I 

109TH CONGRESS 

2D SESSION H. R. 4680 

To provide temporary duty suspension on products from Sri Lanka. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 1, 2006 

Mr. WELLER (for himself and Mr. MORAN of Virginia) introduced the 

following bill; which was referred to the Committee on Ways and Means 

A BILL 

To provide temporary duty suspension on products from Sri 

Lanka. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Sri Lanka Tsunami 

5 Temporary Economic Relief Act of 2006’’. 

6 SEC. 2. FINDINGS. 

7 The Congress finds the following: 

8 (1) On December 26, 2004, a devastating 

9 earthquake occurred in the Indian Ocean, causing a 

10 tsunami that wrecked havoc on the island nation of 

11 Sri Lanka. 
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1 (2) More than 70 percent of the coastline in Sri 

2 Lanka was affected by the tidal wave, displacing 

3 more than 800,000 people, injuring more that 

4 14,000, and killing more than 40,000 out of a popu5 lation of just over 19,000,000 living in a land mass 

6 equivalent to the size of West Virginia. 

7 (3) Nearly 5,000 families have been displaced, 

8 with more than 90,000 homes destroyed and more 

9 than 20,000 homes partially damaged. 

10 (4) Sri Lanka lost 22 hospitals, 77 field med11 ical centers, 68 medical clinics, and 137 schools. 

12 (5) The tourist industry, which had only begun 

13 to rebound after more than 20 years of civil war, 

14 suffered a loss of more than 4,000 hotel rooms that 

15 are no longer useable. 

16 (6) The main roads and railway system which 

17 circumvented the country along the flat coastline 

18 was devastated, cutting off access to the areas of de19 struction. 

20 (7) In addition to the immediate loss of lives 

21 and facilities, Sri Lanka is facing a crisis of restor22 ing industries. 

23 (8) The fishing industry of Sri Lanka was dev24 astated, as 80 percent of Sri Lanka’s fishing boats 

25 were destroyed, causing a major loss of a nationwide 
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1 source of nutrition, as well as employment for an es2 timated 170,000 fishermen. 

3 (9) Ten of the nation’s 12 fishing harbors were 

4 destroyed, as well as most of the 50 plants used for 

5 building small boats. 

6 (10) The industry’s nets and land storage and 

7 transportation facilities were destroyed, as well as 

8 the ice making facilities for the storage facilities. 

9 (11) The coastal estuary sites, where shrimp 

10 and small fish were farmed, and as farm lands lo11 cated inland from the shore, have been silted up and 

12 destroyed. 

13 (12) More than 40 percent of the population 

14 depended on the fishing industry for its livelihood, 

15 and 11 percent of the population depended on agri16 culture. 

17 (13) Former Presidents George Bush and Bill 

18 Clinton estimate that it will require billions of dol19 lars to rebuild the affected countries, and at least 

20 three to five years to do so. 

21 (14) Sri Lanka’s most dynamic sectors had 

22 been food processing, textiles and apparel, food and 

23 beverages, telecommunications, and insurance and 

24 banking. Agriculture accounted for 20.1 percent of 

25 gross domestic product (GDP) in 2003, while indus-
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1 try, primarily garments and leather goods, food 

2 processing, chemicals, refined petroleum, wood prod3 ucts, basic metal products, and paper products, ac4 counted for 26.3 percent of GDP. 

5 (15) The inland and leeward plants that were 

6 not affected by the tsunami need unrestricted mar7 ket access to increase production, to offer employ8 ment to those who lost jobs and or have moved in9 land, and to maintain positive economic growth, sta10 bility, and democracy in the country. 

11 (16) The tsunami has forced the government 

12 and the rebel forces in Sri Lanka to work together 

13 on certain programs, which, through external sup14 port, can re-energize peace talks. 

15 (17) Before the tsunami occurred, Sri Lanka 

16 had implemented an economic reform program to 

17 open its economy to international competition that 

18 will lead to increased growth and international trade 

19 and further foreign investment. 

20 (18) The United States, through opening trade, 

21 has an opportunity to support Sri Lanka in its relief 

22 efforts, economic reform, peace process, and rebuild23 ing process. 
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1 SEC. 3. TRADE ENHANCEMENT. 

