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[Congressional Record Volume 141, Number 73 (Thursday, May 4, 1995)]
[Senate]
[Pages S6184-S6187]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

                OPEN MARKETS AND FAIR TRADE ACT OF 1995

 Mr. ROCKEFELLER. Mr. President, I seek to have placed in the 
Congressional Record a copy of the ``Open Markets and Fair Trade Act of 
1995,'' S.756, that was formally submitted for the Record 
yesterday, May 3, 1995, but which was not printed in full.
  The ``Open Markets and Fair Trade Act of 1995,'' will evaluate the 
current conditions of markets around the world for American products 
and instigate a process of negotiating access to those markets. It also 
gives the President and Congress a new tool to use in those 
negotiations--the threat of reciprocal trade action. Basically the bill 
tells our trading partners that if they refuse to give our products 
reasonable market access, we may impose the same kind of restrictions 
on their products.
  Mr. President, this bill was written in response to a problem that 
persists year after year. I am speaking, of course, of our trade 
deficit, which is out of control. Certainly, we are making progress on 
some micro-economic levels, and the Clinton Administration has hammered 
out more than 70 different trade agreements over the last two-plus 
years--14 with Japan alone. These are helping some industries, some 
workers, and some parts of our economy. But they have done nothing to 
shrink the trade deficit. Clearly, more must be done.
  Mr. President, this bill does not single out any one country. It is 
designed to pry open markets wherever they're closed, wherever in the 
world American products are denied access. This bill follows up on the 
Uruguay Round and looks beyond tariffs--it is designed to deal with 
market barriers; the internal rules in various countries that are 
practical impediments to American businesses. I am seeking to open more 
markets across the globe in order to 
[[Page S6185]] bring about the increased exports and jobs that the GATT 
promised.
  And I think it's high-time we question the wisdom that blames almost 
all of America's trade deficit problems solely on ourselves. For years, 
we've heard the same assertions: ``Americans spend too much and save 
too little * * * the budget deficit is too high * * * we are growing 
faster than other countries so we
 have more money to spend.'' Yes, these economic realities contribute 
to the problem, but under President Clinton's leadership, we have 
reduced the Federal fiscal deficit by over $700 billion, yet the trade 
deficit goes up and up.

  I think it's time we reverse the premise and look at how the trade 
deficit fuels our savings and debt problems. The inability of American 
companies to sell in places like Japan, China, Germany and elsewhere 
costs our corporations profits, our workers job opportunities, and our 
nation revenues--all of which weigh down our own economic growth and 
add to our fiscal deficit.
  Whether it is a requirement for American firms to hire local agents 
to conduct business; cumbersome inspection and customs procedures; bans 
on the sale of products for dubious claims of national sovereignty or 
some other sort of prerogative, the simple fact is that protected 
sanctuary markets abroad are a major contributor to America's economic 
problems.
  To explain this simply, I will use as an example the well known case 
of how Japanese manufacturers sell things like electronics in the 
United States at such cheap prices, even when the Yen is at a record 
height. I am citing Japan here, but it could be any other country that 
has a sanctuary market. It is well known that many Japanese-made 
products are cheaper in the United States than in Japan. That is 
because Japan's closed market is a sanctuary that effectively insulates 
producers from competition, and allows them to overcharge Japanese 
consumers, giving them enough of a profit margin at home to sell below 
cost here. That means American companies lose on both ends. We can't 
export into these markets, and their subsidized exports harm our 
domestic industries and costs us jobs.
  My trade policy is quite simple, in addition to preserving the 
effectiveness of America's trade laws, I support measures that will 
increase American exports, and West Virginia exports specifically. 
Every $1 billion in exports supports about 17,000 jobs. So it follows 
that if we increase American exports, we will create more jobs here in 
the United States. And export related jobs are, on average, better, 
higher paying jobs. That is why I have worked so hard to introduce West 
Virginia businesses to foreign market opportunities.
  The ``Open Markets and Fair Trade Act of 1995'' is about market 
opportunities for American firms and especially markets for American 
industries with the most export potential and which promote critical 
technologies. Most importantly, it instructs the Commerce Department to 
look at markets which, if we can export there, offer the greatest 
employment opportunities for American workers.
  America cannot afford to be a market for everyone else's products 
when we don't get the same kind of access in return. Our economy, and 
the global economy, cannot sustain that kind of imbalance. The American 
people will only continue to support free trade if it means we are able 
to sell American products abroad as easily as Asian and European and 
Latin American manufacturers have access to our shelves and showrooms. 
While past negotiations should have made these points perfectly clear, 
the ``Open Markets and Fair Trade Act of 1995'' will erase any doubts 
that may have lingered with our trading partners.
  Mr. President, I ask that following my statement the full text of the 
``Open Markets and Fair Trade Act of 1995'' appear, followed by a 
summary of S. 756.
  The material follows:
                                 S. 756

       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 ``Open Markets and Fair Trade 
     Act of 1995''.

