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[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 796 Introduced in Senate (IS)]

110th CONGRESS
  1st Session
                                 S. 796

 To amend title VII of the Tariff Act of 1930 to provide that exchange-
  rate misalignment by any foreign nation is a countervailable export 
subsidy, to amend the Exchange Rates and International Economic Policy 
Coordination Act of 1988 to clarify the definition of manipulation with 
              respect to currency, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             March 7, 2007

 Mr. Bunning (for himself, Ms. Stabenow, Mr. Bayh, Ms. Snowe, and Mr. 
Levin) introduced the following bill; which was read twice and referred 
                      to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
 To amend title VII of the Tariff Act of 1930 to provide that exchange-
  rate misalignment by any foreign nation is a countervailable export 
subsidy, to amend the Exchange Rates and International Economic Policy 
Coordination Act of 1988 to clarify the definition of manipulation with 
              respect to currency, 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 ``Fair Currency Act of 2007''.

      TITLE I--SUBSIDIES AND PRODUCT-SPECIFIC SAFEGUARD MECHANISM

SEC. 101. FINDINGS.

    Congress makes the following findings:
            (1) The economy and national security of the United States 
        are critically dependent upon a vibrant manufacturing and 
        agricultural base.
            (2) The good health of United States manufacturing and 
        agriculture requires, among other things, unfettered access to 
        open markets abroad and fairly traded raw materials and 
        products in accord with the international legal principles and 
        agreements of the World Trade Organization and the 
        International Monetary Fund.
            (3) The International Monetary Fund, the G-8, and other 
        international organizations have repeatedly noted that 
        exchange-rate misalignment can cause imbalances in the 
        international trading system that could ultimately undercut the 
        stability of the system, but have taken no action to redress 
        such misalignments and imbalances.
            (4) Since 1994, the People's Republic of China and other 
        countries have repeatedly intervened in currency markets and 
        taken measures that have significantly misaligned the values of 
        their currencies against the United States dollar and other 
        currencies.
            (5) This policy by the People's Republic of China, for 
        example, has resulted in substantial undervaluation of the 
        renminbi, by up to 40 percent or more.
            (6) Evidence of this undervaluation can be found in the 
        large and growing annual trade surpluses of the People's 
        Republic of China; substantially expanding foreign direct 
        investment in China; and the rapidly increasing aggregate 
        amount of foreign currency reserves that are held by the 
        People's Republic of China.
            (7) Undervaluation by the People's Republic of China and by 
        other countries acts as both a subsidy for their exports and as 
        a nontariff barrier against imports into their territories, to 
        the serious detriment of United States manufacturing and 
        agriculture.
            (8)(A) As members of both the World Trade Organization and 
        the International Monetary Fund, the People's Republic of China 
        and other countries have assumed a series of international 
        legal obligations to eliminate all subsidies for exports and to 
        facilitate international trade by fostering a monetary system 
        that does not tend to produce erratic disruptions, that does 
        not prevent effective balance-of-payments adjustment, and that 
        does not gain unfair competitive advantage.
            (B) These obligations are most prominently set forth in--
                    (i) Articles VI, XV, and XVI of the GATT 1994 (as 
                defined in section 2(1)(B) of the Uruguay Round 
                Agreements Act (19 U.S.C. 3501(1)(B));
                    (ii) the Agreement on Subsidies and Countervailing 
                Measures (as described in section 101(d)(12) of the 
                Uruguay Round Agreements Act (19 U.S.C. 3511(d)(12)); 
                and
                    (iii) Articles IV and VIII of the International 
                Monetary Fund's Articles of Agreement.
            (9) Under the foregoing circumstances, it is consistent 
        with the international legal obligations of the People's 
        Republic of China and similarly situated countries and with the 
        corresponding international legal rights of the United States 
        to amend relevant United States trade laws to make explicit 
        that exchange-rate misalignment by any country is actionable as 
        a countervailable export subsidy.

SEC. 102. APPLICATION OF COUNTERVAILING DUTIES TO NONMARKET ECONOMY 
              COUNTRIES.

