Governments of the United States and 

the Federated States of Micronesia. The Government of the Federated States of Micronesia shall notify the Government of the United States of its intention to call 

such a plebiscite, or to pursue another mutually agreed and constitutional process, 

which plebiscite or process shall take place not earlier than three months after delivery of such notice. The plebiscite or other process shall be administered by the 

Government of the Federated States of Micronesia in accordance with its constitutional and legislative processes. If a majority of the valid ballots cast in the plebiscite or other process favors termination, the Government of the Federated States 

of Micronesia shall, upon certification of the results of the plebiscite or other process, give notice of termination to the Government of the United States, such termination to be effective on the date specified in such notice but not earlier than three 

months following the date of delivery of such notice. The time specified in the notice 

of termination may be extended. 

Article V 

Survivability 

Section 451

(a) Should termination occur pursuant to section 441, economic and other assistance by the Government of the United States shall continue only if and as mutually 

agreed by the Governments of the United States and the Federated States of Micronesia, and in accordance with the parties’ respective constitutional processes. 

(b) In view of the special relationship of the United States and the Federated 

States of Micronesia, as reflected in subsections (b) and (c) of section 354 of this 

Compact, as amended, and the separate agreement entered into consistent with 

those subsections, if termination occurs pursuant to section 441 prior to the twentieth anniversary of the effective date of this Compact, as amended, the United 

States shall continue to make contributions to the Trust Fund described in section 

215 of this Compact, as amended. 

(c) In view of the special relationship of the United States and the Federated 

States of Micronesia described in subsection (b) of this section, if termination occurs 

pursuant to section 441 following the twentieth anniversary of the effective date of 

this Compact, as amended, the Federated States of Micronesia shall be entitled to 

receive proceeds from the Trust Fund described in section 215 of this Compact, as 

amended, in the manner described in those provisions and the Trust Fund Agreement governing the distribution of such proceeds. 

Section 452

(a) Should termination occur pursuant to section 442 prior to the twentieth anniversary of the effective date of this Compact, as amended, the following provisions 

of this Compact, as amended, shall remain in full force and effect until the twentieth anniversary of the effective date of this Compact, as amended, and thereafter 

as mutually agreed: 

(1) Article VI and sections 172, 173, 176 and 177 of Title One; 

(2) Sections 232 and 234 of Title Two; 

(3) Title Three; and 

(4) Articles II, III, V and VI of Title Four. 

(b) Should termination occur pursuant to section 442 before the twentieth anniversary of the effective date of the Compact, as amended: 

(1) Except as provided in paragraph (2) of this subsection and subsection (c) 

of this section, economic and other assistance by the United States shall conVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00045 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
46

tinue only if and as mutually agreed by the Governments of the United States 

and the Federated States of Micronesia. 

(2) In view of the special relationship of the United States and the Federated 

States of Micronesia, as reflected in subsections (b) and (c) of section 354 of this 

Compact, as amended, and the separate agreement regarding mutual security, 

and the Trust Fund Agreement, the United States shall continue to make contributions to the Trust Fund described in section 215 of this Compact, as 

amended, in the manner described in the Trust Fund Agreement. 

(c) In view of the special relationship of the United States and the Federated 

States of Micronesia, as reflected in subsections 354(b) and (c) of this Compact, as 

amended, and the separate agreement regarding mutual security, and the Trust 

Fund Agreement, if termination occurs pursuant to section 442 following the twentieth anniversary of the effective date of this Compact, as amended, the Federated 

States of Micronesia shall continue to be eligible to receive proceeds from the Trust 

Fund described in section 215 of this Compact, as amended, in the manner described in those provisions and the Trust Fund Agreement. 

Section 453

(a) Should termination occur pursuant to section 443 prior to the twentieth anniversary of the effective date of this Compact, as amended, the following provisions 

of this Compact, as amended, shall remain in full force and effect until the twentieth anniversary of the effective date of this Compact, as amended, and thereafter 

as mutually agreed: 

(1) Article VI and sections 172, 173, 176 and 177 of Title One; 

(2) Sections 232 and 234 of Title Two; 

(3) Title Three; and 

(4) Articles II, III, V and VI of Title Four. 

(b) Upon receipt of notice of termination pursuant to section 443, the Government 

of the United States and the Government of the Federated States of Micronesia 

shall promptly consult with regard to their future relationship. Except as provided 

in subsection (c) and (d) of this section, these consultations shall determine the level 

of economic and other assistance, if any, which the Government of the United States 

shall provide to the Government of the Federated States of Micronesia for the period 

ending on the twentieth anniversary of the effective date of this Compact, as amended, and for any period thereafter, if mutually agreed. 

(c) In view of the special relationship of the United States and the Federated 

States of Micronesia, as reflected in subsections 354(b) and (c) of this Compact, as 

amended, and the separate agreement regarding mutual security, and the Trust 

Fund Agreement, if termination occurs pursuant to section 443 prior to the twentieth anniversary of the effective date of this Compact, as amended, the United 

States shall continue to make contributions to the Trust Fund described in section 

215 of this Compact, as amended, in the manner described in the Trust Fund Agreement. 

(d) In view of the special relationship of the United States and the Federated 

States of Micronesia, as reflected in subsections 354(b) and (c) of this Compact, as 

amended, and the separate agreement regarding mutual security, and the Trust 

Fund Agreement, if termination occurs pursuant to section 443 following the twentieth anniversary of the effective date of this Compact, as amended, the Federated 

States of Micronesia shall continue to be eligible to receive proceeds from the Trust 

Fund described in section 215 of this Compact, as amended, in the manner described in those provisions and the Trust Fund Agreement. 

Section 454

Notwithstanding any other provision of this Compact, as amended: 

(a) The Government of the United States reaffirms its continuing interest in 

promoting the economic advancement and budgetary self-reliance of the people 

of the Federated States of Micronesia. 

(b) The separate agreements referred to in Article II of Title Three shall remain in effect in accordance with their terms. 

Article VI 

Definition of Terms 

Section 461

For the purpose of this Compact, as amended, only, and without prejudice to the 

views of the Government of the United States or the Government of the Federated 

States of Micronesia as to the nature and extent of the jurisdiction of either of them 

under international law, the following terms shall have the following meanings: 

(a) ‘‘Trust Territory of the Pacific Islands’’ means the area established in the 

Trusteeship Agreement consisting of the former administrative districts of 

47

Kosrae, Yap, Ponape, the Marshall Islands and Truk as described in Title One, 

Trust Territory Code, section 1, in force on January 1, 1979. This term does not 

include the area of Palau or the Northern Mariana Islands. 

(b) ‘‘Trusteeship Agreement’’ means the agreement setting forth the terms of 

trusteeship for the Trust Territory of the Pacific Islands, approved by the Security Council of the United Nations April 2, 1947, and by the United States July 

18, 1947, entered into force July 18, 1947, 61 Stat. 3301, T.I.A.S. 1665, 8 

U.N.T.S. 189. 

(c) ‘‘The Federated States of Micronesia’’ and ‘‘the Republic of the Marshall 

Islands’’ are used in a geographic sense and include the land and water areas 

to the outer limits of the territorial sea and the air space above such areas as 

now or hereafter recognized by the Government of the United States. 

(d) ‘‘Compact’’ means the Compact of Free Association Between the United 

States and the Federated States of Micronesia and the Marshall Islands, that 

was approved by the United States Congress in section 201 of Public Law 99–

239 (Jan. 14, 1986) and went into effect with respect to the Federated States 

of Micronesia on November 3, 1986. 

(e) ‘‘Compact, as amended’’ means the Compact of Free Association Between 

the United States and the Federated States of Micronesia, as amended. The effective date of the Compact, as amended, shall be on a date to be determined 

by the President of the United States, and agreed to by the Government of the 

Federated States of Micronesia, following formal approval of the Compact, as 

amended, in accordance with section 411 of this Compact, as amended. 

(f) ‘‘Government of the Federated States of Micronesia’’ means the Government established and organized by the Constitution of the Federated States of 

Micronesia including all the political subdivisions and entities comprising that 

Government. 

(g) ‘‘Government of the Republic of the Marshall Islands’’ means the Government established and organized by the Constitution of the Republic of the Marshall Islands including all the political subdivisions and entities comprising that 

Government. 

(h) The following terms shall be defined consistent with the 1998 Edition of 

the Radio Regulations of the International Telecommunications Union as follows: 

(1) ‘‘Radiocommunication’’ means telecommunication by means of radio 

waves. 

(2) ‘‘Station’’ means one or more transmitters or receivers or a combination of transmitters and receivers, including the accessory equipment, necessary at one location for carrying on a radiocommunication service, or the 

radio astronomy service. 

(3) ‘‘Broadcasting Service’’ means a radiocommunication service in which 

the transmissions are intended for direct reception by the general public. 

This service may include sound transmissions, television transmissions or 

other types of transmission. 

(4) ‘‘Broadcasting Station’’ means a station in the broadcasting service. 

(5) ‘‘Assignment (of a radio frequency or radio frequency channel)’’ means 

an authorization given by an administration for a radio station to use a 

radio frequency or radio frequency channel under specified conditions. 

(6) ‘‘Telecommunication’’ means any transmission, emission or reception 

of signs, signals, writings, images and sounds or intelligence of any nature 

by wire, radio, optical or other electromagnetic systems. 

(i) ‘‘Military Areas and Facilities’’ means those areas and facilities in the Federated States of Micronesia reserved or acquired by the Government of the Federated States of Micronesia for use by the Government of the United States, as 

set forth in the separate agreements referred to in section 321. 

(j) ‘‘Tariff Schedules of the United States’’ means the Tariff Schedules of the 

United States as amended from time to time and as promulgated pursuant to 

United States law and includes the Tariff Schedules of the United States Annotated (TSUSA), as amended. 

(k) ‘‘Vienna Convention on Diplomatic Relations’’ means the Vienna Convention on Diplomatic Relations, done April 18, 1961, 23 U.S.T. 3227, T.I.A.S. 7502, 

500 U.N.T.S. 95. 

Section 462

(a) The Government of the United States and the Government of the Federated 

States of Micronesia previously have concluded agreements pursuant to the Compact, which shall remain in effect and shall survive in accordance with their terms, 

as follows: 

(1) Agreement Concluded Pursuant to Section 234 of the Compact; 

48

(2) Agreement Between the Government of the United States and the Government of the Federated States of Micronesia Regarding Friendship, Cooperation 

and Mutual Security Concluded Pursuant to Sections 321 and 323 of the Compact of Free Association; and 

(3) Agreement between the Government of the United States of America and 

the Federated States of Micronesia Regarding Aspects of the Marine Sovereignty and Jurisdiction of the Federated States of Micronesia. 

(b) The Government of the United States and the Government of the Federated 

States of Micronesia shall conclude prior to the date of submission of this Compact, 

as amended, to the legislatures of the two countries, the following related agreements which shall come into effect on the effective date of this Compact, as amended, and shall survive in accordance with their terms, as follows: 

(1) Federal Programs and Services Agreement Between the Government of 

the United States of America and the Government of the Federated States of 

Micronesia Concluded Pursuant to Article III of Title One, Article II of Title 

Two (including Section 222), and Section 231 of the Compact of Free Association, as amended which includes: 

(i) Postal Services and Related Programs; 

(ii) Weather Services and Related Programs; 

(iii) Civil Aviation Safety Service and Related Programs; 

(iv) Civil Aviation Economic Services and Related Programs; 

(v) United States Disaster Preparedness and Response Services and Related Programs; 

(vi) Federal Deposit Insurance Corporation Services and Related Programs; and 

(vii) Telecommunications Services and Related Programs. 

(2) Agreement Between the Government of the United States of America and 

the Government of the Federated States of Micronesia on Extradition, Mutual 

Assistance in Law Enforcement Matters and Penal Sanctions Concluded Pursuant to Section 175(a) of the Compact of Free Association, as amended; 

(3) Agreement Between the Government of the United States of America and 

the Government of the Federated States of Micronesia on Labor Recruitment 

Concluded Pursuant to Section 175(b) of the Compact of Free Association, as 

amended; 

(4) Agreement Concerning Procedures for the Implementation of United 

States Economic Assistance Provided in the Compact of Free Association, as 

Amended, of Free Association Between the Government of the United States of 

America and Government of the Federated States of Micronesia; 

(5) Agreement Between the Government of the United States of America and 

the Government of the Federated States of Micronesia Implementing Section 

215 and Section 216 of the Compact, as Amended, Regarding a Trust Fund; 

(6) Agreement Regarding the Military Use and Operating Rights of the Government of the United States in the Federated States of Micronesia Concluded 

Pursuant to Sections 211(b), 321 and 323 of the Compact of Free Association, 

as Amended; and the 

(7) Status of Forces Agreement Between the Government of the United States 

of America and the Government of the Federated States of Micronesia Concluded Pursuant to Section 323 of the Compact of Free Association, as Amended. 

Section 463

(a) Except as set forth in subsection (b) of this section, any reference in this Compact, as amended, to a provision of the United States Code or the Statutes at Large 

of the United States constitutes the incorporation of the language of such provision 

into this Compact, as amended, as such provision was in force on the effective date 

of this Compact, as amended. 

(b) Any reference in Articles IV and Article VI of Title One and Sections 174, 175, 

178 and 342 to a provision of the United States Code or the Statutes at Large of 

the United States or to the Privacy Act, the Freedom of Information Act, the Administrative Procedure Act or the Immigration and Nationality Act constitutes the incorporation of the language of such provision into this Compact, as amended, as 

such provision was in force on the effective date of this Compact, as amended, or 

as it may be amended thereafter on a non-discriminatory basis according to the constitutional processes of the United States. 

Article VII 

Concluding Provisions 

Section 471

49

Both the Government of the United States and the Government of the Federated 

States of Micronesia shall take all necessary steps, of a general or particular character, to ensure, no later than the entry into force date of this Compact, as amended, the conformity of its laws, regulations and administrative procedures with the 

provisions of this Compact, as amended, or in the case of subsection (d) of section 

141, as soon as reasonably possible thereafter. 

Section 472

This Compact, as amended, may be accepted, by signature or otherwise, by the 

Government of the United States and the Government of the Federated States of 

Micronesia. 

IN WITNESS WHEREOF, the undersigned, duly authorized, have signed this 

Compact of Free Association, as amended, which shall enter into force upon the exchange of diplomatic notes by which the Government of the United States of America and the Government of the Federated States of Micronesia inform each other 

about the fulfillment of their respective requirements for entry into force. 

DONE at Pohnpei, Federated States of Micronesia, in duplicate, this fourteenth 

(14) day of May, 2003, each text being equally authentic.

Signed (May 14, 2003) Signed (May 14, 2003) 

For the Government of the For the Government of the 

United States of America: Federated States of 

Micronesia:

(b) COMPACT OF FREE ASSOCIATION, AS AMENDED, BETWEEN THE GOVERNMENT OF

THE UNITED STATES OF AMERICA AND THE GOVERNMENT OF THE REPUBLIC OF THE

MARSHALL ISLANDS

PREAMBLE 

THE GOVERNMENT OF THE UNITED STATES OF AMERICA AND THE 

GOVERNMENT OF THE REPUBLIC OF THE MARSHALL ISLANDS 

Affirming that their Governments and their relationship as Governments are 

founded upon respect for human rights and fundamental freedoms for all, and that 

the people of the Republic of the Marshall Islands have the right to enjoy self-government; and 

Affirming the common interests of the United States of America and the Republic 

of the Marshall Islands in creating and maintaining their close and mutually beneficial relationship through the free and voluntary association of their respective Governments; and 

Affirming the interest of the Government of the United States in promoting the 

economic advancement and budgetary self-reliance of the Republic of the Marshall 

Islands; and 

Recognizing that their relationship until the entry into force on October 21, 1986 

of the Compact was based upon the International Trusteeship System of the United 

Nations Charter, and in particular Article 76 of the Charter; and that pursuant to 

Article 76 of the Charter, the people of the Republic of the Marshall Islands have 

progressively developed their institutions of self-government, and that in the exercise of their sovereign right to self-determination they, through their freely-expressed wishes, have adopted a Constitution appropriate to their particular circumstances; and 

Recognizing that the Compact reflected their common desire to terminate the 

Trusteeship and establish a government-to-government relationship which was in 

accordance with the new political status based on the freely expressed wishes of the 

people of the Republic of the Marshall Islands and appropriate to their particular 

circumstances; and 

Recognizing that the people of the Republic of the Marshall Islands have and retain their sovereignty and their sovereign right to self-determination and the inherent right to adopt and amend their own Constitution and form of government and 

that the approval of the entry of the Government of the Republic of the Marshall 

Islands into the Compact by the people of the Republic of the Marshall Islands constituted an exercise of their sovereign right to self-determination; and 

Recognizing the common desire of the people of the United States and the people 

of the Republic of the Marshall Islands to maintain their close government-to-government relationship, the United States and the Republic of the Marshall Islands:

NOW, THEREFORE, MUTUALLY AGREE to continue and strengthen their relationship of free association by amending the Compact, which continues to provide 

a full measure of self-government for the people of the Republic of the Marshall Islands; and 

FURTHER AGREE that the relationship of free association derives from and is 

as set forth in this Compact, as amended, by the Governments of the United States 

50

and the Republic of the Marshall Islands; and that, during such relationship of free 

association, the respective rights and responsibilities of the Government of the 

United States and the Government of the Republic of the Marshall Islands in regard 

to this relationship of free association derive from and are as set forth in this Compact, as amended. 

TITLE ONE 

GOVERNMENTAL RELATIONS 

Article I 

Self-Government 

Section 111

The people of the Republic of the Marshall Islands, acting through the Government established under their Constitution, are self-governing. 

Article II 

Foreign Affairs 

Section 121

(a) The Government of the Republic of the Marshall Islands has the capacity to 

conduct foreign affairs and shall do so in its own name and right, except as otherwise provided in this Compact, as amended. 

(b) The foreign affairs capacity of the Government of the Republic of the Marshall 

Islands includes: 

(1) the conduct of foreign affairs relating to law of the sea and marine resources matters, including the harvesting, conservation, exploration or exploitation of living and non-living resources from the sea, seabed or subsoil to the 

full extent recognized under international law; 

(2) the conduct of its commercial, diplomatic, consular, economic, trade, banking, postal, civil aviation, communications, and cultural relations, including negotiations for the receipt of developmental loans and grants and the conclusion 

of arrangements with other governments and international and intergovernmental organizations, including any matters specially benefiting its individual 

citizens. 

(c) The Government of the United States recognizes that the Government of the 

Republic of the Marshall Islands has the capacity to enter into, in its own name 

and right, treaties and other international agreements with governments and regional and international organizations. 

(d) In the conduct of its foreign affairs, the Government of the Republic of the 

Marshall Islands confirms that it shall act in accordance with principles of international law and shall settle its international disputes by peaceful means. 

Section 122

The Government of the United States shall support applications by the Government of the Republic of the Marshall Islands for membership or other participation 

in regional or international organizations as may be mutually agreed. 

Section 123

(a) In recognition of the authority and responsibility of the Government of the 

United States under Title Three, the Government of the Republic of the Marshall 

Islands shall consult, in the conduct of its foreign affairs, with the Government of 

the United States. 

(b) In recognition of the foreign affairs capacity of the Government of the Republic 

of the Marshall Islands, the Government of the United States, in the conduct of its 

foreign affairs, shall consult with the Government of the Republic of the Marshall 

Islands on matters that the Government of the United States regards as relating 

to or affecting the Government of the Republic of the Marshall Islands. 

Section 124

The Government of the United States may assist or act on behalf of the Government of the Republic of the Marshall Islands in the area of foreign affairs as may 

be requested and mutually agreed from time to time. The Government of the United 

States shall not be responsible to third parties for the actions of the Government 

of the Republic of the Marshall Islands undertaken with the assistance or through 

the agency of the Government of the United States pursuant to this section unless 

expressly agreed. 

Section 125

51

The Government of the United States shall not be responsible for nor obligated 

by any actions taken by the Government of the Republic of the Marshall Islands 

in the area of foreign affairs, except as may from time to time be expressly agreed. 

Section 126

At the request of the Government of the Republic of the Marshall Islands and 

subject to the consent of the receiving state, the Government of the United States 

shall extend consular assistance on the same basis as for citizens of the United 

States to citizens of the Republic of the Marshall Islands for travel outside the Republic of the Marshall Islands, the United States and its territories and possessions. 

Section 127

Except as otherwise provided in this Compact, as amended, or its related agreements, all obligations, responsibilities, rights and benefits of the Government of the 

United States as Administering Authority which resulted from the application pursuant to the Trusteeship Agreement of any treaty or other international agreement 

to the Trust Territory of the Pacific Islands on October 20, 1986, are, as of that date, 

no longer assumed and enjoyed by the Government of the United States. 

Article III 

Communications 

Section 131

(a) The Government of the Republic of the Marshall Islands has full authority and 

responsibility to regulate its domestic and foreign communications, and the Government of the United States shall provide communications assistance as mutually 

agreed. 

(b) The Government of the Republic of the Marshall Islands has elected to undertake all functions previously performed by the Government of the United States 

with respect to domestic and foreign communications, except for those functions set 

forth in a separate agreement entered into pursuant to this section of the Compact, 

as amended. 

Section 132

The Government of the Republic of the Marshall Islands shall permit the Government of the United States to operate telecommunications services in the Republic 

of the Marshall Islands to the extent necessary to fulfill the obligations of the Government of the United States under this Compact, as amended, in accordance with 

the terms of separate agreements entered into pursuant to this section of the Compact, as amended. 

Article IV 

Immigration 

Section 141

(a) In furtherance of the special and unique relationship that exists between the 

United States and the Republic of the Marshall Islands, under the Compact, as 

amended, any person in the following categories may be admitted to lawfully engage 

in occupations, and establish residence as a nonimmigrant in the United States and 

its territories and possessions (the ‘‘United States’’) without regard to paragraphs 

(5) or (7)(B)(i)(II) of section 212(a) of the Immigration and Nationality Act, as 

amended, 8 U.S.C. 1182(a)(5) or (7)(B)(i)(II): 

(1) a person who, on October 21, 1986, was a citizen of the Trust Territory 

of the Pacific Islands, as defined in Title 53 of the Trust Territory Code in force 

on January 1, 1979, and has become and remains a citizen of the Republic of 

the Marshall Islands; 

(2) a person who acquires the citizenship of the Republic of the Marshall Islands at birth, on or after the effective date of the Constitution of the Republic 

of the Marshall Islands; 

(3) an immediate relative of a person referred to in paragraphs (1) or (2) of 

this section, provided that such immediate relative is a naturalized citizen of 

the Republic of the Marshall Islands who has been an actual resident there for 

not less than five years after attaining such naturalization and who holds a certificate of actual residence, and further provided, that, in the case of a spouse, 

such spouse has been married to the person referred to in paragraph (1) or (2) 

of this section for at least five years, and further provided, that the Government 

of the United States is satisfied that such naturalized citizen meets the requirement of subsection (b) of section 104 of Public Law 99–239 as it was in effect 

on the day prior to the effective date of this Compact, as amended; 

(4) a naturalized citizen of the Republic of the Marshall Islands who was an 

actual resident there for not less than five years after attaining such naturalizaVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00051 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
52

tion and who satisfied these requirements as of April 30, 2003, who continues 

to be an actual resident and holds a certificate of actual residence, and whose 

name is included in a list furnished by the Government of the Republic of the 

Marshall Islands to the Government of the United States no later than the effective date of the Compact, as amended, in form and content acceptable to the 

Government of the United States, provided, that the Government of the United 

States is satisfied that such naturalized citizen meets the requirement of subsection (b) of section 104 of Public Law 99–239 as it was in effect on the day 

prior to the effective date of this Compact, as amended; or 

(5) an immediate relative of a citizen of the Republic of the Marshall Islands, 

regardless of the immediate relative’s country of citizenship or period of residence in the Republic of the Marshall Islands, if the citizen of the Republic of 

the Marshall Islands is serving on active duty in any branch of the United 

States Armed Forces, or in the active reserves. 

(b) Notwithstanding subsection (a) of this section, a person who is coming to the 

United States pursuant to an adoption outside the United States, or for the purpose 

of adoption in the United States, is ineligible for admission under the Compact and 

the Compact, as amended. This subsection shall apply to any person who is or was 

an applicant for admission to the United States on or after March 1, 2003, including 

any applicant for admission in removal proceedings (including appellate proceedings) on or after March 1, 2003, regardless of the date such proceedings were 

commenced. This subsection shall have no effect on the ability of the Government 

of the United States or any United States State or local government to commence 

or otherwise take any action against any person or entity who has violated any law 

relating to the adoption of any person. 

