II 

110TH CONGRESS 

1ST SESSION S. 652 

To extend certain trade preferences to certain least-developed countries, and 

for other purposes. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 15, 2007 

Mr. SMITH (for himself, Mrs. FEINSTEIN, Mr. CRAIG, and Mr. SUNUNU) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To extend certain trade preferences to certain least-developed 

countries, 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 ‘‘Tariff Relief Assist5 ance for Developing Economies Act of 2007’’ or as the 

6 ‘‘TRADE Act of 2007’’. 

7 SEC. 2. FINDINGS. 

8 Congress finds the following: 

9 (1) It is in the mutual interest of the United 

10 States and the least-developed countries to promote 


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1 stable and sustainable economic growth and develop2 ment. 

3 (2) Trade and investment are powerful eco4 nomic tools and a country may use trade and invest5 ment to reduce poverty and raise the standard of liv6 ing in that country. 

7 (3) A country that is open to trade may in8 crease its economic growth. 

9 (4) Twenty-five percent of the world’s popu10 lation survives on less than one dollar per day. 

11 (5) Unemployment rates in least-developed 

12 countries are extremely high, including unemploy13 ment rates in some countries of up to 70 percent. 

14 (6) Trade and investment often lead to employ15 ment opportunities and often help alleviate poverty. 

16 (7) Least-developed countries have a particular 

17 challenge in meeting the economic requirements and 

18 competitiveness of globalization and international 

19 markets. 

20 (8) The United States has recognized the bene21 fits of trade to least-developed countries by enacting 

22 the Generalized System of Preferences and trade 

23 benefits for developing countries in the Caribbean, 

24 Andean, and sub-Saharan African regions of the 

25 world. 


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1 (9) The challenges of the global trading envi2 ronment for least-developed countries are even great3 er given the end of the Multi-Fiber Arrangement in 

4 2005, and certain least-developed countries, includ5 ing Bangladesh, Cambodia, and Nepal, are particu6 larly vulnerable to the changes that will result from 

7 the end of that Arrangement. 

8 (10) Responding to the needs of least-developed 

9 countries would be consistent with other United 

10 States trade objectives, including encouraging for11 ward progress on the WTO Doha Development 

12 Round. 

13 (11) Enhanced trade with the Muslim least-de14 veloped countries, including Yemen, Afghanistan, 

15 and Bangladesh, is consistent with other United 

16 States objectives of encouraging a strong private 

17 sector and individual economic empowerment in 

18 those countries. 

19 (12) Offering least-developed countries en20 hanced trade preferences will encourage both higher 

21 levels of trade and direct investment in support of 

22 positive economic and political developments 

23 throughout the region and the world. 

24 (13) Encouraging the reciprocal reduction of 

25 trade and investment barriers will enhance the beneVerDate Aug 31 2005 23:00 Feb 20, 2007 Jkt 059200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S652.IS S652

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1 fits of trade and investment as well as enhance com2 mercial and political ties between the United States 

3 and the beneficiary countries. 

4 (14) Economic opportunity and engagement in 

5 the global trading system together with support for 

6 democratic institutions and a respect for human 

7 rights are mutually reinforcing objectives and key 

8 elements of a policy to confront and defeat global 

9 terrorism. 

10 (15) A powerful earthquake and tsunami struck 

11 in the Indian Ocean on December 26, 2004. 

12 (16) The destruction caused by the tsunami in 

13 Sri Lanka was devastating and included the loss of 

14 an estimated 30,000 people and physical damage 

15 that will cost an amount equal to 6.5 percent of the 

16 annual economy of Sri Lanka to repair. 

17 (17) The effects of lost businesses and recon18 struction costs caused by the tsunami damage will 

19 result in a drop in the economic growth of Sri 

20 Lanka. 

21 (18) Senate Resolution 4, 109th Congress, 

22 agreed to January 4, 2005, expressed the support of 

23 the Senate for the long-term commitment and en24 gagement of the United States to provide financial 

25 aid and other forms of direct and indirect assistance 


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1 to the countries and peoples of the region impacted 

2 by the earthquake and the tsunami. 

