II 

110TH CONGRESS 

1ST SESSION S. 1607 

To provide for identification of misaligned currency, require action to correct 

the misalignment, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 13, 2007 

Mr. BAUCUS (for himself, Mr. GRASSLEY, Mr. SCHUMER, and Mr. GRAHAM) 

introduced the following bill; which was read twice and referred to the 

Committee on Finance 

A BILL 

To provide for identification of misaligned currency, require 

action to correct the misalignment, 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 ‘‘Currency Exchange 

5 Rate Oversight Reform Act of 2007’’. 

6 TITLE I—CURRENCY EXCHANGE 

7 RATE OVERSIGHT REFORM 

8 SEC. 111. DEFINITIONS. 

9 In this Act: 


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1 (1) ADMINISTERING AUTHORITY.—The term 

2 ‘‘administering authority’’ means the authority re3 ferred to in section 771(1) of the Tariff Act of 1930 

4 (19 U.S.C. 1677(1)). 

5 (2) AGREEMENT ON GOVERNMENT PROCURE6 MENT.—The term ‘‘Agreement on Government Pro7 curement’’ means the agreement referred to in sec8 tion 101(d)(17) of the Uruguay Round Agreements 

9 Act (19 U.S.C. 3511(d)(17)). 

10 (3) COUNTRY.—The term ‘‘country’’ means a 

11 foreign country, dependent territory, or possession of 

12 a foreign country, and may include an association of 

13 2 or more foreign countries, dependent territories, or 

14 possessions of countries into a customs union out15 side the United States. 

16 (4) EXPORTING COUNTRY.—The term ‘‘export17 ing country’’ means the country in which the subject 

18 merchandise is produced or manufactured. 

19 (5) FUNDAMENTAL MISALIGNMENT.—The term 

20 ‘‘fundamental misalignment’’ means a significant 

21 and prolonged undervaluation of the prevailing real 

22 exchange rate between the United States dollar and 

23 a foreign currency from its medium-term equilibrium 

24 level. 


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1 (6) FUNDAMENTALLY MISALIGNED CUR2 RENCY.—The term ‘‘fundamentally misaligned cur3 rency’’ means a foreign currency that is in funda4 mental misalignment. 

5 (7) REAL EXCHANGE RATE.—The term ‘‘real 

6 exchange rate’’ means a nominal exchange rate, ex7 pressed in price-adjusted terms. 

8 (8) SECRETARY.—The term ‘‘Secretary’’ means 

9 the Secretary of the Treasury. 

10 (9) SUBJECT MERCHANDISE.—The term ‘‘sub11 ject merchandise’’ means the merchandise subject to 

12 an antidumping investigation, review, suspension 

13 agreement, or order referred to in section 771(25) of 

14 the Tariff Act of 1930 (19 U.S.C. 1677(25)). 

15 (10) WTO AGREEMENT.—The term ‘‘WTO 

16 Agreement’’ means the agreement referred to in sec17 tion 2(9) of the Uruguay Round Agreements Act (19 

18 U.S.C. 3501(9)). 

19 SEC. 112. REPORT ON INTERNATIONAL MONETARY POLICY 

20 AND CURRENCY EXCHANGE RATES. 

21 (a) REPORTS REQUIRED.— 

22 (1) IN GENERAL.—Not later than March 15 

23 and September 15 of each calendar year, the Sec24 retary, after consulting with the Chairman of the 

25 Board of Governors of the Federal Reserve System 


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1 and the Advisory Committee on International Ex2 change Rate Policy, shall submit to Congress, a 

3 written report on international monetary policy and 

4 currency exchange rates. 

5 (2) CONSULTATIONS.—On or before March 30 

6 and September 30 of each year, the Secretary shall 

7 appear, if requested, before the Committee on Bank8 ing, Housing, and Urban Affairs of the Senate and 

9 the Committee on Financial Services of the House of 

10 Representatives to provide testimony on the reports 

11 submitted pursuant to paragraph (1). 