(c) Notwithstanding subsection (a) of this section, no person who has been or is 

granted citizenship in the Republic of the Marshall Islands, or has been or is issued 

a Republic of the Marshall Islands passport pursuant to any investment, passport 

sale, or similar program has been or shall be eligible for admission to the United 

States under the Compact or the Compact, as amended. 

(d) A person admitted to the United States under the Compact, or the Compact, 

as amended, shall be considered to have the permission of the Government of the 

United States to accept employment in the United States. An unexpired Republic 

of the Marshall Islands passport with unexpired documentation issued by the Government of the United States evidencing admission under the Compact or the Compact, as amended, shall be considered to be documentation establishing identity and 

employment authorization under section 274A(b)(1)(B) of the Immigration and Nationality Act, as amended, 8 U.S.C. 1324a(b)(1)(B). The Government of the United 

States will take reasonable and appropriate steps to implement and publicize this 

provision, and the Government of the Republic of the Marshall Islands will also take 

reasonable and appropriate steps to publicize this provision. 

(e) For purposes of the Compact and the Compact, as amended, 

(1) the term ‘‘residence’’ with respect to a person means the person’s principal, 

actual dwelling place in fact, without regard to intent, as provided in section 

101(a)(33) of the Immigration and Nationality Act, as amended, 8 U.S.C. 

1101(a)(33), and variations of the term ‘‘residence,’’ including ‘‘resident’’ and ‘‘reside,’’ shall be similarly construed; 

(2) the term ‘‘actual residence’’ means physical presence in the Republic of the 

Marshall Islands during eighty-five percent of the five-year period of residency 

required by section 141(a)(3) and (4); 

(3) the term ‘‘certificate of actual residence’’ means a certificate issued to a 

naturalized citizen by the Government of the Republic of the Marshall Islands 

stating that the citizen has complied with the actual residence requirement of 

section 141(a)(3) or (4); 

(4) the term ‘‘nonimmigrant’’ means an alien who is not an ‘‘immigrant’’ as 

defined in section 101(a)(15) of such Act, 8 U.S.C. 1101(a)(15); and 

(5) the term ‘‘immediate relative’’ means a spouse, or unmarried son or unmarried daughter less than 21 years of age. 

(f) The Immigration and Nationality Act, as amended, shall apply to any person 

admitted or seeking admission to the United States (other than a United States possession or territory where such Act does not apply) under the Compact or the Compact, as amended, and nothing in the Compact or the Compact, as amended, shall 

be construed to limit, preclude, or modify the applicability of, with respect to such 

person: 

(1) any ground of inadmissibility or deportability under such Act (except sections 212(a)(5) and 212(a)(7)(B)(i)(II) of such Act, as provided in subsection (a) 

of this section), and any defense thereto, provided that, section 237(a)(5) of such 

Act shall be construed and applied as if it reads as follows: ‘‘any alien who has 

been admitted under the Compact, or the Compact, as amended, who cannot 

53

show that he or she has sufficient means of support in the United States, is 

deportable;’’

(2) the authority of the Government of the United States under section 

214(a)(1) of such Act to provide that admission as a nonimmigrant shall be for 

such time and under such conditions as the Government of the United States 

may by regulations prescribe; 

(3) except for the treatment of certain documentation for purposes of section 

274A(b)(1)(B) of such Act as provided by subsection (d) of this section of the 

Compact, as amended, any requirement under section 274A, including but not 

limited to section 274A(b)(1)(E); 

(4) section 643 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996, Public Law 104–208, and actions taken pursuant to section 

643; and 

(5) the authority of the Government of the United States otherwise to administer and enforce the Immigration and Nationality Act, as amended, or other 

United States law. 

(g) Any authority possessed by the Government of the United States under this 

section of the Compact or the Compact, as amended, may also be exercised by the 

Government of a territory or possession of the United States where the Immigration 

and Nationality Act, as amended, does not apply, to the extent such exercise of authority is lawful under a statute or regulation of such territory or possession that 

is authorized by the laws of the United States. 

(h) Subsection (a) of this section does not confer on a citizen of the Republic of 

the Marshall Islands the right to establish the residence necessary for naturalization under the Immigration and Nationality Act, as amended, or to petition for benefits for alien relatives under that Act. Subsection (a) of this section, however, shall 

not prevent a citizen of the Republic of the Marshall Islands from otherwise acquiring such rights or lawful permanent resident alien status in the United States. 

Section 142

(a) Any citizen or national of the United States may be admitted to lawfully engage in occupations, and reside in the Republic of the Marshall Islands, subject to 

the rights of the Government of the Republic of the Marshall Islands to deny entry 

to or deport any such citizen or national as an undesirable alien. Any determination 

of inadmissibility or deportability shall be based on reasonable statutory grounds 

and shall be subject to appropriate administrative and judicial review within the Republic of the Marshall Islands. If a citizen or national of the United States is a 

spouse of a citizen of the Republic of the Marshall Islands, the Government of the 

Republic of the Marshall Islands shall allow the United States citizen spouse to establish residence. Should the Republic of the Marshall Islands citizen spouse predecease the United States citizen spouse during the marriage, the Government of 

the Republic of the Marshall Islands shall allow the United States citizen spouse 

to continue to reside in the Republic of the Marshall Islands. 

(b) In enacting any laws or imposing any requirements with respect to citizens 

and nationals of the United States entering the Republic of the Marshall Islands 

under subsection (a) of this section, including any grounds of inadmissibility or deportability, the Government of the Republic of the Marshall Islands shall accord to 

such citizens and nationals of the United States treatment no less favorable than 

that accorded to citizens of other countries. 

(c) Consistent with subsection (a) of this section, with respect to citizens and nationals of the United States seeking to engage in employment or invest in the Republic of the Marshall Islands, the Government of the Republic of the Marshall Islands shall adopt immigration-related procedures no less favorable than those 

adopted by the Government of the United States with respect to citizens of the Republic of the Marshall Islands seeking employment in the United States. 

Section 143

Any person who relinquishes, or otherwise loses, his United States nationality or 

citizenship, or his Republic of the Marshall Islands citizenship, shall be ineligible 

to receive the privileges set forth in sections 141 and 142. Any such person may 

apply for admission to the United States or the Republic of the Marshall Islands, 

as the case may be, in accordance with any other applicable laws of the United 

States or the Republic of the Marshall Islands relating to immigration of aliens from 

other countries. The laws of the Republic of the Marshall Islands or the United

States, as the case may be, shall dictate the terms and conditions of any such person’s stay. 

54

Article V 

Representation 

Section 151

Relations between the Government of the United States and the Government of 

the Republic of the Marshall Islands shall be conducted in accordance with the Vienna Convention on Diplomatic Relations. In addition to diplomatic missions and 

representation, the Governments may establish and maintain other offices and designate other representatives on terms and in locations as may be mutually agreed. 

Section 152

(a) Any citizen or national of the United States who, without authority of the 

United States, acts as the agent of the Government of the Republic of the Marshall 

Islands with regard to matters specified in the provisions of the Foreign Agents Registration Act of 1938, as amended (22 U.S.C. 611 et seq.), that apply with respect 

to an agent of a foreign principal shall be subject to the requirements of such Act. 

Failure to comply with such requirements shall subject such citizen or national to 

the same penalties and provisions of law as apply in the case of the failure of such 

an agent of a foreign principal to comply with such requirements. For purposes of 

the Foreign Agents Registration Act of 1938, the Republic of the Marshall Islands 

shall be considered to be a foreign country. 

(b) Subsection (a) of this section shall not apply to a citizen or national of the 

United States employed by the Government of the Republic of the Marshall Islands 

with respect to whom the Government of the Republic of the Marshall Islands from 

time to time certifies to the Government of the United States that such citizen or 

national is an employee of the Republic of the Marshall Islands whose principal duties are other than those matters specified in the Foreign Agents Registration Act 

of 1938, as amended, that apply with respect to an agent of a foreign principal. The 

agency or officer of the United States receiving such certifications shall cause them 

to be filed with the Attorney General, who shall maintain a publicly available list 

of the persons so certified. 

Article VI 

Environmental Protection 

Section 161

The Governments of the United States and the Republic of the Marshall Islands 

declare that it is their policy to promote efforts to prevent or eliminate damage to 

the environment and biosphere and to enrich understanding of the natural resources of the Republic of the Marshall Islands. In order to carry out this policy, 

the Government of the United States and the Government of the Republic of the 

Marshall Islands agree to the following mutual and reciprocal undertakings: 

(a) The Government of the United States: 

(1) shall, for its activities controlled by the U.S. Army at Kwajalein Atoll 

and in the Mid-Atoll Corridor and for U.S. Army Kwajalein Atoll activities 

in the Republic of the Marshall Islands, continue to apply the Environmental Standards and Procedures for United States Army Kwajalein Atoll 

Activities in the Republic of the Marshall Islands, unless and until those 

Standards or Procedures are modified by mutual agreement of the Governments of the United States and the Republic of the Marshall Islands; 

(2) shall apply the National Environmental Policy Act of 1969, 83 Stat. 

852, 42 U.S.C. 4321 et seq., to its activities under the Compact, as amended, and its related agreements as if the Republic of the Marshall Islands 

were the United States; 

(3) in the conduct of any activity not described in section 161(a)(1) requiring the preparation of an Environmental Impact Statement under section 

161(a)(2), shall comply with standards substantively similar to those required by the following laws of the United States, taking into account the 

particular environment of the Republic of the Marshall Islands; the Endangered Species Act of 1973, as amended, 16 U.S.C. 1531 et seq.; the Clean 

Air Act, as amended, 42 U.S.C. 7401 et seq.; the Clean Water Act (Federal 

Water Pollution Control Act), as amended, 33 U.S.C. 1251 et seq.; Title I 

of the Marine Protection, Research and Sanctuaries Act of 1972 (the Ocean 

Dumping Act), 33 U.S.C. 1411 et seq.; the Toxic Substances Control Act, as 

amended, 15 U.S.C. 2601 et seq.; the Solid Waste Disposal Act, as amended, 

42 U.S.C. 6901 et seq.; and such other environmental protection laws of the 

United States and the Republic of the Marshall Islands as may be agreed 

from time to time with the Government of the Republic of the Marshall Islands; 

55

(4) shall, prior to conducting any activity not described in section 

161(a)(1) requiring the preparation of an Environmental Impact Statement 

under section 161(a)(2), develop, as agreed with the Government of the Republic of the Marshall Islands, written environmental standards and procedures to implement the substantive provisions of the laws made applicable 

to U.S. Government activities in the Republic of the Marshall Islands, pursuant to section 161(a)(3). 

(b) The Government of the Republic of the Marshall Islands shall continue to 

develop and implement standards and procedures to protect its environment. As 

a reciprocal obligation to the undertakings of the Government of the United 

States under this Article, the Republic of the Marshall Islands, taking into account its particular environment, shall continue to develop and implement 

standards for environmental protection substantively similar to those required 

of the Government of the United States by section 161(a)(3) prior to its conducting activities in the Republic of the Marshall Islands, substantively equivalent to activities conducted there by the Government of the United States and, 

as a further reciprocal obligation, shall enforce those standards.

(c) Section 161(a), including any standard or procedure applicable thereunder, 

and section 161(b) may be modified or superseded in whole or in part by agreement of the Government of the United States and the Government of the Republic of the Marshall Islands. 

(d) In the event that an Environmental Impact Statement is no longer required under the laws of the United States for major Federal actions significantly affecting the quality of the human environment, the regulatory regime 

established under sections 161(a)(3) and 161(a)(4) shall continue to apply to 

such activities of the Government of the United States until amended by mutual agreement. 

(e) The President of the United States may exempt any of the activities of 

the Government of the United States under this Compact, as amended, and its 

related agreements from any environmental standard or procedure which may 

be applicable under sections 161(a)(3) and 161(a)(4) if the President determines 

it to be in the paramount interest of the Government of the United States to 

do so, consistent with Title Three of this Compact, as amended, and the obligations of the Government of the United States under international law. Prior to 

any decision pursuant to this subsection, the views of the Government of the 

Republic of the Marshall Islands shall be sought and considered to the extent 

practicable. If the President grants such an exemption, to the extent practicable, a report with his reasons for granting such exemption shall be given 

promptly to the Government of the Republic of the Marshall Islands. 

(f) The laws of the United States referred to in section 161(a)(3) shall apply 

to the activities of the Government of the United States under this Compact, 

as amended, and its related agreements only to the extent provided for in this 

section. 

Section 162

The Government of the Republic of the Marshall Islands may bring an action for 

judicial review of any administrative agency action or any activity of the Government of the United States pursuant to section 161(a) for enforcement of the obligations of the Government of the United States arising thereunder. The United States 

District Court for the District of Hawaii and the United States District Court for 

the District of Columbia shall have jurisdiction over such action or activity, and over 

actions brought under section 172(b) which relate to the activities of the Government of the United States and its officers and employees, governed by section 161, 

provided that: 

(a) Such actions may only be civil actions for any appropriate civil relief other 

than punitive damages against the Government of the United States or, where 

required by law, its officers in their official capacity; no criminal actions may 

arise under this section. 

(b) Actions brought pursuant to this section may be initiated only by the Government of the Republic of the Marshall Islands. 

(c) Administrative agency actions arising under section 161 shall be reviewed 

pursuant to the standard of judicial review set forth in 5 U.S.C. 706. 

(d) The United States District Court for the District of Hawaii and the United 

States District Court for the District of Columbia shall have jurisdiction to issue 

all necessary processes, and the Government of the United States agrees to submit itself to the jurisdiction of the court; decisions of the United States District 

Court shall be reviewable in the United States Court of Appeals for the Ninth 

Circuit or the United States Court of Appeals for the District of Columbia, respectively, or in the United States Supreme Court as provided by the laws of 

the United States. 

56

(e) The judicial remedy provided for in this section shall be the exclusive remedy for the judicial review or enforcement of the obligations of the Government 

of the United States under this Article and actions brought under section 

172(b), which relate to the activities of the Government of the United States 

and its officers and employees governed by section 161. 

(f) In actions pursuant to this section, the Government of the Republic of the 

Marshall Islands shall be treated as if it were a United States citizen. 

Section 163

(a) For the purpose of gathering data necessary to study the environmental effects 

of activities of the Government of the United States subject to the requirements of 

this Article, the Government of the Republic of the Marshall Islands shall be granted access to facilities operated by the Government of the United States in the Republic of the Marshall Islands, to the extent necessary for this purpose, except to 

the extent such access would unreasonably interfere with the exercise of the authority and responsibility of the Government of the United States under Title Three. 

(b) The Government of the United States, in turn, shall be granted access to the 

Republic of the Marshall Islands for the purpose of gathering data necessary to discharge its obligations under this Article, except to the extent such access would unreasonably interfere with the exercise of the authority and responsibility of the Government of the Republic of the Marshall Islands under Title One, and to the extent 

necessary for this purpose shall be granted access to documents and other information to the same extent similar access is provided the Government of the Republic 

of the Marshall Islands under the Freedom of Information Act, 5 U.S.C. 552. 

(c) The Government of the Republic of the Marshall Islands shall not impede efforts by the Government of the United States to comply with applicable standards 

and procedures. 

Article VII 

General Legal Provisions 

Section 171

Except as provided in this Compact, as amended, or its related agreements, the 

application of the laws of the United States to the Trust Territory of the Pacific Islands by virtue of the Trusteeship Agreement ceased with respect to the Marshall 

Islands on October 21, 1986, the date the Compact went into effect.

Section 172

(a) Every citizen of the Republic of the Marshall Islands who is not a resident 

of the United States shall enjoy the rights and remedies under the laws of the 

United States enjoyed by any non-resident alien. 

(b) The Government of the Republic of the Marshall Islands and every citizen of 

the Republic of the Marshall Islands shall be considered to be a ‘‘person’’ within the 

meaning of the Freedom of Information Act, 5 U.S.C. 552, and of the judicial review 

provisions of the Administrative Procedure Act, 5 U.S.C. 701-706, except that only 

the Government of the Republic of the Marshall Islands may seek judicial review 

under the Administrative Procedure Act or judicial enforcement under the Freedom 

of Information Act when such judicial review or enforcement relates to the activities 

of the Government of the United States governed by sections 161 and 162. 

Section 173

The Governments of the United States and the Republic of the Marshall Islands 

agree to adopt and enforce such measures, consistent with this Compact, as amended, and its related agreements, as may be necessary to protect the personnel, property, installations, services, programs and official archives and documents maintained by the Government of the United States in the Republic of the Marshall Islands pursuant to this Compact, as amended, and its related agreements and by the 

Government of the Republic of the Marshall Islands in the United States pursuant 

to this Compact, Compact, as amended, and its related agreements. 

Section 174

Except as otherwise provided in this Compact, as amended, and its related agreements: 

(a) The Government of the Republic of the Marshall Islands, and its agencies 

and officials, shall be immune from the jurisdiction of the court of the United 

States, and the Government of the United States, and its agencies and officials, 

shall be immune from the jurisdiction of the courts of the Republic of the Marshall Islands. 

(b) The Government of the United States accepts responsibility for and shall 

pay: 

(1) any unpaid money judgment rendered by the High Court of the Trust 

Territory of the Pacific Islands against the Government of the United 

57

States with regard to any cause of action arising as a result of acts or omissions of the Government of the Trust Territory of the Pacific Islands or the 

Government of the United States prior to October 21, 1986; 

(2) any claim settled by the claimant and the Government of the Trust 

Territory of the Pacific Islands but not paid as of the October 21, 1986; and 

(3) settlement of any administrative claim or of any action before a court 

of the Trust Territory of the Pacific Islands or the Government of the 

United States, arising as a result of acts or omissions of the Government 

of the Trust Territory of the Pacific Islands or the Government of the 

United States. 

(c) Any claim not referred to in section 174(b) and arising from an act or omission of the Government of the Trust Territory of the Pacific Islands or the Government of the United States prior to the effective date of the Compact shall 

be adjudicated in the same manner as a claim adjudicated according to section 

174(d). In any claim against the Government of the Trust Territory of the Pacific Islands, the Government of the United States shall stand in the place of 

the Government of the Trust Territory of the Pacific Islands. A judgment on any 

claim referred to in section 174(b) or this subsection, not otherwise satisfied by 

the Government of the United States, may be presented for certification to the 

United States Court of Appeals for the Federal Circuit, or its successor courts, 

which shall have jurisdiction therefore, notwithstanding the provisions of 28 

U.S.C. 1502, and which court’s decisions shall be reviewable as provided by the 

laws of the United States. The United States Court of Appeals for the Federal 

Circuit shall certify such judgment, and order payment thereof, unless it finds, 

after a hearing, that such judgment is manifestly erroneous as to law or fact, 

or manifestly excessive. In either of such cases the United States Court of Appeals for the Federal Circuit shall have jurisdiction to modify such judgment. 

(d) The Government of the Republic of the Marshall Islands shall not be immune from the jurisdiction of the courts of the United States, and the Government of the United States shall not be immune from the jurisdiction of the 

courts of the Republic of the Marshall Islands in any civil case in which an exception to foreign state immunity is set forth in the Foreign Sovereign Immunities Act (28 U.S.C. 1602 et seq.) or its successor statutes. 

Section 175

(a) A separate agreement, which shall come into effect simultaneously with this 

Compact, as amended, and shall have the force of law, shall govern mutual assistance and cooperation in law enforcement matters, including the pursuit, capture, 

imprisonment and extradition of fugitives from justice and the transfer of prisoners, 

as well as other law enforcement matters. In the United States, the laws of the 

United States governing international extradition, including 18 U.S.C. 3184, 3186, 

and 3188–95, shall be applicable to the extradition of fugitives under the separate 

agreement, and the laws of the United States governing the transfer of prisoners, 

including 18 U.S.C. 4100–15, shall be applicable to the transfer of prisoners under 

the separate agreement; and 

(b) A separate agreement, which shall come into effect simultaneously with this 

Compact, as amended, and shall have the force of law, shall govern requirements 

relating to labor recruitment practices, including registration, reporting, suspension 

or revocation of authorization to recruit persons for employment in the United 

States, and enforcement for violations of such requirements. 

Section 176

The Government of the Republic of the Marshall Islands confirms that final judgments in civil cases rendered by any court of the Trust Territory of the Pacific Islands shall continue in full force and effect, subject to the constitutional power of 

the courts of the Republic of the Marshall Islands to grant relief from judgments 

in appropriate cases. 

Section 177

Section 177 of the Compact entered into force with respect to the Marshall Islands 

on October 21, 1986 as follows: 

‘‘(a) The Government of the United States accepts the responsibility for compensation owing to citizens of the Marshall Islands, or the Federated States of 

Micronesia, (or Palau) for loss or damage to property and person of the citizens 

of the Marshall Islands, or the Federated States of Micronesia, resulting from 

the nuclear testing program which the Government of the United States conducted in the Northern Marshall Islands between June 30, 1946, and August 

18, 1958. 

(b) The Government of the United States and the Government of the Marshall 

Islands shall set forth in a separate agreement provisions for the just and adequate settlement of all such claims which have arisen in regard to the Marshall 

Islands and its citizens and which have not as yet been compensated or which 

58

in the future may arise, for the continued administration by the Government 

of the United States of direct radiation related medical surveillance and treatment programs and radiological monitoring activities and for such additional 

programs and activities as may be mutually agreed, and for the assumption by 

the Government of the Marshall Islands of responsibility for enforcement of limitations on the utilization of affected areas developed in cooperation with the 

Government of the United States and for the assistance by the Government of 

the United States in the exercise of such responsibility as may be mutually 

agreed. This separate agreement shall come into effect simultaneously with this 

Compact and shall remain in effect in accordance with its own terms. 

(c) The Government of the United States shall provide to the Government of 

the Marshall Islands, on a grant basis, the amount of $150 million to be paid 

and distributed in accordance with the separate agreement referred to in this 

Section, and shall provide the services and programs set forth in this separate 

agreement, the language of which is incorporated into this Compact.’’

The Compact, as amended, makes no changes to, and has no effect upon, Section 

177 of the Compact, nor does the Compact, as amended, change or affect the separate agreement referred to in Section 177 of the Compact including Articles IX and 

X of that separate agreement, and measures taken by the parties thereunder. 

Section 178

(a) The Federal agencies of the Government of the United States that provide 

services and related programs in the Republic of the Marshall Islands pursuant to 

Title Two are authorized to settle and pay tort claims arising in the Republic of the 

Marshall Islands from the activities of such agencies or from the acts or omissions 

of the employees of such agencies. Except as provided in section 178(b), the provisions of 28 U.S.C. 2672 and 31 U.S.C. 1304 shall apply exclusively to such administrative settlements and payments. 

(b) Claims under section 178(a) that cannot be settled under section 178(a) shall 

be disposed of exclusively in accordance with Article II of Title Four. Arbitration 

awards rendered pursuant to this subsection shall be paid out of funds under 31 

U.S.C. 1304. 

(c) The Government of the United States and the Government of the Republic of 

the Marshall Islands shall, in the separate agreement referred to in section 231, 

provide for: 

(1) the administrative settlement of claims referred to in section 178(a), including designation of local agents in each State of the Republic of the Marshall 

Islands; such agents to be empowered to accept, investigate and settle such 

claims, in a timely manner, as provided in such separate agreements; and 

(2) arbitration, referred to in section 178(b), in a timely manner, at a site convenient to the claimant, in the event a claim is not otherwise settled pursuant 

to section 178(a). 

(d) The provisions of section 174(d) shall not apply to claims covered by this section. 

(e) Except as otherwise explicitly provided by law of the United States, this Compact, as amended, or its related agreements, neither the Government of the United 

States, its instrumentalities, nor any person acting on behalf of the Government of 

the United States, shall be named a party in any action based on, or arising out 

of, the activity or activities of a recipient of any grant or other assistance provided 

by the Government of the United States (or the activity or activities of the recipient’s agency or any other person or entity acting on behalf of the recipient). 

Section 179

(a) The courts of the Republic of the Marshall Islands shall not exercise criminal 

jurisdiction over the Government of the United States, or its instrumentalities. 

(b) The courts of the Republic of the Marshall Islands shall not exercise criminal 

jurisdiction over any person if the Government of the United States provides notification to the Government of the Republic of the Marshall Islands that such person 

was acting on behalf of the Government of the United States, for actions taken in 

furtherance of section 221 or 224 of this amended Compact, or any other provision 

of law authorizing financial, program, or service assistance to the Republic of the 

Marshall Islands. 