3 (19) Duty preferences that assist Sri Lanka in 

4 the United States market will help Sri Lanka re5 build and overcome the economic destruction caused 

6 by the tsunami. 

7 SEC. 3. DEFINITIONS. 

8 In this Act: 

9 (1) BENEFICIARY TRADE ACT OF 2007 COUN10 TRY.—The term ‘‘beneficiary TRADE Act of 2007 

11 country’’ means a country listed in subsection (b) or 

12 (c) of section 4 that the President has determined 

13 is eligible for preferential treatment under this Act. 

14 (2) FORMER TRADE ACT OF 2007 COUNTRY.— 

15 The term ‘‘former TRADE Act of 2007 country’’ 

16 means a country that, after being designated as a 

17 beneficiary TRADE Act of 2007 country under this 

18 Act, ceased to be designated as such a country by 

19 reason of its entering into a free trade agreement 

20 with the United States. 

21 SEC. 4. AUTHORITY TO DESIGNATE; ELIGIBILITY REQUIRE22 MENTS. 

23 (a) AUTHORITY TO DESIGNATE.— 

24 (1) IN GENERAL.—Notwithstanding any other 

25 provision of law, the President is authorized to desVerDate Aug 31 2005 23:00 Feb 20, 2007 Jkt 059200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S652.IS S652

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1 ignate a TRADE Act of 2007 country as a bene2 ficiary TRADE Act of 2007 country eligible for ben3 efits described in section 5— 

4 (A) if the President determines that the 

5 country meets the requirements set forth in sec6 tion 104 of the African Growth and Oppor7 tunity Act (19 U.S.C. 3703); and 

8 (B) subject to the authority granted to the 

9 President under subsections (a), (d), and (e) of 

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

11 C. 2462 (a), (d), and (e)), if the country other12 wise meets the eligibility criteria set forth in 

13 such section 502. 

14 (2) APPLICATION OF SECTION 104.—Section 

15 104 of the African Growth and Opportunity Act 

16 shall be applied for purposes of paragraph (1) by 

17 substituting ‘‘TRADE Act of 2007 country’’ for 

18 ‘‘sub-Saharan African country’’ each place it ap19 pears. 

20 (b) COUNTRIES ELIGIBLE FOR DESIGNATION.—For 

21 purposes of this Act, the term ‘‘TRADE Act of 2007 coun22 try’’ refers to the following or their successor political enti23 ties: 

24 (1) Afghanistan. 

25 (2) Bangladesh. 


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1 (3) Bhutan. 

2 (4) Cambodia. 

3 (5) Kiribati. 

4 (6) Lao People’s Democratic Republic. 

5 (7) Maldives. 

6 (8) Nepal. 

7 (9) Samoa. 

8 (10) Solomon Islands. 

9 (11) Timor-Leste (East Timor). 

10 (12) Tuvalu. 

11 (13) Vanuatu. 

12 (14) Yemen. 

13 (c) SRI LANKA ECONOMIC EMERGENCY SUPPORT.— 

14 For purposes of this Act, the President may also designate 

15 Sri Lanka as a beneficiary TRADE Act of 2007 country 

16 eligible for benefits described in section 5. 

17 SEC. 5. TRADE ENHANCEMENT. 

18 (a) BENEFITS DESCRIBED.—The benefits described 

19 in this section are as follows: 

20 (1) PREFERENTIAL TARIFF TREATMENT FOR

21 CERTAIN ARTICLES.— 

22 (A) IN GENERAL.—The President may 

23 provide duty-free treatment for any article de24 scribed in section 503(b)(1) (B) through (G) of 

25 the Trade Act of 1974 (19 U.S.C. 2463(b)(1) 


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1 (B) through (G)) that is the growth, product, 

2 or manufacture of a beneficiary TRADE Act of 

3 2007 country, if, after receiving the advice of 

4 the International Trade Commission in accord5 ance with section 503(e) of the Trade Act of 

6 1974 (19 U.S.C. 2463(e)), the President deter7 mines that such article is not import-sensitive 

