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[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 652 Introduced in Senate (IS)]

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.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Tariff Relief Assistance for 
Developing Economies Act of 2007'' or as the ``TRADE Act of 2007''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) It is in the mutual interest of the United States and 
        the least-developed countries to promote stable and sustainable 
        economic growth and development.
            (2) Trade and investment are powerful economic tools and a 
        country may use trade and investment to reduce poverty and 
        raise the standard of living in that country.
            (3) A country that is open to trade may increase its 
        economic growth.
            (4) Twenty-five percent of the world's population survives 
        on less than one dollar per day.
            (5) Unemployment rates in least-developed countries are 
        extremely high, including unemployment rates in some countries 
        of up to 70 percent.
            (6) Trade and investment often lead to employment 
        opportunities and often help alleviate poverty.
            (7) Least-developed countries have a particular challenge 
        in meeting the economic requirements and competitiveness of 
        globalization and international markets.
            (8) The United States has recognized the benefits of trade 
        to least-developed countries by enacting the Generalized System 
        of Preferences and trade benefits for developing countries in 
        the Caribbean, Andean, and sub-Saharan African regions of the 
        world.
            (9) The challenges of the global trading environment for 
        least-developed countries are even greater given the end of the 
        Multi-Fiber Arrangement in 2005, and certain least-developed 
        countries, including Bangladesh, Cambodia, and Nepal, are 
        particularly vulnerable to the changes that will result from 
        the end of that Arrangement.
            (10) Responding to the needs of least-developed countries 
        would be consistent with other United States trade objectives, 
        including encouraging forward progress on the WTO Doha 
        Development Round.
            (11) Enhanced trade with the Muslim least-developed 
        countries, including Yemen, Afghanistan, and Bangladesh, is 
        consistent with other United States objectives of encouraging a 
        strong private sector and individual economic empowerment in 
        those countries.
            (12) Offering least-developed countries enhanced trade 
        preferences will encourage both higher levels of trade and 
        direct investment in support of positive economic and political 
        developments throughout the region and the world.
            (13) Encouraging the reciprocal reduction of trade and 
        investment barriers will enhance the benefits of trade and 
        investment as well as enhance commercial and political ties 
        between the United States and the beneficiary countries.
            (14) Economic opportunity and engagement in the global 
        trading system together with support for democratic 
        institutions and a respect for human rights are mutually 
        reinforcing objectives and key elements of a policy to confront 
        and defeat global terrorism.
            (15) A powerful earthquake and tsunami struck in the Indian 
        Ocean on December 26, 2004.
            (16) The destruction caused by the tsunami in Sri Lanka was 
        devastating and included the loss of an estimated 30,000 people 
        and physical damage that will cost an amount equal to 6.5 
        percent of the annual economy of Sri Lanka to repair.
            (17) The effects of lost businesses and reconstruction 
        costs caused by the tsunami damage will result in a drop in the 
        economic growth of Sri Lanka.
            (18) Senate Resolution 4, 109th Congress, agreed to January 
        4, 2005, expressed the support of the Senate for the long-term 
        commitment and engagement of the United States to provide 
        financial aid and other forms of direct and indirect assistance 
        to the countries and peoples of the region impacted by the 
        earthquake and the tsunami.
            (19) Duty preferences that assist Sri Lanka in the United 
        States market will help Sri Lanka rebuild and overcome the 
        economic destruction caused by the tsunami.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Beneficiary trade act of 2007 country.--The term 
        ``beneficiary TRADE Act of 2007 country'' means a country 
        listed in subsection (b) or (c) of section 4 that the President 
        has determined is eligible for preferential treatment under 
        this Act.
            (2) Former trade act of 2007 country.--The term ``former 
        TRADE Act of 2007 country'' means a country that, after being 
        designated as a beneficiary TRADE Act of 2007 country under 
        this Act, ceased to be designated as such a country by reason 
        of its entering into a free trade agreement with the United 
        States.

SEC. 4. AUTHORITY TO DESIGNATE; ELIGIBILITY REQUIREMENTS.