     SEC. 2. REPORTS ON MARKET ACCESS.

       (a) Annual Reports.--Not later than 90 days after the date 
     of the enactment of this Act, and annually thereafter, the 
     Secretary shall submit to the Congress a report with respect 
     to those countries selected by the Secretary in which goods 
     or services produced or originating in the United States, 
     that would otherwise be competitive in those countries, do 
     not have market access. Each report shall contain the 
     following with respect to each such country:
       (1) Assessment of potential market access.--An assessment 
     of the opportunities that would, but for the lack of market 
     access, be available in the market in that country, for goods 
     and services produced or originating in the United States in 
     those sectors selected by the Secretary. In making such 
     assessment, the Secretary shall consider the competitive 
     position of such goods and services in similarly developed 
     markets in other countries. Such assessment shall specify the 
     time periods within which such market access opportunities 
     should reasonably be expected to be obtained.
       (2) Criteria for measuring market access.--Objective 
     criteria for measuring the extent to which those market 
     access opportunities described in paragraph (1) have been 
     obtained. The development of such objective criteria may 
     include the use of interim objective criteria to measure 
     results on a periodic basis, as appropriate.
       (3) Compliance with trade agreements.--An assessment of 
     whether, and to what extent, the country concerned has 
     materially complied with--
       (A) agreements and understandings reached between the 
     United States and that country pursuant to section 3, and
       (B) existing trade agreements between the United States and 
     that country.

     Such assessment shall include specific information on the 
     extent to which United States suppliers have achieved 
     additional access to the market in the country concerned and 
     the extent to which that country has complied with other 
     commitments under such agreements and understandings.
       (b) Selection of Countries and Sectors.--
       (1) In general.--In selecting countries and sectors that 
     are to be the subject of a report under subsection (a), the 
     Secretary shall give priority to--
       (A) any country with which the United States has a trade 
     deficit if access to the markets in that country is likely to 
     have significant potential to increase exports of United 
     States goods and services; and
       (B) any country, and sectors therein, in which access to 
     the markets will result in significant employment benefits 
     for producers of United States goods and services.

     The Secretary shall also give priority to sectors which 
     represent critical technologies, including those identified 
     by the National Critical Technologies Panel under section 603 
     of the National Science and Technology Policy, Organization, 
     and Priorities Act of 1976 (42 U.S.C. 6683).
       (2) First report.--The first report submitted under 
     subsection (a) shall include those countries with which the 
     United States has a substantial portion of its trade deficit.
       (3) Trade surplus countries.--The Secretary may include in 
     reports after the first report such countries as the 
     Secretary considers appropriate with which the United States 
     has a trade surplus but which are otherwise described in 
     subsection (a) and paragraph (1) of this subsection.
       (c) Other Sectors.--The Secretary shall include an 
     assessment under subsection (a) of any country or sector for 
     which the Trade Representative requests such assessment be 
     made. In preparing any such request, the Trade Representative 
     shall give priority to those barriers identified in the 
     reports required by section 181(b) of the Trade Act of 1974 
     (19 U.S.C. 2241(b)).
       (d) Information on Access by Foreign Suppliers.--The 
     Secretary shall consult with the governments of foreign 
     countries concerning access to the markets of any other 
     country of goods and services produced or originating in 
     those countries. At the request of the government of any such 
     country so consulted, the Secretary may include in the 
     reports required by subsection (a) information, with respect 
     to that country, on such access.

     SEC. 3. NEGOTIATIONS TO ACHIEVE MARKET ACCESS.

