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[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 1412 Introduced in Senate (IS)]

113th CONGRESS
  1st Session
                                S. 1412

To provide the Department of Homeland Security, U.S. Customs and Border 
 Protection, and the Department of the Treasury with authority to more 
  aggressively enforce customs and trade laws relating to textile and 
               apparel articles, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             July 31, 2013

Mrs. Hagan (for herself and Mr. Graham) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
To provide the Department of Homeland Security, U.S. Customs and Border 
 Protection, and the Department of the Treasury with authority to more 
  aggressively enforce customs and trade laws relating to textile and 
               apparel articles, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Textile 
Enforcement and Security Act of 2013''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Textile or apparel article defined.
Sec. 3. Definitions.
Sec. 4. Findings.
Sec. 5. Sense of Congress.
 TITLE I--ADDITIONAL AUTHORITIES FOR U.S. CUSTOMS AND BORDER PROTECTION

Sec. 101. Seizure and forfeiture of certain textile or apparel articles 
                            and use of amounts from fines, penalties, 
                            and forfeitures.
Sec. 102. Increase in certain TTA positions and import specialist 
                            positions and biennial review of staff 
                            levels.
             TITLE II--AMENDMENTS TO THE TARIFF ACT OF 1930

Sec. 201. Special provisions regarding certain violations relating to 
                            import documentation.
Sec. 202. Electronic preference verification system for origin of 
                            textile or apparel articles under CAFTA-DR, 
                            NAFTA, and other free trade agreements.
Sec. 203. Establishment of textile and apparel new importer program.
Sec. 204. Nonresident importer declaration program for textile or 
                            apparel articles.
   TITLE III--ESTABLISHMENT OF TEXTILE AND APPAREL MANUFACTURING AND 
                           SUPPLIER REGISTRY

Sec. 301. Establishment of textile and apparel manufacturing and 
                            supplier registry.
                    TITLE IV--IMPLEMENTATION REPORT

Sec. 401. Implementation report.

SEC. 2. TEXTILE OR APPAREL ARTICLE DEFINED.