    (a) In General.--Section 701(a)(1) of the Tariff Act of 1930 (19 
U.S.C. 1671(a)(1)) is amended by inserting ``(including a nonmarket 
economy country)'' after ``country'' each place it appears.
    (b) Use of Alternate Methodologies.--Section 771(5)(E) of the 
Tariff Act of 1930 (19 U.S.C. 1677(5)(E)) is amended by adding at the 
end the following: ``With respect to a nonmarket economy country, for 
purposes of identifying and measuring a subsidy benefit described in 
clause (i), (ii), (iii), or (iv), or otherwise conferred upon a 
recipient, the administering authority shall use methodologies that 
take into account the possibility that prevailing terms and conditions 
in that country might not be available or might themselves be 
inappropriate benchmarks due to market distortions. In such 
circumstances, unless it is demonstrated that the nonmarket economy 
country's prevailing terms and conditions practicably can be adjusted 
to serve as appropriate benchmarks, the administering authority shall 
use as benchmarks appropriate terms and conditions prevailing outside 
the nonmarket economy country. When the party in possession of the 
information necessary to identify and measure the benefit of a subsidy 
does not timely and completely submit that information for the record, 
the administering authority shall use for that purpose the facts 
otherwise available and shall, as warranted, draw adverse 
inferences.''.
    (c) Adjustments For Export Price and Constructed Export Price.--
Section 772(c)(1)(C) of the Tariff Act of 1930 (19 U.S.C. 
1677a(c)(1)(C)) is amended by inserting before the end comma the 
following: ``, whether the subject merchandise is from a country with a 
market economy, a nonmarket economy, or a combination thereof''.
    (d) Effective Date.--The amendments made by subsections (a), (b), 
and (c) apply with respect to a countervailing duty proceeding 
initiated under subtitle A of title VII of the Tariff Act of 1930 
before, on, or after the date of enactment of this Act.
    (e) Antidumping Provisions Not Affected.--The amendments made by 
subsections (a), (b), and (c) shall not affect the status of a country 
as a nonmarket economy country for the purposes of any matter relating 
to antidumping duties under the Tariff Act of 1930.

SEC. 103. CLARIFICATION TO INCLUDE EXCHANGE-RATE MISALIGNMENT AS A 
              COUNTERVAILABLE SUBSIDY UNDER TITLE VII OF THE TARIFF ACT 
              OF 1930.

