II

106TH CONGRESS

2D SESSION S. 2115

To ensure adequate monitoring of the commitments made by the People’s

Republic of China in its accession to the World Trade Organization

and to create new procedures to ensure compliance with those commitments.

IN THE SENATE OF THE UNITED STATES

FEBRUARY 29, 2000

Mr. BAUCUS (for himself, Mr. MURKOWSKI, Mr. BINGAMAN, Mr. AKAKA, Mr.

WYDEN, and Mr. DORGAN) introduced the following bill; which was read

twice and referred to the Committee on Finance

A BILL

To ensure adequate monitoring of the commitments made

by the People’s Republic of China in its accession to

the World Trade Organization and to create new procedures to ensure compliance with those commitments.

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 ‘‘China-World Trade

5 Organization Compliance Act’’.

6 SEC. 2. FINDINGS.

7 Congress makes the following findings:
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1 (1) On November 15, 1999, the United States

2 Trade Representative announced the completion of a

3 bilateral agreement with the People’s Republic of

4 China regarding accession of the People’s Republic

5 of China to the World Trade Organization.

6 (2) Congress must grant the People’s Republic

7 of China permanent normal trade relations status in

8 order for the United States to receive all the benefits

9 of China’s accession to the World Trade Organiza10 tion.

11 (3) The People’s Republic of China has been a

12 centrally planned, nonmarket economy since its

13 founding in 1949.

14 (4) In 1978, the People’s Republic of China ini15 tiated the first in a series of economic reforms and

16 has made some meaningful and desirable progress in

17 opening up its economy to imports, exports, and in18 vestment.

19 (5) Granting permanent normal trade relations

20 to China would help cement the economic reforms

21 that have taken place thus far and would help those

22 Chinese leaders who are committed to economic re23 form to institutionalize these reforms.

24 (6) Despite these reforms, the People’s Repub25 lic of China is still largely a nonmarket economy and
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1 the People’s Republic of China is still a long way

2 from meeting international standards of trans3 parency, legal accountability, reliability of statistics,

4 and uniform application of law.

5 (7) The viability and credibility of the World

6 Trade Organization and the health of the world

7 trading system require that the People’s Republic of

8 China adheres fully to the bilateral and multilateral

9 commitments it makes during the accession process.

10 (8) Current trade monitoring and enforcement

11 mechanisms within the United States Government

12 and within the World Trade Organization are not

13 designed to take account of the unique Chinese eco14 nomic structure.

15 (9) The General Accounting Office has reported

16 that even simple recordkeeping of agreements in var17 ious executive agencies is inadequate and incomplete.

18 (10) It is necessary to establish new mecha19 nisms, both within the executive branch and within

20 Congress, to ensure adequate and continual moni21 toring and enforcement of China’s commitments at

22 the World Trade Organization.

23 (11) The opaque features of the Chinese econ24 omy, the nonuniform implementation of Chinese

25 Government economic policies, the decentralized na-
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1 ture of Chinese Government economic management,

2 and the new nature of Chinese Government commit3 ments under the World Trade Organization, make it

4 necessary to create a comprehensive, multiagency ef5 fort to monitor China’s compliance with its commit6 ments.

7 (12) Various Federal agencies should be tasked

8 with different aspects of monitoring China’s compli9 ance with its commitments.

10 SEC. 3. MONITORING.

11 (a) PLAN.—

12 (1) IN GENERAL.—Not later than 90 days after

13 the date that the People’s Republic of China accedes

14 to the World Trade Organization, the President

15 shall submit a detailed plan to Congress for moni16 toring the People’s Republic of China’s compliance

17 with the commitments it makes as part of that ac18 cession.

19 (2) CONTENT OF PLAN.—The plan described in

20 paragraph (1) shall—

21 (A) include specific assignments to Federal

22 agencies with respect to monitoring China’s

23 compliance; and
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1 (B) provide for a mechanism to assure

2 public participation in evaluating China’s com3 pliance with its commitments.

4 (3) ESTIMATE OF COSTS FOR MONITORING AC5 TIVITIES.—The President shall submit to Congress,

6 as part of the plan described in paragraph (1), an

7 estimate of the cost for conducting the monitoring

8 activities required under this Act.

9 (4) ANNUAL UPDATES.—The President shall

10 annually submit to Congress an updated and revised

11 plan as part of the President’s report to Congress

12 described in section 4.

13 (b) GAO SURVEY AND REPORT.—

14 (1) IN GENERAL.—In order to determine the

15 degree to which the People’s Republic of China is

16 complying with its World Trade Organization com17 mitments and to obtain information about any prob18 lems encountered by United States businesses, the

19 Comptroller General of the United States shall sur20 vey annually the 50 United States companies doing

21 the most business with the People’s Republic of

22 China in each of the following categories:

23 (A) Exporting nonagricultural goods.

24 (B) Exporting agricultural goods.

25 (C) Exporting or providing services.
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1 (D) Investing.

2 (E) Importing goods.

3 (2) REPORT.—The Comptroller General shall

4 submit a report to Congress on the results of the

5 survey described in paragraph (1).

6 (c) REPORT BY ITC.—The International Trade Com7 mission shall report annually to Congress on United

8 States-China bilateral export and import statistics, includ9 ing, to the extent practicable, reconciling any differences

10 in United States-source and Chinese-source data.

11 SEC. 4. REPORT ON COMPLIANCE.

12 (a) IN GENERAL.—Not later than 1 year after the

13 People’s Republic of China accedes to the World Trade

14 Organization, and annually thereafter, the United States

15 Trade Representative shall submit a report to Congress

16 on China’s compliance with its commitments made in con17 nection with its accession to the World Trade Organiza18 tion, including both multilateral commitments and any bi19 lateral commitments made to the United States.