8 in the context of imports from beneficiary 

9 TRADE Act of 2007 countries. 

10 (B) RULES OF ORIGIN.—The duty-free 

11 treatment provided under subparagraph (A) 

12 shall apply to any article described in that sub13 paragraph that meets the requirements of sec14 tion 503(a)(2) of the Trade Act of 1974 (19 

15 U.S.C. 2463(a)(2)), except that— 

16 (i) if the cost or value of materials 

17 produced in the customs territory of the 

18 United States is included with respect to 

19 that article, an amount not to exceed 15 

20 percent of the appraised value of the arti21 cle at the time it is entered that is attrib22 uted to such United States cost or value 

23 may be applied toward determining the 

24 percentage referred to in subparagraph (A) 


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1 of section 503(a)(2) of the Trade Act of 

2 1974 (19 U.S.C. 2463(a)(2)); and 

3 (ii) the cost or value of the materials 

4 included with respect to that article that 

5 are produced in one or more beneficiary 

6 TRADE Act of 2007 countries or former 

7 beneficiary TRADE Act of 2007 countries 

8 shall be applied in determining such per9 centage. 

10 (2) TEXTILE AND APPAREL ARTICLES.— 

11 (A) IN GENERAL.—The preferential treat12 ment relating to textile and apparel articles de13 scribed in section 112 (a) and (b) (1) and (2) 

14 of the African Growth and Opportunity Act (19 

15 U.S.C. 3721 (a) and (b) (1) and (2)) shall 

16 apply to textile and apparel articles imported 

17 directly into the customs territory of the United 

18 States from a beneficiary TRADE Act of 2007 

19 country and such section shall be applied for 

20 purposes of this subparagraph by substituting 

21 ‘‘TRADE Act of 2007 country’’ and ‘‘TRADE 

22 Act of 2007 countries’’ for ‘‘sub-Saharan Afri23 can country’’ and ‘‘sub-Saharan African coun24 tries’’, respectively, each place such terms ap25 pear. 


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1 (B) APPAREL ARTICLES ASSEMBLED FROM

2 REGIONAL AND OTHER FABRIC.—In applying 

3 such section 112, apparel articles wholly assem4 bled in one or more beneficiary TRADE Act of 

5 2007 countries or former beneficiary TRADE 

6 Act of 2007 countries, or both, from fabric 

7 wholly formed in one or more beneficiary 

8 TRADE Act of 2007 countries or former bene9 ficiary TRADE Act of 2007 countries, or both, 

10 from yarn originating either in the United 

11 States or one or more beneficiary TRADE Act 

12 of 2007 countries or former beneficiary 

13 TRADE Act of 2007 countries, or both (includ14 ing fabrics not formed from yarns, if such fab15 rics are classifiable under heading 5602 or 

16 5603 of the Harmonized Tariff Schedule of the 

17 United States and are wholly formed and cut in 

18 the United States, in one or more beneficiary 

19 TRADE Act of 2007 countries or former bene20 ficiary TRADE Act of 2007 countries, or any 

21 combination thereof), whether or not the ap22 parel articles are also made from any of the 

23 fabrics, fabric components formed, or compo24 nents knit-to-shape described in section 112(b) 

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1 tunity Act (unless the apparel articles are made 

2 exclusively from any of the fabrics, fabric com3 ponents formed, or components knit-to-shape 

4 described in such section 112(b) (1) or (2)) 

5 subject to the following: 

6 (i) LIMITATIONS ON BENEFITS.— 

7 (I) IN GENERAL.—Preferential 

8 treatment under this subparagraph 

9 shall be extended in the 1-year period 

10 beginning January 1, 2007, and in 

11 each of the succeeding 10 1-year peri12 ods, to imports of apparel articles de13 scribed in this subparagraph in an 

14 amount not to exceed the applicable 

15 percentage of the aggregate square 

16 meter equivalents of all apparel arti17 cles imported into the United States 

18 in the preceding 12-month period for 

19 which data are available. 