    (a) In General.--In this Act, the term ``textile or apparel 
article'' means any of the following:
            (1) Any good classifiable in chapters 50 through 63 of the 
        HTS.
            (2) Any good classifiable under one of the following HTS 
        headings or subheadings:
                    (A) 3005.90.
                    (B) 3921.12.15.
                    (C) 3921.13.15.
                    (D) 3921.90.11.
                    (E) 3921.90.15.
                    (F) 3921.90.19.
                    (G) 3921.90.25.
                    (H) 3921.90.29.
                    (I) 3921.90.40.
                    (J) 6601.
                    (K) 7019.19.15.
                    (L) 7019.19.28.
                    (M) 7019.40 through 7019.59.
                    (N) 8708.21.00.
                    (O) 9404.30.
                    (P) 9404.90.
    (b) HTS Defined.--In subsection (a), the term ``HTS'' means the 
Harmonized Tariff Schedule of the United States.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) CAFTA-DR country.--The term ``CAFTA-DR country'' has 
        the meaning given such term in section 3(2) of the Dominican 
        Republic-Central America-United States Free Trade Agreement 
        Implementation Act (19 U.S.C. 4002(2)).
            (2) CEE.--The term ``CEE'' means the Center of Excellence 
        and Expertise for Apparel, Footwear, and Textiles of U.S. 
        Customs and Border Protection.
            (3) Commissioner.--The term ``Commissioner'' means the 
        Commissioner responsible for U.S. Customs and Border 
        Protection.
            (4) Dedicated.--The term ``dedicated'' means, with respect 
        to an import specialist, that the import specialist focuses 
        solely on the import of textile or apparel articles.
            (5) Enter; entry.--The terms ``enter'' and ``entry'' refer 
        to the entry, or withdrawal from warehouse for consumption, of 
        a textile or apparel article in the customs territory of the 
        United States.
            (6) Importer.--The term ``importer'' means one of the 
        parties qualifying as an importer of record under section 
        484(a)(2)(B) of the Tariff Act of 1930 (19 U.S.C. 
        1484(a)(2)(B)).
            (7) New importer.--The term ``new importer'' means an 
        importer with fewer than 3 years of history of importing 
        textile or apparel articles into the United States. For 
        purposes of this paragraph, a new importer that merges with or 
        is purchased by another importer, or is otherwise altered, 
        shall be considered to remain a new importer until such time as 
        such new importer presents proof to the Commissioner of such 
        merger, purchase, or other alteration for a determination 
        regarding whether such new importer may be treated as an 
        importer.
            (8) Nonresident importer.--The term ``nonresident 
        importer'' means an importer who is--
                    (A) an individual who is not a citizen of the 
                United States or an alien lawfully admitted for 
                permanent residence in the United States; or
                    (B) a partnership, corporation, or other commercial 
                entity that is not organized under the laws of a 
                jurisdiction within the customs territory of the United 
                States (as such term is defined in General Note 2 of 
                the Harmonized Tariff Schedule of the United States) or 
                in the Virgin Islands of the United States.
            (9) Special operations.--The term ``special operations'' 
        means an initiative that is--
                    (A) implemented to address specific instances of 
                transactions that do not comply with the customs and 
                trade laws of the United States with respect to textile 
                or apparel articles;
                    (B) used to address any import violations involving 
                textile or apparel articles, including fraud, quota 
                requirements, revenue collection, trade preferences or 
                requirements under free trade agreements, product 
                safety, antidumping and countervailing duties, or 
                intellectual property rights; or
                    (C) initiated to address a singular instance or a 
                pattern of high-risk behavior, involving a particular 
                commodity or other trade issue, including valuation, 
                origin fraud, or trade preference violation, on the 
                part of a country, importer, shipper, exporter, customs 
                broker, freight forwarder, or manufacturer.
            (10) TTA.--The term ``TTA'' means the Textile and Trade 
        Agreements division of the Office of International Trade within 
        U.S. Customs and Border Protection.
            (11) TPVTs.--The term ``TPVTs'' means Textile Product 
        Verification Teams.
            (12) Trained.--The term ``trained'' means, with respect to 
        an import specialist, that such import specialist has received, 
        at least during the last 3 years, education or training related 
        to the import of textile or apparel articles.

SEC. 4. FINDINGS.

    Congress finds the following:
            (1) The fraudulent or illegal imports of textile and 
        apparel articles into the United States results in significant 
        revenue loss to the Department of the Treasury.
            (2) The Textile and Trade Agreements division of the Office 
        of International Trade within U.S. Customs and Border 
        Protection or any subsequent division has, with respect to 
        textile or apparel articles, the primary responsibility to 
        ensure the proper enforcement of all customs and trade laws, 
        rules, and regulations affecting textile and apparel articles.
            (3) The TTA has the authority to direct the implementation 
        and enforcement of free trade agreements, multilateral 
        agreements, bilateral textile agreements, trade preference 
        programs, and all other customs and trade laws affecting 
        textiles and apparel articles.
            (4) The primary focus of the TTA is to ensure the effective 
        implementation of all trade enforcement activities involving 
        textile or apparel articles with its principle focus to prevent 
        circumvention of the requirements to obtain preferential trade 
        treatment under free trade agreements and trade preference 
        programs in order to avoid quotas or duties.

SEC. 5. SENSE OF CONGRESS.