12 (b) CONTENT OF REPORTS.—Each report submitted 

13 under subsection (a) shall contain— 

14 (1) an analysis of currency market develop15 ments and the relationship between the United 

16 States dollar and the currencies of major economies 

17 and trading partners of the United States; 

18 (2) a review of the economic and monetary poli19 cies of major economies and trading partners of the 

20 United States, and an evaluation of how such poli21 cies impact currency exchange rates; 

22 (3) a description of any currency intervention 

23 by the United States or other major economies or 

24 trading partners of the United States, or other acVerDate Aug 31 2005 03:07 Jun 15, 2007 Jkt 059200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1607.IS S1607

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1 tions undertaken to adjust the actual exchange rate 

2 relative to the United States dollar; 

3 (4) an evaluation of the domestic and global 

4 factors that underlie the conditions in the currency 

5 markets, including— 

6 (A) monetary and financial conditions; 

7 (B) accumulation of foreign assets; 

8 (C) macroeconomic trends; 

9 (D) trends in current and financial ac10 count balances; 

11 (E) the size, composition, and growth of 

12 international capital flows; 

13 (F) the impact of the external sector on 

14 economic growth; 

15 (G) the size and growth of external indebt16 edness; 

17 (H) trends in the net level of international 

18 investment; and 

19 (I) capital controls, trade, and exchange 

20 restrictions; 

21 (5) a list of currencies designated as fundamen22 tally misaligned currencies pursuant to section 

23 113(a)(2), and a description of any economic models 

24 or methodologies used to establish the list; 


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1 (6) a list of currencies designated for priority 

2 action pursuant to section 113(a)(3); 

3 (7) an identification of the nominal value asso4 ciated with the medium-term equilibrium exchange 

5 rate, relative to the United States dollar, for each 

6 currency listed under paragraph (6); 

7 (8) a description of any consultations conducted 

8 or other steps taken pursuant to section 114, 115, 

9 or 116; and 

10 (9) a description of any determination made 

11 pursuant to section 118(a). 

12 (c) CONSULTATIONS.—The Secretary shall consult 

13 with the Chairman of the Board of Governors of the Fed14 eral Reserve System and the Advisory Committee on 

15 International Exchange Rate Policy with respect to the 

16 preparation of each report required under subsection (a). 

17 Any comments provided by the Chairman of the Board 

18 of Governors of the Federal Reserve System or the Advi19 sory Committee on International Exchange Rate Policy 

20 shall be submitted to the Secretary not later than the date 

21 that is 15 days before the date each report is due under 

22 subsection (a). The Secretary shall submit the report to 

23 Congress after taking into account all such comments re24 ceived. 


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1 SEC. 113. IDENTIFICATION OF FUNDAMENTALLY MIS2 ALIGNED CURRENCIES. 

3 (a) IDENTIFICATION.— 

4 (1) IN GENERAL.—The Secretary shall analyze 

5 on a semiannual basis the prevailing real exchange 

6 rates between the United States dollar and foreign 

7 currencies. 

8 (2) DESIGNATION OF FUNDAMENTALLY MIS9 ALIGNED CURRENCIES.—As a result of the analysis 

10 conducted under paragraph (1), the Secretary shall 

11 identify any foreign currency that is in fundamental 

12 misalignment and shall designate such currency as a 

13 fundamentally misaligned currency. 

14 (3) DESIGNATION OF CURRENCIES FOR PRI15 ORITY ACTION.—The Secretary shall designate a 

16 currency identified under paragraph (2) for priority 

17 action if the country that issues such currency is— 

18 (A) engaging in protracted large-scale 

19 intervention in one direction in the currency ex20 change market; 

21 (B) engaging in excessive reserve accumu22 lation; 

23 (C) introducing or substantially modifying 

24 for balance of payments purposes a restriction 

25 on, or incentive for, the inflow or outflow of 


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1 capital, that is inconsistent with the goal of 

2 achieving full currency convertibility; or 

3 (D) pursuing any other policy or action 

4 that, in the view of the Secretary, warrants des5 ignation for priority action. 

6 (b) REPORTS.—The Secretary shall include a list of 

7 any foreign currency designated under paragraph (2) or 

8 (3) of subsection (a) in each report required by section 

9 112. 

10 SEC. 114. NEGOTIATIONS AND CONSULTATIONS. 

11 (a) IN GENERAL.—Upon designation of a currency 

12 pursuant to section 113(a)(2), the Secretary shall seek bi13 lateral consultations with the country that issues such cur14 rency in order to facilitate the adoption of appropriate 

15 policies to address the fundamental misalignment. 

