112TH CONGRESS 

1ST SESSION H. R. 3079 

AN ACT 

To implement the United States–Panama Trade Promotion 

Agreement. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘United States–Panama Trade Promotion Agreement Im4 plementation Act’’. 

5 (b) TABLE OF CONTENTS.—The table of contents for 

6 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Purposes. 

Sec. 3. Definitions. 

TITLE I—APPROVAL OF, AND GENERAL PROVISIONS RELATING 

TO, THE AGREEMENT 

Sec. 101. Approval and entry into force of the Agreement. 

Sec. 102. Relationship of the Agreement to United States and State law. 

Sec. 103. Implementing actions in anticipation of entry into force and initial 

regulations. 

Sec. 104. Consultation and layover provisions for, and effective date of, proclaimed actions. 

Sec. 105. Administration of dispute settlement proceedings. 

Sec. 106. Arbitration of claims. 

Sec. 107. Effective dates; effect of termination. 

TITLE II—CUSTOMS PROVISIONS 

Sec. 201. Tariff modifications. 

Sec. 202. Additional duties on certain agricultural goods. 

Sec. 203. Rules of origin. 

Sec. 204. Customs user fees. 

Sec. 205. Disclosure of incorrect information; false certifications of origin; denial of preferential tariff treatment. 

Sec. 206. Reliquidation of entries. 

Sec. 207. Recordkeeping requirements. 

Sec. 208. Enforcement relating to trade in textile or apparel goods. 

Sec. 209. Regulations. 

TITLE III—RELIEF FROM IMPORTS 

Sec. 301. Definitions. 

Subtitle A—Relief From Imports Benefitting From the Agreement 

Sec. 311. Commencing of action for relief. 

Sec. 312. Commission action on petition. 

Sec. 313. Provision of relief. 

Sec. 314. Termination of relief authority. 

Sec. 315. Compensation authority. 

Sec. 316. Confidential business information. 

Subtitle B—Textile and Apparel Safeguard Measures 
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Sec. 321. Commencement of action for relief. 

Sec. 322. Determination and provision of relief. 

Sec. 323. Period of relief. 

Sec. 324. Articles exempt from relief. 

Sec. 325. Rate after termination of import relief. 

Sec. 326. Termination of relief authority. 

Sec. 327. Compensation authority. 

Sec. 328. Confidential business information. 

Subtitle C—Cases Under Title II of the Trade Act of 1974 

Sec. 331. Findings and action on Panamanian articles. 

TITLE IV—MISCELLANEOUS 

Sec. 401. Eligible products. 

Sec. 402. Modification to the Caribbean Basin Economic Recovery Act. 

TITLE V—OFFSETS 

Sec. 501. Extension of customs user fees. 

Sec. 502. Time for payment of corporate estimated taxes. 

1 SEC. 2. PURPOSES. 

2 The purposes of this Act are— 

3 (1) to approve and implement the free trade 

4 agreement between the United States and Panama 

5 entered into under the authority of section 2103(b) 

6 of the Bipartisan Trade Promotion Authority Act of 

7 2002 (19 U.S.C. 3803(b)); 

8 (2) to strengthen and develop economic rela9 tions between the United States and Panama for 

10 their mutual benefit; 

11 (3) to establish free trade between the United 

12 States and Panama through the reduction and elimi13 nation of barriers to trade in goods and services and 

14 to investment; and 
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1 (4) to lay the foundation for further coopera2 tion to expand and enhance the benefits of the 

3 Agreement. 

4 SEC. 3. DEFINITIONS. 

5 In this Act: 

6 (1) AGREEMENT.—The term ‘‘Agreement’’ 

7 means the United States–Panama Trade Promotion 

8 Agreement approved by Congress under section 

9 101(a)(1). 

10 (2) COMMISSION.—The term ‘‘Commission’’ 

11 means the United States International Trade Com12 mission. 

13 (3) HTS.—The term ‘‘HTS’’ means the Har14 monized Tariff Schedule of the United States. 

15 (4) TEXTILE OR APPAREL GOOD.—The term 

16 ‘‘textile or apparel good’’ means a good listed in the 

17 Annex to the Agreement on Textiles and Clothing 

18 referred to in section 101(d)(4) of the Uruguay 

19 Round Agreements Act (19 U.S.C. 3511(d)(4)), 

20 other than a good listed in Annex 3.30 of the Agree21 ment. 
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1 TITLE I—APPROVAL OF, AND 

2 GENERAL PROVISIONS RE3 LATING TO, THE AGREEMENT 

4 SEC. 101. APPROVAL AND ENTRY INTO FORCE OF THE 

5 AGREEMENT. 

6 (a) APPROVAL OF AGREEMENT AND STATEMENT OF

7 ADMINISTRATIVE ACTION.—Pursuant to section 2105 of 

8 the Bipartisan Trade Promotion Authority Act of 2002 

9 (19 U.S.C. 3805) and section 151 of the Trade Act of 

10 1974 (19 U.S.C. 2191), Congress approves— 

11 (1) the United States–Panama Trade Pro12 motion Agreement entered into on June 28, 2007, 

13 with the Government of Panama and submitted to 

14 Congress on October 3, 2011; and 

15 (2) the statement of administrative action pro16 posed to implement the Agreement that was sub17 mitted to Congress on October 3, 2011. 

18 (b) CONDITIONS FOR ENTRY INTO FORCE OF THE

19 AGREEMENT.—At such time as the President determines 

20 that Panama has taken measures necessary to comply 

21 with those provisions of the Agreement that are to take 

22 effect on the date on which the Agreement enters into 

23 force, the President is authorized to exchange notes with 

24 the Government of Panama providing for the entry into 
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1 force, on or after January 1, 2012, of the Agreement with 

2 respect to the United States. 

3 SEC. 102. RELATIONSHIP OF THE AGREEMENT TO UNITED 

4 STATES AND STATE LAW. 

5 (a) RELATIONSHIP OF AGREEMENT TO UNITED

6 STATES LAW.— 

7 (1) UNITED STATES LAW TO PREVAIL IN CON8 FLICT.—No provision of the Agreement, nor the ap9 plication of any such provision to any person or cir10 cumstance, which is inconsistent with any law of the 

11 United States shall have effect. 

12 (2) CONSTRUCTION.—Nothing in this Act shall 

13 be construed— 

14 (A) to amend or modify any law of the 

15 United States, or 

16 (B) to limit any authority conferred under 

17 any law of the United States, 

18 unless specifically provided for in this Act. 