    (a) Authority To Designate.--
            (1) In general.--Notwithstanding any other provision of 
        law, the President is authorized to designate a TRADE Act of 
        2007 country as a beneficiary TRADE Act of 2007 country 
        eligible for benefits described in section 5--
                    (A) if the President determines that the country 
                meets the requirements set forth in section 104 of the 
                African Growth and Opportunity Act (19 U.S.C. 3703); 
                and
                    (B) subject to the authority granted to the 
                President under subsections (a), (d), and (e) of 
                section 502 of the Trade Act of 1974 (19 U.S. C. 2462 
                (a), (d), and (e)), if the country otherwise meets the 
                eligibility criteria set forth in such section 502.
            (2) Application of section 104.--Section 104 of the African 
        Growth and Opportunity Act shall be applied for purposes of 
        paragraph (1) by substituting ``TRADE Act of 2007 country'' for 
        ``sub-Saharan African country'' each place it appears.
    (b) Countries Eligible for Designation.--For purposes of this Act, 
the term ``TRADE Act of 2007 country'' refers to the following or their 
successor political entities:
            (1) Afghanistan.
            (2) Bangladesh.
            (3) Bhutan.
            (4) Cambodia.
            (5) Kiribati.
            (6) Lao People's Democratic Republic.
            (7) Maldives.
            (8) Nepal.
            (9) Samoa.
            (10) Solomon Islands.
            (11) Timor-Leste (East Timor).
            (12) Tuvalu.
            (13) Vanuatu.
            (14) Yemen.
    (c) Sri Lanka Economic Emergency Support.--For purposes of this 
Act, the President may also designate Sri Lanka as a beneficiary TRADE 
Act of 2007 country eligible for benefits described in section 5.

SEC. 5. TRADE ENHANCEMENT.