16 (b) CONSULTATIONS INVOLVING CURRENCIES DES17 IGNATED FOR PRIORITY ACTION.—With respect to each 

18 currency designated for priority action pursuant to section 

19 113(a)(3), the Secretary shall, in addition to the consulta20 tions with the country described in subsection (a)— 

21 (1) seek the advice of the International Mone22 tary Fund with respect to the Secretary’s findings in 

23 the report submitted to Congress pursuant to section 

24 112(a); and 


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1 (2) encourage other governments, whether bilat2 erally or in appropriate multinational fora, to join 

3 the United States in seeking the adoption of appro4 priate policies by the country described in subsection 

5 (a) to eliminate the fundamental misalignment. 

6 SEC. 115. FAILURE TO ADOPT APPROPRIATE POLICIES. 

7 (a) IN GENERAL.—Not later than 180 days after the 

8 date on which a currency is designated for priority action 

9 pursuant to section 113(a)(3), the Secretary shall deter10 mine whether the country that issues such currency has 

11 adopted appropriate policies to eliminate the fundamental 

12 misalignment. The Secretary shall promptly notify Con13 gress of such determination and publish notice of the de14 termination in the Federal Register. If the Secretary de15 termines that the country that issues such currency has 

16 failed to adopt appropriate policies to eliminate the funda17 mental misalignment, the following shall apply with re18 spect to the country until a notification described in sec19 tion 116(b) is published in the Federal Register: 

20 (1) ADJUSTMENT UNDER ANTIDUMPING LAW.— 

21 For purposes of an antidumping investigation or re22 view under title VII of the Tariff Act of 1930 (19 

23 U.S.C. 1673 et seq.) the following shall apply: 

24 (A) IN GENERAL.—The administering au25 thority shall ensure a fair comparison between 


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1 the export price and the normal value by ad2 justing the price used to establish export price 

3 or constructed export price to reflect the funda4 mental misalignment of the currency of the ex5 porting country. 

6 (B) SALES SUBJECT TO ADJUSTMENT.— 

7 The adjustment described in subparagraph (A) 

8 shall apply with respect to subject merchandise 

9 sold on or after the date that is 30 days after 

10 the date the currency of the exporting country 

11 is designated for priority action pursuant to 

12 section 113(a)(3). 

13 (2) FEDERAL PROCUREMENT.— 

14 (A) IN GENERAL.—The President shall 

15 prohibit the procurement by the Federal Gov16 ernment of products or services from the coun17 try. 

18 (B) EXCEPTION.—The prohibition pro19 vided for in subparagraph (A) shall not apply 

20 with respect to a country that is a party to the 

21 Agreement on Government Procurement. 

22 (3) REQUEST FOR IMF ACTION.—The United 

23 States shall inform the Managing Director of the 

24 International Monetary Fund of the failure of the 

25 country to adopt appropriate policies to eliminate 


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1 the fundamental misalignment, and the actions the 

2 country is engaging in that are identified in section 

3 113(a)(3), and shall request that the Managing Di4 rector of the International Monetary Fund— 

5 (A) consult with such country regarding 

6 the observance of the country’s obligations 

7 under article IV of the International Monetary 

8 Fund Articles of Agreement, including through 

9 special consultations, if necessary; and 

10 (B) formally report the results of such con11 sultations to the Executive Board of the Inter12 national Monetary Fund within 180 days of the 

13 date of such request. 

14 (4) OPIC FINANCING.—The Overseas Private 

15 Investment Corporation shall not approve any new 

16 financing (including insurance, reinsurance, or guar17 antee) with respect to a project located within the 

18 country. 

19 (5) MULTILATERAL BANK FINANCING.—The 

20 Secretary shall instruct the United States Executive 

21 Director at each multilateral bank to oppose the ap22 proval of any new financing (including loans, other 

23 credits, insurance, reinsurance, or guarantee) to the 

24 government of the country or for a project located 

25 within the country. 