19 (b) RELATIONSHIP OF AGREEMENT TO STATE

20 LAW.— 

21 (1) LEGAL CHALLENGE.—No State law, or the 

22 application thereof, may be declared invalid as to 

23 any person or circumstance on the ground that the 

24 provision or application is inconsistent with the 

25 Agreement, except in an action brought by the 
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1 United States for the purpose of declaring such law 

2 or application invalid. 

3 (2) DEFINITION OF STATE LAW.—For purposes 

4 of this subsection, the term ‘‘State law’’ includes— 

5 (A) any law of a political subdivision of a 

6 State; and 

7 (B) any State law regulating or taxing the 

8 business of insurance. 

9 (c) EFFECT OF AGREEMENT WITH RESPECT TO PRI10 VATE REMEDIES.—No person other than the United 

11 States— 

12 (1) shall have any cause of action or defense 

13 under the Agreement or by virtue of congressional 

14 approval thereof; or 

15 (2) may challenge, in any action brought under 

16 any provision of law, any action or inaction by any 

17 department, agency, or other instrumentality of the 

18 United States, any State, or any political subdivision 

19 of a State, on the ground that such action or inac20 tion is inconsistent with the Agreement. 

21 SEC. 103. IMPLEMENTING ACTIONS IN ANTICIPATION OF 

22 ENTRY INTO FORCE AND INITIAL REGULA23 TIONS. 

24 (a) IMPLEMENTING ACTIONS.— 
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1 (1) PROCLAMATION AUTHORITY.—After the 

2 date of the enactment of this Act— 

3 (A) the President may proclaim such ac4 tions, and 

5 (B) other appropriate officers of the 

6 United States Government may issue such reg7 ulations, 

8 as may be necessary to ensure that any provision of 

9 this Act, or amendment made by this Act, that takes 

10 effect on the date on which the Agreement enters 

11 into force is appropriately implemented on such 

12 date, but no such proclamation or regulation may 

13 have an effective date earlier than the date on which 

14 the Agreement enters into force. 

15 (2) EFFECTIVE DATE OF CERTAIN PROCLAIMED

16 ACTIONS.—Any action proclaimed by the President 

17 under the authority of this Act that is not subject 

18 to the consultation and layover provisions under sec19 tion 104 may not take effect before the 15th day 

20 after the date on which the text of the proclamation 

21 is published in the Federal Register. 

22 (3) WAIVER OF 15-DAY RESTRICTION.—The 15- 

23 day restriction contained in paragraph (2) on the 

24 taking effect of proclaimed actions is waived to the 

25 extent that the application of such restriction would 
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1 prevent the taking effect on the date the Agreement 

2 enters into force of any action proclaimed under this 

3 section. 

4 (b) INITIAL REGULATIONS.—Initial regulations nec5 essary or appropriate to carry out the actions required by 

6 or authorized under this Act or proposed in the statement 

7 of administrative action submitted under section 

8 101(a)(2) to implement the Agreement shall, to the max9 imum extent feasible, be issued within 1 year after the 

10 date on which the Agreement enters into force. In the case 

11 of any implementing action that takes effect on a date 

12 after the date on which the Agreement enters into force, 

13 initial regulations to carry out that action shall, to the 

14 maximum extent feasible, be issued within 1 year after 

15 such effective date. 

16 SEC. 104. CONSULTATION AND LAYOVER PROVISIONS FOR, 

17 AND EFFECTIVE DATE OF, PROCLAIMED AC18 TIONS. 

19 If a provision of this Act provides that the implemen20 tation of an action by the President by proclamation is 

21 subject to the consultation and layover requirements of 

22 this section, such action may be proclaimed only if— 

23 (1) the President has obtained advice regarding 

24 the proposed action from— 
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1 (A) the appropriate advisory committees 

2 established under section 135 of the Trade Act 

3 of 1974 (19 U.S.C. 2155); and 

4 (B) the Commission; 

5 (2) the President has submitted to the Com6 mittee on Finance of the Senate and the Committee 

7 on Ways and Means of the House of Representatives 

8 a report that sets forth— 

9 (A) the action proposed to be proclaimed 

10 and the reasons therefor; and 

11 (B) the advice obtained under paragraph 

12 (1); 

13 (3) a period of 60 calendar days, beginning on 

14 the first day on which the requirements set forth in 

15 paragraphs (1) and (2) have been met, has expired; 

16 and 

17 (4) the President has consulted with the com18 mittees referred to in paragraph (2) regarding the 

19 proposed action during the period referred to in 

20 paragraph (3). 

21 SEC. 105. ADMINISTRATION OF DISPUTE SETTLEMENT PRO22 CEEDINGS. 

23 (a) ESTABLISHMENT OR DESIGNATION OF OFFICE.— 

24 The President is authorized to establish or designate with25 in the Department of Commerce an office that shall be 
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1 responsible for providing administrative assistance to pan2 els established under chapter 20 of the Agreement. The 

3 office shall not be considered to be an agency for purposes 

4 of section 552 of title 5, United States Code. 

5 (b) AUTHORIZATION OF APPROPRIATIONS.—There 

6 are authorized to be appropriated for each fiscal year after 

7 fiscal year 2011 to the Department of Commerce up to 

8 $150,000 for the establishment and operations of the of9 fice established or designated under subsection (a) and for 

10 the payment of the United States share of the expenses 

11 of panels established under chapter 20 of the Agreement. 

12 SEC. 106. ARBITRATION OF CLAIMS. 

13 The United States is authorized to resolve any claim 

14 against the United States covered by article 

15 10.16.1(a)(i)(C) or article 10.16.1(b)(i)(C) of the Agree16 ment, pursuant to the Investor-State Dispute Settlement 

17 procedures set forth in section B of chapter 10 of the 

18 Agreement. 

19 SEC. 107. EFFECTIVE DATES; EFFECT OF TERMINATION. 

20 (a) EFFECTIVE DATES.—Except as provided in sub21 section (b), this Act and the amendments made by this 

22 Act take effect on the date on which the Agreement enters 

23 into force. 

24 (b) EXCEPTIONS.— 
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1 (1) IN GENERAL.—Sections 1 through 3, this 

2 title, and title V take effect on the date of the enact3 ment of this Act. 

4 (2) CERTAIN AMENDATORY PROVISIONS.—The 

5 amendments made by sections 204, 205, 207, and 

6 401 of this Act take effect on the date of the enact7 ment of this Act and apply with respect to Panama 

8 on the date on which the Agreement enters into 

9 force. 