    It is the sense of Congress that--
            (1) U.S. Customs and Border Protection and the TTA should 
        be involved in supporting the negotiation of enforcement 
        provisions of trade preference programs and free trade 
        agreements affecting textiles and apparel articles;
            (2) the TTA should conduct outreach to other Federal 
        departments and agencies involved in overall trade policy, such 
        as Department of Commerce and the Office of the United States 
        Trade Representative;
            (3) the TTA should develop policies and procedures that 
        provide guidance to the CEE and to the ports of entry of the 
        textile and apparel articles, including training of officials 
        of U.S. Customs and Border Protection;
            (4) officials of the TTA should coordinate and collaborate 
        with officials of the CEE to establish enforcement priorities, 
        based on risk assessments, and a national enforcement response;
            (5) the TTA headquarters office is currently below its 
        optimal staffing levels and the TTA personnel efforts should be 
        targeted at retaining senior staff and hiring new qualified 
        personnel so that the division is brought up to optimal 
        staffing levels, and these positions should be designated as 
        not only policy positions, but enforcement positions as well;
            (6) the TTA should implement special operations, Textile 
        Product Verification Teams, and other actions under U.S. 
        Customs and Border Protection authority to ensure enforcement 
        of customs and trade laws relating to imports of textile or 
        apparel articles in a timely manner as concerns arise, 
        particularly as such concerns relate to enforcement of the 
        North American Free Trade Agreement, the Dominican Republic-
        Central America-United States Free Trade Agreement, and all 
        other free trade agreements and trade preference programs, in 
        order to prevent transshipments and origin fraud;
            (7) the TTA officials should coordinate and collaborate 
        with foreign government counterparts to ensure effective 
        enforcement of textile and apparel articles; and
            (8) U.S. Customs and Border Protection should ensure that 
        seizures, detentions, special operations, and TPVTs remain the 
        primary focus of its enforcement efforts relating to textile 
        and apparel articles.

 TITLE I--ADDITIONAL AUTHORITIES FOR U.S. CUSTOMS AND BORDER PROTECTION

SEC. 101. SEIZURE AND FORFEITURE OF CERTAIN TEXTILE OR APPAREL ARTICLES 
              AND USE OF AMOUNTS FROM FINES, PENALTIES, AND 
              FORFEITURES.

    (a) Seizure and Forfeiture.--
            (1) In general.--The following textile or apparel articles 
        shall be subject to seizure and forfeiture in accordance with 
        the customs and trade laws of the United States and title 18, 
        United States Code:
                    (A) Any textile or apparel article imported into 
                the United States--
                            (i) for which a trade preference has been 
                        claimed; and
                            (ii) that has been either misdescribed on 
                        entry as to country of origin or for which the 
                        importer does not verify actual country of 
                        origin, for purposes of avoiding a duty or 
                        other obligation to the United States 
                        Government, including--
                                    (I) any textile or apparel article 
                                accompanied by documentation that 
                                indicates a false or fraudulent country 
                                of origin or source of textile or 
                                apparel articles; and
                                    (II) any textile or apparel article 
                                accompanied by a counterfeit visa, 
                                license, permit, bill of lading, or 
                                similar documentation that is 
                                subsequently used by the importer for 
                                entry of textile or apparel articles.
                    (B) A textile or apparel article imported into the 
                United States by an importer who provides false 
                information with respect to the physical address of the 
                importer or who does not meet the requirements of 
                section 484(a)(2)(B) of the Tariff Act of 1930 (19 
                U.S.C. 1484(a)(2)(B)).
            (2) Exception.--A clerical error shall not be considered a 
        violation of paragraph (1) unless such error is part of a 
        pattern of negligent conduct.
    (b) Use of Amounts From Fines, Penalties, and Forfeitures.--
            (1) In general.--Notwithstanding any other provision of 
        law, the Secretary of Homeland Security, the Commissioner, or 
        the Secretary of the Treasury--
                    (A) shall use amounts from fines, penalties, and 
                forfeitures of property for violations of any law 
                regarding the import of textile or apparel articles 
                enforced by the Secretary of Homeland Security or the 
                Secretary of the Treasury to pay for--
                            (i) expenses directly related to special 
                        operations, TPVTs, and other enforcement 
                        actions;
                            (ii) expenses related to training and 
                        education for applicable revenue positions, 
                        including import specialists, international 
                        trade specialists, and auditors who participate 
                        in the enforcement of the customs and trade 
                        laws of the United States with respect to the 
                        export or import of textile or apparel 
                        articles; and
                            (iii) implementation of the provisions of 
                        this Act; and
                    (B) may use amounts from fines, penalties, and 
                forfeitures of property for violations of any law 
                regarding the import of textile or apparel articles 
                enforced by the Secretary of Homeland Security, the 
                Commissioner, or the Secretary of the Treasury to pay 
                for a reward of not less than 20 percent of the amount 
                of the fine or penalty collected, or the value of the 
                property forfeited, or $20,000, whichever is the lesser 
                amount, to any person who furnishes information that 
                leads to an arrest, conviction, civil penalty 
                assessment, or forfeiture of property for any violation 
                of any law regarding the import of textile or apparel 
                articles enforced by the Secretary of Homeland 
                Security, the Commissioner, or the Secretary of the 
                Treasury.
            (2) Rule of construction.--Amounts described in paragraph 
        (1) and used to pay for expenses described in subparagraph (A) 
        of that paragraph or a reward described in subparagraph (B) of 
        that paragraph are in addition to amounts otherwise available 
        for such purposes.

