I 

116TH CONGRESS 

1ST SESSION H. R. 2219 

To promote United States-Mongolia trade by authorizing duty-free treatment 

for certain imports from Mongolia, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 10, 2019 

Mr. YOHO (for himself, Ms. TITUS, Mr. COHEN, Mr. FITZPATRICK, Mr. 

YOUNG, Mr. NORMAN, Mr. PRICE of North Carolina, and Mr. MCGOVERN) introduced the following bill; which was referred to the Committee 

on Ways and Means 

A BILL 

To promote United States-Mongolia trade by authorizing 

duty-free treatment for certain imports from Mongolia, 

and for other purposes. 

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 ‘‘Mongolia Third Neigh5 bor Trade Act’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 

8 (1) In 1992, Mongolia adopted a constitution 

9 establishing a parliamentary democracy, becoming 


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1 the only country in Asia to transition from com2 munism to democracy. Mongolia shares land borders 

3 with only the Russian Federation and the People’s 

4 Republic of China. With a large land area and a 

5 population of only 3,000,000, Mongolia is the 

6 world’s most sparsely populated country, and Mon7 golia’s sovereignty is thought to be at risk from the 

8 overwhelming influence of its much larger and more 

9 populous neighbors. 

10 (2) Mongolia has shown its commitment to a 

11 ‘‘third neighbor’’ relationship with the United States 

12 by sending troops to support United States combat 

13 operations in Iraq and Afghanistan, and has a 

14 strong record of troop contributions to international 

15 peacekeeping missions. Mongolia’s success as a de16 mocracy, strategic location, sovereignty, territorial 

17 integrity, and ability to pursue an independent for18 eign policy are highly relevant to the national secu19 rity of the United States. 

20 (3) Mongolia describes the United States as its 

21 most important ‘‘third neighbor’’, but United States22 Mongolia trade is substantially lower than many 

23 other bilateral trading relationships, and trade has 

24 declined in recent years. Total trade between the 

25 countries in 2012 measured $707,000,000, but in 


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1 2017 the United States exported only $82,200,000 

2 in goods to Mongolia and imported only $9,400,000 

3 in goods from Mongolia. 

4 (4) After mining, agriculture is the second most 

5 important sector contributing to the Mongolian econ6 omy. The livestock sector accounts for 87 percent of 

7 agricultural production in Mongolia and employs 

8 around one-third of the working population. 

9 (5) Since the 1940s, the annual mean air tem10 perature in Mongolia has risen at three times the 

11 global rate. Average precipitation is declining and 

12 extreme weather disasters are more frequent, posing 

13 acute challenges for livestock herding in the country. 

14 In 2017, an estimated 700,000 of the country’s live15 stock population were killed due to the post-drought 

16 extreme winter phenomenon known as ‘‘dzud’’. This 

17 phenomenon is unique to Mongolia and has in18 creased in frequency and severity in recent years, 

19 causing a rise in livestock mortality and diminishing 

20 livelihoods for herders which has led to widespread 

21 rural poverty and a contraction in the national econ22 omy. 

23 (6) Mongolia would greatly benefit from pref24 erential treatment for United States imports of cerVerDate Sep 11 2014 04:12 Apr 19, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2219.IH H2219

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1 tain Mongolian products to help address some of the 

2 economic impacts of the dzuds. 

3 (7) The cashmere trade is particularly impor4 tant to Mongolia’s economy, but while Mongolia pro5 duces over one-third of the world’s raw cashmere, it 

6 produces few finished cashmere products. Most Mon7 golian raw cashmere is exported to China, and the 

8 United States buys nearly all of its cashmere prod9 ucts from China. Preferential treatment for United 

10 States imports of certain Mongolian products, in11 cluding cashmere products, would benefit the United 

12 States by facilitating increased trade with Mongolia. 

13 (8) The development of Mongolia’s garment in14 dustry would also promote women’s employment and 

15 empowerment. Women have historically participated 

16 in Mongolia’s garment industry at high rates, and 

17 the garment industry has historically provided safe 

18 and stable employment for women in Mongolia. 

19 (9) In developing and expanding Mongolia’s 

20 cashmere industry, it is critical for Mongolia to take 

21 steps to ensure the protection of its grasslands and 

22 prevent overgrazing of cashmere goats. 

23 (10) Preferential treatment for United States 

24 imports of such Mongolian products would benefit 

25 Mongolia at this critical time. 


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1 SEC. 3. DUTY-FREE TREATMENT FOR CERTAIN IMPORTS 

2 FROM MONGOLIA. 

3 (a) IN GENERAL.—Subject to the eligibility require4 ments in subsection (c), the President is authorized to pro5 vide duty-free treatment for any article described in sub6 section (b) that is imported directly from Mongolia into 

7 the customs territory of the United States. 