       (a) Negotiating Authority.--The President is authorized to 
     enter into agreements or other understandings with the 
     government of any country for the purpose of obtaining the 
     market access opportunities described in the reports of the 
     Secretary under section 2.
       (b) Determination of Priority of Negotiations.--Upon the 
     submission by the Secretary of each report under section 2, 
     the Trade Representative shall determine--
       (1) for which countries and sectors identified in the 
     report the Trade Representative will pursue negotiations, 
     during the 6-month period following submission of the report, 
     for the purpose of concluding agreements or other 
     understandings described in subsection (a), and the timeframe 
     for pursuing negotiations on any other country or sector 
     identified in the report; and
       (2) for which countries and sectors identified in any 
     previous report of the Secretary under section 2 the Trade 
     Representative will pursue negotiations, during the 6-month 
     period described in paragraph (1), in cases in which--
       (A) negotiations were not previously pursued by the Trade 
     Representative, or
       (B) negotiations that were pursued by the Trade 
     Representative did not result in the 
     [[Page S6186]] conclusion of an agreement or understanding 
     described in subsection (a) during the preceding 6-month 
     period, but are expected to result in such an agreement or 
     understanding during the 6-month period described in 
     paragraph (1).

     For purposes of this Act, negotiations by the Trade 
     Representative with respect to a particular sector shall be 
     for a period of not more than 12 months.
       (c) Semiannual Reports.--At the end of the 6-month period 
     beginning on the date on which the Secretary's first report 
     is submitted under section 2(a), and every 6 months 
     thereafter, the Trade Representative shall submit to the 
     Congress a report containing the following:
       (1) Report where negotiations pursued in previous 6-month 
     period.--With respect to each country and sector on which 
     negotiations described in subsection (b) were pursued during 
     that 6-month period--
       (A) a determination of whether such negotiations have 
     resulted in the conclusion of an agreement or understanding 
     intended to obtain the market access opportunities described 
     in the most recent applicable report of the Secretary, and if 
     not--
       (i) whether such negotiations are continuing because they 
     are expected to result in such an agreement or understanding 
     during the succeeding 6-month period; or
       (ii) whether such negotiations have terminated;
       (B) in the case of a positive determination made under 
     subparagraph (A)(i) in the preceding report submitted under 
     this subsection, a determination of whether the continuing 
     negotiations have resulted in the conclusion of an agreement 
     or understanding described in subparagraph (A) during that 6-
     month period.
       (2) Report where negotiations not pursued.--With respect to 
     each country and sector on which negotiations described in 
     subsection (b) were not pursued during that 6-month period, a 
     determination of when such negotiations will be pursued.

     SEC. 4. MONITORING OF AGREEMENTS AND UNDERSTANDINGS.

       (a) In General.--For the purpose of making the assessments 
     required by section 2(a)(3), the Secretary shall monitor the 
     compliance with each agreement or understanding reached 
     between the United States and any country pursuant to section 
     3, and with each existing trade agreement between the United 
     States and any country that is the subject of a report under 
     section 2(a). In making each such assessment, the Secretary 
     shall describe--
       (1) the extent to which market access for the country and 
     sectors covered by the agreement or understanding has been 
     achieved; and
       (2) the bilateral trade relationship with that country in 
     that sector.
     In the case of agreements or understandings reached pursuant 
     to section 3, the description under paragraph (1) shall be 
     done on the basis of the objective criteria set forth in the 
     applicable report under section 2(a)(2).
       (b) Treatment of Agreements and Understandings.--Any 
     agreement or understanding reached pursuant to negotiations 
     conducted under this Act, and each existing trade agreement 
     between the United States and a country that is the subject 
     of a report under section 2(a), shall be considered to be a 
     trade agreement for purposes of section 301 of the Trade Act 
     of 1974.

     SEC. 5. TRIGGERING OF SECTION 301 ACTIONS.

       (a) Failure To Conclude Agreements.--In any case in which 
     the Trade Representative determines under section 3(c)(1) 
     (A)(ii) or (B) that negotiations have not resulted in the 
     conclusion of an agreement or understanding described in 
     section 3(a), each restriction on, or barrier or impediment 
     to, access to the markets of the country concerned that was 
     the subject of such negotiations shall, for purposes of title 
     III of the Trade Act of 1974, be considered to be an act, 
     policy, or practice determined under section 304 of that Act 
     to be an act, policy, or practice that is unreasonable and 
     discriminatory and burdens or restricts United States 
     commerce. The Trade Representative shall determine what 
     action to take under section 301(b) of that Act in response 
     to such act, policy, or practice.
       (b) Noncompliance With Agreements or Understandings.--In 
     any case in which the Secretary determines, in a report 
     submitted under section 2(a), that a foreign country is not 
     in material compliance with--
       (1) any agreement or understanding concluded pursuant to 
     negotiations conducted under section 3, or
       (2) any existing trade agreement between the United States 
     and that country,

     the Trade Representative shall determine what action to take 
     under section 301(a) of the Trade Act of 1974. For purposes 
     of section 301 of that Act, a determination of noncompliance 
     described in the preceding sentence shall be treated as a 
     determination made under section 304 of that Act.
     SEC. 6. EXPEDITED PROCEDURES FOR CERTAIN PRESIDENTIAL 
                   ACTIONS.