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1 (b) WAIVER.— 

2 (1) IN GENERAL.—The President may waive 

3 any action provided for under subsection (a) if the 

4 President determines that— 

5 (A) taking such action would cause serious 

6 harm to the national security of the United 

7 States; or 

8 (B) it is in the vital economic interest of 

9 the United States to do so and taking such ac10 tion would have an adverse impact on the 

11 United States economy greater than the bene12 fits of such action. 

13 (2) NOTIFICATION.—The President shall 

14 promptly notify Congress of a determination under 

15 paragraph (1) (and the reasons for the determina16 tion, if made under paragraph (1)(B)) and shall 

17 publish notice of the determination in the Federal 

18 Register. 

19 (c) REPORTS.—The Secretary shall describe any ac20 tion or determination pursuant to subsection (a) or (b) 

21 in the first semiannual report required by section 112 

22 after the date of such action or determination. 


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1 SEC. 116. PERSISTENT FAILURE TO ADOPT APPROPRIATE 

2 POLICIES. 

3 (a) PERSISTENT FAILURE TO ADOPT APPROPRIATE

4 POLICIES.—Not later than 360 days after the date on 

5 which a currency is designated for priority action pursuant 

6 to section 113(a)(3), the Secretary shall determine wheth7 er the country that issues such currency has adopted ap8 propriate policies to eliminate the fundamental misalign9 ment. The Secretary shall promptly notify Congress of 

10 such determination and shall publish notice of the deter11 mination in the Federal Register. If the Secretary deter12 mines that the country that issues such currency has 

13 failed to adopt appropriate policies to eliminate the funda14 mental misalignment, in addition to the provisions of sec15 tion 115(a), the following shall apply with respect to the 

16 country until a notification described in subsection (b) is 

17 published in the Federal Register: 

18 (1) ACTION AT THE WTO.—The United States 

19 Trade Representative shall request consultations in 

20 the World Trade Organization with the country re21 garding the consistency of the country’s actions with 

22 its obligations under the WTO Agreement. 

23 (2) REMEDIAL INTERVENTION.— 

24 (A) IN GENERAL.—The Secretary shall 

25 consult with the Board of Governors of the 

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1 taking remedial intervention in international 

2 currency markets in response to the funda3 mental misalignment of the currency designated 

4 for priority action, and coordinating such inter5 vention with other monetary authorities and the 

6 International Monetary Fund. 

7 (B) NOTICE TO COUNTRY.—At the same 

8 time the Secretary takes action under subpara9 graph (A), the Secretary shall notify the coun10 try that issues such currency of the consulta11 tions under subparagraph (A). 

12 (b) NOTIFICATION.—The Secretary shall promptly 

13 notify Congress when a country that issues a currency des14 ignated for priority action pursuant to section 113(a)(3) 

15 adopts appropriate policies to eliminate the fundamental 

16 misalignment, and publish notice of the action of that 

17 country in the Federal Register. 

18 (c) WAIVER.— 

19 (1) IN GENERAL.—The President may waive 

20 any action provided for under this section, or extend 

21 any waiver provided for pursuant to section 115(b), 

22 if the President determines that— 

23 (A) taking such action would cause serious 

24 harm to the national security of the United 

25 States; or 


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1 (B) it is in the vital economic interest of 

2 the United States to do so, and that taking 

3 such action would have an adverse impact on 

4 the United States economy substantially out of 

5 proportion to the benefits of such action. 

6 (2) NOTIFICATION.—The President shall 

7 promptly notify Congress of a determination under 

8 paragraph (1) (and the reasons for the determina9 tion, if made under paragraph (1)(B)) and shall 

10 publish notice of the determination in the Federal 

11 Register. 

12 (d) REPORTS.—The Secretary shall describe any ac13 tion or determination pursuant to subsection (a), (b), or 

14 (c) in the first semiannual report required by section 112 

15 after the date of such action or determination. 

16 SEC. 117. CONGRESSIONAL DISAPPROVAL OF WAIVER. 

17 (a) RESOLUTION OF DISAPPROVAL.— 

18 (1) INTRODUCTION.—If a resolution of dis19 approval is introduced in the House of Representa20 tives or the Senate during the 90-day period (not 

21 counting any day which is excluded under section 

22 154(b)(1) of the Trade Act of 1974 (19 U.S.C. 