SEC. 102. INCREASE IN CERTAIN TTA POSITIONS AND IMPORT SPECIALIST 
              POSITIONS AND BIENNIAL REVIEW OF STAFF LEVELS.

    (a) Increase in Certain TTA Positions.--Not later than 180 days of 
the date of the enactment of this Act, the Commissioner shall ensure 
that--
            (1) the Textile Enforcement Branch (or any successor or 
        related branch) of the TTA shall consist of, at a minimum, one 
        branch chief and 6 operations staff, of whom 3 operations staff 
        shall be assigned to one of the CAFTA-DR countries for purposes 
        of assisting U.S. Customs and Border Protection with 
        verification of textile and apparel preferences claimed under 
        the Dominican Republic-Central America-United States Free Trade 
        Agreement;
            (2) the Textile Policy Branch (or any successor or related 
        division) of the TTA shall consist of, at a minimum, one 
        division chief and 3 operations staff, and 2 textile trade 
        analysts; and
            (3) the Quota Branch (or any successor or related branch of 
        the Interagency Collaboration Division) of the TTA shall 
        consist of, at a minimum, one branch chief and 4 operations 
        staff.
    (b) Increase in Textile and Apparel Trained Import Specialists.--As 
soon as practicable after the date of the enactment of this Act, the 
Commissioner shall certify, with respect to the 15 largest (by value of 
entries) United States ports of entry for textile or apparel articles, 
that import specialists who are assigned to such ports of entry are 
trained in fraud, trade preference verification, classification, 
undervaluation, or other issues relating to imports of textile or 
apparel articles so that the number of such trained import specialist 
positions is not less than 150 percent of the number of trained import 
specialist positions as of the date of the enactment of this Act.
    (c) Increase in Dedicated Textile and Apparel Import Specialists.--
As soon as practicable after the date of the enactment of this Act, the 
Commissioner shall increase dedicated textile and import specialists by 
25 percent at the 15 largest (by value of entries) United States ports 
of entry for textile or apparel articles over the number of such 
specialists as of the date of the enactment of this Act.
    (d) Biennial Review of Staff Levels.--Not later than one year after 
the date of the enactment of this Act, and every 2 years thereafter, 
the Commissioner shall submit to the Committee on Ways and Means and 
the Committee on Homeland Security of the House of Representatives, the 
Committee on Finance and the Committee on Homeland Security and 
Governmental Affairs of the Senate, and the co-chairs of the 
Congressional Textile Caucus a report on the staffing levels specified 
in this section, including a determination of whether or not there is 
need for additional staff to carry out the duties of the TTA.

             TITLE II--AMENDMENTS TO THE TARIFF ACT OF 1930

SEC. 201. SPECIAL PROVISIONS REGARDING CERTAIN VIOLATIONS RELATING TO 
              IMPORT DOCUMENTATION.

    (a) Publication of Names of Certain Violators.--Section 592A(a)(1) 
of the Tariff Act of 1930 (19 U.S.C. 1592a(a)(1)) is amended--
            (1) in the matter preceding subparagraph (A), by striking 
        ``is authorized to'' and inserting ``shall''; and
            (2) in subparagraph (A), by inserting before the comma at 
        the end the following: ``, including for violations of quotas, 
        duties, or trade preference programs''.
    (b) List of High-Risk Countries.--Section 592A(b)(1) of the Tariff 
Act of 1930 (19 U.S.C. 1592a(b)(1)) is amended, in the first sentence--
            (1) by striking ``is authorized to'' and inserting 
        ``shall''; and
            (2) by inserting ``or duties or violate trade preference 
        programs'' after ``quotas''.