10 (c) TERMINATION OF THE AGREEMENT.—On the 

11 date on which the Agreement terminates, this Act (other 

12 than this subsection and title V) and the amendments 

13 made by this Act (other than the amendments made by 

14 title V) shall cease to have effect. 

15 TITLE II—CUSTOMS PROVISIONS 

16 SEC. 201. TARIFF MODIFICATIONS. 

17 (a) TARIFF MODIFICATIONS PROVIDED FOR IN THE

18 AGREEMENT.— 

19 (1) PROCLAMATION AUTHORITY.—The Presi20 dent may proclaim— 

21 (A) such modifications or continuation of 

22 any duty, 

23 (B) such continuation of duty-free or ex24 cise treatment, or 

25 (C) such additional duties, 
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1 as the President determines to be necessary or ap2 propriate to carry out or apply articles 3.3, 3.5, 3.6, 

3 3.26, 3.27, 3.28, and 3.29, and Annex 3.3, of the 

4 Agreement. 

5 (2) EFFECT ON GSP STATUS.—Notwithstanding 

6 section 502(a)(1) of the Trade Act of 1974 (19 

7 U.S.C. 2462(a)(1)), the President shall, on the date 

8 on which the Agreement enters into force, terminate 

9 the designation of Panama as a beneficiary devel10 oping country for purposes of title V of the Trade 

11 Act of 1974 (19 U.S.C. 2461 et seq.). 

12 (3) EFFECT ON CBERA STATUS.— 

13 (A) IN GENERAL.—Notwithstanding sec14 tion 212(a) of the Caribbean Basin Economic 

15 Recovery Act (19 U.S.C. 2702(a)), the Presi16 dent shall, on the date on which the Agreement 

17 enters into force, terminate the designation of 

18 Panama as a beneficiary country for purposes 

19 of that Act. 

20 (B) EXCEPTION.—Notwithstanding sub21 paragraph (A), Panama shall be considered a 

22 beneficiary country under section 212(a) of the 

23 Caribbean Basin Economic Recovery Act, for 

24 purposes of— 
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1 (i) sections 771(7)(G)(ii)(III) and 

2 771(7)(H) of the Tariff Act of 1930 (19 

3 U.S.C. 1677(7)(G)(ii)(III) and 

4 1677(7)(H)); 

5 (ii) the duty-free treatment provided 

6 under paragraph 4 of the General Notes to 

7 the Schedule of the United States to 

8 Annex 3.3 of the Agreement; and 

9 (iii) section 274(h)(6)(B) of the Inter10 nal Revenue Code of 1986. 

11 (b) OTHER TARIFF MODIFICATIONS.—Subject to the 

12 consultation and layover provisions of section 104, the 

13 President may proclaim— 

14 (1) such modifications or continuation of any 

15 duty, 

16 (2) such modifications as the United States 

17 may agree to with Panama regarding the staging of 

18 any duty treatment set forth in Annex 3.3 of the 

19 Agreement, 

20 (3) such continuation of duty-free or excise 

21 treatment, or 

22 (4) such additional duties, 

23 as the President determines to be necessary or appropriate 

24 to maintain the general level of reciprocal and mutually 
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1 advantageous concessions with respect to Panama pro2 vided for by the Agreement. 

3 (c) CONVERSION TO AD VALOREM RATES.—For pur4 poses of subsections (a) and (b), with respect to any good 

5 for which the base rate in the Schedule of the United 

6 States to Annex 3.3 of the Agreement is a specific or com7 pound rate of duty, the President may substitute for the 

8 base rate an ad valorem rate that the President deter9 mines to be equivalent to the base rate. 

10 (d) TARIFF RATE QUOTAS.—In implementing the 

11 tariff rate quotas set forth in Appendix I to the General 

12 Notes to the Schedule of the United States to Annex 3.3 

13 of the Agreement, the President shall take such action as 

14 may be necessary to ensure that imports of agricultural 

15 goods do not disrupt the orderly marketing of commodities 

16 in the United States. 

17 SEC. 202. ADDITIONAL DUTIES ON CERTAIN AGRICUL18 TURAL GOODS. 

19 (a) DEFINITIONS.—In this section: 

20 (1) APPLICABLE NTR (MFN) RATE OF DUTY.— 

21 The term ‘‘applicable NTR (MFN) rate of duty’’ 

22 means, with respect to a safeguard good, a rate of 

23 duty equal to the lowest of— 

24 (A) the base rate in the Schedule of the 

25 United States to Annex 3.3 of the Agreement; 
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1 (B) the column 1 general rate of duty that 

2 would, on the day before the date on which the 

3 Agreement enters into force, apply to a good 

4 classifiable in the same 8-digit subheading of 

5 the HTS as the safeguard good; or 

6 (C) the column 1 general rate of duty that 

7 would, at the time the additional duty is im8 posed under subsection (b), apply to a good 

9 classifiable in the same 8-digit subheading of 

10 the HTS as the safeguard good. 

11 (2) SAFEGUARD GOOD.—The term ‘‘safeguard 

12 good’’ means a good— 

13 (A) that is included in the Schedule of the 

14 United States to Annex 3.17 of the Agreement; 

15 (B) that qualifies as an originating good 

16 under section 203; and 

17 (C) for which a claim for preferential tariff 

18 treatment under the Agreement has been made. 

19 (3) SCHEDULE RATE OF DUTY.—The term 

20 ‘‘schedule rate of duty’’ means, with respect to a 

21 safeguard good, the rate of duty for that good that 

22 is set forth in the Schedule of the United States to 

23 Annex 3.3 of the Agreement. 

24 (4) TRIGGER LEVEL.— 
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1 (A) IN GENERAL.—The term ‘‘trigger 

2 level’’ means— 

3 (i) in the case of a safeguard good 

4 classified under subheading 0201.10.50, 

5 0201.20.80, 0201.30.80, 0202.10.50, 

6 0202.20.80, or 0202.30.80 of the HTS— 

7 (I) in year 1 of the Agreement, 

8 330 metric tons; and 

9 (II) in year 2 of the Agreement 

10 through year 14 of the Agreement, a 

11 quantity equal to 110 percent of the 

12 trigger level for that safeguard good 

13 for the preceding calendar year; and 

14 (ii) in the case of any other safeguard 

15 good, 115 percent of the quantity that is 

16 provided for that safeguard good in the 

17 corresponding calendar year in the applica18 ble table contained in Appendix I to the 

19 General Notes to the Schedule of the 

20 United States to Annex 3.3 of the Agree21 ment. 

22 (B) RELATIONSHIP TO TABLE.—For pur23 poses of subparagraph (A)(ii), year 1 in the ap24 plicable table contained in Appendix I to the 

25 General Notes to the Schedule of the United 
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1 States to Annex 3.3 of the Agreement cor2 responds to year 1 of the Agreement. 