23 2194(b)(1)), beginning on the date on which the 

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1 ant to section 116(c)(1)(B), that resolution of dis2 approval shall be considered in accordance with this 

3 subsection. 

4 (2) RESOLUTION OF DISAPPROVAL.—In this 

5 subsection, the term ‘‘resolution of disapproval’’ 

6 means only a concurrent resolution of the two 

7 Houses of the Congress, the sole matter after the re8 solving clause of which is as follows: ‘‘That the Con9 gress does not approve the determination of the 

10 President under section 116(c)(1)(B) of the Cur11 rency Exchange Rate Oversight Reform Act of 2007 

12 with respect to llllll, of which Congress 

13 was notified on lllll.’’, with the first blank 

14 space being filled with the name of the appropriate 

15 country and the second blank space being filled with 

16 the appropriate date. 

17 (3) PROCEDURES FOR CONSIDERING RESOLU18 TIONS.— 

19 (A) INTRODUCTION AND REFERRAL.—Res20 olutions of disapproval— 

21 (i) in the House of Representatives— 

22 (I) may be introduced by any 

23 Member of the House; 

24 (II) shall be referred to the Com25 mittee on Financial Services and, in 


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1 addition, to the Committee on Rules; 

2 and 

3 (III) may not be amended by ei4 ther Committee; and 

5 (ii) in the Senate— 

6 (I) may be introduced by any 

7 Member of the Senate; 

8 (II) shall be referred to the Com9 mittee on Banking, Housing, and 

10 Urban Affairs; and 

11 (III) may not be amended. 

12 (B) COMMITTEE DISCHARGE AND FLOOR

13 CONSIDERATION.—The provisions of sub14 sections (c) through (f) of section 152 of the 

15 Trade Act of 1974 (other than paragraph (3) 

16 of such subsection (f)) (19 U.S.C. 2192(c) 

17 through (f)) (relating to committee discharge 

18 and floor consideration of certain resolutions in 

19 the House and Senate) apply to a concurrent 

20 resolution of disapproval under this section to 

21 the same extent as such subsections apply to 

22 joint resolutions under such section 152. 

23 (b) RULES OF HOUSE OF REPRESENTATIVES AND

24 SENATE.—This section is enacted by the Congress— 


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1 (1) as an exercise of the rulemaking power of 

2 the House of Representatives and the Senate, re3 spectively, and as such are deemed a part of the 

4 rules of each House, respectively, and such proce5 dures supersede other rules only to the extent that 

6 they are inconsistent with such other rules; and 

7 (2) with the full recognition of the constitu8 tional right of either House to change the rules (so 

9 far as relating to the procedures of that House) at 

10 any time, in the same manner, and to the same ex11 tent as any other rule of that House. 

12 SEC. 118. INTERNATIONAL FINANCIAL INSTITUTION GOV13 ERNANCE ARRANGEMENTS. 

14 (a) INITIAL REVIEW.—Notwithstanding any other 

15 provision of law, before the United States approves a pro16 posed change in the governance arrangement of any inter17 national financial institution, as defined in section 

18 1701(c)(2) of the International Financial Institutions Act 

19 (22 U.S.C. 262r(c)(2)), the Secretary shall determine 

20 whether any member of the international financial institu21 tion that would benefit from the proposed change, in the 

22 form of increased voting shares or representation, has a 

23 currency that was designated a currency for priority action 

24 pursuant to section 113(a)(3) in the most recent report 


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1 required by section 112. The determination shall be re2 ported to Congress. 

3 (b) SUBSEQUENT ACTION.—The United States shall 

4 oppose any proposed change in the governance arrange5 ment of the international financial institution (as defined 

6 in subsection (a)), if the Secretary renders an affirmative 

7 determination pursuant to subsection (a). 

8 (c) FURTHER ACTION.—The United States shall con9 tinue to oppose any proposed change in the governance 

10 arrangement of the international financial institution, pur11 suant to subsection (b), until the Secretary determines 

12 and reports to Congress that the proposed change would 

13 not benefit any member of the international financial insti14 tution, in the form of increased voting shares or represen15 tation, that has a currency that is designated a currency 

16 for priority action pursuant to section 113(a)(3). 