    (a) Amendments to Definition of Countervailable Subsidy.--
            (1) Financial contribution.--Section 771(5)(D) of the 
        Tariff Act of 1930 (19 U.S.C. 1677(5)(D)) is amended--
                    (A) by redesignating clauses (i) through (iv) as 
                subclauses (I) through (IV), respectively;
                    (B) by striking ``The term'' and inserting ``(i) 
                The term''; and
                    (C) by adding at the end the following:
                            ``(ii) Exchange-rate misalignment (as 
                        defined in paragraph (5C)) constitutes a 
                        financial contribution within the meaning of 
                        subclauses (I) and (III) of clause (i).''.
            (2) Benefit conferred.--Section 771(5)(E) of the Tariff Act 
        of 1930 (19 U.S.C. 1677(5)(E)) is amended--
                    (A) in clause (iii), by striking ``, and'' and 
                inserting a comma;
                    (B) in clause (iv), by striking the period at the 
                end and inserting ``, and''; and
                    (C) by inserting after clause (iv) the following 
                new clause:
                            ``(v) in the case of exchange-rate 
                        misalignment (as defined in paragraph (5C)), if 
                        the price of exported goods in United States 
                        dollars is less than what the price of such 
                        goods would be without the exchange-rate 
                        misalignment.''.
            (3) Specificity.--Section 771(5A)(B) of the Tariff Act of 
        1930 (19 U.S.C. 1677(5A)(B)) is amended by inserting before the 
        period at the end the following: ``, such as exchange-rate 
        misalignment (as defined in paragraph (5C))''.
    (b) Definition of Exchange-Rate Misalignment.--Section 771 of the 
Tariff Act of 1930 (19 U.S.C. 1677) is amended by inserting after 
paragraph (5B) the following new paragraph:
            ``(5C) Exchange-rate misalignment.--
                    ``(A) In general.--For purposes of paragraphs (5) 
                and (5A), the term `exchange-rate misalignment' means 
                an undervaluation of a foreign currency as a result of 
                protracted large-scale intervention by or at the 
                direction of a governmental authority in the exchange 
                market. Such undervaluation shall be found when the 
                observed exchange rate for a foreign currency is below 
                the exchange rate that could reasonably be expected for 
                that foreign currency absent the intervention.
                    ``(B) Factors.--In determining whether exchange-
                rate misalignment is occurring and a benefit thereby is 
                conferred, the administering authority in each case--
                            ``(i) shall consider the exporting 
                        country's--
                                    ``(I) bilateral balance-of-trade 
                                surplus or deficit with the United 
                                States;
                                    ``(II) balance-of-trade surplus or 
                                deficit with its other trading partners 
                                individually and in the aggregate;
                                    ``(III) foreign direct investment 
                                in its territory;
                                    ``(IV) currency-specific and 
                                aggregate amounts of foreign currency 
                                reserves; and
                                    ``(V) mechanisms employed to 
                                maintain its currency at an undervalued 
                                exchange rate relative to another 
                                currency and, particularly, the nature, 
                                duration, and monetary expenditures of 
                                those mechanisms;
                            ``(ii) may consider such other economic 
                        factors as are relevant; and
                            ``(iii) shall measure the trade surpluses 
                        or deficits described in subclauses (I) and 
                        (II) of clause (i) with reference to the trade 
                        data reported by the United States and the 
                        other trading partners of the exporting 
                        country, unless such trade data are not 
                        available or are demonstrably inaccurate, in 
                        which case the exporting country's trade data 
                        may be relied upon if shown to be sufficiently 
                        accurate and trustworthy.
                    ``(C) Computation.--In quantifying exchange-rate 
                misalignment, the administering authority shall develop 
                and apply an objective methodology that is consistent 
                with widely recognized macroeconomic theory and shall 
                rely upon governmentally published and other publicly 
                available and reliable data.
                    ``(D) Type of economy.--An authority found to be 
                engaged in exchange-rate misalignment may have either a 
                market economy or a nonmarket economy or a combination 
                thereof.''.
    (c) Effective Date.--The amendments made by this section apply with 
respect to a countervailing duty proceeding initiated under subtitle A 
of title VII of the Tariff Act of 1930 before, on, or after the date of 
enactment of this Act.

SEC. 104. CLARIFICATION TO INCLUDE EXCHANGE-RATE MISALIGNMENT BY THE 
              PEOPLE'S REPUBLIC OF CHINA AS A CONDITION TO BE 
              CONSIDERED WITH RESPECT TO MARKET DISRUPTION UNDER 
              CHAPTER 2 OF TITLE IV OF THE TRADE ACT OF 1974.