3 (5) YEAR 1 OF THE AGREEMENT.—The term 

4 ‘‘year 1 of the Agreement’’ means the period begin5 ning on the date, in a calendar year, on which the 

6 Agreement enters into force and ending on Decem7 ber 31 of that calendar year. 

8 (6) YEARS OTHER THAN YEAR 1 OF THE

9 AGREEMENT.—Any reference to a year of the Agree10 ment subsequent to year 1 of the Agreement shall 

11 be deemed to be a reference to the corresponding 

12 calendar year in which the Agreement is in force. 

13 (b) ADDITIONAL DUTIES ON SAFEGUARD GOODS.— 

14 (1) IN GENERAL.—In addition to any duty pro15 claimed under subsection (a) or (b) of section 201, 

16 the Secretary of the Treasury shall assess a duty, in 

17 the amount determined under paragraph (2), on a 

18 safeguard good imported into the United States in 

19 a calendar year if the Secretary determines that, 

20 prior to such importation, the total volume of that 

21 safeguard good that is imported into the United 

22 States in that calendar year exceeds the trigger level 

23 for that good for that calendar year. 
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1 (2) CALCULATION OF ADDITIONAL DUTY.—The 

2 additional duty on a safeguard good under this sub3 section shall be— 

4 (A) in the case of a good classified under 

5 subheading 0201.10.50, 0201.20.80, 

6 0201.30.80, 0202.10.50, 0202.20.80, or 

7 0202.30.80 of the HTS— 

8 (i) in year 1 of the Agreement 

9 through year 6 of the Agreement, an 

10 amount equal to 100 percent of the excess 

11 of the applicable NTR (MFN) rate of duty 

12 over the schedule rate of duty; and 

13 (ii) in year 7 of the Agreement 

14 through year 14 of the Agreement, an 

15 amount equal to 50 percent of the excess 

16 of the applicable NTR (MFN) rate of duty 

17 over the schedule rate of duty; 

18 (B) in the case of a good classified under 

19 subheading 0406.10.08, 0406.10.88, 

20 0406.20.91, 0406.30.91, 0406.90.97, or 

21 2105.00.20 of the HTS— 

22 (i) in year 1 of the Agreement 

23 through year 11 of the Agreement, an 

24 amount equal to 100 percent of the excess 
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1 of the applicable NTR (MFN) rate of duty 

2 over the schedule rate of duty; and 

3 (ii) in year 12 of the Agreement 

4 through year 14 of the Agreement, an 

5 amount equal to 50 percent of the excess 

6 of the applicable NTR (MFN) rate of duty 

7 over the schedule rate of duty; and 

8 (C) in the case of any other safeguard 

9 good— 

10 (i) in year 1 of the Agreement 

11 through year 13 of the Agreement, an 

12 amount equal to 100 percent of the excess 

13 of the applicable NTR (MFN) rate of duty 

14 over the schedule rate of duty; and 

15 (ii) in year 14 of the Agreement 

16 through year 16 of the Agreement, an 

17 amount equal to 50 percent of the excess 

18 of the applicable NTR (MFN) rate of duty 

19 over the schedule rate of duty. 

20 (3) NOTICE.—Not later than 60 days after the 

21 date on which the Secretary of the Treasury first as22 sesses an additional duty in a calendar year on a 

23 good under this subsection, the Secretary shall no24 tify the Government of Panama in writing of such 
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1 action and shall provide to that Government data 

2 supporting the assessment of the additional duty. 

3 (c) EXCEPTIONS.—No additional duty shall be as4 sessed on a good under subsection (b) if, at the time of 

5 entry, the good is subject to import relief under— 

6 (1) subtitle A of title III of this Act; or 

7 (2) chapter 1 of title II of the Trade Act of 

8 1974 (19 U.S.C. 2251 et seq.). 

9 (d) TERMINATION.—The assessment of an additional 

10 duty on a good under subsection (b) shall cease to apply 

11 to that good on the date on which duty-free treatment 

12 must be provided to that good under the Schedule of the 

13 United States to Annex 3.3 of the Agreement. 

14 SEC. 203. RULES OF ORIGIN. 

15 (a) APPLICATION AND INTERPRETATION.—In this 

16 section: 

17 (1) TARIFF CLASSIFICATION.—The basis for 

18 any tariff classification is the HTS. 

19 (2) REFERENCE TO HTS.—Whenever in this 

20 section there is a reference to a chapter, heading, or 

21 subheading, such reference shall be a reference to a 

22 chapter, heading, or subheading of the HTS. 

23 (3) COST OR VALUE.—Any cost or value re24 ferred to in this section shall be recorded and main25 tained in accordance with the generally accepted ac-
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1 counting principles applicable in the territory of the 

2 country in which the good is produced (whether 

3 Panama or the United States). 

4 (b) ORIGINATING GOODS.—For purposes of this Act 

5 and for purposes of implementing the preferential tariff 

6 treatment provided for under the Agreement, except as 

7 otherwise provided in this section, a good is an originating 

8 good if— 

9 (1) the good is a good wholly obtained or pro10 duced entirely in the territory of Panama, the 

11 United States, or both; 

12 (2) the good— 

13 (A) is produced entirely in the territory of 

14 Panama, the United States, or both, and— 

15 (i) each of the nonoriginating mate16 rials used in the production of the good 

17 undergoes an applicable change in tariff 

18 classification specified in Annex 4.1 of the 

19 Agreement; or 

20 (ii) the good otherwise satisfies any 

21 applicable regional value-content or other 

22 requirements specified in Annex 4.1 of the 

23 Agreement; and 

24 (B) satisfies all other applicable require25 ments of this section; or 
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1 (3) the good is produced entirely in the terri2 tory of Panama, the United States, or both, exclu3 sively from materials described in paragraph (1) or 

4 (2). 

5 (c) REGIONAL VALUE-CONTENT.— 

6 (1) IN GENERAL.—For purposes of subsection 

7 (b)(2), the regional value-content of a good referred 

8 to in Annex 4.1 of the Agreement, except for goods 

9 to which paragraph (4) applies, shall be calculated 

10 by the importer, exporter, or producer of the good, 

11 on the basis of the build-down method described in 

12 paragraph (2) or the build-up method described in 

13 paragraph (3). 