17 SEC. 119. ADJUSTMENT FOR FUNDAMENTALLY MIS18 ALIGNED CURRENCY DESIGNATED FOR PRI19 ORITY ACTION. 

20 (a) IN GENERAL.—Subsection (c)(2) of section 772 

21 of the Tariff Act of 1930 (19 U.S.C. 1677a(c)(2)) is 

22 amended— 

23 (1) by striking ‘‘and’’ at the end of subpara24 graph (A); 


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1 (2) by striking the period at the end of sub2 paragraph (B) and inserting ‘‘; and’’; and 

3 (3) by adding at the end the following: 

4 ‘‘(C) if required by section 115(a)(1) of the 

5 Currency Exchange Rate Oversight Reform Act 

6 of 2007, the percentage by which the domestic 

7 currency of the producer or exporter is under8 valued in relation to the United States dollar.’’. 

9 (b) CALCULATION METHODOLOGY.—Section 771 of 

10 the Tariff Act of 1930 (19 U.S.C. 1677) is amended by 

11 adding at the end the following: 

12 ‘‘(37) PERCENTAGE UNDERVALUATION.—The 

13 administering authority shall determine the percent14 age by which the domestic currency of the producer 

15 or exporter is undervalued in relation to the United 

16 States dollar by comparing the nominal value associ17 ated with the medium-term equilibrium exchange 

18 rate of the domestic currency of the producer or ex19 porter, identified by the Secretary pursuant to sec20 tion 112(b)(7) of the Currency Exchange Rate Over21 sight Reform Act of 2007, to the exchange rate used 

22 by the administering authority to convert the domes23 tic currency to United States dollars.’’. 


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1 SEC. 120. NONMARKET ECONOMY STATUS. 

2 Paragraph (18)(B) of section 771 of the Tariff Act 

3 of 1930 (19 U.S.C. 1677(18)(B)) is amended— 

4 (1) by striking ‘‘and’’ at the end of clause (v); 

5 and 

6 (2) by redesignating clause (vi) as clause (vii) 

7 and inserting after clause (v) the following: 

8 ‘‘(vi) whether the currency of the for9 eign country is designated a currency for 

10 priority action pursuant to section 

11 113(a)(3) of the Currency Exchange Rate 

12 Oversight Reform Act of 2007, and’’. 

13 SEC. 121. APPLICATION TO CANADA AND MEXICO. 

14 Pursuant to article 1902 of the North American Free 

15 Trade Agreement and section 408 of the North American 

16 Free Trade Agreement Implementation Act (19 U.S.C. 

17 3438), section 115(a)(1) and the amendments made by 

18 sections 119 and 120 shall apply with respect to goods 

19 from Canada and Mexico. 

20 SEC. 122. ADVISORY COMMITTEE ON INTERNATIONAL EX21 CHANGE RATE POLICY. 

22 (a) ESTABLISHMENT.— 

23 (1) IN GENERAL.—There is established an Ad24 visory Committee on International Exchange Rate 

25 Policy (in this section referred to as the ‘‘Com26 mittee’’) The Committee shall be responsible for— 


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1 (A) advising the Secretary in the prepara2 tion of each report to Congress on international 

3 monetary policy and currency exchange rates, 

4 provided for in section 112; and 

5 (B) advising the Congress and the Presi6 dent with respect to— 

7 (i) international exchange rates and 

8 financial policies; and 

9 (ii) the impact of such policies on the 

10 economy of the United States. 

11 (2) MEMBERSHIP.— 

12 (A) IN GENERAL.—The Committee shall be 

13 composed of 9 members as follows, none of 

14 whom shall be from the Federal Government: 

15 (i) CONGRESSIONAL APPOINTEES.— 

16 (I) SENATE APPOINTEES.—Four 

17 persons shall be appointed by the 

18 President pro tempore of the Senate, 

19 upon the recommendation of the 

20 Chairmen and Ranking Members of 

21 the Committee on Banking, Housing, 

22 and Urban Affairs and the Committee 

23 on Finance of the Senate. 