59

TITLE TWO 

ECONOMIC RELATIONS 

Article I 

Grant Assistance 

Section 211 - Annual Grant Assistance 

(a) In order to assist the Government of the Republic of the Marshall Islands in 

its efforts to promote the economic advancement and budgetary self-reliance of its 

people, and in recognition of the special relationship that exists between the Republic of the Marshall Islands and the United States, the Government of the United 

States shall provide assistance on a grant basis for a period of twenty years in the 

amounts set forth in section 217, commencing on the effective date of this Compact, 

as amended. Such grants shall be used for assistance in education, health care, the 

environment, public sector capacity building, and private sector development, or for 

other areas as mutually agreed, with priorities in the education and health care sectors. Consistent with the medium-term budget and investment framework described 

in subsection (f) of this section, the proposed division of this amount among the 

identified areas shall require the concurrence of both the Government of the United 

States and the Government of the Republic of the Marshall Islands, through the 

Joint Economic Management and Financial Accountability Committee described in 

section 214. The Government of the United States shall disburse the grant assistance and monitor the use of such grant assistance in accordance with the provisions 

of this Article and an Agreement Concerning Procedures for the Implementation of 

United States Economic Assistance Provided in the Compact, as Amended, of Free 

Association Between the Government of the United States of America and the Government of the Republic of the Marshall Islands (‘‘Fiscal Procedures Agreement’’) 

which shall come into effect simultaneously with this Compact, as amended. 

(1) EDUCATION.—United States grant assistance shall be made available in 

accordance with the strategic framework described in subsection (f) of this section to support and improve the educational system of the Republic of the Marshall Islands and develop the human, financial, and material resources necessary for the Republic of the Marshall Islands to perform these services. Emphasis should be placed on advancing a quality basic education system. 

(2) HEALTH.—United States grant assistance shall be made available in accordance with the strategic framework described in subsection (f) of this section 

to support and improve the delivery of preventive, curative and environmental 

care and develop the human, financial, and material resources necessary for the 

Republic of the Marshall Islands to perform these services. 

(3) PRIVATE SECTOR DEVELOPMENT.—United States grant assistance shall be 

made available in accordance with the strategic framework described in subsection (f) of this section to support the efforts of the Republic of the Marshall 

Islands to attract foreign investment and increase indigenous business activity 

by vitalizing the commercial environment, ensuring fair and equitable application of the law, promoting adherence to core labor standards, maintaining 

progress toward privatization of state-owned and partially state-owned enterprises, and engaging in other reforms. 

(4) CAPACITY BUILDING IN THE PUBLIC SECTOR.—United States grant assistance shall be made available in accordance with the strategic framework described in subsection (f) of this section to support the efforts of the Republic of 

the Marshall Islands to build effective, accountable and transparent national 

and local government and other public sector institutions and systems. 

(5) ENVIRONMENT.—United States grant assistance shall be made available in 

accordance with the strategic framework described in subsection (f) of this section to increase environmental protection; establish and manage conservation 

areas; engage in environmental infrastructure planning, design construction 

and operation; and to involve the citizens of the Republic of the Marshall Islands in the process of conserving their country’s natural resources. 

(b) KWAJALEIN ATOLL.—

(1) Of the total grant assistance made available under subsection (a) of this 

section, the amount specified herein shall be allocated annually from fiscal year 

2004 through fiscal year 2023 (and thereafter in accordance with the Agreement 

between the Government of the United States and the Government of the Republic of the Marshall Islands Regarding Military Use and Operating Rights) 

to advance the objectives and specific priorities set forth in subsections (a) and 

(d) of this section and the Fiscal Procedures Agreement, to address the special 

needs of the community at Ebeye, Kwajalein Atoll and other Marshallese comVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00059 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
60

munities within Kwajalein Atoll. This United States grant assistance shall be 

made available, in accordance with the medium-term budget and investment 

framework described in subsection (f) of this section, to support and improve the 

infrastructure and delivery of services and develop the human and material resources necessary for the Republic of the Marshall Islands to carry out its responsibility to maintain such infrastructure and deliver such services. The 

amount of this assistance shall be $3,100,000, with an inflation adjustment as 

provided in section 218, from fiscal year 2004 through fiscal year 2013 and the 

fiscal year 2013 level of funding, with an inflation adjustment as provided in 

section 218, will be increased by $2 million for fiscal year 2014. The fiscal year 

2014 level of funding, with an inflation adjustment as provided in section 218, 

will be made available from fiscal year 2015 through fiscal year 2023 (and 

thereafter as noted above). 

(2) The Government of the United States shall also provide to the Government of the Republic of the Marshall Islands, in conjunction with section 321(a) 

of this Compact, as amended, an annual payment from fiscal year 2004 through 

fiscal year 2023 (and thereafter in accordance with the Agreement between the 

Government of the United States and the Government of the Republic of the 

Marshall Islands Regarding Military Use and Operating Rights) of $1.9 million. 

This grant assistance will be subject to the Fiscal Procedures Agreement and 

will be adjusted for inflation under section 218 and used to address the special 

needs of the community at Ebeye, Kwajalein Atoll and other Marshallese communities within Kwajalein Atoll with emphasis on the Kwajalein landowners, 

as described in the Fiscal Procedures Agreement. 

(3) Of the total grant assistance made available under subsection (a) of this 

section, and in conjunction with section 321(a) of the Compact, as amended, 

$200,000, with an inflation adjustment as provided in section 218, shall be allocated annually from fiscal year 2004 through fiscal year 2023 (and thereafter 

as provided in the Agreement between the Government of the United States 

and the Government of the Republic of the Marshall Islands Regarding Military 

Use and Operating Rights) for a grant to support increased participation of the 

Government of the Republic of the Marshall Islands Environmental Protection 

Authority in the annual U.S. Army Kwajalein Atoll Environmental Standards 

Survey and to promote a greater Government of the Republic of the Marshall 

Islands capacity for independent analysis of the Survey’s findings and conclusions. 

(c) HUMANITARIAN ASSISTANCE-REPUBLIC OF THE MARSHALL ISLANDS PROGRAM.—

In recognition of the special development needs of the Republic of the Marshall Islands, the Government of the United States shall make available to the Government 

of the Republic of the Marshall Islands, on its request and to be deducted from the 

grant amount made available under subsection (a) of this section, a Humanitarian 

Assistance - Republic of the Marshall Islands (‘‘HARMI’’) Program with emphasis 

on health, education, and infrastructure (including transportation), projects and 

such other projects as mutually agreed. The terms and conditions of the HARMI 

shall be set forth in the Agreement Regarding the Military Use and Operating 

Rights of the Government of the United States in the Republic of the Marshall Islands Concluded Pursuant to Sections 321 and 323 of the Compact of Free Association, as Amended, which shall come into effect simultaneously with the amendments 

to this Compact. 

(d) PUBLIC INFRASTRUCTURE.—

(1) Unless otherwise agreed, not less than 30 percent and not more than 50 

percent of U.S. annual grant assistance provided under this section shall be 

made available in accordance with a list of specific projects included in the infrastructure improvement and maintenance plan prepared by the Government 

of the Republic of the Marshall Islands as part of the strategic framework described in subsection (f) of this section. 

(2) INFRASTRUCTURE MAINTENANCE FUND.—Five percent of the annual public 

infrastructure grant made available under paragraph (1) of this subsection shall 

be set aside, with an equal contribution from the Government of the Republic 

of the Marshall Islands, as a contribution to an Infrastructure Maintenance 

Fund. Administration of the Infrastructure Maintenance Fund shall be governed by the Fiscal Procedures Agreement. 

(e) DISASTER ASSISTANCE EMERGENCY FUND.—Of the total grant assistance made 

available under subsection (a) of this section, an amount of two hundred thousand 

dollars ($200,000) shall be provided annually, with an equal contribution from the 

Government of the Republic of the Marshall Islands, as a contribution to a Disaster 

Assistance Emergency Fund (‘‘DAEF’’). Any funds from the DAEF may be used only 

for assistance and rehabilitation resulting from disasters and emergencies. The 

funds will be accessed upon declaration of a State of Emergency by the Government 

61

of the Republic of the Marshall Islands, with the concurrence of the United States 

Chief of Mission to the Republic of the Marshall Islands. Administration of the 

DAEF shall be governed by the Fiscal Procedures Agreement. 

(f) BUDGET AND INVESTMENT FRAMEWORK.—The Government of the Republic of 

the Marshall Islands shall prepare and maintain an official medium-term budget 

and investment framework. The framework shall be strategic in nature, shall be 

continuously reviewed and updated through the annual budget process, and shall 

make projections on a multi-year rolling basis. Each of the sectors and areas named 

in subsections (a), (b), and (d) of this section, or other sectors and areas as mutually 

agreed, shall be accorded specific treatment in the framework. Those portions of the 

framework that contemplate the use of United States grant funds shall require the 

concurrence of both the Government of the United States and the Government of 

the Republic of the Marshall Islands. 

Section 212 - Kwajalein Impact and Use 

The Government of the United States shall provide to the Government of the Republic of the Marshall Islands in conjunction with section 321(a) of the Compact, 

as amended, and the agreement between the Government of the United States and 

the Government of the Republic of the Marshall Islands regarding military use and 

operating rights, a payment in fiscal year 2004 of $15,000,000, with no adjustment 

for inflation. In fiscal year 2005 and through fiscal year 2013, the annual payment 

will be the fiscal year 2004 amount ($15,000,000) with an inflation adjustment as 

provided under section 218. In fiscal year 2014, the annual payment will be 

$18,000,000 (with no adjustment for inflation) or the fiscal year 2013 amount with 

an inflation adjustment under section 218, whichever is greater. For fiscal year 2015 

through fiscal year 2023 (and thereafter in accordance with the Agreement between 

the Government of the United States and the Government of the Republic of the 

Marshall Islands Regarding Military Use and Operating Rights) the annual payment will be the fiscal year 2014 amount, with an inflation adjustment as provided 

under section 218. 

Section 213 - Accountability 

(a) Regulations and policies normally applicable to United States financial assistance to its state and local governments, as set forth in the Fiscal Procedures Agreement, shall apply to each grant described in section 211, and to grants administered 

under section 221 below, except as modified in the separate agreements referred to 

in section 231 of this Compact, as amended, or by U.S. law. As set forth in the Fiscal Procedures Agreement, reasonable terms and conditions, including annual performance indicators that are necessary to ensure effective use of United States assistance and reasonable progress toward achieving program objectives may be attached. In addition, the United States may seek appropriate remedies for noncompliance with the terms and conditions attached to the assistance, or for failure to comply with section 234, including withholding assistance. 

(b) The Government of the United States shall, for each fiscal year of the twenty 

years during which assistance is to be provided on a sector grant basis under section 

211 (a), grant the Government of the Republic of the Marshall Islands an amount 

equal to the lesser of (i) one half of the reasonable, properly documented cost incurred during such fiscal year to conduct the annual audit required under Article 

VIII (2) of the Fiscal Procedures Agreement or (ii) $500,000. Such amount will not 

be adjusted for inflation under section 218 or otherwise. 

Section 214 - Joint Economic Management and Financial Accountability Committee 

The Governments of the United States and the Republic of the Marshall Islands 

shall establish a Joint Economic Management and Financial Accountability Committee, composed of a U.S. chair, two other members from the Government of the 

United States and two members from the Government of the Republic of the Marshall Islands. The Joint Economic Management and Financial Accountability Committee shall meet at least once each year to review the audits and reports required 

under this Title and the Fiscal Procedures Agreement, evaluate the progress made 

by the Republic of the Marshall Islands in meeting the objectives identified in its 

framework described in subsection (f) of section 211, with particular focus on those 

parts of the framework dealing with the sectors and areas identified in subsection 

(a) of section 211, identify problems encountered, and recommend ways to increase 

the effectiveness of U.S. assistance made available under this Title. The establishment and operations of the Joint Economic Management and Financial Accountability Committee shall be governed by the Fiscal Procedures Agreement. 

Section 215 - Annual Report 

The Government of the Republic of the Marshall Islands shall report annually to 

the President of the United States on the use of United States sector grant assistance and other assistance and progress in meeting mutually agreed program and 

economic goals. The Joint Economic Management and Financial Accountability 

62

Committee shall review and comment on the report and make appropriate recommendations based thereon. 

Section 216 - Trust Fund 

(a) The United States shall contribute annually for twenty years from the effective 

date of the Compact, as amended, in the amounts set forth in section 217 into a 

trust fund established in accordance with the Agreement Between the Government 

of the United States of America and the Government of the Republic of the Marshall 

Islands Implementing Section 216 and Section 217 of the Compact, as Amended, Regarding a Trust Fund (‘‘Trust Fund Agreement’’), which shall come into effect simultaneously with this Compact, as amended. Upon termination of the annual grant 

assistance under section 211 (a), (d) and (e), the earnings of the fund shall thereafter be used for the purposes described in section 211 or as otherwise mutually 

agreed. 

(b) The United States contribution into the Trust Fund described in subsection 

(a) of this section is conditioned on the Government of the Republic of the Marshall 

Islands contributing to the Trust Fund at least $25,000,000, on the effective date 

of the Trust Fund Agreement or on October 1, 2003, whichever is later, $2,500,000 

prior to October 1, 2004, and $2,500,000 prior to October 1, 2005. Any funds received by the Republic of the Marshall Islands under section 111(d) of Public Law 

99–239 (January 14, 1986), or successor provisions, would be contributed to the 

Trust Fund as a Republic of the Marshall Islands’ contribution. 

(c) The terms regarding the investment and management of funds and use of the 

income of the Trust Fund shall be governed by the Trust Fund Agreement. Funds 

derived from United States investment shall not be subject to Federal or state taxes 

in the United States or any taxes in the Republic of the Marshall Islands. The Trust 

Fund Agreement shall also provide for annual reports to the Government of the 

United States and to the Government of the Republic of the Marshall Islands. The 

Trust Fund Agreement shall provide for appropriate distributions of trust fund proceeds to the Republic of the Marshall Islands and for appropriate remedies for the 

failure of the Republic of the Marshall Islands to use income of the Trust Fund for 

the annual grant purposes set forth in section 211. These remedies may include the 

return to the United States of the present market value of its contributions to the 

Trust Fund and the present market value of any undistributed income on the contributions of the United States. If this Compact, as amended, is terminated, the provisions of sections 451–453 of the Compact, as amended, and the Trust Fund Agreement shall govern treatment of any U.S. contributions to the Trust Fund or accrued 

income thereon. 

Section 217 - Annual Grant Funding and Trust Fund Contributions 

The funds described in sections 211, 212, 213(b), and 216 shall be made available 

as follows:

[In millions of dollars] 

Fiscal 

year 

Annual Grants 

Section 211

Audit Grant

Section 213(b) 

Trust Fund

Section 216 (a&c) 

Kwajalein Impact 

Section 212 Total 

2004 35.2 .5 7 15.0 57.7

2005 34.7 .5 7.5 15.0 57.7

2006 34.2 .5 8 15.0 57.7

2007 33.7 .5 8.5 15.0 57.7

2008 33.2 .5 9 15.0 57.7

2009 32.7 .5 9.5 15.0 57.7

2010 32.2 .5 10 15.0 57.7

2011 31.7 .5 10.5 15.0 57.7

2012 31.2 .5 11 15.0 57.7

2013 30.7 .5 11.5 15.0 57.7

2014 32.2 .5 12 18.0 62.7

2015 31.7 .5 12.5 18.0 62.7

2016 31.2 .5 13 18.0 62.7

2017 30.7 .5 13.5 18.0 62.7

2018 30.2 .5 14 18.0 62.7

2019 29.7 .5 14.5 18.0 62.7

2020 29.2 .5 15 18.0 62.7

2021 28.7 .5 15.5 18.0 62.7

2022 28.2 .5 16 18.0 62.7

2023 27.7 .5 16.5 18.0 62.7

63

Section 218 - Inflation Adjustment 

Except as otherwise provided, the amounts stated in this Title shall be adjusted 

for each United States Fiscal Year by the percent that equals two-thirds of the percent change in the United States Gross Domestic Product Implicit Price Deflator, 

or 5 percent, whichever is less in any one year, using the beginning of Fiscal Year 

2004 as a base. 

Section 219 - Carry-Over of Unused Funds 

If in any year the funds made available by the Government of the United States 

for that year pursuant to this Article are not completely obligated by the Government of the Republic of the Marshall Islands, the unobligated balances shall remain 

available in addition to the funds to be provided in subsequent years. 

Article II 

Services and Program Assistance 

Section 221

(a) SERVICES.—The Government of the United States shall make available to the 

Republic of the Marshall Islands, in accordance with and to the extent provided in 

the Federal Programs and Services Agreement referred to in Section 231, the services and related programs of: 

(1) the United States Weather Service; 

(2) the United States Postal Service; 

(3) the United States Federal Aviation Administration; 

(4) the United States Department of Transportation; and 

(5) the Department of Homeland Security, and the United States Agency for 

International Development, Office of Foreign Disaster Assistance. 

Upon the effective date of this Compact, as amended, the United States Departments and Agencies named or having responsibility to provide these services and 

related programs shall have the authority to implement the relevant provisions of 

the Federal Programs and Services Agreement referred to in section 231. 

(b) PROGRAMS.—

(1) Other than the services and programs covered by subsection (a) of this section, and to the extent authorized by the Congress of the United States, the 

Government of the United States shall make available to the Republic of the 

Marshall Islands the services and programs that were available to the Republic 

of the Marshall Islands on the effective date of this Compact, as amended, to 

the extent that such services and programs continue to be available to State 

and local governments of the United States. As set forth in the Fiscal Procedures Agreement, funds provided under subsection (a) of section 211 shall be 

considered to be local revenues of the Government of the Republic of the Marshall Islands when used as the local share required to obtain Federal programs 

and services. 

(2) Unless provided otherwise by U.S. law, the services and programs described in paragraph (1) of this subsection shall be extended in accordance with 

the terms of the Federal Programs and Services Agreement. 

(c) The Government of the United States shall have and exercise such authority 

as is necessary to carry out its responsibilities under this Title and the Federal Programs and Services Agreement, including the authority to monitor and administer 

all service and program assistance provided by the United States to the Republic 

of the Marshall Islands. The Federal Programs and Services Agreement shall also 

set forth the extent to which services and programs shall be provided to the Republic of the Marshall Islands. 

(d) Except as provided elsewhere in this Compact, as amended, under any separate agreement entered into under this Compact, as amended, or otherwise under 

U.S. law, all Federal domestic programs extended to or operating in the Republic 

of the Marshall Islands shall be subject to all applicable criteria, standards, reporting requirements, auditing procedures, and other rules and regulations applicable 

to such programs and services when operating in the United States. 

(e) The Government of the United States shall make available to the Republic of 

the Marshall Islands alternate energy development projects, studies, and conservation measures to the extent provided for the Freely Associated States in the laws 

of the United States. 

Section 222

The Government of the United States and the Government of the Republic of the 

Marshall Islands may agree from time to time to extend to the Republic of the Marshall Islands additional United States grant assistance, services and programs, as 

provided under the laws of the United States. Unless inconsistent with such laws, 

or otherwise specifically precluded by the Government of the United States at the 

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time such additional grant assistance, services, or programs are extended, the Federal Programs and Services Agreement shall apply to any such assistance, services 

or programs. 

Section 223

The Government of the Republic of the Marshall Islands shall make available to 

the Government of the United States at no cost such land as may be necessary for 

the operations of the services and programs provided pursuant to this Article, and 

such facilities as are provided by the Government of the Republic of the Marshall 

Islands at no cost to the Government of the United States as of the effective date 

of this Compact, as amended, or as may be mutually agreed thereafter. 

Section 224

The Government of the Republic of the Marshall Islands may request, from the 

time to time, technical assistance from the Federal agencies and institutions of the 

Government of the United States, which are authorized to grant such technical assistance in accordance with its laws. If technical assistance is granted pursuant to 

such a request, the Government of the United States shall provide the technical assistance in a manner which gives priority consideration to the Republic of the Marshall Islands over other recipients not a part of the United States, its territories or 

possessions, and equivalent consideration to the Republic of the Marshall Islands 

with respect to other states in Free Association with the United States. Such assistance shall be made available on a reimbursable or non-reimbursable basis to the 

extent provided by United States law.

Article III 

Administrative Provisions 

Section 231

The specific nature, extent and contractual arrangements of the services and programs provided for in section 221 of this Compact, as amended, as well as the legal 

status of agencies of the Government of the United States, their civilian employees 

and contractors, and the dependents of such personnel while present in the Republic 

of the Marshall Islands, and other arrangements in connection with the assistance, 

services, or programs furnished by the Government of the United States, are set 

forth in a Federal Programs and Services Agreement which shall come into effect 

simultaneously with this Compact, as amended. 

Section 232

The Government of the United States, in consultation with the Government of the 

Republic of the Marshall Islands, shall determine and implement procedures for the 

periodic audit of all grants and other assistance made under Article I of this Title 

and of all funds expended for the services and programs provided under Article II 

of this Title. Further, in accordance with the Fiscal Procedures Agreement described 

in subsection (a) of section 211, the Comptroller General of the United States shall 

have such powers and authorities as described in sections 103(m) and 110(c) of Public Law 99–239, 99 Stat. 1777–78, and 99 Stat. 1799 (January 14, 1986). 

Section 233

Approval of this Compact, as amended, by the Government of the United States, 

in accordance with its constitutional processes, shall constitute a pledge by the 

United States that the sums and amounts specified as grants in section 211 of this 

Compact, as amended, shall be appropriated and paid to the Republic of the Marshall Islands for such period as those provisions of this Compact, as amended, remain in force, provided that the Republic of the Marshall Islands complies with the 

terms and conditions of this Title and related subsidiary agreements. 

Section 234

The Government of the Republic of the Marshall Islands pledges to cooperate 

with, permit, and assist if reasonably requested, designated and authorized representatives of the Government of the United States charged with investigating 

whether Compact funds, or any other assistance authorized under this Compact, as 

amended, have, or are being, used for purposes other than those set forth in this 

Compact, as amended, or its subsidiary agreements. In carrying out this investigative authority, such United States Government representatives may request that 

the Government of the Republic of the Marshall Islands subpoena documents and 

records and compel testimony in accordance with the laws and Constitution of the 

Republic of the Marshall Islands. Such assistance by the Government of the Republic of the Marshall Islands to the Government of the United States shall not be unreasonably withheld. The obligation of the Government of the Marshall Islands to 

fulfill its pledge herein is a condition to its receiving payment of such funds or other 

assistance authorized under this Compact, as amended. The Government of the 

United States shall pay any reasonable costs for extraordinary services executed by 

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the Government of the Marshall Islands in carrying out the provisions of this section. 

Article IV 

Trade 

Section 241

The Republic of the Marshall Islands is not included in the customs territory of 

the United States. 

Section 242

The President shall proclaim the following tariff treatment for articles imported 

from the Republic of the Marshall Islands which shall apply during the period of 

effectiveness of this title: 

(a) Unless otherwise excluded, articles imported from the Republic of the 

Marshall Islands, subject to the limitations imposed under section 503(b) of title 

V of the Trade Act of 1974 (19 U.S.C. 2463(b)), shall be exempt from duty. 

(b) Only tuna in airtight containers provided for in heading 1604.14.22 of the 

Harmonized Tariff Schedule of the United States that is imported from the Republic of the Marshall Islands and the Federated States of Micronesia during 

any calendar year not to exceed 10 percent of apparent United States consumption of tuna in airtight containers during the immediately preceding calendar 

year, as reported by the National Marine Fisheries Service, shall be exempt 

from duty; but the quantity of tuna given duty-free treatment under this paragraph for any calendar year shall be counted against the aggregated quantity 

of tuna in airtight containers that is dutiable under rate column numbered 1 

of such heading 1604.14.22 for that calendar year. 

(c) The duty-free treatment provided under subsection (a) shall not apply to: 

(1) watches, clocks, and timing apparatus provided for in Chapter 91, excluding heading 9113, of the Harmonized Tariff Schedule of the United 

States; 

(2) buttons (whether finished or not finished) provided for in items 

9606.21.40 and 9606.29.20 of such Schedule; 

(3) textile and apparel articles which are subject to textile agreements; 

and 

(4) footwear, handbags, luggage, flat goods, work gloves, and leather 

wearing apparel which were not eligible articles for purposes of title V of 

the Trade Act of 1974 (19 U.S.C. 2461, et seq.) on April 1, 1984. 

(d) If the cost or value of materials produced in the customs territory of the 

United States is included with respect to an eligible article which is a product 

of the Republic of the Marshall Islands, an amount not to exceed 15 percent of 

the appraised value of the article at the time it is entered that is attributable 

to such United States cost or value may be applied for duty assessment purposes toward determining the percentage referred to in section 503(a)(2) of title 

V of the Trade Act of 1974. 