20 (II) APPLICABLE PERCENT21 AGE.—For purposes of this clause, the 

22 term ‘‘applicable percentage’’ means 

23 11 percent for the 1-year period be24 ginning January 1, 2007, increased in 

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1 riod by equal increments, so that for 

2 the period beginning January 1, 2017 

3 the applicable percentage does not ex4 ceed 14 percent. 

5 (ii) SPECIAL RULE.— 

6 (I) IN GENERAL.—Subject to 

7 clause (i), preferential treatment de8 scribed in this subparagraph shall be 

9 extended through December 31, 2014, 

10 for apparel articles wholly assembled 

11 in one or more beneficiary TRADE 

12 Act of 2007 countries or former bene13 ficiary TRADE Act of 2007 countries, 

14 or both, regardless of the country of 

15 origin of the yarn or fabric used to 

16 make such articles. 

17 (II) COUNTRY LIMITATIONS.— 

18 (aa) SMALL SUPPLIERS.—If, 

19 during the preceding 1-year pe20 riod beginning on January 1 for 

21 which data are available, imports 

22 from a beneficiary TRADE Act 

23 of 2007 country are less than 1 

24 percent of the aggregate square 

25 meter equivalents of all apparel 


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1 articles imported into the United 

2 States during such period, such 

3 imports may increase to an 

4 amount that is equal to not more 

5 than 1.5 percent of the aggregate 

6 square meter equivalents of all 

7 apparel articles imported into the 

8 United States during such pe9 riod. 

10 (bb) OTHER SUPPLIERS.—If 

11 during the preceding 1-year pe12 riod beginning on January 1 for 

13 which data are available, imports 

14 from a beneficiary TRADE Act 

15 of 2007 country are at least 1 

16 percent of the aggregate square 

17 meter equivalents of all apparel 

18 articles imported into the United 

19 States during such period, such 

20 imports may increase, during 

21 each subsequent 12-month pe22 riod, by an amount that is equal 

23 to not more than one-third of 1 

24 percent of the aggregate square 

25 meter equivalents of all apparel 


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1 articles imported into the United 

2 States. 

3 (cc) AGGREGATE COUNTRY

4 LIMIT.—In no case may the ag5 gregate quantity of textile and 

6 apparel articles imported into the 

7 United States under this sub8 paragraph exceed the applicable 

9 percentage set forth in clause (i). 

10 (C) TECHNICAL AMENDMENT.—Section 

11 6002(a)(2)(B) of the African Investment Incen12 tive Act of 2006 (Public Law 109–432) is 

13 amended by inserting before ‘‘by striking’’ the 

14 following: ‘‘in paragraph (3),’’. 

15 (D) OTHER RESTRICTIONS.—The provi16 sions of section 112(b) (3)(B), (4), (5), (6), (7), 

17 and (8), and (e), and section 113 of the African 

18 Growth and Opportunity Act (19 U.S.C. 

19 3721(b) (3)(B), (4), (5), (6), (7), and (8), and 

20 (e), and 3722) shall apply with respect to the 

21 preferential treatment extended under this Act 

22 to a beneficiary TRADE Act of 2007 country 

23 by substituting ‘‘TRADE Act of 2007 country’’ 

24 for ‘‘sub-Saharan African country’’ and 

25 ‘‘TRADE Act of 2007 countries’’ and ‘‘former 


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1 TRADE Act of 2007 countries’’ for ‘‘sub-Saha2 ran African countries’’ wherever appropriate. 

3 SEC. 6. REPORTING REQUIREMENT. 

4 The President shall monitor, review, and report to 

5 Congress, not later than 1 year after the date of enact6 ment of this Act, and annually thereafter, on the imple7 mentation of this Act and on the trade and investment 

8 policy of the United States with respect to the TRADE 

9 Act of 2007 countries. 

10 SEC. 7. TERMINATION OF PREFERENTIAL TREATMENT. 

11 No duty-free treatment or other preferential treat12 ment extended to a beneficiary TRADE Act of 2007 coun13 try under this Act shall remain in effect after December 

14 31, 2017. 

15 SEC. 8. EFFECTIVE DATE. 

16 The provisions of this Act shall take effect on Janu17 ary 1, 2007. 

Æ 


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