       (a) Authority for Reciprocal Actions.--In any case in 
     which--
       (1) section 5 applies,
       (2) the President determines that reciprocal action should 
     be taken by the United States in response to--
       (A) a restriction, barrier, or impediment referred to in 
     section 5(a) with respect to access to the market of a 
     country, or
       (B) noncompliance with an agreement, understanding, or 
     trade agreement referred to in section 5(b),

     as the case may be,
       (3) changes in existing law or new statutory authority is 
     necessary for such reciprocal action to be taken, and
       (4) the President, within 30 days (excluding any day 
     described in section 154(b) of the Trade Act of 1974) after--
       (A) the determination of the Trade Representative under 
     section 3(c)(1)(A)(ii) or (B), or
       (B) the determination of the Secretary in the applicable 
     report under section 2(a),

     as the case may be, submits to the Congress a draft of 
     implementing legislation with respect to the changes or 
     authority described in paragraph (3),

     then subsection (c) applies.
       (b) Definitions.--For purposes of this section--
       (1) the term ``reciprocal action'' means action that is 
     taken in direct response to a restriction on, or barrier or 
     impediment to, access to the market in another country and is 
     comparable or of equivalent effect to such restriction, 
     barrier, or impediment; and
       (2) the term ``implementing legislation'' means a bill of 
     either House of Congress which is introduced as provided in 
     subsection (c) and which contains provisions necessary to 
     make the changes or provide the authority described in 
     subsection (a)(3).
       (c) Procedures for Implementing Legislation.--On the day on 
     which implementing legislation is submitted to the House of 
     Representatives and the Senate under subsection (a), the 
     implementing legislation shall be introduced and referred as 
     provided in section 151(c)(1) of the Trade Act of 1974 for 
     implementing bills under such section. The provisions of 
     subsections (d), (e), (f), and (g) of section 151 of such Act 
     shall apply to implementing legislation to the same extent as 
     such subsections apply to implementing bills.
       (d) Rules of House of Representatives and Senate.--This 
     section is enacted by the Congress--
       (1) as an exercise of the rulemaking power of the House of 
     Representatives and the Senate, respectively, and as such is 
     deemed a part of the rules of each House, respectively, and 
     such procedures supersede other rules only to the extent that 
     they are inconsistent with such other rules; and
       (2) with the full recognition of the constitutional right 
     of either House to change the rules (so far as relating to 
     the procedures of that House) at any time, in the same 
     manner, and to the same extent as any other rule of that 
     House.

     SEC. 7. URUGUAY ROUND AGREEMENTS NOT AFFECTED.

       Nothing in this Act shall be construed to violate any 
     provision of the agreements approved by the Congress in 
     section 101(a)(1) of the Uruguay Round Agreements Act (19 
     U.S.C. 3511(a)(1)).

     SEC. 8. DEFINITIONS.