14 (2) BUILD-DOWN METHOD.— 

15 (A) IN GENERAL.—The regional value-con16 tent of a good may be calculated on the basis 

17 of the following build-down method: 

AV–VNM 

RVC = ————— × 100 

AV 

18 (B) DEFINITIONS.—In subparagraph (A): 

19 (i) RVC.—The term ‘‘RVC’’ means 

20 the regional value-content of the good, ex21 pressed as a percentage. 

22 (ii) AV.—The term ‘‘AV’’ means the 

23 adjusted value of the good. 
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1 (iii) VNM.—The term ‘‘VNM’’ means 

2 the value of nonoriginating materials that 

3 are acquired and used by the producer in 

4 the production of the good, but does not 

5 include the value of a material that is self6 produced. 

7 (3) BUILD-UP METHOD.— 

8 (A) IN GENERAL.—The regional value-con9 tent of a good may be calculated on the basis 

10 of the following build-up method: 

VOM 

RVC = ————— × 100 

AV 

11 (B) DEFINITIONS.—In subparagraph (A): 

12 (i) RVC.—The term ‘‘RVC’’ means 

13 the regional value-content of the good, ex14 pressed as a percentage. 

15 (ii) AV.—The term ‘‘AV’’ means the 

16 adjusted value of the good. 

17 (iii) VOM.—The term ‘‘VOM’’ means 

18 the value of originating materials that are 

19 acquired or self-produced, and used by the 

20 producer in the production of the good. 

21 (4) SPECIAL RULE FOR CERTAIN AUTOMOTIVE

22 GOODS.— 

23 (A) IN GENERAL.—For purposes of sub24 section (b)(2), the regional value-content of an 
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1 automotive good referred to in Annex 4.1 of the 

2 Agreement may be calculated by the importer, 

3 exporter, or producer of the good on the basis 

4 of the build-down method described in para5 graph (2), the build-up method described in 

6 paragraph (3), or the following net cost method: 

NC¥VNM 

RVC = ————— × 100 

NC 

7 (B) DEFINITIONS.—In subparagraph (A): 

8 (i) AUTOMOTIVE GOOD.—The term 

9 ‘‘automotive good’’ means a good provided 

10 for in any of subheadings 8407.31 through 

11 8407.34, subheading 8408.20, heading 

12 8409, or any of headings 8701 through 

13 8708. 

14 (ii) RVC.—The term ‘‘RVC’’ means 

15 the regional value-content of the auto16 motive good, expressed as a percentage. 

17 (iii) NC.—The term ‘‘NC’’ means the 

18 net cost of the automotive good. 

19 (iv) VNM.—The term ‘‘VNM’’ means 

20 the value of nonoriginating materials that 

21 are acquired and used by the producer in 

22 the production of the automotive good, but 

23 does not include the value of a material 

24 that is self-produced. 
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1 (C) MOTOR VEHICLES.— 

2 (i) BASIS OF CALCULATION.—For 

3 purposes of determining the regional value4 content under subparagraph (A) for an 

5 automotive good that is a motor vehicle 

6 provided for in any of headings 8701 

7 through 8705, an importer, exporter, or 

8 producer may average the amounts cal9 culated under the net cost formula con10 tained in subparagraph (A), over the pro11 ducer’s fiscal year— 

12 (I) with respect to all motor vehi13 cles in any one of the categories de14 scribed in clause (ii); or 

15 (II) with respect to all motor ve16 hicles in any such category that are 

17 exported to the territory of Panama 

18 or the United States. 

19 (ii) CATEGORIES.—A category is de20 scribed in this clause if it— 

21 (I) is the same model line of 

22 motor vehicles, is in the same class of 

23 motor vehicles, and is produced in the 

24 same plant in the territory of Panama 

25 or the United States, as the good de-
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1 scribed in clause (i) for which regional 

2 value-content is being calculated; 

3 (II) is the same class of motor 

4 vehicles, and is produced in the same 

5 plant in the territory of Panama or 

6 the United States, as the good de7 scribed in clause (i) for which regional 

8 value-content is being calculated; or 

9 (III) is the same model line of 

10 motor vehicles produced in the terri11 tory of Panama or the United States 

12 as the good described in clause (i) for 

13 which regional value-content is being 

14 calculated. 

15 (D) OTHER AUTOMOTIVE GOODS.—For 

16 purposes of determining the regional value-con17 tent under subparagraph (A) for automotive 

18 materials provided for in any of subheadings 

19 8407.31 through 8407.34, in subheading 

20 8408.20, or in heading 8409, 8706, 8707, or 

21 8708, that are produced in the same plant, an 

22 importer, exporter, or producer may— 

23 (i) average the amounts calculated 

24 under the net cost formula contained in 

25 subparagraph (A) over— 
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1 (I) the fiscal year of the motor 

2 vehicle producer to whom the auto3 motive goods are sold, 

4 (II) any quarter or month, or 

5 (III) the fiscal year of the pro6 ducer of such goods, 

7 if the goods were produced during the fis8 cal year, quarter, or month that is the 

9 basis for the calculation; 

10 (ii) determine the average referred to 

11 in clause (i) separately for such goods sold 

12 to 1 or more motor vehicle producers; or 

13 (iii) make a separate determination 

14 under clause (i) or (ii) for such goods that 

15 are exported to the territory of Panama or 

16 the United States. 

17 (E) CALCULATING NET COST.—The im18 porter, exporter, or producer of an automotive 

19 good shall, consistent with the provisions re20 garding allocation of costs provided for in gen21 erally accepted accounting principles, determine 

22 the net cost of the automotive good under sub23 paragraph (B) by— 

24 (i) calculating the total cost incurred 

25 with respect to all goods produced by the 
29 

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1 producer of the automotive good, sub2 tracting any sales promotion, marketing, 

3 and after-sales service costs, royalties, 

4 shipping and packing costs, and nonallow5 able interest costs that are included in the 

6 total cost of all such goods, and then rea7 sonably allocating the resulting net cost of 

8 those goods to the automotive good; 

9 (ii) calculating the total cost incurred 

10 with respect to all goods produced by that 

11 producer, reasonably allocating the total 

12 cost to the automotive good, and then sub13 tracting any sales promotion, marketing, 

14 and after-sales service costs, royalties, 

15 shipping and packing costs, and nonallow16 able interest costs that are included in the 

17 portion of the total cost allocated to the 

18 automotive good; or 

19 (iii) reasonably allocating each cost 

20 that forms part of the total cost incurred 

21 with respect to the automotive good so that 

22 the aggregate of these costs does not in23 clude any sales promotion, marketing, and 

24 after-sales service costs, royalties, shipping 
30 

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1 and packing costs, or nonallowable interest 

2 costs. 