24 (II) HOUSE APPOINTEES.—Four 

25 persons shall be appointed by the 


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1 Speaker of the House of Representa2 tives upon the recommendation of the 

3 Chairmen and Ranking Members of 

4 the Committee on Financial Services 

5 and the Committee on Ways and 

6 Means of the House of Representa7 tives. 

8 (ii) PRESIDENTIAL APPOINTEE.—One 

9 person shall be appointed by the President. 

10 (B) QUALIFICATIONS.—Persons shall be 

11 selected under subparagraph (A) on the basis of 

12 their objectivity and demonstrated expertise in 

13 finance, economics, or currency exchange. 

14 (3) TERMS.—Members shall be appointed for a 

15 term of 4 years or until the Committee terminates. 

16 An individual may be reappointed to the Committee 

17 for additional terms. 

18 (4) VACANCIES.—Any vacancy in the Com19 mittee shall not affect its powers, but shall be filled 

20 in the same manner as the original appointment. 

21 (b) DURATION OF COMMITTEE.—The Committee 

22 shall terminate on the date that is 4 years after the date 

23 of the enactment of this Act unless renewed by the Presi24 dent pursuant to section 14 of the Federal Advisory Com25 mittee Act (5 U.S.C. App.) for a subsequent 4-year period. 


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1 The President may continue to renew the Committee for 

2 successive 4-year periods by taking appropriate action 

3 prior to the date on which the Committee would otherwise 

4 terminate. 

5 (c) PUBLIC MEETINGS.—The Committee shall hold 

6 at least 1 public meeting each year for the purpose of ac7 cepting public comments. The Committee shall also meet 

8 as needed at the call of the Secretary or at the call of 

9 two-thirds of the members of the Committee. 

10 (d) CHAIRPERSON.—The Committee shall elect from 

11 among its members a chairperson for a term of 4 years 

12 or until the Committee terminates. A chairperson of the 

13 Committee may be reelected chairperson but is ineligible 

14 to serve consecutive terms as chairperson. 

15 (e) STAFF.—The Secretary shall make available to 

16 the Committee such staff, information, personnel, admin17 istrative services, and assistance as the Committee may 

18 reasonably require to carry out its activities. 

19 (f) APPLICATION OF FEDERAL ADVISORY COM20 MITTEE ACT.— 

21 (1) IN GENERAL.—The provisions of the Fed22 eral Advisory Committee Act (5 U.S.C. App.) shall 

23 apply to the Committee. 

24 (2) EXCEPTION.—Except for the annual public 

25 meeting required under subsection (c), meetings of 


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1 the Committee shall be exempt from the require2 ments of subsections (a) and (b) of sections 10 and 

3 11 of the Federal Advisory Committee Act (relating 

4 to open meetings, public notice, public participation, 

5 and public availability of documents), whenever and 

6 to the extent it is determined by the President or the 

7 Secretary that such meetings will be concerned with 

8 matters the disclosure of which would seriously com9 promise the development by the United States Gov10 ernment of monetary and financial policy. 

11 SEC. 123. REPEAL OF THE EXCHANGE RATES AND INTER12 NATIONAL ECONOMIC POLICY COORDINA13 TION ACT OF 1988. 

14 The Exchange Rates and International Economic 

15 Policy Coordination Act of 1988 (22 U.S.C. 5301–5306) 

16 is repealed. 

17 TITLE II—TAX REFORM 

18 SEC. 201. PERMANENT SUBPART F EXEMPTION FOR ACTIVE 

19 FINANCING INCOME. 

20 (a) BANKING, FINANCING, OR SIMILAR BUSI21 NESSES.—Subsection (h) of section 954 of the Internal 

22 Revenue Code of 1986 (relating to special rule for income 

23 derived in the active conduct of banking, financing, or 

24 similar businesses) is amended by striking paragraph (9). 


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26 

•S 1607 IS

1 (b) INSURANCE BUSINESSES.—Subsection (e) of sec2 tion 953 of such Code (relating to exempt insurance in3 come) is amended by striking paragraph (10) and by re4 designating paragraph (11) as paragraph (10). 

5 (c) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to taxable years of a foreign cor7 poration beginning after the date of the enactment of this 

8 Act, and to taxable years of United States shareholders 

9 with or within which such taxable years of such foreign 

10 corporation end. 

Æ 


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