20 (b) PUBLIC PARTICIPATION.—In preparing the re21 port described in subsection (a), the United States Trade

22 Representative shall seek public participation by pub23 lishing a notice in the Federal Register and holding a pub24 lic hearing.
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1 (c) CONTENT.—The report described in subsection

2 (a) shall include the results of monitoring China’s compli3 ance, and the specific conclusions reached by each Federal

4 agency assigned responsibility for monitoring.

5 SEC. 5. ACTION BY COMMITTEES.

6 (a) SECTION 301 ACTION.—

7 (1) IN GENERAL.—Notwithstanding any other

8 provision of law, the Committee on Finance of the

9 Senate and the Committee on Ways and Means of

10 the House of Representatives, after considering the

11 report described in section 4 and holding hearings

12 on the report—

13 (A) may, by majority vote of either com14 mittee, instruct the United States Trade Rep15 resentative to take appropriate action pursuant

16 to title III of the Trade Act of 1974 (19 U.S.C.

17 2411 et seq.), after initiating an investigation

18 under section 301 of such Act to determine

19 under section 304(a)(1) of such Act if—

20 (i) the rights of the United States

21 under any trade agreement are being de22 nied; or

23 (ii) an act, policy, or practice of the

24 People’s Republic of China—
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1 (I) violates, or is inconsistent

2 with, the provisions of, or otherwise

3 denies benefits to the United States

4 under, any trade agreement; or

5 (II) is unjustifiable and burdens

6 or restricts United States commerce;

7 or

8 (B) may, by majority vote of both commit9 tees, instruct the United States Trade Rep10 resentative to initiate action before the Dispute

11 Settlement Body (as defined in section 121(5)

12 of the Uruguay Round Agreements Act).

13 (2) ADVERSE INFERENCE.—Section 304(a) of

14 the Trade Act of 1974 (19 U.S.C. 2414(a)) is

15 amended by adding at the end the following new

16 paragraph:

17 ‘‘(5) If the foreign country against which an in18 vestigation is initiated under this chapter fails or re19 fuses to cooperate in the investigation, the Trade

20 Representative may draw an inference adverse to the

21 interests of the country for purposes of making an

22 affirmative determination under paragraph (1).’’.

23 (b) INITIATION OF OTHER ACTION.—

24 (1) IN GENERAL.—Upon completion of an in25 vestigation described in subsection (a)(1)(B), if the
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1 United States Trade Representative determines that

2 an act, policy, or practice of the People’s Republic

3 of China) violates, or is inconsistent with, the provi4 sions of, or otherwise denies benefits to the United

5 States under, any trade agreement (including the

6 commitments made by the People’s Republic of

7 China as part of its accession to the World Trade

8 Organization), the United States Trade Representa9 tive shall initiate an action before the Dispute Set10 tlement Body of the World Trade Organization, un11 less there exists another, more effective action.

12 (2) CONSULTATION WITH CONGRESS.—Before

13 taking the action described in paragraph (1), the

14 United States Trade Representative shall consult

15 with Congress and provide Congress with the rea16 sons for taking or not taking an action.

17 SEC. 6. SPECIAL WORLD TRADE ORGANIZATION REVIEW OF

18 CHINA.

19 (a) IN GENERAL.—It is the sense of Congress that

20 there should be a special multilateral process at the World

21 Trade Organization for conducting an annual review of

22 the People’s Republic of China’s compliance with the com23 mitments it makes as part of its accession to the World

24 Trade Organization.
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1 (b) USTR TO PROPOSE EXPANDED WTO RE2 VIEW.—The United States Trade Representative is di3 rected to propose that—

4 (1) as part of the Trade Policy Review Mecha5 nism of the World Trade Organization, a thorough

6 review of China’s trade policies be conducted each

7 year;

8 (2) the Trade Policy Review Mechanism be sig9 nificantly enhanced and expanded in connection with

10 the review of the People’s Republic of China; and

11 (3) the Trade Policy Review Mechanism of the

12 People’s Republic of China include onsite visits and

13 active participation by representatives of World

14 Trade Organization members.

15 SEC. 7. INSTITUTION-BUILDING IN CHINA.

16 (a) IN GENERAL.—Not later than 90 days after the

17 People’s Republic of China accedes to the World Trade

18 Organization, the President shall submit to Congress a

19 plan for providing assistance to China to build the institu20 tions necessary to carry out the obligations China has

21 made as part of its accession to the World Trade Organi22 zation. The plan shall include personnel and budget re23 quirements needed to provide assistance.

24 (b) MECHANISMS FOR PROVIDING ASSISTANCE.—It

25 is the sense of Congress that the United States should
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1 provide the assistance described in subsection (a)

2 through—

3 (1) bilateral mechanisms; including nongovern4 mental organizations under contract to the Federal

5 Government;

6 (2) if appropriate, multilateral mechanisms

7 through the auspices of the World Trade Organiza8 tion; and

9 (3) because United States businesses will be a

10 primary beneficiary of China’s compliance, cost-shar11 ing and other cooperative measures with the private

12 sector.

13 (c) AUTHORIZATION OF APPROPRIATIONS.—There

14 are authorized to be appropriated to carry out the provi15 sions of this section, the lesser of—

16 (1) $5,000,000 for each fiscal year; or

17 (2) an amount equal to one-tenth of one per18 cent of the dollar value of the goods and services ex19 ported to the People’s Republic of China during the

20 fiscal year preceding the fiscal year for which the

21 appropriation is made.
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1 SEC. 8. AUTHORIZATION OF APPROPRIATIONS.

2 There are authorized to be appropriated such sums

3 as may be necessary to carry out the provisions of this

4 Act other than section 7.

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