3 (d) VALUE OF MATERIALS.— 

4 (1) IN GENERAL.—For the purpose of calcu5 lating the regional value-content of a good under 

6 subsection (c), and for purposes of applying the de 

7 minimis rules under subsection (f), the value of a 

8 material is— 

9 (A) in the case of a material that is im10 ported by the producer of the good, the ad11 justed value of the material; 

12 (B) in the case of a material acquired in 

13 the territory in which the good is produced, the 

14 value, determined in accordance with Articles 1 

15 through 8, Article 15, and the corresponding in16 terpretive notes, of the Agreement on Imple17 mentation of Article VII of the General Agree18 ment on Tariffs and Trade 1994 referred to in 

19 section 101(d)(8) of the Uruguay Round Agree20 ments Act (19 U.S.C. 3511(d)(8)), as set forth 

21 in regulations promulgated by the Secretary of 

22 the Treasury providing for the application of 

23 such Articles in the absence of an importation 

24 by the producer; or 
31 

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1 (C) in the case of a material that is self2 produced, the sum of— 

3 (i) all expenses incurred in the pro4 duction of the material, including general 

5 expenses; and 

6 (ii) an amount for profit equivalent to 

7 the profit added in the normal course of 

8 trade. 

9 (2) FURTHER ADJUSTMENTS TO THE VALUE OF

10 MATERIALS.— 

11 (A) ORIGINATING MATERIAL.—The fol12 lowing expenses, if not included in the value of 

13 an originating material calculated under para14 graph (1), may be added to the value of the 

15 originating material: 

16 (i) The costs of freight, insurance, 

17 packing, and all other costs incurred in 

18 transporting the material within or be19 tween the territory of Panama, the United 

20 States, or both, to the location of the pro21 ducer. 

22 (ii) Duties, taxes, and customs broker23 age fees on the material paid in the terri24 tory of Panama, the United States, or 

25 both, other than duties or taxes that are 
32 

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1 waived, refunded, refundable, or otherwise 

2 recoverable, including credit against duty 

3 or tax paid or payable. 

4 (iii) The cost of waste and spoilage re5 sulting from the use of the material in the 

6 production of the good, less the value of 

7 renewable scrap or byproducts. 

8 (B) NONORIGINATING MATERIAL.—The 

9 following expenses, if included in the value of a 

10 nonoriginating material calculated under para11 graph (1), may be deducted from the value of 

12 the nonoriginating material: 

13 (i) The costs of freight, insurance, 

14 packing, and all other costs incurred in 

15 transporting the material within or be16 tween the territory of Panama, the United 

17 States, or both, to the location of the pro18 ducer. 

19 (ii) Duties, taxes, and customs broker20 age fees on the material paid in the terri21 tory of Panama, the United States, or 

22 both, other than duties or taxes that are 

23 waived, refunded, refundable, or otherwise 

24 recoverable, including credit against duty 

25 or tax paid or payable. 
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1 (iii) The cost of waste and spoilage re2 sulting from the use of the material in the 

3 production of the good, less the value of 

4 renewable scrap or byproducts. 

5 (iv) The cost of originating materials 

6 used in the production of the nonorigi7 nating material in the territory of Panama, 

8 the United States, or both. 

9 (e) ACCUMULATION.— 

10 (1) ORIGINATING MATERIALS USED IN PRODUC11 TION OF GOODS OF THE OTHER COUNTRY.—Origi12 nating materials from the territory of Panama or 

13 the United States that are used in the production of 

14 a good in the territory of the other country shall be 

15 considered to originate in the territory of such other 

16 country. 

17 (2) MULTIPLE PRODUCERS.—A good that is 

18 produced in the territory of Panama, the United 

19 States, or both, by 1 or more producers, is an origi20 nating good if the good satisfies the requirements of 

21 subsection (b) and all other applicable requirements 

22 of this section. 

23 (f) DE MINIMIS AMOUNTS OF NONORIGINATING MA24 TERIALS.— 
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1 (1) IN GENERAL.—Except as provided in para2 graphs (2) and (3), a good that does not undergo a 

3 change in tariff classification pursuant to Annex 4.1 

4 of the Agreement is an originating good if— 

5 (A) the value of all nonoriginating mate6 rials that— 

7 (i) are used in the production of the 

8 good, and 

9 (ii) do not undergo the applicable 

10 change in tariff classification (set forth in 

11 Annex 4.1 of the Agreement), 

12 does not exceed 10 percent of the adjusted 

13 value of the good; 

14 (B) the good meets all other applicable re15 quirements of this section; and 

16 (C) the value of such nonoriginating mate17 rials is included in the value of nonoriginating 

18 materials for any applicable regional value-con19 tent requirement for the good. 

20 (2) EXCEPTIONS.—Paragraph (1) does not 

21 apply to the following: 

22 (A) A nonoriginating material provided for 

23 in chapter 4, or a nonoriginating dairy prepara24 tion containing over 10 percent by weight of 

25 milk solids provided for in subheading 1901.90 
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1 or 2106.90, that is used in the production of a 

2 good provided for in chapter 4. 

3 (B) A nonoriginating material provided for 

4 in chapter 4, or a nonoriginating dairy prepara5 tion containing over 10 percent by weight of 

6 milk solids provided for in subheading 1901.90, 

7 that is used in the production of the following 

8 goods: 

9 (i) Infant preparations containing 

10 over 10 percent by weight of milk solids 

11 provided for in subheading 1901.10. 

12 (ii) Mixes and doughs, containing over 

13 25 percent by weight of butterfat, not put 

14 up for retail sale, provided for in sub15 heading 1901.20. 

16 (iii) Dairy preparations containing 

17 over 10 percent by weight of milk solids 

18 provided for in subheading 1901.90 or 

19 2106.90. 

20 (iv) Goods provided for in heading 

21 2105. 

22 (v) Beverages containing milk pro23 vided for in subheading 2202.90. 
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1 (vi) Animal feeds containing over 10 

2 percent by weight of milk solids provided 

3 for in subheading 2309.90. 