Section 243

Articles imported from the Republic of the Marshall Islands which are not exempt 

from duty under subsections (a), (b), (c), and 

(d) of section 242 shall be subject to the rates of duty set forth in column numbered 1-general of the Harmonized Tariff Schedule of the United States (HTSUS). 

Section 244

(a) All products of the United States imported into the Republic of the Marshall 

Islands shall receive treatment no less favorable than that accorded like products 

of any foreign country with respect to customs duties or charges of a similar nature 

and with respect to laws and regulations relating to importation, exportation, taxation, sale, distribution, storage or use. 

(b) The provisions of subsection (a) shall not apply to advantages accorded by the 

Republic of the Marshall Islands by virtue of their full membership in the Pacific 

Island Countries Trade Agreement (PICTA), done on August, 18, 2001, to those governments listed in Article 26 of PICTA, as of the date the Compact, as amended, 

is signed. 

(c) Prior to entering into consultations on, or concluding, a free trade agreement 

with governments not listed in Article 26 of PICTA, the Republic of the Marshall 

Islands shall consult with the United States regarding whether or how subsection 

(a) of section 244 shall be applied. 

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Article V 

Finance and Taxation 

Section 251

The currency of the United States is the official circulating legal tender of the Republic of the Marshall Islands. Should the Government of the Republic of the Marshall Islands act to institute another currency, the terms of an appropriate currency 

transitional period shall be as agreed with the Government of the United States. 

Section 252

The Government of the Republic of the Marshall Islands may, with respect to 

United States persons, tax income derived from sources within its respective jurisdiction, property situated therein, including transfers of such property by gift or at 

death, and products consumed therein, in such manner as the Government of the 

Republic of the Marshall Islands deems appropriate. The determination of the 

source of any income, or the situs of any property, shall for purposes of this Compact, as amended, be made according to the United States Internal Revenue Code. 

Section 253

A citizen of the Republic of the Marshall Islands, domiciled therein, shall be exempt from estate, gift, and generation-skipping transfer taxes imposed by the Government of the United States, provided that such citizen of the Republic of the Marshall Islands is neither a citizen nor a resident of the United States. 

Section 254

(a) In determining any income tax imposed by the Government of the Republic 

of the Marshall Islands, the Government of the Republic of the Marshall Islands 

shall have authority to impose tax upon income derived by a resident of the Republic of the Marshall Islands from sources without the Republic of the Marshall Islands, in the same manner and to the same extent as the Government of the Republic of the Marshall Islands imposes tax upon income derived from within its own 

jurisdiction. If the Government of the Republic of the Marshall Islands exercises 

such authority as provided in this subsection, any individual resident of the Republic of the Marshall Islands who is subject to tax by the Government of the United 

States on income which is also taxed by the Government of the Republic of the Marshall Islands shall be relieved of liability to the Government of the United States 

for the tax which, but for this subsection, would otherwise be imposed by the Government of the United States on such income. However, the relief from liability to 

the United States Government referred to in the preceding sentence means only relief in the form of the foreign tax credit (or deduction in lieu thereof) available with 

respect to the income taxes of a possession of the United States, and relief in the 

form of the exclusion under section 911 of the Internal Revenue Code of 1986. For 

purposes of this section, the term ‘‘resident of the Republic of the Marshall Islands’’

shall be deemed to include any person who was physically present in the Republic 

of the Marshall Islands for a period of 183 or more days during any taxable year. 

(b) If the Government of the Republic of the Marshall Islands subjects income to 

taxation substantially similar to that which was imposed by the Trust Territory 

Code in effect on January 1, 1980, such Government shall be deemed to have exercised the authority described in section 254(a). 

Section 255

For purposes of section 274(h)(3)(A) of the U.S. Internal Revenue Code of 1986, 

the term ‘‘North American Area’’ shall include the Republic of the Marshall Islands. 

TITLE THREE 

SECURITY AND DEFENSE RELATIONS 

Article I 

Authority and Responsibility 

Section 311

(a) The Government of the United States has full authority and responsibility for 

security and defense matters in or relating to the Republic of the Marshall Islands. 

(b) This authority and responsibility includes: 

(1) the obligation to defend the Republic of the Marshall Islands and its people from attack or threats thereof as the United States and its citizens are defended; 

(2) the option to foreclose access to or use of the Republic of the Marshall Islands by military personnel or for the military purposes of any third country; 

and 

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(3) the option to establish and use military areas and facilities in the Republic 

of the Marshall Islands, subject to the terms of the separate agreements referred to in sections 321 and 323. 

(c) The Government of the United States confirms that it shall act in accordance 

with the principles of international law and the Charter of the United Nations in 

the exercise of this authority and responsibility.

Section 312

Subject to the terms of any agreements negotiated in accordance with sections 321 

and 323, the Government of the United States may conduct within the lands, waters 

and airspace of the Republic of the Marshall Islands the activities and operations 

necessary for the exercise of its authority and responsibility under this Title. 

Section 313

(a) The Government of the Republic of the Marshall Islands shall refrain from actions that the Government of the United States determines, after appropriate consultation with that Government, to be incompatible with its authority and responsibility for security and defense matters in or relating to the Republic of the Marshall 

Islands. 

(b) The consultations referred to in this section shall be conducted expeditiously 

at senior levels of the two Governments, and the subsequent determination by the 

Government of the United States referred to in this section shall be made only at 

senior interagency levels of the Government of the United States. 

(c) The Government of the Republic of the Marshall Islands shall be afforded, on 

an expeditious basis, an opportunity to raise its concerns with the United States 

Secretary of State personally and the United States Secretary of Defense personally 

regarding any determination made in accordance with this section. 

Section 314

(a) Unless otherwise agreed, the Government of the United States shall not, in 

the Republic of the Marshall Islands: 

(1) test by detonation or dispose of any nuclear weapon, nor test, dispose of, 

or discharge any toxic chemical or biological weapon; or 

(2) test, dispose of, or discharge any other radioactive, toxic chemical or biological materials in an amount or manner that would be hazardous to public 

health or safety. 

(b) Unless otherwise agreed, other than for transit or overflight purposes or during time of a national emergency declared by the President of the United States, 

a state of war declared by the Congress of the United States or as necessary to defend against an actual or impending armed attack on the United States, the Republic of the Marshall Islands or the Federated States of Micronesia, the Government 

of the United States shall not store in the Republic of the Marshall Islands or the 

Federated States of Micronesia any toxic chemical weapon, nor any radioactive materials nor any toxic chemical materials intended for weapons use. 

(c) Radioactive, toxic chemical, or biological materials not intended for weapons 

use shall not be affected by section 314(b). 

(d) No material or substance referred to in this section shall be stored in the Republic of the Marshall Islands except in an amount and manner which would not 

be hazardous to public health or safety. In determining what shall be an amount 

or manner which would be hazardous to public health or safety under this section, 

the Government of the United States shall comply with any applicable mutual 

agreement, international guidelines accepted by the Government of the United 

States, and the laws of the United States and their implementing regulations. 

(e) Any exercise of the exemption authority set forth in section 161(e) shall have 

no effect on the obligations of the Government of the United States under this section or on the application of this subsection. 

(f) The provisions of this section shall apply in the areas in which the Government 

of the Republic of the Marshall Islands exercises jurisdiction over the living resources of the seabed, subsoil or water column adjacent to its coasts. 

Section 315

The Government of the United States may invite members of the armed forces 

of other countries to use military areas and facilities in the Republic of the Marshall 

Islands, in conjunction with and under the control of United States Armed Forces. 

Use by units of the armed forces of other countries of such military areas and facilities, other than for transit and overflight purposes, shall be subject to consultation 

with and, in the case of major units, approval of the Government of the Republic 

of the Marshall Islands. 

Section 316

The authority and responsibility of the Government of the United States under 

this Title may not be transferred or otherwise assigned. 

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Article II 

Defense Facilities and Operating Rights 

Section 321

(a) Specific arrangements for the establishment and use by the Government of the 

United States of military areas and facilities in the Republic of the Marshall Islands 

are set forth in separate agreements, which shall remain in effect in accordance 

with the terms of such agreements. 

(b) If, in the exercise of its authority and responsibility under this Title, the Government of the United States requires the use of areas within the Republic of the 

Marshall Islands in addition to those for which specific arrangements are concluded 

pursuant to section 321(a), it may request the Government of the Republic of the 

Marshall Islands to satisfy those requirements through leases or other arrangements. The Government of the Republic of the Marshall Islands shall sympathetically consider any such request and shall establish suitable procedures to discuss it with and provide a prompt response to the Government of the United States. 

(c) The Government of the United States recognizes and respects the scarcity and 

special importance of land in the Republic of the Marshall Islands. In making any 

requests pursuant to section 321(b), the Government of the United States shall follow the policy of requesting the minimum area necessary to accomplish the required 

security and defense purpose, of requesting only the minimum interest in real property necessary to support such purpose, and of requesting first to satisfy its requirement through public real property, where available, rather than through private 

real property. 

Section 322

The Government of the United States shall provide and maintain fixed and floating aids to navigation in the Republic of the Marshall Islands at least to the extent 

necessary for the exercise of its authority and responsibility under this Title. 

Section 323

The military operating rights of the Government of the United States and the 

legal status and contractual arrangements of the United States Armed Forces, their 

members, and associated civilians, while present in the Republic of the Marshall Islands are set forth in separate agreements, which shall remain in effect in accordance with the terms of such agreements. 

Article III 

Defense Treaties and International Security Agreements 

Section 331

Subject to the terms of this Compact, as amended, and its related agreements, the 

Government of the United States, exclusively, has assumed and enjoys, as to the 

Republic of the Marshall Islands, all obligations, responsibilities, rights and benefits 

of: 

(a) Any defense treaty or other international security agreement applied by 

the Government of the United States as Administering Authority of the Trust 

Territory of the Pacific Islands as of October 20, 1986. 

(b) Any defense treaty or other international security agreement to which the 

Government of the United States is or may become a party which it determines 

to be applicable in the Republic of the Marshall Islands. Such a determination 

by the Government of the United States shall be preceded by appropriate consultation with the Government of the Republic of the Marshall Islands. 

Article IV 

Service in Armed Forces of the United States 

Section 341

Any person entitled to the privileges set forth in Section 141 (with the exception 

of any person described in section 141(a)(5) who is not a citizen of the Republic of 

the Marshall Islands) shall be eligible to volunteer for service in the Armed Forces 

of the United States, but shall not be subject to involuntary induction into military 

service of the United States as long as such person has resided in the United States 

for a period of less than one year, provided that no time shall count towards this 

one year while a person admitted to the United States under the Compact, or the 

Compact, as amended, is engaged in full-time study in the United States. Any person described in section 141(a)(5) who is not a citizen of the Republic of the Marshall Islands shall be subject to United States laws relating to selective service. 

Section 342

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The Government of the United States shall have enrolled, at any one time, at 

least one qualified student from the Republic of the Marshall Islands, as may be 

nominated by the Government of the Republic of the Marshall Islands, in each of: 

(a) The United States Coast Guard Academy pursuant to 14 U.S.C. 195. 

(b) The United States Merchant Marine Academy pursuant to 46 U.S.C. 

1295(b)(6), provided that the provisions of 46 U.S.C. 1295b(b)(6)(C) shall not 

apply to the enrollment of students pursuant to section 342(b) of this Compact, 

as amended. 

Article V 

General Provisions 

Section 351

(a) The Government of the United States and the Government of the Republic of 

the Marshall Islands shall continue to maintain a Joint Committee empowered to 

consider disputes arising under the implementation of this Title and its related 

agreements. 

(b) The membership of the Joint Committee shall comprise selected senior officials 

of the two Governments. The senior United States military commander in the Pacific area shall be the senior United States member of the Joint Committee. For the 

meetings of the Joint Committee, each of the two Governments may designate additional or alternate representatives as appropriate for the subject matter under consideration. 

(c) Unless otherwise mutually agreed, the Joint Committee shall meet annually 

at a time and place to be designated, after appropriate consultation, by the Government of the United States. The Joint Committee also shall meet promptly upon request of either of its members. The Joint Committee shall follow such procedures, 

including the establishment of functional subcommittees, as the members may from 

time to time agree. Upon notification by the Government of the United States, the 

Joint Committee of the United States and the Republic of the Marshall Islands shall 

meet promptly in a combined session with the Joint Committee established and 

maintained by the Government of the United States and the Government of the 

Federated States of Micronesia to consider matters within the jurisdiction of the two 

Joint Committees. 

(d) Unresolved issues in the Joint Committee shall be referred to the Governments for resolution, and the Government of the Republic of the Marshall Islands 

shall be afforded, on an expeditious basis, an opportunity to raise its concerns with 

the United States Secretary of Defense personally regarding any unresolved issue 

which threatens its continued association with the Government of the United 

States. 

Section 352

In the exercise of its authority and responsibility under Title Three, the Government of the United States shall accord due respect to the authority and responsibility of the Government of the Republic of the Marshall Islands under Titles One, 

Two and Four and to the responsibility of the Government of the Republic of the 

Marshall Islands to assure the well-being of its people. 

Section 353

(a) The Government of the United States shall not include the Government of the 

Republic of the Marshall Islands as a named party to a formal declaration of war, 

without that Government’s consent. 

(b) Absent such consent, this Compact, as amended, is without prejudice, on the 

ground of belligerence or the existence of a state of war, to any claims for damages 

which are advanced by the citizens, nationals or Government of the Republic of the 

Marshall Islands, which arise out of armed conflict subsequent to October 21, 1986, 

and which are: 

(5) petitions to the Government of the United States for redress; or 

(6) claims in any manner against the government, citizens, nationals or entities of any third country.

(c) Petitions under section 353(b)(1) shall be treated as if they were made by citizens of the United States. 

Section 354

(a) The Government of the United States and the Government of the Republic of 

the Marshall Islands are jointly committed to continue their security and defense 

relations, as set forth in this Title. Accordingly, it is the intention of the two countries that the provisions of this Title shall remain binding as long as this Compact, 

as amended, remains in effect, and thereafter as mutually agreed, unless earlier terminated by mutual agreement pursuant to section 441, or amended pursuant to Article III of Title Four. If at any time the Government of the United States, or the 

70

Government of the Republic of the Marshall Islands, acting unilaterally, terminates 

this Title, such unilateral termination shall be considered to be termination of the 

entire Compact, as amended, in which case the provisions of section 442 and 452 

(in the case of termination by the Government of the United States) or sections 443 

and 453 (in the case of termination by the Government of the Republic of the Marshall Islands), with the exception of paragraph (3) of subsection (a) of section 452 

or paragraph (3) of subsection (a) of section 453, as the case may be, shall apply. 

(b) The Government of the United States recognizes, in view of the special relationship between the Government of the United States and the Government of the 

Republic of the Marshall Islands, and in view of the existence of the separate agreement regarding mutual security concluded with the Government of the Republic of 

the Marshall Islands pursuant to sections 321 and 323, that, even if this Title 

should terminate, any attack on the Republic of the Marshall Islands during the period in which such separate agreement is in effect, would constitute a threat to the 

peace and security of the entire region and a danger to the United States. In the 

event of such an attack, the Government of the United States would take action to 

meet the danger to the United States and to the Republic of the Marshall Islands 

in accordance with its constitutional processes. 

(c) As reflected in Article 21(1)(b) of the Trust Fund Agreement, the Government 

of the United States and the Government of the Republic of the Marshall Islands 

further recognize, in view of the special relationship between their countries, that 

even if this Title should terminate, the Government of Republic of the Marshall Islands shall refrain from actions which the Government of the United States determines, after appropriate consultation with that Government, to be incompatible 

with its authority and responsibility for security and defense matters in or relating 

to the Republic of the Marshall Islands or the Federated States of Micronesia. 

TITLE FOUR 

GENERAL PROVISIONS 

Article I 

Approval and Effective Date 

Section 411

Pursuant to section 432 of the Compact and subject to subsection (e) of section 

461 of the Compact, as amended, the Compact, as amended, shall come into effect 

upon mutual agreement between the Government of the United States and the Government of the Republic of the Marshall Islands subsequent to completion of the following: 

(a) Approval by the Government of the Republic of the Marshall Islands in 

accordance with its constitutional processes. 

(b) Approval by the Government of the United States in accordance with its 

constitutional processes. 

Article II 

Conference and Dispute Resolution 

Section 421

The Government of the United States shall confer promptly at the request of the 

Government of the Republic of the Marshall Islands and that Government shall confer promptly at the request of the Government of the United States on matters relating to the provisions of this Compact, as amended, or of its related agreements. 

Section 422

In the event the Government of the United States or the Government of the Republic of the Marshall Islands, after conferring pursuant to section 421, determines 

that there is a dispute and gives written notice thereof, the two Governments shall 

make a good faith effort to resolve the dispute between themselves. 

Section 423

If a dispute between the Government of the United States and the Government 

of the Republic of the Marshall Islands cannot be resolved within 90 days of written 

notification in the manner provided in section 422, either party to the dispute may 

refer it to arbitration in accordance with section 424. 

Section 424

Should a dispute be referred to arbitration as provided for in section 423, an Arbitration Board shall be established for the purpose of hearing the dispute and rendering a decision which shall be binding upon the two parties to the dispute unless 

71

the two parties mutually agree that the decision shall be advisory. Arbitration shall 

occur according to the following terms: 

(a) An Arbitration Board shall consist of a Chairman and two other members, 

each of whom shall be a citizen of a party to the dispute. Each of the two Governments that is a party to the dispute shall appoint one member to the Arbitration Board. If either party to the dispute does not fulfill the appointment requirements of this section within 30 days of referral of the dispute to arbitration 

pursuant to section 423, its member on the Arbitration Board shall be selected 

from its own standing list by the other party to the dispute. Each Government 

shall maintain a standing list of 10 candidates. The parties to the dispute shall 

jointly appoint a Chairman within 15 days after selection of the other members 

of the Arbitration Board. Failing agreement on a Chairman, the Chairman shall 

be chosen by lot from the standing lists of the parties to the dispute within 5 

days after such failure. 

(b) Unless otherwise provided in this Compact, as amended, or its related 

agreements, the Arbitration Board shall have jurisdiction to hear and render its 

final determination on all disputes arising exclusively under Articles I, II, III, 

IV and V of Title One, Title Two, Title Four, and their related agreements. 

(c) Each member of the Arbitration Board shall have one vote. Each decision 

of the Arbitration Board shall be reached by majority vote. 

(d) In determining any legal issue, the Arbitration Board may have reference 

to international law and, in such reference, shall apply as guidelines the provisions set forth in Article 38 of the Statute of the International Court of Justice. 

(e) The Arbitration Board shall adopt such rules for its proceedings as it may 

deem appropriate and necessary, but such rules shall not contravene the provisions of this Compact, as amended. Unless the parties provide otherwise by mutual agreement, the Arbitration Board shall endeavor to render its decision 

within 30 days after the conclusion of arguments. The Arbitration Board shall 

make findings of fact and conclusions of law and its members may issue dissenting or individual opinions. Except as may be otherwise decided by the Arbitration Board, one-half of all costs of the arbitration shall be borne by the Government of the United States and the remainder shall be borne by the Government of the Republic of the Marshall Islands. 

Article III 

Amendment 

Section 431

The provisions of this Compact, as amended, may be further amended by mutual 

agreement of the Government of the United States and the Government of the Republic of the Marshall Islands, in accordance with their respective constitutional 

processes. 

Article IV 

Termination 

Section 441

This Compact, as amended, may be terminated by mutual agreement of the Government of the Republic of the Marshall Islands and the Government of the United 

States, in accordance with their respective constitutional processes. Such mutual 

termination of this Compact, as amended, shall be without prejudice to the continued application of section 451 of this Compact, as amended, and the provisions of 

the Compact, as amended, set forth therein. 

Section 442

Subject to section 452, this Compact, as amended, may be terminated by the Government of the United States in accordance with its constitutional processes. Such 

termination shall be effective on the date specified in the notice of termination by 

the Government of the United States but not earlier than six months following delivery of such notice. The time specified in the notice of termination may be extended. Such termination of this Compact, as amended, shall be without prejudice 

to the continued application of section 452 of this Compact, as amended, and the 

provisions of the Compact, as amended, set forth therein. 

Section 443

This Compact, as amended, shall be terminated by the Government of the Republic of the Marshall Islands, pursuant to its constitutional processes, subject to section 453 if the people represented by that Government vote in a plebiscite to terminate the Compact. The Government of the Republic of the Marshall Islands shall 

notify the Government of the United States of its intention to call such a plebiscite, 

72

which shall take place not earlier than three months after delivery of such notice. 

The plebiscite shall be administered by the Government of the Republic of the Marshall Islands in accordance with its constitutional and legislative processes, but the 

Government of the United States may send its own observers and invite observers 

from a mutually agreed party. If a majority of the valid ballots cast in the plebiscite 

favors termination, the Government of the Republic of the Marshall Islands shall, 

upon certification of the results of the plebiscite, give notice of termination to the 

Government of the United States, such termination to be effective on the date specified in such notice but not earlier than three months following the date of delivery 

of such notice. The time specified in the notice of termination may be extended. 

Article V 

Survivability 

Section 451

(a) Should termination occur pursuant to section 441, economic and other assistance by the Government of the United States shall continue only if and as mutually 

agreed by the Governments of the United States and the Republic of the Marshall 

Islands, and in accordance with the countries’ respective constitutional processes. 

(b) In view of the special relationship of the United States and the Republic of 

the Marshall Islands, as reflected in subsections (b) and (c) of section 354 of this 

Compact, as amended, and the separate agreement entered into consistent with 

those subsections, if termination occurs pursuant to section 441 prior to the twentieth anniversary of the effective date of this Compact, as amended, the United 

States shall continue to make contributions to the Trust Fund described in section 

216 of this Compact, as amended. 

(c) In view of the special relationship of the United States and the Republic of 

the Marshall Islands described in subsection (b) of this section, if termination occurs 

pursuant to section 441 following the twentieth anniversary of the effective date of 

this Compact, as amended, the Republic of the Marshall Islands shall be entitled 

to receive proceeds from the Trust Fund described in section 216 of this Compact, 

as amended, in the manner described in those provisions and the Trust Fund Agreement. 

Section 452

(a) Should termination occur pursuant to section 442 prior to the twentieth anniversary of the effective date of this Compact, as amended, the following provisions 

of this amended Compact shall remain in full force and effect until the twentieth 

anniversary of the effective date of this Compact, as amended, and thereafter as 

mutually agreed: 

(1) Article VI and sections 172, 173, 176 and 177 of Title One; 

(2) Article One and sections 232 and 234 of Title Two; 

(3) Title Three; and 

(4) Articles II, III, V and VI of Title Four. 

(b) Should termination occur pursuant to section 442 before the twentieth anniversary of the effective date of this Compact, as amended:

(1) Except as provided in paragraph (2) of this subsection and subsection (c) 

of this section, economic and other assistance by the United States shall continue only if and as mutually agreed by the Governments of the United States 

and the Republic of the Marshall Islands. 

(2) In view of the special relationship of the United States and the Republic 

of the Marshall Islands, as reflected in subsections (b) and (c) of section 354 of 

this Compact, as amended, and the separate agreement regarding mutual security, and the Trust Fund Agreement, the United States shall continue to make 

contributions to the Trust Fund described in section 216 of this Compact, as 

amended, in the manner described in the Trust Fund Agreement. 

(c) In view of the special relationship of the United States and the Republic of 

the Marshall Islands, as reflected in subsections 354(b) and (c) of this Compact, as 

amended, and the separate agreement regarding mutual security, and the Trust 

Fund Agreement, if termination occurs pursuant to section 442 following the twentieth anniversary of the effective date of this Compact, as amended, the Republic 

of the Marshall Islands shall continue to be eligible to receive proceeds from the 

Trust Fund described in section 216 of this Compact, as amended, in the manner 

described in those provisions and the Trust Fund Agreement. 

Section 453

(a) Should termination occur pursuant to section 443 prior to the twentieth anniversary of the effective date of this Compact, as amended, the following provisions 

of this Compact, as amended, shall remain in full force and effect until the twenVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00072 Fmt 6659 Sfmt 6621 E:\HR\OC\HR262P2.XXX HR262P2
73

tieth anniversary of the effective date of this Compact, as amended, and thereafter 

as mutually agreed: 

(1) Article VI and sections 172, 173, 176 and 177 of Title One; 

(2) Sections 232 and 234 of Title Two; 

(3) Title Three; and 

(4) Articles II, III, V and VI of Title Four. 