SEC. 202. ELECTRONIC PREFERENCE VERIFICATION SYSTEM FOR ORIGIN OF 
              TEXTILE OR APPAREL ARTICLES UNDER CAFTA-DR, NAFTA, AND 
              OTHER FREE TRADE AGREEMENTS.

    (a) Establishment.--Not later than 180 days after the date of the 
enactment of this Act, the President, acting through the Commissioner 
and in coordination with the head of the Office of Textiles and Apparel 
of the Department of Commerce, shall establish an electronic 
verification system for tracking textile or apparel articles imported 
or exported under the Dominican Republic-Central America-United States 
Free Trade Agreement, the North American Free Trade Agreement, or any 
other free trade agreement to which the United States is a party, to 
ensure compliance with the respective requirements of such agreements.
    (b) Implementation.--The President shall seek to enter into 
consultations and agreements, as appropriate, with the government of 
each foreign country that is a party to an agreement referred to in 
subsection (a) for purposes of implementing the electronic verification 
system established under that subsection.
    (c) Confidentiality.--The electronic verification system 
established under subsection (a) shall ensure that proprietary 
information, such as information about supply chain participants, is 
coded so that only U.S. Customs and Border Protection and Office of 
Textiles and Apparel personnel can access the information.
    (d) Sense of Congress.--It is the sense of Congress that the 
President should seek to make the integration of the electronic 
verification system established under subsection (a) in future free 
trade agreements a priority in negotiations for such agreements.

SEC. 203. ESTABLISHMENT OF TEXTILE AND APPAREL NEW IMPORTER PROGRAM.

    (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, the Commissioner shall establish a new importer 
program that directs U.S. Customs and Border Protection to adjust bond 
amounts for new importers of textile and apparel articles based on the 
level of risk with respect to protection of the revenue of the Federal 
Government presented by each new importer.
    (b) Requirements.--The Commissioner shall ensure that, as part of 
the new importer program established under subsection (a), U.S. Customs 
and Border Protection--
            (1) develops risk assessment guidelines for new importers 
        of textile and apparel articles;
            (2) adjusts bond amounts for new importers in accordance 
        with the risk assessment guidelines developed under paragraph 
        (1);
            (3) maintains a centralized database of new importers; and
            (4) ensures accuracy of required information provided to 
        U.S. Customs and Border Protection by new importers.
    (c) Bonding Authority.--Section 623(b) of the Tariff Act of 1930 
(19 U.S.C. 1623(b)) is amended by adding at the end the following new 
paragraph:
            ``(5) In the case of importation of textile or apparel 
        articles, by regulation or specific instruction require, or 
        authorize U.S. Customs and Border Protection officers to 
        require, the amount of the bond to include amounts equal to any 
        duties, fees, or penalties estimated to be payable on such 
        articles. For purposes of this paragraph, amounts equal to any 
        penalties estimated to be payable on such articles shall be 
        based on a risk assessment of the new importer carried out in 
        accordance with section 203 of the Textile Security and 
        Enforcement Act of 2013. Any person who violates a requirement 
        imposed pursuant to this paragraph shall be liable for a civil 
        penalty of $50,000 for each such violation.''.
    (d) Other Penalties.--In addition to the penalties specified in 
paragraph (5) of section 623(b) of the Tariff Act of 1930 (19 U.S.C. 
1623(b)), as added by subsection (c) of this section, for a violation 
of such paragraph, any person who violates any other customs or trade 
law of the United States with respect to the importation of textile or 
apparel articles shall be subject to any applicable civil or criminal 
penalty, including seizure and forfeiture that may be imposed under 
such customs or trade law, including section 592 of the Tariff Act of 
1930 (19 U.S.C. 1592).

SEC. 204. NONRESIDENT IMPORTER DECLARATION PROGRAM FOR TEXTILE OR 
              APPAREL ARTICLES.