2 (a) ELIGIBILITY REQUIREMENTS.—Sri Lanka shall 

3 be eligible for duty-free treatment under subsection (c)— 

4 (1) if the President determines and certifies to 

5 Congress that Sri Lanka— 

6 (A) has established, or is making continual 

7 progress toward establishing— 

8 (i) a market-based economy that pro9 tects private property rights, incorporates 

10 an open rules-based trading system, and 

11 minimizes government interference in the 

12 economy through measures such as price 

13 controls, subsidies, and government owner14 ship of economic assets; 

15 (ii) the rule of law, political pluralism, 

16 and the right to due process, a fair trial, 

17 and equal protection under the law; 

18 (iii) the elimination of barriers to 

19 United States trade and investment, in20 cluding by— 

21 (I) the provision of national 

22 treatment and measures to create an 

23 environment conducive to domestic 

24 and foreign investment; 

25 (II) the protection of intellectual 

26 property; and 
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1 (III) the resolution of bilateral 

2 trade and investment disputes; 

3 (iv) economic policies to reduce pov4 erty, increase the availability of health care 

5 and educational opportunities, expand 

6 physical infrastructure, promote the devel7 opment of private enterprise, and encour8 age the formation of capital markets 

9 through micro-credit or other programs; 

10 (v) a system to combat corruption and 

11 bribery, such as signing and implementing 

12 the Convention on Combating Bribery of 

13 Foreign Public Officials in International 

14 Business Transactions; and 

15 (vi) protection of internationally rec16 ognized worker rights, including the right 

17 of association, the right to organize and 

18 bargain collectively, a prohibition on the 

19 use of any form of forced or compulsory 

20 labor, a minimum age for the employment 

21 of children, and acceptable conditions of 

22 work with respect to minimum wages, 

23 hours of work, and occupational safety and 

24 health; 
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1 (B) does not engage in activities that un2 dermine United States national security or for3 eign policy interests; and 

4 (C) does not engage in gross violations of 

5 internationally recognized human rights or pro6 vide support for acts of international terrorism 

7 and cooperates in international efforts to elimi8 nate human rights violations and terrorist ac9 tivities; and 

10 (2) subject to the authority granted to the 

11 President under subsections (a), (d), and (e) of sec12 tion 502 of the Trade Act of 1974 (19 U.S.C. 

13 2462(a), (d), and (e)), if Sri Lanka otherwise meets 

14 the eligibility criteria set forth in section 502 of the 

15 Trade Act of 1974. 

16 (b) CONTINUING COMPLIANCE.—If the President de17 termines that Sri Lanka is not making continual progress 

18 in meeting the requirements described in subsection 

19 (a)(1), the President shall terminate the eligibility of Sri 

20 Lanka for the preferential treatment under subsection (c). 

21 (c) PREFERENTIAL TREATMENT.— 

22 (1) IN GENERAL.—Subject to subsections (a) 

23 and (b), duty-free treatment shall apply to any arti24 cle that is the growth, product, or manufacture of 
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1 Sri Lanka and that meets the requirements of para2 graph (2). 

3 (2) REQUIREMENTS.— 

4 (A) IN GENERAL.—The duty-free treat5 ment provided under paragraph (1) shall apply 

6 to any article described in that paragraph if— 

7 (i) that article is imported directly 

8 from Sri Lanka into the customs territory 

9 of the United States; and 

10 (ii) the direct costs of processing oper11 ations performed on the article in Sri 

12 Lanka is not less than 35 percent of the 

13 appraised value of the article at the time 

14 it enters the customs territory of the 

15 United States. 

16 (B) TEXTILE AND APPAREL ARTICLES.— 

17 The duty-free treatment provided under para18 graph (1) applies to a textile and apparel article 

19 only if that article meets the requirements set 

20 forth in section 102.21 of title 19, Code of Fed21 eral Regulations, as in effect on November 1, 

22 2005. 

23 (C) DETERMINATION OF 35 PERCENT RE24 QUIREMENT.—For purposes of determining the 

25 percentage referred to in subparagraph (A)(ii), 
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1 if the cost or value of material produced in the 

2 customs territory of the United States (other 

3 than the Commonwealth of Puerto Rico) is in4 cluded with respect to an article that is the 

5 growth, product, or manufacture of Sri Lanka, 

6 an amount not to exceed 15 percent of the ap7 praised value of the article at the time it enters 

8 the customs territory of the United States that 

9 is attributable to such United States cost or 

10 value may be applied toward determining the 

11 percentage referred to in subparagraph (A)(ii). 