(b) Upon receipt of notice of termination pursuant to section 443, the Government 

of the United States and the Government of the Republic of the Marshall Islands 

shall promptly consult with regard to their future relationship. Except as provided 

in subsections (c) and (d) of this section, these consultations shall determine the 

level of economic and other assistance, if any, which the Government of the United 

States shall provide to the Government of the Republic of the Marshall Islands for 

the period ending on the twentieth anniversary of the effective date of this Compact, 

as amended, and for any period thereafter, if mutually agreed. 

(c) In view of the special relationship of the United States and the Republic of 

the Marshall Islands, as reflected in subsections 354(b) and (c) of this Compact, as 

amended, and the separate agreement regarding mutual security, and the Trust 

Fund Agreement, if termination occurs pursuant to section 443 prior to the twentieth anniversary of the effective date of this Compact, as amended, the United 

States shall continue to make contributions to the Trust Fund described in section 

216 of this Compact, as amended. 

(d) In view of the special relationship of the United States and the Republic of 

the Marshall Islands, as reflected in subsections 354(b) and (c) of this Compact, as 

amended, and the separate agreement regarding mutual security, and the Trust 

Fund Agreement, if termination occurs pursuant to section 443 following the twentieth anniversary of the effective date of this Compact, as amended, the Republic 

of the Marshall Islands shall continue to be eligible to receive proceeds from the 

Trust Fund described in section 216 of this Compact, as amended, in the manner 

described in those provisions and the Trust Fund Agreement. 

Section 454

Notwithstanding any other provision of this Compact, as amended: 

(a) The Government of the United States reaffirms its continuing interest in 

promoting the economic advancement and budgetary self-reliance of the people 

of the Republic of the Marshall Islands. 

(b) The separate agreements referred to in Article II of Title Three shall remain in effect in accordance with their terms. 

Article VI 

Definition of Terms 

Section 461

For the purpose of this Compact, as amended, only, and without prejudice to the 

views of the Government of the United States or the Government of the Republic 

of the Marshall Islands as to the nature and extent of the jurisdiction of either of 

them under international law, the following terms shall have the following meanings: 

(a) ‘‘Trust Territory of the Pacific Islands’’ means the area established in the 

Trusteeship Agreement consisting of the former administrative districts of 

Kosrae, Yap, Ponape, the Marshall Islands and Truk as described in Title One, 

Trust Territory Code, section 1, in force on January 1, 1979. This term does not 

include the area of Palau or the Northern Mariana Islands. 

(b) ‘‘Trusteeship Agreement’’ means the agreement setting forth the terms of 

trusteeship for the Trust Territory of the Pacific Islands, approved by the Security Council of the United Nations April 2, 1947, and by the United States July 

18, 1947, entered into force July 18, 1947, 61 Stat. 3301, T.I.A.S. 1665, 8 

U.N.T.S. 189. 

(c) ‘‘The Republic of the Marshall Islands’’ and ‘‘the Federated States of Micronesia’’ are used in a geographic sense and include the land and water areas to 

the outer limits of the territorial sea and the air space above such areas as now 

or hereafter recognized by the Government of the United States. 

(d) ‘‘Compact’’ means the Compact of Free Association Between the United 

States and the Federated States of Micronesia and the Marshall Islands, that 

was approved by the United States Congress in section 201 of Public Law 99–

239 (Jan. 14, 1986) and went into effect with respect to the Republic of the Marshall Islands on October 21, 1986. 

(e) ‘‘Compact, as amended’’ means the Compact of Free Association Between 

the United States and the Republic of the Marshall Islands, as amended. The 

effective date of the Compact, as amended, shall be on a date to be determined 

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by the President of the United States, and agreed to by the Government of the 

Republic of the Marshall Islands, following formal approval of the Compact, as 

amended, in accordance with section 411 of this Compact, as amended. 

(f) ‘‘Government of the Republic of the Marshall Islands’’ means the Government established and organized by the Constitution of the Republic of the Marshall Islands including all the political subdivisions and entities comprising that 

Government. 

(g) ‘‘Government of the Federated States of Micronesia’’ means the Government established and organized by the Constitution of the Federated States of 

Micronesia including all the political subdivisions and entities comprising that 

Government. 

(h) The following terms shall be defined consistent with the 1978 Edition of 

the Radio Regulations of the International Telecommunications as follows: 

(1) ‘‘Radiocommunication’’ means telecommunication by means of radio waves. (2) ‘‘Station’’ means one or more transmitters or receivers or a combination of transmitters and receivers, including the accessory equipment, necessary at one location for carrying on a radiocommunication service, or the 

radio astronomy service. 

(3) ‘‘Broadcasting Service’’ means a radiocommunication service in which 

the transmissions are intended for direct reception by the general public. 

This service may include sound transmissions, television transmissions or 

other types of transmission. 

(4) ‘‘Broadcasting Station’’ means a station in the broadcasting service. 

(5) ‘‘Assignment (of a radio frequency or radio frequency channel)’’ means 

an authorization given by an administration for a radio station to use a 

radio frequency or radio frequency channel under specified conditions. 

(6) ‘‘Telecommunication’’ means any transmission, emission or reception 

of signs, signals, writings, images and sounds or intelligence of any nature 

by wire, radio, optical or other electromagnetic systems. 

(i) ‘‘Military Areas and Facilities’’ means those areas and facilities in the Republic of the Marshall Islands reserved or acquired by the Government of the 

Republic of the Marshall Islands for use by the Government of the United 

States, as set forth in the separate agreements referred to in section 321. 

(j) ‘‘Tariff Schedules of the United States’’ means the Tariff Schedules of the 

United States as amended from time to time and as promulgated pursuant to 

United States law and includes the Tariff Schedules of the United States Annotated (TSUSA), as amended. 

(k) ‘‘Vienna Convention on Diplomatic Relations’’ means the Vienna Convention on Diplomatic Relations, done April 18, 1961, 23 U.S.T. 3227, T.I.A.S. 7502, 

500 U.N.T.S. 95. 

Section 462

(a) The Government of the United States and the Government of the Republic of 

the Marshall Islands previously have concluded agreements, which shall remain in 

effect and shall survive in accordance with their terms, as follows: 

(1) Agreement Between the Government of the United States and the Government of the Marshall Islands for the Implementation of Section 177 of the Compact of Free Association; 

(2) Agreement Between the Government of the United States and the Government of the Marshall Islands by Persons Displaced as a Result of the United 

States Nuclear Testing Program in the Marshall Islands; 

(3) Agreement Between the Government of the United States and the Government of the Marshall Islands Regarding the Resettlement of Enjebi Island; 

(4) Agreement Concluded Pursuant to Section 234 of the Compact; and 

(5) Agreement Between the Government of the United States and the Government of the Marshall Islands Regarding Mutual Security Concluded Pursuant 

to Sections 321 and 323 of the Compact of Free Association. 

(b) The Government of the United States and the Government of the Republic of 

the Marshall Islands shall conclude prior to the date of submission of this Compact 

to the legislatures of the two countries, the following related agreements which shall 

come into effect on the effective date of this Compact, as amended, and shall survive 

in accordance with their terms, as follows: 

(1) Federal Programs and Services Agreement Between the Government of 

the United States of America and the Government of the Republic of the Marshall Islands Concluded Pursuant to Article III of Title One, Article II of Title 

Two (including Section 222), and Section 231 of the Compact of Free Association, as Amended, which include: 

(i) Postal Services and Related Programs; 

(ii) Weather Services and Related Programs; 

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(iii) Civil Aviation Safety Service and Related Programs; 

(iv) Civil Aviation Economic Services and Related Programs; 

(v) United States Disaster Preparedness and Response Services and Related Programs; and 

(vi) Telecommunications Services and Related Programs. 

(2) Agreement Between the Government of the United States of America and 

the Government of the Republic of the Marshall Islands on Extradition, Mutual 

Assistance in Law Enforcement Matters and Penal Sanctions Concluded Pursuant to Section 175 (a) of the Compact of Free Association, as Amended; 

(3) Agreement Between the Government of the United States of America and 

the Government of the Republic of the Marshall Islands on Labor Recruitment 

Concluded Pursuant to Section 175 (b) of the Compact of Free Association, as 

Amended; 

(4) Agreement Concerning Procedures for the Implementation of United 

States Economic Assistance Provided in the Compact, as Amended, of Free Association Between the Government of the United States of America and the 

Government of the Republic of the Marshall Islands; 

(5) Agreement Between the Government of the United States of America and 

the Government of the Republic of the Marshall Islands Implementing Section 

216 and Section 217 of the Compact, as Amended, Regarding a Trust Fund; 

(6) Agreement Regarding the Military Use and Operating Rights of the Government of the United States in the Republic of the Marshall Islands Concluded 

Pursuant to Sections 321 and 323 of the Compact of Free Association, as 

Amended; and, 

(7) Status of Forces Agreement Between the Government of the United States 

of America and the Government of the Republic of the Marshall Islands Concluded Pursuant to Section 323 of the Compact of Free Association, as Amended. 

Section 463

(a) Except as set forth in subsection (b) of this section, any reference in this Compact, as amended, to a provision of the United States Code or the Statutes at Large 

of the United States constitutes the incorporation of the language of such provision 

into this Compact, as amended, as such provision was in force on the effective date 

of this Compact, as amended. 

(b) Any reference in Article IV and VI of Title One, and Sections 174, 175, 178 

and 342 to a provision of the United States Code or the Statutes at Large of the 

United States or to the Privacy Act, the Freedom of Information Act, the Administrative Procedure Act or the Immigration and Nationality Act constitutes the incorporation of the language of such provision into this Compact, as amended, as such 

provision was in force on the effective date of this Compact, as amended, or as it 

may be amended thereafter on a non-discriminatory basis according to the constitutional processes of the United States. 

Article VII 

Concluding Provisions 

Section 471

Both the Government of the United States and the Government of the Republic 

of the Marshall Islands shall take all necessary steps, of a general or particular 

character, to ensure, no later than the entry into force date of this Compact, as 

amended, the conformity of its laws, regulations and administrative procedures with 

the provisions of this Compact, as amended, or, in the case of subsection (d) of section 141, as soon as reasonably possible thereafter. 

Section 472

This Compact, as amended, may be accepted, by signature or otherwise, by the 

Government of the United States and the Government of the Republic of the Marshall Islands. 

IN WITNESS WHEREOF, the undersigned, duly authorized, have signed this 

Compact of Free Association, as amended, which shall enter into force upon the exchange of diplomatic notes by which the Government of the United States of America and the Government of the Republic of the Marshall Islands inform each other 

about the fulfillment of their respective requirements for entry into force. 

DONE at Majuro, Republic of the Marshall Islands, in duplicate, this thirtieth 

(30) day of April, 2003, each text being equally authentic.

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PURPOSE OF THE BILL

The purpose of H.J. Res. 63 is to approve the ‘‘Compact of Free 

Association, as amended between the Government of the United 

States of America and the Government of the Federated States of 

Micronesia,’’ and the ‘‘Compact of Free Association, as amended between the Government of the United States of America and the 

Government of the Republic of the Marshall Islands,’’ and otherwise to amend Public Law 99–239, and to appropriate for the purposes of amended Public Law 99–239 for fiscal years ending on or 

before September 30, 2023, and for other purposes. 

BACKGROUND AND NEED FOR LEGISLATION

On June 27, 2003, the U.S. State Department and Department 

of the Interior sent to Congress the negotiated product that is to 

be considered as the reauthorization of the Compacts of Free Association (Compacts) with the Federated States of Micronesia (FSM) 

and the Republic of the Marshall Island (RMI). Title II of the current Compacts, implemented in Public Law 99–239, provides U.S. 

economic assistance in the forms of grants and program assistance, 

and is set to expire on September 30, 2003. The proposal submitted 

to Congress amends the current Compacts to provide for an additional 20 years of economic assistance to the RMI and FSM. 

Located in the Western Pacific Ocean, the RMI and the FSM 

were former districts of the U.S.-administered United Nations 

Trust Territory established in 1947. Their geographic location 

played an important strategic role in the wake of World War II and 

throughout the Cold War era. In addition, between 1946 through 

1958, atolls located within the Marshall Islands were used as sites 

for the U.S. nuclear testing program. A total of 66 nuclear detonations occurred, including ‘‘Castle Bravo,’’ the largest U.S. nuclear 

test ever exploded. 

In 1986, the Marshall Islands and Micronesia became Freely Associated States (FAS) under Compacts of Free Association with the 

U.S. The Compacts fulfilled the U.S. obligation to U.N. mandated 

Trust Territories, ‘‘to promote the development of the inhabitants 

of the trust territories toward self-government or independence as 

may be appropriate to the particular circumstances of the trust territory and its peoples, and the freely expressed wishes of the peoples concerned.’’

The Compacts, which are extremely similar to treaties, are the 

basis of the relationship between the U.S. and these countries. U.S. 

State Department officials have stated that agreement on continued U.S. economic assistance is important for the renewal of the 

Compact’s defense provisions, and would provide a positive context 

for the exercise of U.S. defense rights and facilitate the advancement of U.S. interests. 

In general, the Compacts have four goals: (1) to continue economic assistance while encouraging self-reliance; (2) to continue 

our defense relationship, which includes a 50-year lease extension 

for access to Kwajalein (the U.S. Anti-Ballistic Missile testing facility located in the RMI); (3) to strengthen immigration provisions; 

and (4) to provide mandatory impact assistance to affected U.S. jurisdictions in response to FAS migration. The Compacts as negotiated between the United States, the FSM, and the RMI follows 

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a course that would preserve the existing defense and security relationship between the United States and each of these countries. 

The United States obligations to defend the islands and the right 

to deny military access to other nations continue indefinitely 

through a related agreement. 

The House Resources Committee shares jurisdiction with the 

House Committee on International Relations over Title II (economic development) of the Compacts. The purpose of Title II is to 

assist the Governments of the FSM and RMI in their efforts to advance economic self-sufficiency. The State Department’s Office of 

Compact Negotiations has negotiated with the FSM and the RMI 

to extend both program and grant assistance to their countries 

until 2023. After such date, the Administration has proposed termination of the annual mandatory financial assistance. To partially 

offset this termination, the United States, in addition to extending 

program and grant assistance throughout the new Compact period, 

will also establish trust funds for each country to generate annual 

earnings beyond 2023. The initial contribution to each trust fund 

will be made by the RMI and the FSM. Thereafter, continuing annual U.S. contributions to the trust funds will be equal to the annual reduction in grant assistance to each country. Other important provisions in H.J. Res. 63 include changes to immigration 

standards and establishing joint economic management teams to 

promote economic growth in the FSM and RMI. 

COMMITTEE ACTION

H.J. Res. 63 was introduced on July 8, 2003, by Congressman 

James A. Leach (R–IA), by request. The bill was referred to the 

Committee on International Relations and additionally to the Committee on Resources. On July 10, 2003, the Full Committee held a 

hearing on the bill. On September 4, 2003, the Full Resources Committee met to consider the bill. Chairman Richard W. Pombo (R–

CA) offered an amendment in the nature of a substitute that added 

and continued eligibility for crucial Federal Emergency Management Agency funding, increased ‘‘Compact impact’’ funding, protected important education programs, and provided for stronger 

health care options for patients and providers, as well as other provisions. The amendment was adopted by voice vote. The bill, as 

amended, was then ordered favorably reported to the House of Representatives by voice vote. 

SECTION-BY-SECTION ANALYSIS

PREAMBLE

The Preamble has been updated to reflect that the Compact, as 

amended, now consists of two separate Compacts with the Republic 

of the Marshall Islands and the Federated States of Micronesia. As 

amended, it also provides for more historical context, stating what 

goals have been accomplished since the original Compact of Free 

Association. 

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TITLE I—APPROVAL OF U.S.-FSM COMPACT AND U.S.-RMI COMPACT; IN- TERPRETATION OF, AND UNITED STATES POLICIES REGARDING, U.S.—FSM COMPACT AND U.S.—RMI COMPACT; SUPPLEMENTAL PRO- VISIONS

Section 101. Approval of U.S.-FSM Compact of Free Association 

and U.S.-RMI Compact of Free Association

Subsection (a) notes the existence of a separate Compact, as 

amended, between the United States and the Federated States of 

Micronesia. 

Subsection (b) notes the existence of a separate Compact, as 

amended, between the United States and the Republic of the Marshall Islands. 

Subsection (c) defines and updates terms of reference to reflect 

the existence of the two separate Compacts referred to above and 

to provide definitions for the terms ‘‘subsidiary’’ or ‘‘separate agreements.’’ Subsection (d) requires that any changes or amendments to either of the two Compacts, or to certain subsidiary agreements (or 

portions), be approved through an Act of Congress. 

Subsection (e) states that the one trilateral subsidiary agreement 

that is not being amended (relating to the transfer of title of U.S. 

Government property situated in the former Trust Territory of the 

Pacific Islands) shall be deemed bilateral, reflecting the newly separate Compacts. 

Subsection (f) provides generally that (except for those agreements identified in section 101(d), which require an Act of Congress for modification) no changes to any subsidiary agreement 

may be made without prior notification and explanation to both 

Houses of Congress. 

Section 102. Agreements with Federated States of Micronesia 

Subsection (a) provides generally for law enforcement technical 

and training assistance to the FSM. 

Subsection (b) provides the Comptroller General with authority 

to audit assistance provided by the United States to the FSM 

under the amended Compacts, and requires the FSM to cooperate 

with the Comptroller General in conducting such audits. As amended the subsection also ensures that all relevant audit documentation is preserved for a sufficient amount of time. 

Section 103. Agreements with and other provisions related to the 

Republic of the Marshall Islands 

Subsection (a) provides generally for technical and training assistance to the RMI in the area of law enforcement. 

Subsection (b) repeats the language from Public Law 99–239 (regarding assurances that Bikini residents will have access to lands 

on Ejit Island until Bikini—the site of past U.S. nuclear tests—is 

restored and habitable), but adds a new paragraph noting that the 

United States and the RMI entered into an agreement in furtherance of paragraphs (1) through (3) of this subsection on July 21, 

1986. The Committee also understands the relevance of the language that previous to the amendments stated that ‘‘nothing in this 

subsection creates any rights or obligations beyond those provided 

for in the original enacted version of Public Law 99–239.’’

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Subsection (c) as amended places emphasis on United States policy to ensure payments are made in accordance with the land use 

agreement from October 1982 on Kwajalein. The subsection also 

creates an escrow account where payments above the original land 

use agreement amount are held in an interest bearing account 

until a new land use agreement specifically amending the October 

1982 agreement is signed. 

Subsection (d) repeats the language from Public Law 99–239 regarding U.S. payment of nuclear claims compensation. 

Subsection (e) repeats the language from Public Law 99–239 regarding compensation to Bikini, Enewetak, Rongelap, and Utrik 

atolls for nuclear test effects. 

Subsection (f) repeats Congress’s intent that Section 177 of the 

original Compact and the separate agreement entered into thereunder constitute a full and final settlement of all nuclear compensation claims (described in articles X and XI of that separate 

agreement). The Committee also understands the relevance of the 

language that previous to the amendments stated that ‘‘nothing in 

this subsection creates any rights or obligations beyond those provided for in the original enacted version of Public Law 99–239.’’ Subsection (g) repeats and updates the language from Public 

Law 99–239 regarding health care and agricultural programs for 

certain populations affected by U.S. nuclear tests. The Committee 

also understands the relevance of the language that previous to the 

amendments stated that ‘‘nothing in this subsection creates any 

rights or obligations beyond those provided for in the original enacted version of Public Law 99–239.’’ The subsection also makes 

payments for the planting and agricultural maintenance program 

on Enewetak. 

Subsection (h) repeats the language of Public Law 99–239 regarding restoring the habitability of Rongelap. The Committee also 

understands the relevance of the language that previous to the 

amendments stated that ‘‘nothing in this subsection creates any 

rights or obligations beyond those provided for in the original enacted version of Public Law 99–239.’’

Subsection (i) deals with the Four Atoll Health Care Program, repeating the language of Public Law 99–239 regarding the administration of certain health care funds for Bikini, Enewetak, Rongelap, 

and Utrik. The Committee also understands the relevance of the 

language that previous to the amendments stated that ‘‘nothing in 

this subsection creates any rights or obligations beyond those provided for in the original enacted version of Public Law 99–239.’’

Subsection (j) deals with the Enjebi Community Trust Fund, repeating the language of Public Law 99–239 regarding the creation 

and administration of that fund. The Committee also understands 

the relevance of the language that previous to the amendments 

stated that ‘‘nothing in this subsection creates any rights or obligations beyond those provided for in the original enacted version of 

Public Law 99–239.’’

Subsection (k) deals with the cleanup of Bikini Atoll, repeating 

and updating the language of Public Law 99–239. The Committee 

also understands the relevance of the language that previous to the 

amendments stated that ‘‘nothing in this subsection creates any 

rights or obligations beyond those provided for in the original enacted version of Public Law 99–239.’’

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Subsection (l) generally provides the Comptroller General with 

authority to audit all grants, program assistance, and other assistance provided by the United States to the RMI under the amended 

Compact, and requires the RMI to cooperate with the Comptroller 

General in conducting such audits. 

Section 104. Interpretation of and United States policy regarding 

U.S.-FSM Compact and U.S.-RMI Compact 

Subsection (a) notes and affirms the parties’ commitment to 

democratic government and respect for human rights. It has been 

updated to reflect the existence of the two separate amended Compacts, but is otherwise unchanged from the original statute. 

Subsection (b)(1) places restrictions on the admission of certain 

naturalized citizens of the FSM and the RMI into the United 

States under the Compact. While generally similar to the original 

statute, it contains updated citations to reflect the restrictions on 

the admission of most naturalized citizens of the FSM and the RMI 

found in section 141 of the amended Compacts. Subsection (b)(2) directs that $250,000 of the Compact grant 

funds for each country be used for the development of machinereadable and secure FSM and RMI passports. 

Subsection (b)(3) provides generally that the FSM and the RMI 

shall share information the United States Government deems necessary to enforce the criminal and security-related provisions of the 

Immigration and Nationality Act, as amended. 

Subsection (b)(4) contains a clarification relating to the proper 

implementation of sections 141(a)(3) and (4) of the amended Compacts (regarding the grandfathering of certain naturalized citizens 

into the special immigration status enjoyed by FSM and RMI citizens). 

Subsection (c) generally repeats the language of Section 104(c) of 

the original statute, which endorses FSM and RMI restrictions on 

the permanent sale of land to non-citizens of those countries. 

Subsection (d) generally repeats the language of Section 104(d) 

of the original statute, which recognizes FSM and RMI prohibitions 

on certain forms of nuclear and toxic waste disposal in their countries. 

Subsection (e) deals with certain adverse effects of migration 

(from the RMI, FSM, and Palau to the U.S.) on the State of Hawaii, Guam, the Commonwealth of the Northern Mariana Islands 

(CNMI), and American Samoa. As amended, the subsection provides for reports to be sent to the President regarding past debts 

due to the impact of the migration of FAS citizens. The President 

then reports to Congress and can take actions to address these 

debts. In granting authority to the President to reduce, in whole or 

in part, amounts owed by the Government of Guam and the Government of CNMI, this Committee believes that funding made 

available in Guam as a result of a debt being altered could be helpful to the eventual privatization of the Guam Telephone Authority 

(GTA). The Committee believes that privatization of the phone authority, which is the last government-owned telephone authority in 

the nation, would bring significant benefits to the island of Guam. 

This subsection authorizes and appropriates $30 million, as 

amended, in Compact impact funding per fiscal year from Fiscal 

Year 2004 through 2023, allocates it to those U.S. jurisdictions by 

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formula, places limitations on the use of any such funding, and requires periodic enumerations of FSM, RMI, and Palau citizens 

within those four affected jurisdictions. For purposes of this section, the term ‘‘adverse consequences’’ shall include, but not be limited to, unpaid health costs related to indigent qualified nonimmigrants at public and private hospitals or health facilities; educational costs related to the numbers of qualified nonimmigrant 

students based on an average per-pupil cost enrolled in the public 

school systems; social costs related to law enforcement and incarceration of qualified nonimmigrants; and unpaid costs related to 

providing housing to indigent qualified nonimmigrants. 

The subsection also provides for reimbursement of medical referral debts, requires use of Department of Defense medical facilities 

on a space available and reimbursable basis, and brings back the 

National Health Service Corps to the FAS as was in Public Law 

99–239. 

Subsection (f) is a new section which states the Sense of Congress that 30 percent of the grant assistance would be best utilized 

to fund public infrastructure improvements. 