4 (C) A nonoriginating material provided for 

5 in heading 0805, or any of subheadings 

6 2009.11 through 2009.39, that is used in the 

7 production of a good provided for in any of sub8 headings 2009.11 through 2009.39, or in fruit 

9 or vegetable juice of any single fruit or vege10 table, fortified with minerals or vitamins, con11 centrated or unconcentrated, provided for in 

12 subheading 2106.90 or 2202.90. 

13 (D) A nonoriginating material provided for 

14 in heading 0901 or 2101 that is used in the 

15 production of a good provided for in heading 

16 0901 or 2101. 

17 (E) A nonoriginating material provided for 

18 in heading 1006 that is used in the production 

19 of a good provided for in heading 1102 or 1103 

20 or subheading 1904.90. 

21 (F) A nonoriginating material provided for 

22 in chapter 15 that is used in the production of 

23 a good provided for in chapter 15. 

24 (G) A nonoriginating material provided for 

25 in heading 1701 that is used in the production 
37 

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1 of a good provided for in any of headings 1701 

2 through 1703. 

3 (H) A nonoriginating material provided for 

4 in chapter 17 that is used in the production of 

5 a good provided for in subheading 1806.10. 

6 (I) Except as provided in subparagraphs 

7 (A) through (H) and Annex 4.1 of the Agree8 ment, a nonoriginating material used in the 

9 production of a good provided for in any of 

10 chapters 1 through 24, unless the nonorigi11 nating material is provided for in a different 

12 subheading than the good for which origin is 

13 being determined under this section. 

14 (3) TEXTILE OR APPAREL GOODS.— 

15 (A) IN GENERAL.—Except as provided in 

16 subparagraph (B), a textile or apparel good 

17 that is not an originating good because certain 

18 fibers or yarns used in the production of the 

19 component of the good that determines the tar20 iff classification of the good do not undergo an 

21 applicable change in tariff classification, set 

22 forth in Annex 4.1 of the Agreement, shall be 

23 considered to be an originating good if— 

24 (i) the total weight of all such fibers 

25 or yarns in that component is not more 
38 

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1 than 10 percent of the total weight of that 

2 component; or 

3 (ii) the yarns are those described in 

4 section 204(b)(3)(B)(vi)(IV) of the Andean 

5 Trade Preference Act (19 U.S.C. 

6 3203(b)(3)(B)(vi)(IV)) (as in effect on 

7 February 12, 2011). 

8 (B) CERTAIN TEXTILE OR APPAREL

9 GOODS.—A textile or apparel good containing 

10 elastomeric yarns in the component of the good 

11 that determines the tariff classification of the 

12 good shall be considered to be an originating 

13 good only if such yarns are wholly formed and 

14 finished in the territory of Panama, the United 

15 States, or both. 

16 (C) FABRIC, YARN, OR FIBER.—For pur17 poses of this paragraph, in the case of a good 

18 that is a fabric, yarn, or fiber, the term ‘‘com19 ponent of the good that determines the tariff 

20 classification of the good’’ means all of the fi21 bers in the good. 

22 (g) FUNGIBLE GOODS AND MATERIALS.— 

23 (1) IN GENERAL.— 

24 (A) CLAIM FOR PREFERENTIAL TARIFF

25 TREATMENT.—A person claiming that a fun-
39 

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1 gible good or fungible material is an originating 

2 good may base the claim either on the physical 

3 segregation of the fungible good or fungible ma4 terial or by using an inventory management 

5 method with respect to the fungible good or 

6 fungible material. 

7 (B) INVENTORY MANAGEMENT METHOD.— 

8 In this subsection, the term ‘‘inventory manage9 ment method’’ means— 

10 (i) averaging; 

11 (ii) ‘‘last-in, first-out’’; 

12 (iii) ‘‘first-in, first-out’’; or 

13 (iv) any other method— 

14 (I) recognized in the generally 

15 accepted accounting principles of the 

16 country in which the production is 

17 performed (whether Panama or the 

18 United States); or 

19 (II) otherwise accepted by that 

20 country. 

21 (2) ELECTION OF INVENTORY METHOD.—A 

22 person selecting an inventory management method 

23 under paragraph (1) for a particular fungible good 

24 or fungible material shall continue to use that meth-
40 

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1 od for that fungible good or fungible material 

2 throughout the fiscal year of such person. 

3 (h) ACCESSORIES, SPARE PARTS, OR TOOLS.— 

4 (1) IN GENERAL.—Subject to paragraphs (2) 

5 and (3), accessories, spare parts, or tools delivered 

6 with a good that form part of the good’s standard 

7 accessories, spare parts, or tools shall— 

8 (A) be treated as originating goods if the 

9 good is an originating good; and 

10 (B) be disregarded in determining whether 

11 all the nonoriginating materials used in the pro12 duction of the good undergo the applicable 

13 change in tariff classification set forth in Annex 

14 4.1 of the Agreement. 

15 (2) CONDITIONS.—Paragraph (1) shall apply 

16 only if— 

17 (A) the accessories, spare parts, or tools 

18 are classified with and not invoiced separately 

19 from the good, regardless of whether such ac20 cessories, spare parts, or tools are specified or 

21 are separately identified in the invoice for the 

22 good; and 

23 (B) the quantities and value of the acces24 sories, spare parts, or tools are customary for 

25 the good. 
41 

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1 (3) REGIONAL VALUE-CONTENT.—If the good is 

2 subject to a regional value-content requirement, the 

3 value of the accessories, spare parts, or tools shall 

4 be taken into account as originating or nonorigi5 nating materials, as the case may be, in calculating 

6 the regional value-content of the good. 

7 (i) PACKAGING MATERIALS AND CONTAINERS FOR

8 RETAIL SALE.—Packaging materials and containers in 

9 which a good is packaged for retail sale, if classified with 

10 the good, shall be disregarded in determining whether all 

11 the nonoriginating materials used in the production of the 

12 good undergo the applicable change in tariff classification 

13 set forth in Annex 4.1 of the Agreement, and, if the good 

14 is subject to a regional value-content requirement, the 

15 value of such packaging materials and containers shall be 

16 taken into account as originating or nonoriginating mate17 rials, as the case may be, in calculating the regional value18 content of the good. 

19 (j) PACKING MATERIALS AND CONTAINERS FOR

20 SHIPMENT.—Packing materials and containers for ship21 ment shall be disregarded in determining whether a good 

22 is an originating good. 