    (a) Market Disruption.--
            (1) In general.--Section 421(c) of the Trade Act of 1974 
        (19 U.S.C. 2451(c)) is amended by adding at the end the 
        following new paragraphs:
            ``(3) For purposes of this section, the term `under such 
        conditions' includes exchange-rate misalignment (as defined in 
        paragraph (4)).
            ``(4)(A) For purposes of this section, the term `exchange-
        rate misalignment' means an undervaluation of the renminbi as a 
        result of protracted large-scale intervention by or at the 
        direction of the Government of the People's Republic of China 
        in the exchange market. Such undervaluation shall be found when 
        the observed exchange rate for the renminbi is below the 
        exchange rate that could reasonably be expected for the 
        renminbi absent the intervention.
            ``(B) In determining whether exchange-rate misalignment is 
        occurring, the Commission in each case--
                    ``(i) shall consider the People's Republic of 
                China's--
                            ``(I) bilateral balance-of-trade surplus or 
                        deficit with the United States;
                            ``(II) balance-of-trade surplus or deficit 
                        with its other trading partners individually 
                        and in the aggregate;
                            ``(III) foreign-direct investment in its 
                        territory;
                            ``(IV) currency-specific and aggregate 
                        amounts of foreign currency reserves; and
                            ``(V) mechanisms employed to maintain its 
                        currency at an undervalued exchange rate 
                        relative to another currency and, particularly, 
                        the nature, duration, and monetary expenditures 
                        of those mechanisms;
                    ``(ii) may consider such other economic factors as 
                are relevant; and
                    ``(iii) shall measure the trade surpluses or 
                deficits described in subclauses (I) and (II) of clause 
                (i) with reference to the trade data reported by the 
                United States and the other trading partners of the 
                People's Republic of China, unless such trade data are 
                not available or are demonstrably inaccurate, in which 
                case the trade data of the People's Republic of China 
                may be relied upon if shown to be sufficiently accurate 
                and trustworthy.
            ``(C) Computation.--In quantifying exchange-rate 
        misalignment, the Commission shall develop and apply an 
        objective methodology that is consistent with widely recognized 
        macroeconomic theory and shall rely upon governmentally 
        published and other publicly available and reliable data.''.
    (b) Critical Circumstances.--Section 421(i)(1) of the Trade Act of 
1974 (19 U.S.C. 2451(i)(1)) is amended by inserting after subparagraph 
(B) the following:
``If the petition alleges and reasonably documents that exchange-rate 
misalignment is occurring, such exchange-rate misalignment shall be 
considered as a factor weighing in favor of affirmative findings in 
subparagraphs (A) and (B).''.
    (c) Standard for Presidential Action.--Section 421(k)(2) of the 
Trade Act of 1974 (19 U.S.C. 2451(k)(2)) is amended by adding at the 
end the following new sentence: ``If the Commission makes an 
affirmative determination that exchange-rate misalignment is occurring, 
the President shall consider such exchange-rate misalignment as a 
factor weighing in favor of providing import relief in accordance with 
subsection (a).''.
    (d) Modifications of Relief.--Section 421(n)(2) of the Trade Act of 
1974 (19 U.S.C. 2451(n)(2)) is amended by adding at the end the 
following new sentence: ``If the Commission affirmatively determines 
that exchange-rate misalignment is occurring, the Commission and the 
President shall consider such exchange-rate misalignment as a factor 
weighing in favor of finding that continuation of relief is necessary 
to prevent or remedy the market disruption at issue.''.
    (e) Extension of Action.--Section 421(o) of the Trade Act of 1974 
(19 U.S.C. 2451(o)) is amended--
            (1) in paragraph (1), by adding at the end the following 
        new sentence: ``If the Commission makes an affirmative 
        determination that exchange-rate misalignment is occurring, the 
        Commission shall consider such exchange-rate misalignment as a 
        factor weighing in favor of finding that an extension of the 
        period of relief is necessary to prevent or remedy the market 
        disruption at issue.''; and
            (2) in paragraph (4), by adding at the end the following 
        new sentence: ``If the Commission makes an affirmative 
        determination that exchange-rate misalignment is occurring, the 
        President shall consider such exchange-rate misalignment as a 
        factor weighing in favor of finding that an extension of the 
        period of relief is necessary to prevent or remedy the market 
        disruption at issue.''.
    (f) Effective Date.--The amendments made by this section apply with 
respect to an investigation initiated under chapter 2 of title IV of 
the Trade Act of 1974 before, on, or after the date of the enactment of 
this Act.

SEC. 105. PROHIBITION ON PROCUREMENT BY THE DEPARTMENT OF DEFENSE OF 
              CERTAIN DEFENSE ARTICLES IMPORTED FROM THE PEOPLE'S 
              REPUBLIC OF CHINA.