Subsection (g) repeats section 104(g) of Public Law 99–239, reaffirming that the U.S. is not responsible for foreign debt contracted by the FSM or RMI. 

Subsection (h) is a new section which provides for Presidential 

reviews and reports to Congress after the fifth and fifteenth years 

of the enacted legislation. The Committee notes that trust funds established for the RMI and FSM, pursuant to the amended Compact 

should receive consideration to be included within a report or review to evaluate trust fund contributions, current performance and 

future speculation. The subsection also provides for reports to be 

submitted to Congress three years after enactment and every five 

years after that date by the Comptroller General on multiple facets, including implementation and economic progress. 

Subsection (i) is a new section which provides for Congressional 

notification on regulations regarding immigration. 

Section 105. Supplemental provisions 

Subsection (a) generally repeats Section 105(a) of the original 

statute, that all U.S. federal programs and services extended to the 

FSM and RMI remain subject to the same criteria, standards, audits, and rules as in the U.S.

Subsection (b)(1) specifies that appropriations made pursuant to 

article I of title two (which includes the major financial sector 

grants) and Section 221(a)(2) of the amended Compacts (regarding 

U.S. Postal Service), are to be made to the Secretary of the Interior. 

Subsection (b)(2) specifies that certain appropriations made for 

services and programs provided to the FSM and RMI by the U.S. 

Weather Service, Federal Aviation Administration, Department of 

Transportation, Federal Deposit Insurance Corporation, Federal 

Emergency Management Agency, and U.S. Agency for International 

Development/Office of Foreign Disaster Assistance, shall be made 

directly to those agencies. 

Subsection (b)(3) specifies that appropriations made for certain 

other federal services and programs (including the Legal Services 

Corporation, Public Health Service, and Rural Housing Service) 

82

shall be made to the relevant agencies in accordance with the 

terms of any appropriations for such services and programs. 

Subsection (b)(4) requires all federal agencies providing program 

and service assistance to the FSM or the RMI to consult and coordinate with the Secretaries of State and the Interior regarding 

the provision of any such assistance. 

Subsection (b)(5) provides that U.S. Government employees in either the FSM or the RMI are subject to the authority of the United 

States Chief of Mission. 

Subsection (b)(6) authorizes the appointment of an Interagency 

Group on Freely Associated States’ Affairs to provide policy guidance to the U.S. Government. 

Subsection (b)(7) specifies that the three U.S. appointees to the 

Joint Economic Management Committees provided for in each of 

the amended Compacts and Fiscal Procedures Agreements shall be 

U.S. Government officers or employees. 

Subsection (b)(8) specifies that the United States voting members 

of the Trust Fund Committees appointed by the U.S. Government 

shall be U.S. Government officers or employees. 

Subsection (b)(9) specifies that the Trust Fund Committees provided for in the amended Compacts and Trust Fund Agreements 

shall be non-profit corporations incorporated under the laws of the 

District of Columbia. 

Subsection (c) is a new section which provides a total of $300,000 

for the FSM and RMI for training of judges and officials of the judiciary. 

Subsection (d) repeats the content of Section 105(c) of the original statute, which deals with any continuing authorizations from 

the Trust Territory period. 

Subsection (e) provides for the survivability of certain provisions 

of this joint resolution (such as those regarding audits) even if the 

amended Compacts are terminated. 

Subsection (f) states that actions by the FSM or RMI that are incompatible with U.S. defense authorities and responsibilities toward those countries will constitute a material breach of the respective Compact. 

Subsection (g) states in paragraph (1) that certain programs and 

services (from the Legal Services Corporation, Public Health Service, and Rural Housing Service) be made available to the FSM and 

the RMI, pursuant to Section 222 of the amended Compacts. The 

subsection provides eligibility for the FSM and RMI for the Pell 

Grant program and eliminates eligibility for other programs administered by the Department of Education and instead provides payments to the FSM and RMI. These payments provide assistance to 

administer their educational programs as they see most beneficial. 

The subsection continues eligibility for competitive grants. The subsection also creates a new Federal Emergency Management Agency 

(FEMA) interplay where the Disaster Assistance Emergency Fund 

will be able to accrue funding. After 10 years or when this fund 

reaches a certain level, the FEMA programs for public infrastructure will remain in the FSM and RMI. Paragraph (2) applies the 

tort claims provisions of the amended Compacts to U.S. Government employees and contractors. Paragraph (3) continues eligibility 

for Environmental Protection Agency programs for PCB cleanup. 

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Subsection (h) provides that the College of Micronesia shall retain its status as a land-grant institution until otherwise provided 

by Congress or until termination of the amended Compact. 

Subsection (i) absolves the Governments of the FSM and the RMI 

from payment of certain debts of the former Trust Territory Government to U.S. federal agencies. 

Subsection (j) continues the authorization for certain U.S. federal 

agencies to provide technical assistance at the request of the FSM 

and RMI. 

Subsection (k) authorizes continued payments to persons who 

were eligible to receive payment under the Prior Service Benefits 

Program established during the Trust Territory period (due to pre–

1968 service for the U.S. Navy or Trust Territory Government). 

Subsection (l) repeats the language of the original statute authorizing certain sums to complete repayment by the United States of 

debts owed for use of various land in the FSM and the RMI prior 

to January 1, 1985. 

Subsection (m) authorizes grants for the purposes of dealing with 

communicable diseases in the FSM and RMI. 

Subsection (n) requires payment of standard user fees for services provided by the United States to persons in the FSM and the 

RMI. 

Subsection (o) provides that no judgment of an FSM, RMI, or 

Palau court against the United States or its instrumentalities shall 

be honored by the U.S., unless the judgment is consistent with the 

U.S. interpretation of international agreements relevant to the 

judgment. In making such a determination, due deference shall be 

given to assurances made by the Executive Branch to Congress regarding proper interpretation of any such international agreement. 

Subsection (p) states if the United States Gross Domestic Product Implicit Price Deflator in the second five years of the enacted 

legislation is higher than the United States Gross Domestic Product Implicit Price Deflator for first five years of the enacted legislation, the relevant grant funding in the Fiscal Procedures Agreements for the FSM and RMI will receive full inflation from the fiscal year 2015 forward. 

Section 106. Construction and contract assistance 

This section authorizes assistance to U.S. firms who may be 

awarded construction contracts within the FSM or RMI to help 

them employ and train citizens of the FSM and RMI to the extent 

possible. 

Section 107. Prohibition 

This section states that the portions of the U.S. Code dealing 

with criminal bribery and conflict of interest apply in full to U.S. 

employees involved in the Compact negotiations. 

Section 108. Compensatory adjustments 

Subsection (a) authorizes the provision of certain federal programs and services (Small Business Administration, Economic Development Administration, Rural Utilities Services, Department of 

Labor/Workforce Investment Act, and Department of Commerce/

tourism and marine resource programs) to the FSM and the RMI. 

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The subsection also provides eligibility to qualify for Federal Deposit Insurance Corporation (FDIC) services, and this option will 

no longer apply on and after September 30, 2005. At this time the 

Committee continues to work with the relevant agency on this 

FDIC component, with the understanding that the FSM and RMI 

have differing relationships with the FDIC and this issue may need 

to be further evaluated. 

Subsection (b) authorizes the payment, upon an adequate showing, of certain sums to the FSM and the RMI as compensation for 

the effects, if any, during the first 15 years following the effective 

date of the original Compact, of certain Congressional clarifications 

regarding trade and taxation enacted by the Congress in Public 

Law 99–239. The countries must submit any such request by September 30, 2009. 

Section 109. Authorization and continuing appropriation 

This section authorizes and appropriates, through fiscal year 

2023 (September 30, 2023), the sums required for grant, trust fund, 

and Kwajalein payments under the amended Compacts. 

Section 110. Payment of citizens of the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic 

of Palau Employed by the Government of the United States in 

the Continental United States 

This section exempts citizens of the FSM, RMI, and Palau from 

the general rule of Section 605 of Public Law 107–67 that U.S. 

Government employees posted within the continental U.S. should 

be U.S. citizens (or someone who owes allegiance to the U.S. or 

falls within other defined groups). 

TITLE II—COMPACTS OF FREE ASSOCIATION WITH THE FEDERATED

STATES OF MICRONESIA AND THE REPUBLIC OF THE MARSHALL ISLANDS

Title II reproduces the amended Compacts between the U.S. and 

the Federated States of Micronesia [Section 201(a)] and the Republic of the Marshall Islands [Section 201(b)], which are discussed 

below. 

Subsection 201(a). The Preamble has been updated to reflect that 

the Federated States of Micronesia (FSM) is a sovereign country 

(not a Trust Territory), that the amended Compacts are now separate (one each with the FSM and RMI), and the term ‘‘self-sufficiency’’ has been replaced by ‘‘budgetary self-reliance’’ to reflect the 

objective that the FSM end its reliance on U.S. financial assistance 

and obtain revenues from other legitimate sources. 

TITLE ONE—GOVERNMENTAL RELATIONS

Article I—Self Government 

Section 111 states that the people of the FSM are self-governing. 

Article II—Foreign Affairs 

Section 121 affirms the capacity of the Government of the FSM 

to conduct foreign affairs. 

Section 122 states that the U.S. will support FSM membership 

in international organizations. 

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Section 123 states that the U.S. and FSM will consult with each 

other regarding foreign affairs. 

Section 124 states that the U.S. may assist the FSM with foreign 

affairs when requested and mutually agreed. 

Section 125 states that the U.S. cannot be obligated by the FSM’s 

conduct of foreign affairs unless expressly agreed. 

Section 126 makes available U.S. consular services to FSM citizens traveling outside the FSM. 

Section 127 states that except as agreed in the amended Compact and related agreements, the rights and obligations of the U.S. 

as Administering Authority of the Trust Territory of the Pacific Islands ended on November 2, 1986. 

Article III—Communications 

Section 131 states that the FSM has authority to regulate its 

communications, notes that the FSM elected in 1993 to assume 

telecommunications functions previously performed by the U.S., 

and grants the U.S. rights to operate telecommunications services 

within the FSM to the extent necessary to fulfill its obligations 

under the amended Compact.

Article IV—Immigration 

Section 141(a) provides that otherwise admissible FSM citizens 

will continue to be eligible for visa-free admission to the U.S. (including territories and possessions) to lawfully engage in occupations and establish residence as nonimmigrants, but now requires 

that they possess valid passports. Subsections (3) and (4) restrict 

the class of naturalized FSM citizens eligible for this special status 

(to address concerns about potential abuse of the special status by 

non-FSM natives). Subsection (5) extends this status to bona fide 

immediate relatives of FSM citizens serving on active duty with the 

U.S. Armed Forces. 

Section 141(b) provides that FSM children traveling to the U.S. 

for the purpose of being adopted are not eligible for visa-free admission under the Compact. This new language is intended to prevent attempted use of Compact privileges to circumvent U.S. immigration requirements that help ensure the legitimacy of international adoptions, protect the children involved, and provide the 

adoptees with lawful permanent immigration status. 

Subsection 141(c) is new language, which declares that no person 

who has purchased FSM citizenship or an FSM passport shall be 

eligible for admission to the U.S. under the amended Compact. 

This is intended to remove incentives for passport sales or other 

abuse. 

Subsection 141(d) confirms the existing privilege to work in the 

U.S. and expands the types of documents that FSM citizens can 

use to demonstrate identity and employment authorization under 

U.S. immigration law. 

Subsection 141(e) defines certain terms used in this immigration 

title. 

Subsection 141(f) affirms that (except as specified in Section 

141(a)), the U.S. Immigration and Nationality Act (INA) applies 

fully to any person admitted to the U.S. (or seeking admission to 

the U.S.) under the Compact, and that the U.S. has full authority 

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under the INA to regulate the terms and conditions of persons 

seeking admission under the Compact. 

Subsection 141(g) provides that the governments of U.S. territories or possessions not subject to the INA (such as American 

Samoa and the Commonwealth of the Northern Mariana Islands) 

have the same authorities as the U.S. enjoys under the INA to exercise immigration authority under the amended Compact. 

Subsection 141 notes that admission to the U.S. under the Compact does not count as residence necessary for U.S. naturalization, 

or give FSM admittees to the U.S. the right to petition for benefits 

for alien relatives under the INA. 

Subsection 142(a) recognizes the right of U.S. citizens to enter 

and work in the FSM (subject to the FSM’s reasonable authority 

to deport and deny entry), as well as the right of U.S. citizen 

spouses of FSM citizens to reside in the FSM, even after the death 

of the FSM citizen spouse. 

Subsection 142(b) requires that the FSM accord U.S. citizens and 

nationals immigration status no less favorable than that accorded 

to citizens of other countries. 

Subsection 142(c) provides that the FSM will adopt immigration 

procedures towards U.S. citizens and nationals seeking employment or investment in the FSM that are no less favorable than 

those adopted by the U.S. toward FSM citizens. 

Section 143 states that FSM citizens and U.S. citizens or nationals who lose their citizenship or nationality shall be ineligible to receive immigration privileges under the Compact. 

Article V—Representation 

Section 151 provides that relations between the U.S. and the 

FSM shall be conducted in accordance with the Vienna Convention 

on Diplomatic Relations, and that the governments may establish 

offices and representatives as mutually agreed. 

Section 152 provides that U.S. citizens and nationals who act as 

agents of FSM without authority of the U.S. are subject to the Foreign Agents Registration Act, except for U.S. citizen/national employees of the FSM whom the FSM certifies are not principally engaged in activities specified in that Act. 

Article VI—Environmental Protection 

Subsection 161(a) declares the policy of the parties to prevent 

damage to the environment, and commits the U.S. to conducting its 

activities in accord with certain environmental standards similar to 

those in effect in the U.S. 

Subsection 161(b) commits the FSM to continuing to develop, implement, and enforce environmental standards similar to those required of the U.S. in the previous subsection. 

Subsection 161(c) states that the parties may modify the environmental obligations of the previous two subsections by mutual 

agreement. 

Subsection 161(d) states that in the event that U.S. law no 

longer requires Environmental Impact Statements, the obligations 

of Section 161(a) will continue to require them until the parties 

mutually agree otherwise. 

Subsection 161(e) states that the President of the U.S. may exempt any U.S. Government activities from the environmental 

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standards of Section 161(a)(3)–(4) if it is in the ‘‘paramount interest’’ of the U.S. Government to do so, after considering the views 

of the FSM and explaining the reasons for the exemption, to the 

extent practicable. 

Subsection 161(f) states that the laws of the U.S. referred to in 

Section 161(a)(3) apply to U.S. activities under the Compact only 

to the extent provided in Section 161.

Section 162 states that the FSM may bring an action for judicial 

review of U.S. Government environmental activities pursuant to 

Section 161(a) only in the U.S. District Court for Hawaii or the 

U.S. District Court for the District of Columbia, and subject to certain conditions. 

Section 163 states that the U.S. and the FSM shall have access 

to each other’s facilities to the extent necessary to gather information to carry out article VI, so long as it does not unreasonably 

interfere with the other’s exercise of its authorities and responsibilities. 

Article VII—General Legal Provisions 

Section 171 provides that except as provided in the amended 

Compact or related agreements, the application of the laws of the 

U.S. to the Trust Territory of the Pacific Islands ceased on November 3, 1986. 

Section 172 declares that FSM citizens who are not U.S. residents shall have the same rights and remedies under U.S. law enjoyed by any non-resident alien. Subsection (b) affirms that the 

government and citizens of the FSM are ‘‘persons’’ for purposes of 

making Freedom of Information Act (FOIA) requests and seeking 

judicial review of FOIA determinations, but states that only the 

FSM government (and not its citizens) have standing to seek judicial review relating to U.S. environmental activities governed by 

Sections 161 and 162. 

Section 173 states that the U.S. and the FSM agree to adopt and 

enforce measures necessary to protect U.S. assets maintained in 

the FSM pursuant to the Compact and related agreements. 

Section 174 states that, except as otherwise provided in the Compact and related agreements: (a) the FSM and U.S. Governments, 

agencies, and officials shall be immune from the jurisdiction of the 

other’s courts; (b) the U.S. shall pay unpaid judgments and claim 

settlements of the Trust Territory of the Pacific Islands; (c) claims 

against the Trust Territory or U.S. Governments arising before the 

original Compact may be pursued against the U.S. Government according to certain conditions and procedures; and (d) the FSM and 

U.S. Governments shall not be immune from the jurisdiction of the 

other’s courts in civil cases that fall within exceptions to foreign 

state immunity in the Foreign Sovereign Immunities Act. 

Subsection 175(a) declares that a separate, simultaneously effective agreement between the parties shall govern mutual law enforcement assistance and cooperation, including pursuit and extradition of fugitives and prisoner transfers. 

Subsection 175(b) declares that a separate, simultaneously effective agreement between the parties shall govern labor recruitment 

practices for employment in the U.S. and enforcement for violations. This new section has been added to protect FSM citizens 

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from abusive labor recruitment practices that have been recently 

alleged. 

Section 176 states that the FSM confirms that final judgments 

in civil cases by courts of the Trust Territory of the Pacific Islands 

shall continue in full force and effect. 

Section 177 quotes the language of Section 177 of the original 

Compact which constituted a full and final settlement of all claims 

related to the U.S. nuclear testing program in the region, and notes 

that the amended Compacts make no changes to, and have no effect upon, that settlement. 

Section 178 authorizes U.S. federal agencies that provide services 

in the FSM to settle and pay tort claims arising in the FSM. 

Claims that cannot be settled administratively shall be disposed of 

exclusively according to the arbitration procedure outlined in article II of title IV of the Compact. Except as explicitly provided in 

U.S. law, neither the U.S. nor any federal agency may be named 

as a party in any action arising out of U.S. grant assistance activities. 

Section 179 states that the courts of the FSM shall not exercise 

criminal jurisdiction over the U.S. Government, agencies, or employees acting on behalf of the U.S. in providing assistance to the 

FSM. 

TITLE TWO—ECONOMIC RELATIONS

Article I—Grant Assistance 

Subsection 211(a) states that the U.S. shall provide 20 years of 

annual sectoral grant assistance to the FSM in the priority sectors 

of education and health care, as well as in private sector development, the environment, public sector capacity building, public infrastructure, and other sectors as mutually agreed. The sector 

grants will be made available in accordance with mutually agreed 

sector development plans, and will be subject to monitoring according to the Fiscal Procedures Agreement between the parties. 

Subsection 211(b) makes available a ‘‘Humanitarian AssistanceFSM’’ (HAFSM) program at the request of the FSM, designed to extend targeted health, education, and infrastructure assistance. 

HAFSM costs will be deducted from the annual grant provided 

under Section 211(a), and the terms of the program will be governed by the separate Military Use and Operating Rights agreement. 

Subsection 211(c) requires the FSM to prepare, maintain, and 

update a strategic development plan that specifically addresses the 

sectors identified in Section 211(a) and requires the concurrence of 

the U.S. (insofar as U.S. grant funds are involved). Subsection 211(d) provides that $200,000 per year shall be provided, with a matching contribution from the FSM, to a Disaster 

Assistance Emergency Fund, which may be used only for assistance 

and rehabilitation needs resulting from officially declared disasters 

or emergencies, and which shall be governed by the Fiscal Procedures Agreement. 

Section 212 states that, as reflected in the Fiscal Procedures 

Agreement, sector grants and U.S. programs and services shall be 

subject to regulations and policies normally applicable to U.S. assistance to State and local governments. The U.S. may condition 

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such assistance on performance indicators, and may seek remedies 

for noncompliance, including withholding assistance. Subsection (b) 

states that the U.S., as part of its grant assistance, grant the FSM 

either one half of the cost of the annual audit, or $500,000, whichever is less.

Section 213 states that the U.S. and the FSM shall establish a 

Joint Economic Management Committee (comprised of a U.S. chairman, 2 U.S. members, and 2 FSM members) governed by the Fiscal 

Procedures Agreement. The Committee will review the audits, reports, and progress toward plan objectives, and recommend ways to 

increase effectiveness. 

Section 214 states that the FSM shall report annually to the U.S. 

on its use of U.S. grant assistance and progress toward economic 

goals. 

Section 215 states that the U.S. shall provide 20 years of annual 

contributions to a trust fund (governed by the separate Trust Fund 

Agreement) the proceeds of which may be used at the end of those 

20 years for the purposes described in Section 211, or as mutually 

agreed. The U.S. contribution is conditioned on the FSM having already contributed $30 million to the fund by September 30, 2004. 

Section 216 sets forth the amounts of U.S. sector grants and 

trust fund contributions for each of the 20 years of assistance. The 

combined amount for each year is $92.7 million. 

Section 217 states that the grant and trust fund contributions for 

each fiscal year shall be adjusted by two thirds the amount of the 

U.S. GDP Implicit Price Deflator or 5 percent, whichever is less. 

Section 218 states that unobligated balances from any year shall 

remain available to the FSM in future years. 

Article II—Services and Program Assistance 

Subsection 221(a) states that the U.S. shall make available to 

the FSM (to the extent provided in the Federal Programs and Services Agreement) the services and related programs of: (1) U.S. 

Weather Service; (2) U.S. Postal Service; (3) Federal Aviation Administration; (4) U.S. Department of Transportation; (5) Federal 

Deposit Insurance Corporation; and (6) Federal Emergency Management Agency; and (7) U.S. Agency for International Development/Office of Foreign Disaster Assistance. 

Subsection 221(b) states that, with the exception of those services 

covered by Section 221(a), the U.S. shall (unless Congress provides 

otherwise) make available to the FSM the services and programs 

that were available to the FSM on the effective date of the amended Compact, to the extent that such services are available to U.S. 

State and local governments. 

Subsection 221(c) states that the U.S. has the authority to monitor and administer all service and program assistance to the FSM. 

Subsection 221(d) states that, except as otherwise provided, federal programs and services extended to the FSM shall be subject 

to the same standards and rules applicable to such programs in the 

U.S. 

Subsection 221(e) states that the U.S. shall make available to the 

FSM, to the extent provided in U.S. law, alternate energy development projects and conservation measures. 

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Section 222 states that the U.S. and the FSM may agree to extend additional U.S. grant assistance to the FSM, which shall be 

governed by the Federal Programs and Services Agreement. 

Section 223 states that the FSM shall make available at no 

charge to the U.S. whatever land is necessary for such service and 

program assistance, and whatever facilities are currently provided 

at no cost to the U.S., or may be mutually agreed in the future. 

Section 224 states that the FSM may request technical assistance from U.S. federal agencies that, if provided, would give priority consideration to the FSM over other non-U.S. recipients. 

Article III—Administrative Provisions 

Section 231 notes that the extent of U.S. program assistance, the 

status of U.S. agencies and employees, and other program and 

service-related arrangements are set forth in a separate Federal 

Programs and Services Agreement. 

Section 232 states that the U.S. shall determine and implement 

procedures for audits of all grant and program assistance, and authorizes the U.S. Comptroller General to conduct audits in the 

FSM. 

Section 233 states that the U.S. pledges that it will provide the 

grant assistance (specified in Section 211) for the 20 year term 

specified, subject to the terms and conditions of title II and related 

subsidiary agreements. 

Section 234 states that the FSM pledges that it will cooperate in 

U.S. investigations of misuse of Compact funds and that it will not 

unreasonably withhold U.S.—requested subpoena assistance in the 

FSM. The FSM acknowledges that its receipt of Compact funding 

is conditioned on its fulfillment of these obligations. 

Article IV—Trade 

Section 241 states that the FSM is not within the customs territory of the U.S. 

Subsection 242(a) states that unless otherwise excluded, articles 

imported from the FSM shall be exempt from duty. 

Subsection 242(b) states that imports of ‘‘tuna in airtight containers’’ from the FSM shall be exempt from duty, in an amount 

not to exceed (when aggregated with the amount imported from the 

RMI) 10 percent of the previous year’s U.S. consumption of ‘‘tuna 

in airtight containers.’’

Subsection 242(c) states that duty-free treatment shall not be extended to certain classes of watches, clocks, buttons, textiles, apparel, footwear, and luggage. 

Subsection 242(d) provides that the value of U.S. inputs into 

products imported from the FSM (up to 15 percent of the article’s 

total appraised value) may be applied for duty assessment purposes 

toward determining the percentage referred to in Section 503(a)(2) 

of title V of the Trade Act of 1974.

Section 243 states that articles imported from the FSM and not 

exempt from duty under Section 242 are subject to the duty rates 

in column 1–general of the Harmonized Tariff Schedule of the U.S. 