12 (3) SURGE MECHANISM.— 

13 (A) IMPORT MONITORING.—The Secretary 

14 of Commerce shall monitor imports of textile 

15 and apparel articles from Sri Lanka on a 

16 monthly basis to determine if there has been a 

17 surge in imports of such articles. In order to 

18 permit public access to preliminary inter19 national trade data and to facilitate the early 

20 identification of potentially disruptive import 

21 surges, the Director of the Office of Manage22 ment and Budget may grant an exception to 

23 the publication dates established for the release 

24 of data on United States international trade in 
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1 covered articles, if the Director notifies the 

2 Congress of the early release of the data. 

3 (B) DETERMINATION OF DAMAGE OR

4 THREAT THEREOF.—Whenever the Secretary of 

5 Commerce determines, based on the data de6 scribed in subparagraph (A), or pursuant to a 

7 written request made by an interested party, 

8 that there has been a surge in imports of a tex9 tile or apparel article from Sri Lanka, the Sec10 retary shall determine whether such article 

11 from such country is being imported in such in12 creased quantities as to cause serious damage, 

13 or threat thereof, to the domestic industry pro14 ducing a like or directly competitive article. If 

15 the Secretary’s determination is affirmative, the 

16 President shall suspend the duty-free treatment 

17 provided for such article under paragraph (1). 

18 If the inquiry is initiated at the request of an 

19 interested party, the Secretary shall make the 

20 determination within 60 days after the date of 

21 the request. 

22 (C) FACTORS TO CONSIDER.—In deter23 mining whether a domestic industry has been 

24 seriously damaged, or is threatened with serious 

25 damage, the Secretary shall examine the effect 
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1 of the imports on relevant economic indicators 

2 such as domestic production, sales, market 

3 share, capacity utilization, inventories, employ4 ment, profits, exports, prices, and investment. 

5 (D) PROCEDURE.— 

6 (i) INITIATION.—The Secretary of 

7 Commerce shall initiate an inquiry within 

8 10 days after receiving a written request 

9 and supporting information for an inquiry 

10 from an interested party. Notice of initi11 ation of an inquiry shall be published in 

12 the Federal Register. 

13 (ii) PARTICIPATION BY INTERESTED

14 PARTIES.—The Secretary of Commerce 

15 shall establish procedures to ensure partici16 pation in the inquiry by interested parties. 

17 (iii) NOTICE OF DETERMINATION.— 

18 The Secretary of Commerce shall publish 

19 the determination described in subpara20 graph (B) in the Federal Register. 

21 (iv) INFORMATION AVAILABLE.—If 

22 relevant information is not available on the 

23 record or any party withholds information 

24 that has been requested by the Secretary 

25 of Commerce, the Secretary shall make the 
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1 determination on the basis of the facts 

2 available. When the Secretary relies on in3 formation submitted in the inquiry as facts 

4 available, the Secretary shall, to the extent 

5 practicable, corroborate the information 

6 from independent sources that are reason7 ably available to the Secretary. 

8 (v) INTERESTED PARTY.—For pur9 poses of this paragraph, the term ‘‘inter10 ested party’’ means any producer of a like 

11 or directly competitive article, a certified 

12 union or recognized union or group of 

13 workers which is representative of an in14 dustry engaged in the manufacture, pro15 duction, or sale in the United States of a 

16 like or directly competitive article, a trade 

17 or business association representing pro18 ducers or sellers of like or directly competi19 tive articles, producers engaged in the pro20 duction of essential inputs for like or di21 rectly competitive articles, a certified union 

22 or group of workers which is representative 

23 of an industry engaged in the manufac24 ture, production, or sale of essential inputs 

25 for the like or directly competitive article, 
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1 or a trade or business association rep2 resenting companies engaged in the manu3 facture, production, or sale of such essen4 tial inputs. 

5 SEC. 4. EFFECTIVE PERIOD OF DUTY-FREE TREATMENT. 

6 The duty-free treatment under section 3 shall apply 

7 to any article that is entered, or withdrawn from ware8 house for consumption, into the customs territory of the 

9 United States during the period beginning on the 15th day 

10 after the date of the enactment of this Act and ending 

11 on the earlier of— 

12 (1) 5 years after that date; or 

13 (2) the date on which a free trade agreement 

14 between the United States and Sri Lanka enters 

15 into force with respect to the United States under 

16 the Bipartisan Trade Promotion Authority Act of 

17 2002 (19 U.S.C. 3801 et seq.). 

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