    (a) Copy of Petition, Request, or Resolution To Be Transmitted to 
the Secretary of Defense.--Section 421(b)(4) of the Trade Act of 1974 
(19 U.S.C. 2451(b)(4)) is amended by inserting ``, the Secretary of 
Defense'' after ``, the Trade Representative''.
    (b) Determination of Secretary of Defense.--Section 421(b) of the 
Trade Act of 1974 (19 U.S.C. 2451(b)) is amended by adding at the end 
the following new paragraph:
            ``(6) Not later than 15 days after the date on which an 
        investigation is initiated under this subsection, the Secretary 
        of Defense shall submit to the Commission a report in writing 
        which contains the determination of the Secretary as to whether 
        or not the articles of the People's Republic of China that are 
        the subject of the investigation are like or directly 
        competitive with articles produced by a domestic industry that 
        are critical to the defense industrial base of the United 
        States.''.
    (c) Prohibition on Procurement by the Department of Defense of 
Certain Defense Articles.--
            (1) Prohibition.--If the United States International Trade 
        Commission makes an affirmative determination under section 
        421(b) of the Trade Act of 1974 (19 U.S.C. 2451(b)), or a 
        determination which the President or the United States Trade 
        Representative may consider as affirmative under section 421(e) 
        of such Act (19 U.S.C. 2451(e)), with respect to articles of 
        the People's Republic of China that the Secretary of Defense 
        has determined are like or directly competitive with articles 
        produced by a domestic industry that are critical to the 
        defense industrial base of the United States, the Secretary of 
        Defense may not procure, directly or indirectly, such articles 
        of the People's Republic of China.
            (2) Waiver.--The President may waive the application of the 
        prohibition contained in paragraph (1) on a case-by-case basis 
        if the President determines and certifies to Congress that it 
        is in the national security interests of the United States to 
        do so.

SEC. 106. APPLICATION TO GOODS FROM CANADA AND MEXICO.

    Pursuant to article 1902 of the North American Free Trade Agreement 
and section 408 of the North American Free Trade Agreement 
Implementation Act of 1993 (19 U.S.C. 3438), the amendments made by 
sections 102, 103, and 206 of this Act shall apply to goods from Canada 
and Mexico.

         TITLE II--INTERNATIONAL MONETARY AND FINANCIAL POLICY

SEC. 201. FINDINGS.

    Congress makes the following findings:
            (1) Since the Exchange Rates and International Economic 
        Policy Coordination Act of 1988 (22 U.S.C. 5302(3)) was enacted 
        the global economy has changed dramatically, with increased 
        capital account openness, a sharp increase in the flow of funds 
        internationally, and an ever growing number of emerging market 
        economies becoming systemically important to the global flow of 
        goods, services, and capital. In addition, practices such as 
        the maintenance of multiple currency regimes have become rare.
            (2) Exchange rates among major trading nations are 
        occasionally manipulated or fundamentally misaligned due to 
        direct or indirect governmental intervention in the exchange 
        market.
            (3) A major focus of national economic policy should be a 
        market-driven exchange rate for the United States dollar at a 
        level consistent with a sustainable balance in the United 
        States current account.
            (4) While some degree of surpluses and deficits in payments 
        balances may be expected, particularly in response to 
        increasing economic globalization, large and growing imbalances 
        raise concerns of possible disruption to financial markets. In 
        part, such imbalances often reflect exchange rate policies that 
        foster fundamental misalignment of currencies.
            (5) Currencies in fundamental misalignment can seriously 
        impair the ability of international markets to adjust 
        appropriately to global capital and trade flows, distorting 
        trade flows and causing economic harm to the United States.
            (6) The effects of a fundamentally misaligned currency may 
        be so harmful that it is essential to correct the fundamental 
        misalignment without regard to the purpose of any policy that 
        contributed to the misalignment.
            (7) In the interests of facilitating the exchange of goods, 
        services, and capital among countries, sustaining sound 
        economic growth, and fostering financial and economic 
        stability, Article IV of the International Monetary Fund's 
        Articles of Agreement obligates each member of the 
        International Monetary Fund to avoid manipulating exchange 
        rates in order to prevent effective balance of payments 
        adjustments or to gain an unfair competitive advantage over 
        other members.
            (8) The failure of a government to acknowledge a 
        fundamental misalignment of its currency or to take timely and 
        effective steps to correct such a fundamental misalignment, 
        either through inaction or mere token action, is a form of 
        exchange rate manipulation and is inconsistent with that 
        government's obligations under Article IV of the International 
        Monetary Fund's Articles of Agreement.

SEC. 202. AMENDMENTS TO DEFINITIONS.