Section 244 ensures that all U.S. products imported into the 

FSM receive customs treatment no less favorable than that accorded like products of any foreign country, except for advantages 

accorded by the FSM to other governments listed in article 26 of 

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the Pacific Island Countries Trade Agreement (PICTA). The FSM 

commits to consult with the U.S. before concluding a free trade 

agreement with any government not listed in PICTA. 

Article V—Finance and Taxation 

Section 251 notes that U.S. currency is the legal tender of the 

FSM, and states that the FSM will agree on a transitional period 

with the U.S. before switching to any other currency. 

Section 252 states that the FSM may tax U.S. persons on income 

earned and property located within the FSM. 

Section 253 states that FSM citizens domiciled in the FSM are 

exempt from U.S. estate, gift, and generation-skipping transfer 

taxes, provided that they are neither citizens nor residents of the 

U.S. 

Section 254 states that the FSM shall have authority to tax FSM 

residents for income earned outside the FSM to the same extent 

that it taxes income earned in the FSM. If the FSM imposes such 

taxes, any FSM resident who is subject to U.S. taxes on the same 

income shall be relieved of such tax liability to the U.S. (in the 

form of a foreign tax credit or exclusion under Section 911 of the 

Internal Revenue Code). 

Section 255 grants U.S. tax benefits for conventions held in the 

FSM. 

TITLE THREE—SECURITY AND DEFENSE RELATIONS

Article I—Authority and Responsibility 

Section 311 states that the U.S. has full authority and responsibility for defense matters in or relating to the FSM, including: the 

obligation to defend the FSM; the option to foreclose military access 

to the FSM to any third country (a.k.a. ‘‘strategic denial’’); and the 

option to establish military facilities in the FSM. 

Section 312 states that the U.S. may conduct necessary military 

operations in FSM lands, waters, and airspace. 

Section 313 states that the FSM shall refrain from actions that 

the U.S., after consultation, deems incompatible with U.S. defense 

authorities and responsibilities (a.k.a. ‘‘defense veto’’). 

Section 314 states that unless otherwise agreed, the U.S. shall 

not test, dispose of, or store (outside of a time of emergency or war) 

any nuclear, chemical, or biological weapon in the FSM. 

Section 315 states that the U.S. may invite other countries’

armed forces (under the control of U.S. forces) to use military facilities in the FSM. Such use is subject to consultation with and (in 

the case of major units) approval of the FSM. 

Section 316 states that the U.S. may not transfer or assign its 

authority or responsibility under this title. 

Article II—Defense Facilities and Operating Rights 

Section 321 states that specific arrangements for establishment 

of U.S. military facilities in the FSM are set forth in a separate 

agreement. The U.S. may request to lease additional areas within 

FSM. The FSM will consider such requests sympathetically, and 

the U.S. will respect the scarcity of land in the FSM. 

Section 322 states that the U.S. will provide and maintain certain fixed and floating navigational aids in the FSM. 

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Section 323 states that U.S. military operating rights and the 

status of U.S. forces in the FSM are set forth in separate agreements. 

Article III—Defense Treaties and International Security Agreements 

Section 331 states that the U.S. has assumed and enjoys all 

rights and obligations of: (a) pre-Compact treaties and international security agreements applied by the U.S. as Administering 

Authority of the Trust Territory of the Pacific Islands; and (b) any 

treaty or international security agreement to which the U.S. is a 

party and deems applicable in the FSM. 

Article IV—Service in Armed Forces of the United States 

Section 341 states that persons entitled to the Compact immigration benefits (in Section 141) are eligible to volunteer for service in 

the U.S. Armed Forces. 

Section 342 states that the U.S. will have at any given time at 

least one qualified FSM student enrolled in its Coast Guard Academy and Merchant Marine Academy. 

Article V—General Provisions 

Section 351 states that the U.S. and the FSM will continue to 

maintain a Joint Committee of senior officials to consider disputes 

arising under the Security title of the Compact, which will meet 

annually or upon request of either country. 

Section 352 states that in exercising its authority under this 

title, the U.S. shall accord due respect to the authority and responsibility of the FSM to assure the well-being of its people.

Section 353 states that the U.S. will not name the FSM as a 

party to a declaration of war without the FSM’s consent. Without 

such consent, the Compact will not prejudice any FSM petitions for 

redress from the US or claims against third countries arising out 

of armed conflict. 

Subsection 354(a) states that the security provisions of title three 

shall remain binding for the duration of the Compact, and thereafter as mutually agreed. If either the U.S. or the FSM unilaterally 

terminates this title, it will be considered a termination of the entire Compact (as provided in articles IV and V of title four) 

Subsection 354(b) states that even if this security title should 

terminate, any attack on the FSM during the period in which the 

separate Military Use and Operating Rights agreement is in effect 

will result in the U.S. taking action to meet the danger to the U.S. 

and the FSM. 

Subsection 354(c) states that even if this security title should terminate, the FSM shall refrain from acts which the U.S. determines 

to be incompatible with its authority and responsibility for security 

and defense matters relating to the FSM and RMI (i.e., the ‘‘defense veto’’ continues). 

TITLE FOUR—GENERAL PROVISIONS

Article I—Approval and Effective Date 

Section 411 states that the amended Compact shall come into effect upon mutual agreement between the U.S. and the FSM after 

approval by their respective governments. 

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Article II—Conference and Dispute Resolution 

Section 421 states that both governments shall confer promptly 

upon the request of the other on Compact-related matters. 

Section 422 states that if, after conferring, one government determines that there is a dispute and notifies the other in writing, both 

governments shall make a good faith effort to resolve it between 

themselves. 

Section 423 states that if the governments cannot resolve a dispute within 90 days of the written notice, either party may refer 

it to arbitration according to Section 424. 

Section 424 states that such disputes will be referred to a binding Arbitration Board comprised of one Chairman (jointly selected 

by the parties) and two other members (one each selected by the 

U.S. and FSM). Unless otherwise provided, the Board shall have 

jurisdiction over disputes arising exclusively under the Compact 

and related agreements. The Board shall conduct its proceedings as 

it deems appropriate and reach its decision by majority vote, preferably within 30 days after the conclusion of arguments. Except as 

otherwise decided by the board, the U.S. and the FSM shall split 

the costs of the arbitration. 

Article III—Amendment 

Section 431 states that the amended Compact may be further 

amended by mutual agreement of the parties, according to their respective constitutional processes. 

Article IV—Termination 

Section 441 states that the amended Compact may be terminated 

by mutual agreement of the parties, in which case Section 451 will 

apply. 

Section 442 states that the amended Compact may be terminated 

by the U.S., in which case Section 452 will apply. Such termination 

shall be effective not earlier than 6 months following delivery of 

the notice of termination. 

Section 443 states that the amended Compact may be terminated 

by the FSM if the FSM people vote for termination in a plebiscite, 

or by some other mutually agreed process, in which case Section 

453 will apply. Such termination shall be effective not earlier than 

3 months following notice to the U.S. of the plebiscite vote for termination. 

Article V—Survivability 

Subsection 451(a) states that should the parties mutually terminate the Compact, U.S. economic and other assistance to the FSM 

shall continue only by mutual agreement. 

Subsection 451(b) states that in the event of mutual termination 

prior to the 20th anniversary of the amended Compact, the U.S. 

will continue to make its contributions to the FSM Trust Fund so 

long as the U.S. continues to enjoy the right of strategic denial and 

the defense veto (under Section 354(c) and the separate mutual security agreement). 

Subsection 451(c) states that in the event of mutual termination 

after the 20th anniversary of the amended Compact, the FSM will 

be entitled to receive proceeds from its Trust Fund as described in 

Section 215 and the Trust Fund Agreement. 

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Subsection 452(a) describes the Compact provisions that survive 

if the U.S. terminates the amended Compact before its 20th anniversary (including certain provisions regarding: environmental protection, grant audits and fund misuse investigations, security and 

defense relations, and dispute resolution). Those provisions remain 

in effect until the 20th anniversary, and thereafter as mutually 

agreed. 

Subsection 452(b) states that if the U.S. terminates the amended 

Compact before its 20th anniversary, economic and other assistance will continue only by mutual agreement, except that the U.S. 

will continue to make its contributions to the FSM Trust Fund so 

long as the U.S. continues to enjoy the right of strategic denial and 

the defense veto (under Section 354(c) and the separate mutual security agreement). 

Subsection 452(c) states that if the U.S. terminates the amended 

Compact after its 20th anniversary, the FSM will be entitled to receive proceeds from its Trust Fund as described in Section 215 and 

the Trust Fund Agreement. 

Subsection 453(a) describes the Compact provisions that survive 

if the FSM terminates the amended Compact before its 20th anniversary (including certain provisions regarding: environmental protection, grant audits and fund misuse investigations, security and 

defense relations, and dispute resolution). Those provisions remain 

in effect until the 20th anniversary, and thereafter as mutually 

agreed. 

Subsection 453(b) states that in the event of FSM termination, 

there shall be prompt consultations between the countries regarding their future relationship to determine the level of future U.S. 

assistance, if any, other than what is provided in subsections (c) 

and (d) of this section. 

Subsection 453(c) states that if the FSM terminates the amended 

Compact before its 20th anniversary, the U.S. will continue to 

make its contributions to the FSM Trust Fund so long as the U.S. 

continues to enjoy the right of strategic denial and the defense veto 

(under Section 354(c) and the separate mutual security agreement). 

Subsection 453(d) states that if the FSM terminates the amended 

Compact after its 20th anniversary, the FSM will be entitled to receive proceeds from its Trust Fund as described in Section 215 and 

the Trust Fund Agreement. 

Section 454 states that notwithstanding any other provision of 

the amended Compact: (1) the U.S. reaffirms its interest in promoting the economic advancement of the FSM; and (2) the separate 

Military Use and Operating Rights Agreement and Status of Forces 

Agreement shall remain in effect in accordance with their terms. 

Article VI—Definition of Terms 

Section 461 sets forth definitions for a number of terms used in 

the amended Compact. 

Subsection 462(a) lists the separate agreements that will remain 

in effect under the amended Compact, including: (1) the trilateral 

agreement on transfer of Trust Territory property; (2) the Friendship, Cooperation, and Mutual Security Agreement; and (3) the 

Maritime Sovereignty and Jurisdiction Agreement. 

Subsection 462(b) lists the separate agreements that will go into 

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grams and Services Agreement; (2) the Extradition, Mutual Assistance in Law Enforcement, and Penal Sanctions Agreement; (3) the 

Labor Recruitment Agreement (implementing Section 175(b)); (4) 

the Fiscal Procedures Agreement; (5) the Trust Fund Agreement; 

(6) the Military Use and Operating Rights Agreement; and (7) the 

Status of Forces Agreement. 

Section 463 clarifies that certain references in the amended Compact to various U.S. laws constitutes the incorporation of the applicable language of those laws into the amended Compact. 

Article VII—Concluding Provisions 

Section 471 states that both the U.S. and the FSM shall take all 

necessary steps to ensure the conformity of their respective laws 

and regulations with the provisions of the amended Compact. 

Section 472 states that the amended Compact may be accepted 

by the U.S. and the FSM by signature or otherwise. 

* * * * * * *

Subsection 201(b). The Preamble has been updated to reflect that 

the Republic of the Marshall Islands (RMI) is a sovereign country 

(not a Trust Territory), that the amended Compacts are now separate (one each with the RMI and the FSM), and the term ‘‘self-sufficiency’’ has been replaced by ‘‘budgetary self-reliance’’ to reflect 

the objective that the RMI end its reliance on U.S. financial assistance and obtain revenues from other legitimate sources. 

TITLE ONE—GOVERNMENTAL RELATIONS

Article I—Self-Government 

Section 111 states that the people of the RMI are self-governing. 

Article II—Foreign Affairs 

Section 121 affirms the capacity of the Government of the RMI 

to conduct foreign affairs. 

Section 122 states that the U.S. will support RMI membership in 

international organizations. 

Section 123 states that the U.S. and RMI will consult with each 

other regarding foreign affairs. 

Section 124 states that the U.S. may assist the RMI with foreign 

affairs when requested and mutually agreed. 

Section 125 states that the U.S. cannot be obligated by the RMI’s 

conduct of foreign affairs unless expressly agreed. 

Section 126 makes available U.S. consular services to RMI citizens traveling outside the RMI. 

Section 127 states that except as agreed in the amended Compact and related agreements, the rights and obligations of the U.S. 

as Administering Authority of the Trust Territory of the Pacific Islands ended on October 20, 1986. 

Article III—Communications 

Section 131 states that the RMI has authority to regulate its 

communications, and notes that the RMI assumed telecommunications functions previously performed by the U.S., except as otherwise provided. 

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Article IV—Immigration 

Section 141(a) provides that otherwise admissible RMI citizens 

will continue to be eligible for visa-free admission to the U.S. (including territories and possessions) to lawfully engage in occupations and establish residence as nonimmigrants, but now requires 

that they possess valid passports. Subsections (3) and (4) restrict 

the class of naturalized RMI citizens eligible for this special status 

(to address concerns about potential abuse of the special status by

non-RMI natives). Subsection (5) extends this status to bona fide 

immediate relatives of RMI citizens serving on active duty with the 

U.S. Armed Forces. 

Subsection 141(b) provides that RMI children traveling to the 

U.S. for the purpose of being adopted are not eligible for visa-free 

admission under the Compact. This new language is intended to 

prevent attempted use of Compact privileges to circumvent U.S. 

immigration requirements that help ensure the legitimacy of international adoptions, protect the children involved, and provide the 

adoptees with lawful permanent immigration status. 

Subsection 141(c) declares that no person who has purchased 

RMI citizenship or an RMI passport shall be eligible for admission 

to the U.S. under the amended Compact. This new language is intended to remove incentives for passport sales or other abuse. 

Subsection 141(d) confirms the existing privilege to work in the 

U.S. and expands the types of documents that RMI citizens can use 

to demonstrate identity and employment authorization under U.S. 

immigration law. 

Subsection 141(e) defines certain terms used in this immigration 

title. 

Subsection 141(f) affirms that (except as specified in Section 

141(a)) the U.S. Immigration and Nationality Act (INA) applies 

fully to any person admitted to the U.S. (or seeking admission to 

the U.S.) under the Compact, and that the U.S. has full authority 

under the INA to regulate the terms and conditions of persons 

seeking admission under the Compact. 

Subsection 141(g) provides that the governments of U.S. territories or possessions not subject to the INA (such as American 

Samoa and the Commonwealth of the Northern Mariana Islands) 

have the same authorities as the U.S. enjoys under the INA to exercise immigration authority under the amended Compact. 

Subsection 141(h) notes that admission to the U.S. under the 

Compact does not count as residence necessary for U.S. naturalization, or give RMI admittees to the U.S. the right to petition for benefits for alien relatives under the INA. 

Subsection 142(a) recognizes the right of U.S. citizens to enter 

and work in the RMI (subject to the RMI’s reasonable authority to 

deport and deny entry), as well as the right of U.S. citizen spouses 

of RMI citizens to reside in the RMI, even after the death of the 

RMI citizen spouse. 

Subsection 142(b) requires that the RMI accord U.S. citizens and 

nationals immigration status no less favorable than that accorded 

to citizens of other countries. 

Subsection 142(c) provides that the RMI will adopt immigration 

procedures towards U.S. citizens and nationals seeking employment or investment in the RMI that are no less favorable than 

those adopted by the U.S. toward RMI citizens. 

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Section 143 states that RMI citizens and U.S. citizens or nationals who lose their citizenship or nationality shall be ineligible to receive immigration privileges under the Compact. 

Article V—Representation 

Section 151 provides that relations between the U.S. and the 

RMI shall be conducted in accordance with the Vienna Convention 

on Diplomatic Relations, and that the governments may establish 

offices and representatives as mutually agreed. 

Section 152 provides that U.S. citizens and nationals who act as 

agents of RMI without authority of the U.S. are subject to the Foreign Agents Registration Act, except for U.S. citizen/national employees of the RMI whom the RMI certifies are not principally engaged in activities specified in that Act. 

Article VI—Environmental Protection 

Subsection 161(a) declares the policy of the parties to prevent 

damage to the environment, and commits the U.S. to conducting its 

activities in accord with certain environmental standards similar to 

those in effect in the U.S. 

Subsection 161(b) commits the RMI to continuing to develop, implement, and enforce environmental standards similar to those required of the U.S. in the previous subsection. 

Subsection 161(c) states that the parties may modify the environmental obligations of the previous two subsections by mutual 

agreement. 

Subsection 161(d) states that in the event that U.S. law no 

longer requires Environmental Impact Statements, the obligations 

of Section 161(a) will continue to require them until the parties 

mutually agree otherwise. 

Subsection 161(e) states that the President of the U.S. may exempt any U.S. Government activities from the environmental 

standards of Section 161(a)(3)–(4) if it is in the ‘‘paramount interest’’ of the U.S. Government to do so, after considering the views 

of the RMI and explaining the reasons for the exemption, to the extent practicable. 

Subsection 161(f) states that the laws of the U.S. referred to in 

Section 161(a)(3) apply to U.S. activities under the Compact only 

to the extent provided in Section 161. 

Section 162 states that the RMI may bring an action for judicial 

review of U.S. Government environmental activities pursuant to 

Section 161(a) only in the U.S. District Court for Hawaii or the 

U.S. District Court for the District of Columbia, and subject to certain conditions. 

Section 163 states that the U.S. and the RMI shall have access 

to each other’s facilities to the extent necessary to gather information to carry out article VI, so long as it does not unreasonably 

interfere with the other’s exercise of its authorities and responsibilities. 

Article VII—General Legal Provisions

Section 171 states that except as provided in the amended Compact or related agreements, the application of the laws of the U.S. 

to the Trust Territory of the Pacific Islands ceased on November 

3, 1986. 

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Section 172 declares that RMI citizens who are not U.S. residents shall have the same rights and remedies under U.S. law enjoyed by any non-resident alien. Subsection (b) affirms that the 

government and citizens of the RMI are ‘‘persons’’ for purposes of 

making Freedom of Information Act (FOIA) requests and seeking 

judicial review of FOIA determinations, but states that only the 

RMI government (and not its citizens) have standing to seek judicial review relating to U.S. environmental activities governed by 

Sections 161 and 162. 

Section 173 states that the U.S. and the RMI agree to adopt and 

enforce measures necessary to protect U.S. assets maintained in 

the RMI pursuant to the Compact and related agreements. 

Section 174 states that, except as otherwise provided in the Compact and related agreements: (a) the RMI and U.S. Governments, 

agencies, and officials shall be immune from the jurisdiction of the 

other’s courts; (b) the U.S. shall pay unpaid judgments and claim 

settlements of the Trust Territory of the Pacific Islands; (c) claims 

against the Trust Territory or U.S. Governments arising before the 

original Compact may be pursued against the U.S. Government according to certain conditions and procedures; and (d) the RMI and 

U.S. Governments shall not be immune from the jurisdiction of the 

other’s courts in civil cases that fall within exceptions to foreign 

state immunity in the Foreign Sovereign Immunities Act. 

Subsection 175(a) declares that a separate, simultaneously effective agreement between the parties shall govern mutual law enforcement assistance and cooperation, including pursuit and extradition of fugitives and prisoner transfers. 

Subsection 175(b) declares that a separate, simultaneously effective agreement between the parties shall govern labor recruitment 

practices for employment in the U.S. and enforcement for violations. This new section has been added to protect RMI citizens 

from abusive labor recruitment practices that have been recently 

alleged. 

Section 176 states that the RMI confirms that final judgments in 

civil cases by courts of the Trust Territory of the Pacific Islands 

shall continue in full force and effect. 

Section 177 quotes the language of Section 177 of the original 

Compact which constituted a full and final settlement of all claims 

related to the U.S. nuclear testing program in the region, and notes 

that the amended Compacts make no changes to, and have no effect upon, that settlement. 

Section 178 authorizes U.S. federal agencies that provide services 

in the RMI to settle and pay tort claims arising in the RMI. Claims 

that cannot be settled administratively shall be disposed of exclusively according to the arbitration procedure outlined in article II 

of title IV of the Compact. Except as explicitly provided in U.S. 

law, neither the U.S. nor any Federal agency may be named as a 

party in any action arising out of U.S. grant assistance activities. 

Section 179 states that the courts of the RMI shall not exercise 

criminal jurisdiction over the U.S. Government, agencies, or employees acting on behalf of the U.S. in providing assistance to the 

RMI. 

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TITLE TWO—ECONOMIC RELATIONS

Article I—Grant Assistance 

Subsection 211(a) states that the U.S. shall provide 20 years of 

annual grant assistance to the RMI in the areas of education, 

health care, the environment, public sector capacity building, and 

private sector development, and other areas as mutually agreed. 

The sector grants will be made available in accordance with mutually agreed sector development plans, and will be subject to monitoring according to the Fiscal Procedures Agreement between the 

parties. 

Subsection 211(b)(1) states that of the total grant assistance 

made available to the RMI, a specified amount shall be used to address the special needs (including infrastructure and services delivery) of the population at Ebeye and other Marshallese communities 

within Kwajalein Atoll. That annual amount shall be $3.1 million 

(with an inflation adjustment) through Fiscal Year 2013, and shall 

be increased by an additional $2 million (with an inflation adjustment) for Fiscal Years 2014 through 2023, and thereafter in accordance with the Military Use and Operating Rights Agreement. 

Subsection 211(b)(2) states that in addition to the 211(a) money 

earmarked in the subsection above, the U.S. will provide an additional $1.9 million per year (with an inflation adjustment and subject to the Fiscal Procedures Agreement) for those special needs, 

from Fiscal Year 2004 through Fiscal year 2023 (and thereafter in 

accordance with the Military Use and Operating Rights Agreement). 

Subsection 211(b)(3) states that of the total 211(a) annual grant assistance, $200,000 (with an inflation adjustment) shall be allocated for increasing the RMI’s participation in and ability to analyze the annual U.S. Army Kwajalein Atoll Environmental Standards Survey. 

Subsection 211(c) makes available a ‘‘Humanitarian Assistance 

RMI’’ (HARMI) program at the request of the RMI, designed to extend targeted health, education, and infrastructure assistance. 

HARMI costs will be deducted from the annual grant provided 

under Section 211(a), and the terms of the program will be governed by the separate Military Use and Operating Rights agreement. 

Subsection 211(d) states that unless otherwise agreed, between 

30 and 50 percent of U.S. annual grant assistance shall be made 

available for infrastructure improvement and maintenance. Five 

percent of that amount shall be set aside, with an equal RMI contribution, for an infrastructure maintenance fund. 

Subsection 211(e) provides that $200,000 per year of the grant 

assistance in Section 211(a) shall be provided, with a matching contribution from the RMI, for a Disaster Assistance Emergency Fund, 

which may be used only for assistance and rehabilitation needs resulting from officially declared disasters or emergencies, and which 

shall be governed by the Fiscal Procedures Agreement. 

Subsection 211(f) requires the RMI to prepare, maintain, and update a strategic, medium term budget and investment framework 

that specifically addresses the sectors and areas identified in Section 211(a) and requires the concurrence of the U.S. (insofar as 

U.S. grant funds are involved). 

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Section 212 states that in connection with its military use of 

Kwajalein Atoll, the U.S. shall provide to the RMI an annual payment of $15 million (with an inflation adjustment) from Fiscal Year 

2004 through Fiscal Year 2013. From Fiscal Year 2014 through 

Fiscal Year 2023 the annual payment will be either the 2013 

amount or $18 million, whichever is greater (also with an annual 

inflation adjustment). 

Section 213 states that, as reflected in the Fiscal Procedures 

Agreement, sector grants and U.S. programs and services shall be 

subject to regulations and policies normally applicable to U.S. assistance to State and local governments. The U.S. may condition 

such assistance on performance indicators, and may seek remedies 

for noncompliance, including withholding assistance. Section 212(b) 

states that the U.S., as part of its grant assistance, will grant the 

RMI either one-half of the cost of the annual audit, or $500,000, 

whichever is less. 

Section 214 states that the U.S. and the RMI shall establish a 

Joint Economic Management and Financial Accountability Committee (comprised of a U.S. chairman, 2 U.S. members, and 2 RMI 

members) governed by the Fiscal Procedures Agreement. The Committee will review the audits, reports, and progress toward plan objectives, and recommend ways to increase effectiveness. 

Section 215 states that the RMI shall report annually to the U.S. 

on its use of U.S. grant assistance and progress toward economic 

goals. 

Section 216 states that the U.S. shall provide 20 years of annual 

contributions to a trust fund (governed by the separate Trust Fund 

Agreement) the proceeds of which may be used at the end of those 

20 years for the purposes described in Section 211, or as mutually 

agreed. The U.S. contribution is conditioned on the RMI contributing $25 million to the fund by September 30, 2003, an additional 

$2.5 million by October 1, 2004, and an additional $2.5 million by 

October 1, 2005. 

