I 

111TH CONGRESS 

2D SESSION H. R. 5298 

To require the Secretary of Defense to take illegal subsidization into account 

in evaluating proposals for contracts for major defense acquisition programs, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 13, 2010 

Mr. TIAHRT (for himself, Mr. LARSEN of Washington, Mr. INSLEE, Mr. 

BLUNT, Mr. SMITH of Texas, Mr. MORAN of Kansas, Mrs. EMERSON, 

Mr. CLAY, Mr. LUETKEMEYER, Mr. CARNAHAN, Ms. JENKINS, Mrs. 

NAPOLITANO, Mr. MANZULLO, Mr. FOSTER, Mr. MCMAHON, Mr. 

LOEBSACK, Mr. WILSON of South Carolina, Mr. BROWN of South Carolina, Mr. DAVIS of Illinois, Mr. CALVERT, Ms. DELAURO, Mr. BACA, Mr. 

COSTELLO, Mr. HASTINGS of Washington, Mr. GERLACH, Mr. ROTHMAN

of New Jersey, Mr. RUSH, Mr. LIPINSKI, and Mr. HARE) introduced the 

following bill; which was referred to the Committee on Armed Services 

A BILL 

To require the Secretary of Defense to take illegal subsidization into account in evaluating proposals for contracts 

for major defense acquisition programs, 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 ‘‘Fair Defense Competi5 tion Act’’. 

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1 SEC. 2. ACCOUNTING FOR ILLEGAL SUBSIDIZATION IN 

2 EVALUATION OF PROPOSALS FOR CON3 TRACTS FOR MAJOR DEFENSE ACQUISITION 

4 PROGRAMS. 

5 (a) REQUIREMENT.— 

6 (1) IN GENERAL.—In awarding a contract for 

7 any major defense acquisition program, the Sec8 retary of Defense shall, in conducting the cost or 

9 price evaluation of any proposal for that contract, 

10 take into account any final panel report described in 

11 paragraph (2) and take the action described in para12 graph (3). 

13 (2) FINAL PANEL REPORT DESCRIBED.—A final 

14 panel report described in this paragraph is the final 

15 report of a dispute settlement panel of the World 

16 Trade Organization, submitted to the parties to a 

17 dispute pursuant to article 4.6 or 7.4 of the Agree18 ment on Subsidies and Countervailing Measures, 

19 that either a prohibited or actionable subsidy has 

20 been provided with respect to any merchandise or 

21 major component thereof, or the development of any 

22 merchandise or major component thereof, if that 

23 merchandise or component is part of a proposal de24 scribed in paragraph (1). 

25 (3) ACTION DESCRIBED.—If the subsidy found 

26 to be prohibited or actionable in the final panel remstockstill on DSKH9S0YB1PROD with BILLS

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1 port has not been withdrawn pursuant to article 4.7 

2 or 7.8 of the Agreement on Subsidies and Counter3 vailing Measures, the action described in this para4 graph is, in conducting the cost or price evaluation 

5 of a proposal, the Secretary shall increase the cost 

6 or price of the proposal by the amount of the sub7 sidy found to be prohibited or actionable in the final 

8 panel report described in paragraph (2), as cal9 culated jointly by the Secretary of Commerce and 

10 the United States Trade Representative after notifi11 cation is made by the Secretary of Defense for the 

12 need for such a calculation. 

13 (b) DEFINITIONS.—In this section: 

14 (1) AGREEMENT ON SUBSIDIES AND COUNTER15 VAILING MEASURES.—The term ‘‘Agreement on Sub16 sidies and Countervailing Measures’’ means the 

17 Agreement on Subsidies and Countervailing Meas18 ures described in section 101(d)(12) of the Uruguay 

19 Round Agreements Act (19 U.S.C. 3511(d)(12)). 

20 (2) COST OR PRICE EVALUATION.—The term 

21 ‘‘cost or price evaluation’’ means an evaluation con22 ducted by a source selection authority pursuant to 

23 subpart 15.305(a)(1) of the Federal Acquisition 

24 Regulation. 

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1 (3) MAJOR DEFENSE ACQUISITION PROGRAM.— 

2 The term ‘‘major defense acquisition program’’ has 

3 the meaning given that term in section 2430 of title 

4 10, United States Code. 

5 (4) PROHIBITED OR ACTIONABLE SUBSIDY.— 

6 The term ‘‘prohibited or actionable subsidy’’ means 

7 a subsidy that is inconsistent with the Agreement on 

8 Subsidies and Countervailing Measures because the 

9 subsidy is a prohibited or actionable subsidy under 

10 the Agreement. 

Æ 

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