    (a) Establishment of Program.--Not later than 180 days after the 
date of the enactment of this Act, the Commissioner shall establish and 
maintain a nonresident importer declaration program with respect to the 
importation of textile or apparel articles. The program shall require 
nonresident importers of textile or apparel articles to provide the 
information required under subsection (b) and declare the information 
required under subsection (c), and require that such information 
accompany the entry summary documentation for such textile or apparel 
articles.
    (b) Information Required.--The Commissioner shall require the 
following information to be submitted by any nonresident importer 
seeking to import textile or apparel articles:
            (1) An identification of a resident agent in the State in 
        which the port of entry is located who is authorized to accept 
        service of process against the nonresident importer in 
        connection with the importation of the textile or apparel 
        articles.
            (2) A certification that the resident agent described in 
        paragraph (1) has assets in the United States in sufficient 
        amounts for the purpose of ensuring the payment of any 
        additional loss of revenue not covered by any surety bond or 
        for any civil penalties levied by the Federal Government in 
        connection with the importation of the textile or apparel 
        articles.
            (3) A copy of the commercial invoice accompanying the 
        shipment of the textile or apparel articles, including the 
        name, address, and contact information for each person in the 
        transaction, such as the trading house, the freight forwarder, 
        and the ultimate purchaser of the goods.
    (c) Declarations Required.--Pursuant to procedures prescribed by 
the Commissioner, any nonresident importer seeking to import textile or 
apparel articles shall declare the following:
            (1) The nonresident importer has secured a bond in 
        connection with the importation of the textile or apparel 
        articles as required by paragraph (5) of section 623(b) of the 
        Tariff Act of 1930 (19 U.S.C. 1623(b)) (as added by section 
        203(c) of this Act).
            (2) The nonresident importer has established a power of 
        attorney in connection with the importation of the textile or 
        apparel articles.
    (d) Authority.--A resident agent under this section shall accept 
service of process on behalf of the nonresident importer of such agent 
for the purpose of duties, penalties, or other fines issued by the 
Secretary of Homeland Security or the Commissioner if the Secretary or 
the Commissioner is unable to collect duties, penalties, or other fines 
from such nonresident importer.
    (e) Penalties.--
            (1) In general.--It shall be unlawful for any person to 
        import into the United States any textile or apparel article in 
        violation of this section.
            (2) Civil penalties.--Any person who violates paragraph (1) 
        shall be liable for a civil penalty of $50,000 for each such 
        violation.
            (3) Other penalties.--In addition to the penalties 
        specified in paragraph (2), any violation of this section that 
        violates any other customs or trade law of the United States 
        shall be subject to any applicable civil and criminal penalty, 
        including seizure and forfeiture, that may be imposed under 
        such customs or trade law or title 18, United States Code, with 
        respect to the importation of textile or apparel articles.

   TITLE III--ESTABLISHMENT OF TEXTILE AND APPAREL MANUFACTURING AND 
                           SUPPLIER REGISTRY

SEC. 301. ESTABLISHMENT OF TEXTILE AND APPAREL MANUFACTURING AND 
              SUPPLIER REGISTRY.

    Not later than 180 days after the date of the enactment of this 
Act, the President, acting through the Commissioner and in coordination 
with the head of the Office of Textiles and Apparel of the Department 
of Commerce, shall establish an electronic Textile and Apparel 
Manufacturing Supplier Registry pilot program to serve as a centralized 
database of United States producers and manufacturers of thread, yarn, 
fabric, and apparel that supply products to companies in the United 
States, countries that are parties to the North American Free Trade 
Agreement, the Dominican Republic-Central America-United States Free 
Trade Agreement, and other free trade agreements or eligible for 
preference programs for countries in the Western Hemisphere.

                    TITLE IV--IMPLEMENTATION REPORT

SEC. 401. IMPLEMENTATION REPORT.

    Not later than one year after the date of the enactment of this 
Act, the Commissioner shall submit to the Committee on Ways and Means 
and the Committee on Homeland Security of the House of Representatives, 
the Committee on Finance and the Committee on Homeland Security and 
Governmental Affairs of the Senate, and the co-chairs of the 
Congressional Textile Caucus a report on the implementation of this 
Act.
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