Section 217 sets forth the amounts of U.S. grant assistance and 

trust fund contributions for each of the 20 years of assistance. The 

combined amount is $57.7 million annually from Fiscal Year 2004 

through Fiscal Year 2013, and $62.7 million annually from Fiscal 

Year 2014 through Fiscal Year 2023. 

Section 218 states that the grant and trust fund contributions for 

each fiscal year shall be adjusted by two-thirds the amount of the 

U.S. GDP Implicit Price Deflator, or 5 percent, whichever is less. 

Section 219 states that unobligated balances from any year shall 

remain available to the RMI in future years. 

Article II—Services and Program Assistance 

Subsection 221(a) states that the U.S. shall make available to 

the RMI (to the extent provided in the Federal Programs and Services Agreement) the services and related programs of: (1) U.S. 

Weather Service; (2) U.S. Postal Service; (3) Federal Aviation Administration; (4) U.S. Department of Transportation; and (5) the 

Department of Homeland Security; and (7) U.S. Agency for International Development/Office of Foreign Disaster Assistance. 

Subsection 221(b) states that, with the exception of those services 

covered by Section 221(a), the U.S. shall (unless Congress provides 

otherwise) make available to the RMI the services and programs 

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that were available to the RMI on the effective date of the amended Compact, to the extent that such services are available to U.S. 

State and local governments. 

Subsection 221(c) states that the U.S. has the authority to monitor and administer all service and program assistance to the RMI. 

Subsection 221(d) states that, except as otherwise provided, federal programs and services extended to the RMI shall be subject to 

the same standards and rules applicable to such programs in the 

U.S. 

Subsection 221(e) states that the U.S. shall make available to the 

RMI, to the extent provided in U.S. law, alternate energy development projects and conservation measures. 

Section 222 states that the U.S. and the RMI may agree to extend additional U.S. grant assistance to the RMI, which shall be 

governed by the Federal Programs and Services Agreement. 

Section 223 states that the RMI shall make available at no 

charge to the U.S. whatever land is necessary for such service and 

program assistance, and whatever facilities are currently provided 

at no cost to the U.S., or may be mutually agreed in the future. 

Section 224 states that the RMI may request technical assistance 

from U.S. federal agencies that, if provided, would give priority 

consideration to the RMI over other non-U.S. recipients. 

Article III—Administrative Provisions 

Section 231 notes that the extent of U.S. program assistance, the 

status of U.S. agencies and employees, and other program and 

service-related arrangements are set forth in a separate Federal 

Programs and Services Agreement. 

Section 232 states that the U.S. shall determine and implement 

procedures for audits of all grant and program assistance, and authorizes the U.S. Comptroller General to conduct audits in the 

RMI.

Section 233 states that the U.S. pledges that it will provide the 

grant assistance (specified in Section 211) for the 20-year term 

specified, subject to the terms and conditions of title II and related 

subsidiary agreements. 

Section 234 states that the RMI pledges that it will cooperate in 

U.S. investigations of misuse of Compact funds and that it will not 

unreasonably withhold U.S.-requested subpoena assistance in the 

RMI. The RMI acknowledges that its receipt of Compact funding is 

conditioned on its fulfillment of these obligations. 

Article IV—Trade 

Section 241 states that the RMI is not within the customs territory of the U.S. 

Subsection 242(a) states that unless otherwise excluded, articles 

imported from the RMI shall be exempt from duty. 

Subsection 242(b) states that imports of ‘‘tuna in airtight containers’’ from the RMI shall be exempt from duty, in an amount not 

to exceed (when aggregated with the amount imported from the 

FSM) 10 percent of the previous year’s U.S. consumption of ‘‘tuna 

in airtight containers.’’

Subsection 242(c) states that duty-free treatment shall not be extended to certain classes of watches, clocks, buttons, textiles, apparel, footwear, and luggage. 

102

Subsection 242(d) provides that the value of U.S. inputs into 

products imported from the RMI (up to 15 percent of the article’s 

total appraised value) may be applied for duty assessment purposes 

toward determining the percentage referred to in Section 503(a)(2) 

of title V of the Trade Act of 1974. 

Section 243 states that articles imported from the RMI and not 

exempt from duty under Section 242 are subject to the duty rates 

in column 1—general of the Harmonized Tariff Schedule of the 

U.S. 

Section 244 ensures that all U.S. products imported into the RMI 

receive customs treatment no less favorable than that accorded like 

products of any foreign country, except for advantages accorded by 

the RMI to other governments listed in article 26 of the Pacific Island Countries Trade Agreement (PICTA). The RMI commits to 

consult with the U.S. before concluding a free trade agreement 

with any government not listed in PICTA. 

Article V—Finance and Taxation 

Section 251 notes that U.S. currency is the legal tender of the 

RMI, and states that the RMI will agree on a transitional period 

with the U.S. before switching to any other currency. 

Section 252 states that the RMI may tax U.S. persons on income 

earned and property located within the RMI. 

Section 253 states that RMI citizens domiciled in the RMI are exempt from U.S. estate, gift, and generation-skipping transfer taxes, 

provided that they are neither citizens nor residents of the U.S. 

Section 254 states that the RMI shall have authority to tax RMI 

residents for income earned outside the RMI to the same extent 

that it taxes income earned in the RMI. If the RMI imposes such 

taxes, any RMI resident who is subject to U.S. taxes on the same 

income shall be relieved of such tax liability to the U.S. (in the 

form of a foreign tax credit or exclusion under Section 911 of the 

Internal Revenue Code). 

Section 255 grants U.S. tax benefits for conventions held in the 

RMI. 

TITLE THREE—SECURITY AND DEFENSE RELATIONS

Article I—Authority and Responsibility 

Section 311 states that the U.S. has full authority and responsibility for defense matters in or relating to the RMI, including: the 

obligation to defend the RMI; the option to foreclose military access 

to the RMI to any third country (a.k.a. ‘‘strategic denial’’); and the 

option to establish military facilities in the RMI. 

Section 312 states that the U.S. may conduct necessary military 

operations in RMI lands, waters, and airspace. 

Section 313 states that the RMI shall refrain from actions that 

the U.S., after consultation, deems incompatible with U.S. defense 

authorities and responsibilities (a.k.a. ‘‘defense veto’’). 

Section 314 states that unless otherwise agreed, the U.S. shall 

not test, dispose of, or store (outside of a time of emergency or war) 

any nuclear, chemical, or biological weapon in the RMI. 

Section 315 states that the U.S. may invite other countries’

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ties in the RMI. Such use is subject to consultation with and (in 

the case of major units) approval of the RMI. 

Section 316 states that the U.S. may not transfer or assign its 

authority or responsibility under this title. 

Article II—Defense Facilities and Operating Rights 

Section 321 states that specific arrangements for establishment 

of U.S. military facilities in the RMI are set forth in a separate 

agreement. The U.S. may request to lease additional areas within 

RMI. The RMI will consider such requests sympathetically, and the 

U.S. will respect the scarcity of land in the RMI. 

Section 322 states that the U.S. will provide and maintain certain fixed and floating navigational aids in the RMI.

Section 323 states that U.S. military operating rights and the 

status of U.S. forces in the RMI are set forth in separate agreements. 

Article III—Defense Treaties and International Security Agreements 

Section 331 states that the U.S. has assumed and enjoys all 

rights and obligations of: (a) pre-Compact treaties and international security agreements applied by the U.S. as Administering 

Authority of the Trust Territory of the Pacific Islands; and (b) any 

treaty or international security agreement to which the U.S. is a 

party and deems applicable in the RMI. 

Article IV—Service in Armed Forces of the United States 

Section 341 states that persons entitled to the Compact immigration benefits (in Section 141) are eligible to volunteer for service in 

the U.S. Armed Forces. 

Section 342 states that the U.S. will have at any given time at 

least one qualified RMI student enrolled in its Coast Guard Academy and Merchant Marine Academy. 

Article V—General Provisions 

Section 351 states that the U.S. and the RMI will continue to 

maintain a Joint Committee of senior officials to consider disputes 

arising under the Security title of the Compact, which will meet 

annually or upon request of either country. 

Section 352 states that in exercising its authority under this 

title, the U.S. shall accord due respect to the authority and responsibility of the RMI to assure the well-being of its people. 

Section 353 states that the U.S. will not name the RMI as a 

party to a declaration of war without the RMI’s consent. Without 

such consent, the Compact will not prejudice any RMI petitions for 

redress from the US or claims against third countries arising out 

of armed conflict. 

Subsection 354(a) states that the security provisions of title three 

shall remain binding for the duration of the Compact, and thereafter as mutually agreed. If either the U.S. or the RMI unilaterally 

terminates this title, it will be considered a termination of the entire Compact (as provided in articles IV and V of title four). 

Subsection 354(b) states that even if this security title should 

terminate, any attack on the RMI during the period in which the 

separate Military Use and Operating Rights agreement is in effect 

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will result in the U.S. taking action to meet the danger to the U.S. 

and the RMI. 

Subsection 354(c) states that even if this security title should terminate, the RMI shall refrain from acts which the U.S. determines 

to be incompatible with its authority and responsibility for security 

and defense matters relating to the RMI and FSM (i.e., the ‘‘defense veto’’ continues). 

TITLE FOUR—GENERAL PROVISIONS

Article I—Approval and Effective Date 

Section 411 states that the amended Compact shall come into effect upon mutual agreement between the U.S. and the RMI after 

approval by their respective governments. 

Article II—Conference and Dispute Resolution 

Section 421 states that both governments shall confer promptly 

upon the request of the other on Compact-related matters. 

Section 422 states that if, after conferring, one government determines that there is a dispute and notifies the other in writing, both 

governments shall make a good faith effort to resolve it between 

themselves. 

Section 423 states that if the governments cannot resolve a dispute within 90 days of the written notice, either party may refer 

it to arbitration according to Section 424. 

Section 424 states that such disputes will be referred to a binding Arbitration Board comprised of one Chairman (jointly selected 

by the parties) and two other members (one each selected by the 

U.S. and RMI). Unless otherwise provided, the Board shall have jurisdiction over disputes arising exclusively under the Compact and 

related agreements. The Board shall conduct its proceedings as it 

deems appropriate and reach its decision by majority vote, preferably within 30 days after the conclusion of arguments. Except as 

otherwise decided by the board, the U.S. and the RMI shall split 

the costs of the arbitration. 

Article III—Amendment 

Section 431 states that the amended Compact may be further 

amended by mutual agreement of the parties, according to their respective constitutional processes. 

Article IV—Termination 

Section 441 states that the amended Compact may be terminated 

by mutual agreement of the parties, in which case Section 451 will 

apply. 

Section 442 states that the amended Compact may be terminated 

by the U.S., in which case Section 452 will apply. Such termination 

shall be effective not earlier than 6 months following delivery of 

the notice of termination. 

Section 443 states that the amended Compact may be terminated 

by the RMI if the RMI people vote for termination in a plebiscite, 

or by some other mutually agreed process, in which case Section 

453 will apply. Such termination shall be effective not earlier than 

3 months following notice to the U.S. of the plebiscite vote for termination. 

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Article V—Survivability 

Subsection 451(a) states that should the parties mutually terminate the Compact, U.S. economic and other assistance to the RMI 

shall continue only by mutual agreement. 

Subsection 451(b) states that in the event of mutual termination 

prior to the 20th anniversary of the amended Compact, the U.S. 

will continue to make its contributions to the RMI Trust Fund so

long as the U.S. continues to enjoy the right of strategic denial and 

the defense veto (under Section 354(c) and the separate mutual security agreement). 

Subsection 451(c) states that in the event of mutual termination 

after the 20th anniversary of the amended Compact, the RMI will 

be entitled to receive proceeds from its Trust Fund as described in 

Section 215 and the Trust Fund Agreement. 

Subsection 452(a) describes the Compact provisions that survive 

if the U.S. terminates the amended Compact before its 20th anniversary (including certain provisions regarding: environmental protection, grant audits and fund misuse investigations, security and 

defense relations, and dispute resolution). Those provisions remain 

in effect until the 20th anniversary, and thereafter as mutually 

agreed. 

Subsection 452(b) states that if the U.S. terminates the amended 

Compact before its 20th anniversary, economic and other assistance will continue only by mutual agreement, except that the U.S. 

will continue to make its contributions to the RMI Trust Fund so 

long as the U.S. continues to enjoy the right of strategic denial and 

the defense veto (under Section 354(c) and the separate mutual security agreement). 

Subsection 452(c) states that if the U.S. terminates the amended 

Compact after its 20th anniversary, the RMI will be entitled to receive proceeds from its Trust Fund as described in Section 215 and 

the Trust Fund Agreement. 

Subsection 453(a) describes the Compact provisions that survive 

if the RMI terminates the amended Compact before its 20th anniversary (including certain provisions regarding: environmental protection, grant audits and fund misuse investigations, security and 

defense relations, and dispute resolution). Those provisions remain 

in effect until the 20th anniversary, and thereafter as mutually 

agreed. 

Subsection 453(b) states that in the event of RMI termination, 

there shall be prompt consultations between the countries regarding their future relationship to determine the level of future U.S. 

assistance, if any, other than what is provided in subsections (c) 

and (d) of this section. 

Subsection 453(c) states that if the RMI terminates the amended 

Compact before its 20th anniversary, the U.S. will continue to 

make its contributions to the RMI Trust Fund so long as the U.S. 

continues to enjoy the right of strategic denial and the defense veto 

(under Section 354(c) and the separate mutual security agreement). 

Subsection 453(d) states that if the RMI terminates the amended 

Compact after its 20th anniversary, the RMI will be entitled to receive proceeds from its Trust Fund as described in Section 215 and 

the Trust Fund Agreement. 

Section 454 states that notwithstanding any other provision of 

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moting the economic advancement of the RMI; and (2) the separate 

Military Use and Operating Rights Agreement and Status of Forces 

Agreement shall remain in effect in accordance with their terms. 

Article VI—Definition of Terms 

Section 461 sets forth definitions for a number of terms used in 

the amended Compact. 

Subsection 462(a) lists the separate agreements that will remain 

in effect under the amended Compact, including: (1) the trilateral 

agreement on transfer of Trust Territory property; (2) the Friendship, Cooperation, and Mutual Security Agreement; and (3) the 

Maritime Sovereignty and Jurisdiction Agreement. 

Subsection 462(b) lists the separate agreements that will go into 

effect under the amended Compact, including: (1) the Federal Programs and Services Agreement; (2) the Extradition, Mutual Assistance in Law Enforcement, and Penal Sanctions Agreement; (3) the 

Labor Recruitment Agreement (implementing Section 175(b)); (4) 

the Fiscal Procedures Agreement; (5) the Trust Fund Agreement; 

(6) the Military Use and Operating Rights Agreement; and (7) the 

Status of Forces Agreement. 

Section 463 clarifies that certain references in the amended Compact to various U.S. laws constitutes the incorporation of the applicable language of those laws into the amended Compact. 

Article VII—Concluding Provisions 

Section 471 states that both the U.S. and the RMI shall take all 

necessary steps to ensure the conformity of their respective laws 

and regulations with the provisions of the amended Compact. 

Section 472 states that the amended Compact may be accepted 

by the U.S. and the RMI by signature or otherwise. 

COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of rule XIII 

of the Rules of the House of Representatives, the Committee on Resources’ oversight findings and recommendations are reflected in 

the body of this report. 

FEDERAL ADVISORY COMMITTEE STATEMENT

The functions of the proposed advisory committee authorized in 

the bill are not currently being nor could they be performed by one 

or more agencies, an advisory committee already in existence or by 

enlarging the mandate of an existing advisory committee. 

CONSTITUTIONAL AUTHORITY STATEMENT

Article I, section 8 of the Constitution of the United States 

grants Congress the authority to enact this bill.

COMPLIANCE WITH HOUSE RULE XIII 

1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the Rules of 

the House of Representatives requires an estimate and a comparison by the Committee of the costs which would be incurred in carrying out this bill. However, clause 3(d)(3)(B) of that rule provides 

that this requirement does not apply when the Committee has inVerDate jul 14 2003 01:17 Sep 17, 2003 Jkt 089370 PO 00000 Frm 00106 Fmt 6659 Sfmt 6602 E:\HR\OC\HR262P2.XXX HR262P2
107

cluded in its report a timely submitted cost estimate of the bill prepared by the Director of the Congressional Budget Office under section 402 of the Congressional Budget Act of 1974. The Committee 

has requested but not received a cost estimate from the Congressional Budget Office at the time the report was filed. Based on discussions with the relevant budget analyst, the Committee believes 

that enactment of this bill would result in approximately $400 million in spending subject to appropriation over the next 10 fiscal 

years and $680 million (plus an unspecified amount of loan forgiveness) in direct spending over the next 10 fiscal years. 

2. Congressional Budget Act. As required by clause 3(c)(2) of rule 

XIII of the Rules of the House of Representatives and section 

308(a) of the Congressional Budget Act of 1974, this bill does not 

contain any new budget authority, credit authority, or an increase 

or decrease in revenues or tax expenditures. The bill will result in 

approximately $680 million in direct spending over the next 10 fiscal years. 

3. General Performance Goals and Objectives. As required by 

clause 3(c)(4) of rule XIII, the general performance goal or objective 

of this bill is to approve the ‘‘Compact of Free Association, as 

amended between the Government of the United States of America 

and the Government of the Federated States of Micronesia,’’ and 

the ‘‘Compact of Free Association, as amended between the Government of the United States of America and the Government of the 

Republic of the Marshall Islands,’’ and otherwise to amend Public 

Law 99–239, and to appropriate for the purposes of amended Public Law 99–239 for fiscal years ending on or before September 30, 

2023, and for other purposes. 

4. Congressional Budget Office Cost Estimate. Under clause 

3(c)(3) of rule XIII of the Rules of the House of Representatives and 

section 403 of the Congressional Budget Act of 1974, the Committee has requested but not received a cost estimate for this bill 

from the Director of the Congressional Budget Office. 

COMPLIANCE WITH PUBLIC LAW 104–4 

This bill contains no unfunded mandates as defined under Public 

Law 104–4. 

PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

This bill is not intended to preempt any State, local or tribal law.

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, 

existing law in which no change is proposed is shown in roman): 

SECTION 605 OF THE TREASURY AND GENERAL 

GOVERNMENT APPROPRIATIONS ACT, 2002

(Public Law 107–67) 

SEC. 605. Unless otherwise specified during the current fiscal 

year, no part of any appropriation contained in this or any other 

108

Act shall be used to pay the compensation of any officer or employee of the Government of the United States (including any agency the majority of the stock of which is owned by the Government 

of the United States) whose post of duty is in the continental 

United States unless such person: (1) is a citizen of the United 

States; (2) is a person in the service of the United States on the 

date of the enactment of this Act who, being eligible for citizenship, 

has filed a declaration of intention to become a citizen of the 

United States prior to such date and is actually residing in the 

United States; (3) is a person who owes allegiance to the United 

States; (4) is an alien from Cuba, Poland, South Vietnam, the countries of the former Soviet Union, or the Baltic countries lawfully 

admitted to the United States for permanent residence; (5) is a 

South Vietnamese, Cambodian, or Laotian refugee paroled in the 

United States after January 1, 1975; or (6) is a national of the People’s Republic of China who qualifies for adjustment of status pursuant to the Chinese Student Protection Act of 1992: Provided, That for the purpose of this section, an affidavit signed by any such 

person shall be considered prima facie evidence that the requirements of this section with respect to his or her status have been 

complied with: Provided further, That any person making a false 

affidavit shall be guilty of a felony, and, upon conviction, shall be 

fined no more than $4,000 or imprisoned for not more than 1 year, 

or both: Provided further, That the above penal clause shall be in 

addition to, and not in substitution for, any other provisions of existing law: Provided further, That any payment made to any officer 

or employee contrary to the provisions of this section shall be recoverable in action by the Federal Government. This section shall 

not apply to citizens of Ireland, Israel, øor the Republic of the Philippines,¿ the Republic of the Philippines, the Federated States of 

Micronesia, the Republic of the Marshall Islands, or the Republic 

of Palau, or to nationals of those countries allied with the United 

States in a current defense effort, or to international broadcasters 

employed by the United States Information Agency, or to temporary employment of translators, or to temporary employment in 

the field service (not to exceed 60 days) as a result of emergencies.

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Insert offset folio 115 here HR262.002
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Insert offset folio 116 here HR262.003
112

COMMITTEE CORRESPONDENCE

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON FINANCIAL SERVICES, 

Washington, DC, September 11, 2003. 

Hon. RICHARD W. POMBO, 

Chairman, Committee on Resources, Longworth House Office Building, Washington, DC. 

DEAR CHAIRMAN POMBO: On September 4, 2003, the Committee 

on Resources ordered reported H.J. Res. 63, the Compact of Free 

Association Amendments Act of 2003, with an amendment. As you 

know, the amendment agreed to by the Committee on Resources 

contains matters which fall within the jurisdiction of the Committee on Financial Services pursuant to the Committee’s jurisdiction under Rule X of the Rules of the House of Representatives 

over banks and banking. 

Of particular interest is section 108 of the joint resolution which 

includes language regarding the continuing eligibility in the Marshall Islands of certain financial institutions for Federal deposit insurance. As you are aware, the Federal Deposit Insurance Corporation has raised concerns about this provision, and its possible implications for the safety and soundness practices of the FDIC. 

After conversations between our respective staffs, and your commitment not to support inclusion of the aforementioned provision 

in the version of the bill that comes to the floor, I recognize the 

need to move this legislation expeditiously and will waive consideration of the bill by the Financial Services Committee. By agreeing 

to waive its consideration of the bill, the Financial Services Committee does not waive its jurisdiction over H.J. Res. 63. In addition, 

the Committee on Financial Services reserves its authority to seek 

conferees on any provisions of the bill that are within the Financial 

Services Committee’s jurisdiction during any House-Senate conference that may be convened on this legislation. 

I request that you include this letter and your response as part 

of your committee’s report on the bill and the Congressional Record 

during consideration of the legislation on the House floor. 

Thank you for your attention to these matters. 

Sincerely, 

MICHAEL G. OXLEY, Chairman. 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON RESOURCES, 

Washington, DC, September 10, 2003. 

Hon. MICHAEL G. OXLEY,

Chairman, Committee on Financial Services, Rayburn House Office 

Building, Washington, DC. 

DEAR MR. CHAIRMAN: Thank you for your letter regarding H.J. 

Res. 63, to approve the ‘‘Compact of Free Association, as amended 

between the Government of the United States of America and the 

Government of the Federated States of Micronesia,’’ and the ‘‘Compact of Free Association, as amended between the Government of 

the United States of America and the Government of the Republic 

of the Marshall Islands,’’ and otherwise to amend Public Law 99–

113

239, and to appropriate for the purposes of amended Public Law 

99–239 for fiscal years ending on or before September 30, 2023, 

and for other purposes. This resolution was referred primarily to 

the Committee on International Relations (which filed its report on 

the bill 4 September 2003) and additionally to the Committee on 

Resources. Our referral (and a sequential referral to the Committee 

on the Judiciary) expires on 15 September 2003. 

I agree that the amendment in the nature of a substitute to this 

bill which was adopted by the Committee on Resources on 4 September 2003, does contain matters within your Committee’s jurisdiction, including a portion of section 108 of the amendment. Unfortunately, the Federal Deposit Insurance Corporation informed us 

of its concerns too late for us to make any changes at the markup, 

but my staff pledged to work with the agency before the bill is 

brought to the Floor to address any concerns it might have. I make 

that same pledge to you as I work with Chairman Hyde of the 

Committee on International Relations and Congressman Leach (the 

author of the bill) to develop a suitable text for consideration by the 

House of Representatives. I will ask that the portion of section 108 

of the Resources amendment in the nature of a substitute referencing the Federal Deposit Insurance Corporation not be included in this text. 

I also agree that by not seeking a sequential referral of H.J. Res. 

63, the Committee on Financial Services has not waived any jurisdiction over the resolution. In addition, if provisions affecting your 

jurisdiction remain in the bill after its consideration by the House 

of Representatives, I would support your request to have the Committee on Financial Services represented on any House-Senate conference on the bill. Finally, I would be pleased to include your letter and my response in the Committee on Resources’ report on H.J. 

Res. 63. 

Thank you for your cooperation in this matter, and I look forward to working with you again on matters of mutual interest. 

Sincerely, 

RICHARD W. POMBO, Chairman.

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