    Section 3006 of the Exchange Rates and International Economic 
Policy Coordination Act of 1988 (22 U.S.C. 5306) is amended by adding 
at the end the following:
            ``(3) Fundamental misalignment.--The term `fundamental 
        misalignment' means a material sustained disparity between the 
        observed levels of an effective exchange rate for a currency 
        and the corresponding levels of an effective exchange rate for 
        that currency that would be consistent with fundamental 
        macroeconomic conditions based on a generally accepted economic 
        rationale.
            ``(4) Effective exchange rate.--The term `effective 
        exchange rate' means a weighted average of bilateral exchange 
        rates, expressed in either nominal or real terms.
            ``(5) Generally accepted economic rationale.--The term 
        `generally accepted economic rationale' means an explanation 
        drawn on widely recognized macroeconomic theory for which there 
        is a significant degree of empirical support.''.

SEC. 203. BILATERAL NEGOTIATIONS.

    Section 3004(b) of the Exchange Rates and International Economic 
Policy Coordination Act of 1988 (22 U.S.C. 5304(b)) is amended to read 
as follows:
    ``(b) Bilateral Negotiations.--
            ``(1) In general.--The Secretary of the Treasury shall 
        analyze on an annual basis the exchange rate policies of 
        foreign countries, in consultation with the International 
        Monetary Fund, and consider whether countries--
                    ``(A) manipulate the rate of exchange between their 
                currency and the United States dollar for purposes of 
                preventing effective balance of payments adjustments or 
                gaining unfair competitive advantage in international 
                trade; or
                    ``(B) have a currency that is in fundamental 
                misalignment.
            ``(2) Affirmative determination.--If the Secretary 
        considers that such manipulation or fundamental misalignment is 
        occurring with respect to countries that--
                    ``(A) have material global current account 
                surpluses; or
                    ``(B) have significant bilateral trade surpluses 
                with the United States,
        the Secretary of the Treasury shall take action to initiate 
        negotiations with such foreign countries on an expedited basis, 
        in the International Monetary Fund or bilaterally, for the 
        purpose of ensuring that such countries regularly and promptly 
        adjust the rate of exchange between their currencies and the 
        United States dollar to permit effective balance of payments 
        adjustments and to eliminate the unfair advantage.
            ``(3) Exception.--The Secretary shall not be required to 
        initiate negotiations if the Secretary determines that such 
        negotiations would have a serious detrimental impact on vital 
        national economic and security interests. The Secretary shall 
        inform the chairman and the ranking minority member of the 
        Committee on Banking, Housing, and Urban Affairs of the Senate 
        and of the Committee on Financial Services of the House of 
        Representatives of the Secretary's determination.''.

SEC. 204. REPORTING REQUIREMENTS.

    Section 3005 of the Exchange Rates and International Economic 
Policy Coordination Act of 1988 (22 U.S.C. 5305) is amended to read as 
follows:

``SEC. 3005. REPORTING REQUIREMENTS.