    (a) Benefits Described.--The benefits described in this section are 
as follows:
            (1) Preferential tariff treatment for certain articles.--
                    (A) In general.--The President may provide duty-
                free treatment for any article described in section 
                503(b)(1) (B) through (G) of the Trade Act of 1974 (19 
                U.S.C. 2463(b)(1) (B) through (G)) that is the growth, 
                product, or manufacture of a beneficiary TRADE Act of 
                2007 country, if, after receiving the advice of the 
                International Trade Commission in accordance with 
                section 503(e) of the Trade Act of 1974 (19 U.S.C. 
                2463(e)), the President determines that such article is 
                not import-sensitive in the context of imports from 
                beneficiary TRADE Act of 2007 countries.
                    (B) Rules of origin.--The duty-free treatment 
                provided under subparagraph (A) shall apply to any 
                article described in that subparagraph that meets the 
                requirements of section 503(a)(2) of the Trade Act of 
                1974 (19 U.S.C. 2463(a)(2)), except that--
                            (i) if the cost or value of materials 
                        produced in the customs territory of the United 
                        States is included with respect to that 
                        article, an amount not to exceed 15 percent of 
                        the appraised value of the article at the time 
                        it is entered that is attributed to such United 
                        States cost or value may be applied toward 
                        determining the percentage referred to in 
                        subparagraph (A) of section 503(a)(2) of the 
                        Trade Act of 1974 (19 U.S.C. 2463(a)(2)); and
                            (ii) the cost or value of the materials 
                        included with respect to that article that are 
                        produced in one or more beneficiary TRADE Act 
                        of 2007 countries or former beneficiary TRADE 
                        Act of 2007 countries shall be applied in 
                        determining such percentage.
            (2) Textile and apparel articles.--
                    (A) In general.--The preferential treatment 
                relating to textile and apparel articles described in 
                section 112 (a) and (b) (1) and (2) of the African 
                Growth and Opportunity Act (19 U.S.C. 3721 (a) and (b) 
                (1) and (2)) shall apply to textile and apparel 
                articles imported directly into the customs territory 
                of the United States from a beneficiary TRADE Act of 
                2007 country and such section shall be applied for 
                purposes of this subparagraph by substituting ``TRADE 
                Act of 2007 country'' and ``TRADE Act of 2007 
                countries'' for ``sub-Saharan African country'' and 
                ``sub-Saharan African countries'', respectively, each 
                place such terms appear.
                    (B) Apparel articles assembled from regional and 
                other fabric.--In applying such section 112, apparel 
                articles wholly assembled in one or more beneficiary 
                TRADE Act of 2007 countries or former beneficiary TRADE 
                Act of 2007 countries, or both, from fabric wholly 
                formed in one or more beneficiary TRADE Act of 2007 
                countries or former beneficiary TRADE Act of 2007 
                countries, or both, from yarn originating either in the 
                United States or one or more beneficiary TRADE Act of 
                2007 countries or former beneficiary TRADE Act of 2007 
                countries, or both (including fabrics not formed from 
                yarns, if such fabrics are classifiable under heading 
                5602 or 5603 of the Harmonized Tariff Schedule of the 
                United States and are wholly formed and cut in the 
                United States, in one or more beneficiary TRADE Act of 
                2007 countries or former beneficiary TRADE Act of 2007 
                countries, or any combination thereof), whether or not 
                the apparel articles are also made from any of the 
                fabrics, fabric components formed, or components knit-
                to-shape described in section 112(b) (1) or (2) of the 
                African Growth and Opportunity Act (unless the apparel 
                articles are made exclusively from any of the fabrics, 
                fabric components formed, or components knit-to-shape 
                described in such section 112(b) (1) or (2)) subject to 
                the following:
                            (i) Limitations on benefits.--
                                    (I) In general.--Preferential 
                                treatment under this subparagraph shall 
                                be extended in the 1-year period 
                                beginning January 1, 2007, and in each 
                                of the succeeding 10 1-year periods, to 
                                imports of apparel articles described 
                                in this subparagraph in an amount not 
                                to exceed the applicable percentage of 
                                the aggregate square meter equivalents 
                                of all apparel articles imported into 
                                the United States in the preceding 12-
                                month period for which data are 
                                available.
                                    (II) Applicable percentage.--For 
                                purposes of this clause, the term 
                                ``applicable percentage'' means 11 
                                percent for the 1-year period beginning 
                                January 1, 2007, increased in each of 
                                the 10 succeeding 1-year period by 
                                equal increments, so that for the 
                                period beginning January 1, 2017 the 
                                applicable percentage does not exceed 
                                14 percent.
                            (ii) Special rule.--
                                    (I) In general.--Subject to clause 
                                (i), preferential treatment described 
                                in this subparagraph shall be extended 
                                through December 31, 2014, for apparel 
                                articles wholly assembled in one or 
                                more beneficiary TRADE Act of 2007 
                                countries or former beneficiary TRADE 
                                Act of 2007 countries, or both, 
                                regardless of the country of origin of 
                                the yarn or fabric used to make such 
                                articles.
                                    (II) Country limitations.--
                                            (aa) Small suppliers.--If, 
                                        during the preceding 1-year 
                                        period beginning on January 1 
                                        for which data are available, 
                                        imports from a beneficiary 
                                        TRADE Act of 2007 country are 
                                        less than 1 percent of the 
                                        aggregate square meter 
                                        equivalents of all apparel 
                                        articles imported into the 
                                        United States during such 
                                        period, such imports may 
                                        increase to an amount that is 
                                        equal to not more than 1.5 
                                        percent of the aggregate square 
                                        meter equivalents of all 
                                        apparel articles imported into 
                                        the United States during such 
                                        period.
                                            (bb) Other suppliers.--If 
                                        during the preceding 1-year 
                                        period beginning on January 1 
                                        for which data are available, 
                                        imports from a beneficiary 
                                        TRADE Act of 2007 country are 
                                        at least 1 percent of the 
                                        aggregate square meter 
                                        equivalents of all apparel 
                                        articles imported into the 
                                        United States during such 
                                        period, such imports may 
                                        increase, during each 
                                        subsequent 12-month period, by 
                                        an amount that is equal to not 
                                        more than one-third of 1 
                                        percent of the aggregate square 
                                        meter equivalents of all 
                                        apparel articles imported into 
                                        the United States.
                                            (cc) Aggregate country 
                                        limit.--In no case may the 
                                        aggregate quantity of textile 
                                        and apparel articles imported 
                                        into the United States under 
                                        this subparagraph exceed the 
                                        applicable percentage set forth 
                                        in clause (i).
                    (C) Technical amendment.--Section 6002(a)(2)(B) of 
                the African Investment Incentive Act of 2006 (Public 
                Law 109-432) is amended by inserting before ``by 
                striking'' the following: ``in paragraph (3),''.
                    (D) Other restrictions.--The provisions of section 
                112(b) (3)(B), (4), (5), (6), (7), and (8), and (e), 
                and section 113 of the African Growth and Opportunity 
                Act (19 U.S.C. 3721(b) (3)(B), (4), (5), (6), (7), and 
                (8), and (e), and 3722) shall apply with respect to the 
                preferential treatment extended under this Act to a 
                beneficiary TRADE Act of 2007 country by substituting 
                ``TRADE Act of 2007 country'' for ``sub-Saharan African 
                country'' and ``TRADE Act of 2007 countries'' and 
                ``former TRADE Act of 2007 countries'' for ``sub-
                Saharan African countries'' wherever appropriate.

SEC. 6. REPORTING REQUIREMENT.

    The President shall monitor, review, and report to Congress, not 
later than 1 year after the date of enactment of this Act, and annually 
thereafter, on the implementation of this Act and on the trade and 
investment policy of the United States with respect to the TRADE Act of 
2007 countries.

SEC. 7. TERMINATION OF PREFERENTIAL TREATMENT.

    No duty-free treatment or other preferential treatment extended to 
a beneficiary TRADE Act of 2007 country under this Act shall remain in 
effect after December 31, 2017.

SEC. 8. EFFECTIVE DATE.

    The provisions of this Act shall take effect on January 1, 2007.
                                 <all>
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