       As used in this Act:
       (1) Existing trade agreement between the united states and 
     a country.--An ``existing trade agreement'' between the 
     United States and another country means any trade agreement 
     or understanding that was entered into between the United 
     States and that country before the date of the enactment of 
     this Act and is in effect on such date. Such term includes, 
     but is not limited to--
       (A) with respect to Japan--
       (i) the Arrangement Between the Government of Japan and the 
     Government of the United States of America Concerning Trade 
     in Semiconductor Products, signed in 1986;
       (ii) the Arrangement Between the Government of Japan and 
     the Government of the United States of America Concerning 
     Trade in Semiconductor Products, signed in 1991;
       (iii) the United States-Japan Wood Products Agreement, 
     signed on June 5, 1990;
       (iv) Measures Related to Japanese Public Sector 
     Procurements of Computer Products and Services, signed on 
     January 10, 1992;
       (v) the Tokyo Declaration on the U.S.-Japan Global 
     Partnership, signed on January 9, 1992; and
       (vi) the Cellular Telephone and Third-Party Radio 
     Agreement, signed in 1989;
       (B) with respect to the European Union--
       (i) the Agreement Concerning the Application of the GATT 
     Agreement on Trade in Civil Aircraft Between the European 
     Economic Community and the Government of the United States of 
     America on trade in large civil aircraft, with annexes, 
     entered into force on July 17, 1992;
       (ii) the Agreement Concerning Procurement Between the 
     United States and the European Union, signed April 15, 1994; 
     and
       (iii) the Memorandum of Understanding (MOU) on Procurement 
     Between the United States and the European Union, signed May 
     25, 1993; and
       (C) with respect to the People's Republic of China--
       (i) the Memorandum of Understanding (MOU) on the Protection 
     of Intellectual Property Rights Between the United States and 
     the People's Republic of China, signed January 17, 1992;
       (ii) the Memorandum of Understanding (MOU) on Market Access 
     Between the United States and the People's Republic of China, 
     signed October 10, 1992;
       (iii) the Bilateral Textile Agreement Between the United 
     States and the People's Republic of China, signed January 17, 
     1994; and
       (iv) an exchange of letters with an attached action plan 
     between the United 
     [[Page S6187]] States and the People's Republic of China, 
     signed February 26, 1995, relating to intellectual property 
     rights.
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Commerce.
       (3) Trade representative.--The term ``Trade 
     Representative'' means the United States Trade 
     Representative.
                                                                    ____

          The Open Markets and Fair Trade Act of 1995--Summary

                                  goal

       The legislation will help the United States develop a 
     systematic, long-term trade policy that will pry open foreign 
     markets for American exporters. This bill supports the 
     Clinton Administration's results-oriented trade policy.
       The U.S. has accumulated more than $1 trillion in 
     merchandise trade deficits since 1980. Countries like Japan--
     which accounted for more than 43% of last years deficit and 
     China, which accounted for almost 20% of last years trade 
     deficit, continue to exclude U.S. products from their 
     markets.
       This legislation will create a process for defining what 
     our goals and objectives should be in trade negotiations. It 
     will help ensure that our trade negotiations achieve 
     measurable results, not just empty promises. Additionally, 
     the legislation will grant the President the authority to 
     have Congress grant him reciprocal trade authority on an 
     expedited basis.

                               specifics

       The legislation instructs the Commerce Department to choose 
     a range of important American goods and services, and study 
     how well those products do in foreign markets. Then we'll 
     understand how well we should be doing if trade were free and 
     fair. Commerce will outline clear, objective criteria for 
     gaining market access and the USTR will be given authority to 
     negotiate to achieve these or similar goals.
       The bill requires that in developing objective criteria the 
     Department of Commerce should give priority to industries 
     which will result in the greatest employment benefits for the 
     United States, industries which have the most export 
     potential and industries that promote critical technologies.
       The legislation doesn't specify what objective criteria 
     should be used. It simply endorses a results-oriented trade 
     policy. The effect will not be ``managed trade''. Rather, it 
     will provide the basis for our negotiators and our trading 
     partners to know what ``success'' is. It seeks to create a 
     basis for open, honest negotiations where others understand 
     what our expectations are.
       The legislation also gives the President the ability to 
     come to Congress to authorize reciprocal trade actions if he 
     deems it appropriate. This reciprocal trade authority would 
     be considered on an expedited basis.
       The President has full discretion under this legislation. 
     But it sends a clear message to our trading partners: follow 
     the Golden Rule in trade. If another country believes that 
     its market access impediments are appropriate and should be 
     continued, then they shouldn't object to others following 
     their lead.
       Nothing in this legislation violates our commitment to the 
     GATT. The process that the bill begins simply requires that 
     we define what our national interests and what fair play 
     would achieve. It does not specify how we will respond to the 
     market barriers our farmers, workers and businesses face, 
     although, through the expedited procedures provided for in 
     the bill, it shows a clear preference for reciprocity. 
     Reciprocity to respond to anticompetitive practices. Actions 
     that aren't covered by the GATT.
       Those with a vested interest in the status quo have engaged 
     in an intensive public relations campaign to discredit the 
     President's trade policy. We must not retreat from our desire 
     to enforce the rights of our farmers, workers and 
     businesses.
     

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