    ``(a) Reports Required.--
            ``(1) In general.--The Secretary, after consulting with the 
        Chairman of the Board, shall submit to Congress, on or before 
        October 15 of each year, a written report on international 
        economic policy and currency exchange rates.
            ``(2) Interim report.--The Secretary, after consulting with 
        the Chairman of the Board, shall submit to Congress, on or 
        before April 15 of each year, a written report on interim 
        developments with respect to international economic policy and 
        currency exchange rates.
    ``(b) Contents of Reports.--Each report submitted under subsection 
(a) shall contain--
            ``(1) an analysis of currency market developments and the 
        relationship between the United States dollar and the 
        currencies of major economies and United States trading 
        partners;
            ``(2) a review of the economic and financial policies of 
        major economies and United States trading partners and an 
        evaluation of the impact that such policies have on currency 
        exchange rates;
            ``(3) a description of any currency intervention by the 
        United States or other major economies or United States trading 
        partners, or other actions undertaken to adjust the actual 
        exchange rate of the dollar;
            ``(4) an evaluation of the factors that underlie conditions 
        in the currency markets, including--
                    ``(A) monetary and financial conditions;
                    ``(B) foreign exchange reserve accumulation;
                    ``(C) macroeconomic trends;
                    ``(D) trends in current and financial account 
                balances;
                    ``(E) the size and composition of, and changes in, 
                international capital flows;
                    ``(F) the impact of the external sector on economic 
                changes;
                    ``(G) the size and growth of external indebtedness;
                    ``(H) trends in the net level of international 
                investment; and
                    ``(I) capital controls, trade, and exchange 
                restrictions;
            ``(5) a list of currencies of the major economies or 
        economic areas that are manipulated or in fundamental 
        misalignment and a description of any economic models or 
        methodologies used to establish the list;
            ``(6) a description of any reason or circumstance that 
        accounts for why each currency identified under paragraph (5) 
        is manipulated or in fundamental misalignment based on a 
        generally accepted economic rationale;
            ``(7) a list of each currency identified under paragraph 
        (5) for which the manipulation or fundamental misalignment 
        causes, or contributes to, a material adverse impact on the 
        economy of the United States, including a description of any 
        reason or circumstance that explains why the manipulation or 
        fundamental misalignment is not accounted for under paragraph 
        (6);
            ``(8) the results of any prior consultations conducted or 
        other steps taken; and
            ``(9)(A) a list of each occasion during the reporting 
        period when the issue of exchange-rate misalignment was raised 
        in a countervailing duty proceeding under subtitle A of title 
        VII of the Tariff Act of 1930 or in an investigation under 
        section 421 of the Trade Act of 1974;
            ``(B) a summary in each such instance of whether or not 
        exchange-rate misalignment was found and the reasoning and data 
        underlying that finding; and
            ``(C) a discussion regarding each affirmative finding of 
        exchange-rate misalignment to consider the circumstances 
        underlying that exchange-rate misalignment and what action 
        appropriately has been or might be taken by the Secretary apart 
        from and in addition to import relief to correct the exchange-
        rate misalignment.
    ``(c) Development of Reports.--The Secretary shall consult with the 
Chairman of the Board with respect to the preparation of each report 
required under subsection (a). Any comments provided by the Chairman of 
the Board shall be submitted to the Secretary not later than the date 
that is 15 days before the date each report is due under subsection 
(a). The Secretary shall submit the report after taking into account 
all comments received.''.

SEC. 205. INTERNATIONAL FINANCIAL INSTITUTION GOVERNANCE ARRANGEMENTS.

    (a) Initial Review.--Notwithstanding any other provision of law, 
before the United States approves a proposed change in the governance 
arrangement of any international financial institution, as defined in 
section 1701(c)(2) of the International Financial Institutions Act (22 
U.S.C. 262r(c)(2)), the Secretary of the Treasury shall determine 
whether any member of the international financial institution that 
would benefit from the proposed change, in the form of increased voting 
shares or representation, has a currency that is manipulated or in 
fundamental misalignment, and if so, whether the manipulation or 
fundamental misalignment causes or contributes to a material adverse 
impact on the economy of the United States. The determination shall be 
reported to Congress.
    (b) Subsequent Action.--The United States shall oppose any proposed 
change in the governance arrangement of any international financial 
institution (as defined in subsection (a)) if the Secretary renders an 
affirmative determination pursuant to subsection (a).
    (c) Further Action.--The United States shall continue to oppose any 
proposed change in the governance arrangement of an international 
financial institution, pursuant to subsection (b), until the Secretary 
determines and reports to Congress that the currency of each member of 
the international financial institution that would benefit from the 
proposed change, in the form of increased voting shares or 
representation, is neither manipulated nor in fundamental misalignment.

SEC. 206. NONMARKET ECONOMY STATUS.

    Paragraph (18)(B)(vi) of section 771 of the Tariff Act of 1930 (19 
U.S.C. 1677(18)(B)(vi)) is amended by inserting before the period at 
the end the following: ``, including whether the currency of the 
foreign country has been identified pursuant to section 3005(b)(7) of 
the Exchange Rates and International Economic Policy Coordination Act 
of 1988 (22 U.S.C. 5305(b)(7)) in any written report required by such 
section 3005(b)(7) during the 24-month period immediately preceding the 
month during which the administering authority seeks to revoke a 
determination that such foreign country is a nonmarket economy 
country''.
                                 <all>
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