8 (b) ARTICLE DESCRIBED.— 

9 (1) IN GENERAL.—An article is described in 

10 this subsection if— 

11 (A) the article is the growth, product, or 

12 manufacture of Mongolia; 

13 (B) the article is classified under chapter 

14 51, 57, 60, 61, 62, 63, or 94 of the Har15 monized Tariff Schedule of the United States; 

16 (C)(i) the article is an apparel or textile 

17 article made of fabrics or fibers containing not 

18 less than 23 percent by weight of cashmere; or 

19 (ii) the sum of the cost or value of cash20 mere components of the article is not less than 

21 51 percent of the appraised value of the article 

22 at the time it is entered; 

23 (D) in the case of an article that is a tex24 tile or apparel article, the yarn and fabric used 

25 to manufacture the article— 


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1 (i) are wholly produced in Mongolia; 

2 and 

3 (ii) are wholly formed and cut, or are 

4 components wholly knit-to-shape, in Mon5 golia; 

6 (E) the sum of the cost or value of the ma7 terials produced in, and the direct costs of proc8 essing operations performed in, Mongolia or the 

9 customs territory of the United States is not 

10 less than 50 percent of the appraised value of 

11 the article at the time it is entered; and 

12 (F) the President determines that the arti13 cle is not import-sensitive, after receiving the 

14 advice of the United States International Trade 

15 Commission in accordance with section 503(e) 

16 of the Trade Act of 1974 (19 U.S.C. 2463(e)). 

17 (2) EXCLUSIONS.—An article shall not be treat18 ed as the growth, product, or manufacture of Mon19 golia for purposes of paragraph (1)(A) by virtue of 

20 having merely undergone— 

21 (A) simple combining or packaging oper22 ations; or 

23 (B) mere dilution with water or mere dilu24 tion with another substance that does not mate25 rially alter the characteristics of the article. 


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1 (c) ELIGIBILITY REQUIREMENTS.—Duty-free treat2 ment may not be provided under this Act unless the Presi3 dent determines and certifies to Congress that— 

4 (1) Mongolia meets— 

5 (A) each of the requirements described in 

6 paragraphs (1), (2), and (3) of section 104(a) 

7 of the African Growth and Opportunity Act (19 

8 U.S.C. 3703(a)); and 

9 (B) each of the criteria relating to the pre10 vention of transshipment described in para11 graphs (1) and (2) of section 113(a) of such 

12 Act (19 U.S.C. 3722(a)); 

13 (2) Mongolia has effectively enforced environ14 mental laws, regulations, or other measures and ful15 filled its international environmental obligations, in16 cluding as such obligations relate to public health; 

17 and 

18 (3) after taking into account the factors set 

19 forth in paragraphs (1) through (7) of subsection (c) 

20 of section 502 of the Trade Act of 1974 (19 U.S.C. 

21 2462), Mongolia meets the eligibility requirements of 

22 such section 502. 

23 (d) VERIFICATION WITH RESPECT TO TRANS24 SHIPMENT FOR TEXTILE AND APPAREL ARTICLES.— 


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1 (1) IN GENERAL.—Not later than January 1 of 

2 each year, the Commissioner of U.S. Customs and 

3 Border Protection shall verify that textile and ap4 parel articles imported from Mongolia to which duty5 free treatment is extended under this Act are not 

6 being unlawfully transshipped into the United 

7 States. 

8 (2) REPORT TO PRESIDENT AND CONGRESS.— 

9 If the Commissioner determines pursuant to para10 graph (1) that textile and apparel articles imported 

11 from Mongolia to which duty-free treatment is ex12 tended under this Act are being unlawfully trans13 shipped into the United States, the Commissioner 

14 shall report that determination to the President and 

15 the appropriate congressional committees. 

16 (e) WITHDRAWAL, SUSPENSION, OR LIMITATION OF

17 PREFERENTIAL TREATMENT AND MANDATORY GRADUA18 TION.—The provisions of subsections (d) and (e) of sec19 tion 502 of the Trade Act of 1974 (19 U.S.C. 2462) shall 

20 apply with respect to Mongolia to the same extent and 

21 in the same manner as such provisions apply with respect 

22 to beneficiary developing countries under title V of that 

23 Act (19 U.S.C. 2461 et seq.). 


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1 (f) TERMINATION OF DUTY-FREE TREATMENT.—No 

2 duty-free treatment extended under this Act shall remain 

3 in effect after December 31, 2025. 

4 (g) DEFINITIONS.—In this section: 

5 (1) CUSTOMS TERRITORY OF THE UNITED

6 STATES.—The term ‘‘customs territory of the United 

7 States’’ has the meaning given the term in General 

8 Note 2 of the Harmonized Tariff Schedule of the 

9 United States. 

10 (2) CASHMERE.—The term ‘‘cashmere’’ means 

11 fine hair obtained from a cashmere goat (capra 

12 hircus laniger). 

13 SEC. 4. BRIEFING REQUIREMENT. 

14 (a) IN GENERAL.—Not later than one year after the 

15 date of the enactment of this Act, and annually thereafter, 

16 the President shall monitor, review, and provide a briefing 

17 to the appropriate congressional committees on— 

18 (1) the implementation of this Act; 

19 (2) compliance of Mongolia with the eligibility 

20 requirements described in section 3(d); and 

21 (3) the trade and investment policy of the 

22 United States with respect to Mongolia. 


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1 SEC. 5. APPROPRIATE CONGRESSIONAL COMMITTEES DE2 FINED. 

3 In this Act, the term ‘‘appropriate congressional com4 mittees’’ means— 

5 (1) the Committee on Ways and Means and the 

6 Committee on Foreign Affairs of the House of Rep7 resentatives; and 

8 (2) the Committee on Finance and the Com9 mittee on Foreign Relations of the Senate. 

Æ 


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