23 (k) INDIRECT MATERIALS.—An indirect material 

24 shall be treated as an originating material without regard 

25 to where it is produced. 
42 

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1 (l) TRANSIT AND TRANSHIPMENT.—A good that has 

2 undergone production necessary to qualify as an origi3 nating good under subsection (b) shall not be considered 

4 to be an originating good if, subsequent to that produc5 tion, the good— 

6 (1) undergoes further production or any other 

7 operation outside the territory of Panama or the 

8 United States, other than unloading, reloading, or 

9 any other operation necessary to preserve the good 

10 in good condition or to transport the good to the ter11 ritory of Panama or the United States; or 

12 (2) does not remain under the control of cus13 toms authorities in the territory of a country other 

14 than Panama or the United States. 

15 (m) GOODS CLASSIFIABLE AS GOODS PUT UP IN

16 SETS.—Notwithstanding the rules set forth in Annex 4.1 

17 of the Agreement, goods classifiable as goods put up in 

18 sets for retail sale as provided for in General Rule of Inter19 pretation 3 of the HTS shall not be considered to be origi20 nating goods unless— 

21 (1) each of the goods in the set is an origi22 nating good; or 

23 (2) the total value of the nonoriginating goods 

24 in the set does not exceed— 
43 

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1 (A) in the case of textile or apparel goods, 

2 10 percent of the adjusted value of the set; or 

3 (B) in the case of goods, other than textile 

4 or apparel goods, 15 percent of the adjusted 

5 value of the set. 

6 (n) DEFINITIONS.—In this section: 

7 (1) ADJUSTED VALUE.—The term ‘‘adjusted 

8 value’’ means the value determined in accordance 

9 with Articles 1 through 8, Article 15, and the cor10 responding interpretive notes, of the Agreement on 

11 Implementation of Article VII of the General Agree12 ment on Tariffs and Trade 1994 referred to in sec13 tion 101(d)(8) of the Uruguay Round Agreements 

14 Act (19 U.S.C. 3511(d)(8)), adjusted, if necessary, 

15 to exclude any costs, charges, or expenses incurred 

16 for transportation, insurance, and related services 

17 incident to the international shipment of the mer18 chandise from the country of exportation to the 

19 place of importation. 

20 (2) CLASS OF MOTOR VEHICLES.—The term 

21 ‘‘class of motor vehicles’’ means any one of the fol22 lowing categories of motor vehicles: 

23 (A) Motor vehicles provided for in sub24 heading 8701.20, 8704.10, 8704.22, 8704.23, 

25 8704.32, or 8704.90, or heading 8705 or 8706, 
44 

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1 or motor vehicles for the transport of 16 or 

2 more persons provided for in subheading 

3 8702.10 or 8702.90. 

4 (B) Motor vehicles provided for in sub5 heading 8701.10 or any of subheadings 

6 8701.30 through 8701.90. 

7 (C) Motor vehicles for the transport of 15 

8 or fewer persons provided for in subheading 

9 8702.10 or 8702.90, or motor vehicles provided 

10 for in subheading 8704.21 or 8704.31. 

11 (D) Motor vehicles provided for in any of 

12 subheadings 8703.21 through 8703.90. 

13 (3) FUNGIBLE GOOD OR FUNGIBLE MATE14 RIAL.—The term ‘‘fungible good’’ or ‘‘fungible mate15 rial’’ means a good or material, as the case may be, 

16 that is interchangeable with another good or mate17 rial for commercial purposes and the properties of 

18 which are essentially identical to such other good or 

19 material. 

20 (4) GENERALLY ACCEPTED ACCOUNTING PRIN21 CIPLES.—The term ‘‘generally accepted accounting 

22 principles’’— 

23 (A) means the recognized consensus or 

24 substantial authoritative support given in the 

25 territory of Panama or the United States, as 
45 

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1 the case may be, with respect to the recording 

2 of revenues, expenses, costs, assets, and liabil3 ities, the disclosure of information, and the 

4 preparation of financial statements; and 

5 (B) may encompass broad guidelines for 

6 general application as well as detailed stand7 ards, practices, and procedures. 

8 (5) GOOD WHOLLY OBTAINED OR PRODUCED

9 ENTIRELY IN THE TERRITORY OF PANAMA, THE

10 UNITED STATES, OR BOTH.—The term ‘‘good wholly 

11 obtained or produced entirely in the territory of 

12 Panama, the United States, or both’’ means any of 

13 the following: 

14 (A) Plants and plant products harvested or 

15 gathered in the territory of Panama, the United 

16 States, or both. 

17 (B) Live animals born and raised in the 

18 territory of Panama, the United States, or 

19 both. 

20 (C) Goods obtained in the territory of Pan21 ama, the United States, or both from live ani22 mals. 

23 (D) Goods obtained from hunting, trap24 ping, fishing, or aquaculture conducted in the 
46 

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1 territory of Panama, the United States, or 

2 both. 

3 (E) Minerals and other natural resources 

4 not included in subparagraphs (A) through (D) 

5 that are extracted or taken from the territory 

6 of Panama, the United States, or both. 

7 (F) Fish, shellfish, and other marine life 

8 taken from the sea, seabed, or subsoil outside 

9 the territory of Panama or the United States 

10 by— 

11 (i) a vessel that is registered or re12 corded with Panama and flying the flag of 

13 Panama; or 

14 (ii) a vessel that is documented under 

15 the laws of the United States. 

16 (G) Goods produced on board a factory 

17 ship from goods referred to in subparagraph 

18 (F), if such factory ship— 

19 (i) is registered or recorded with Pan20 ama and flies the flag of Panama; or 

21 (ii) is a vessel that is documented 

22 under the laws of the United States. 

23 (H)(i) Goods taken by Panama or a person 

24 of Panama from the seabed or subsoil outside 
47 

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1 the territorial waters of Panama, if Panama 

2 has rights to exploit such seabed or subsoil. 

3 (ii) Goods taken by the United States or a 

4 person of the United States from the seabed or 

5 subsoil outside the territorial waters of the 

6 United States, if the United States has rights 

7 to exploit such seabed or subsoil. 

8 (I) Goods taken from outer space, if the 

9 goods are obtained by Panama or the United 

10 States or a person of Panama or the United 

11 States and not processed in the territory of a 

12 country other than Panama or the United 

13 States. 

14 (J) Waste and scrap derived from— 

15 (i) manufacturing or processing oper16 ations in the territory of Panama, the 

17 United States, or both; or 

18 (ii) used goods collected in the terri19 tory of Panama, the United States, or 

20 both, if such goods are fit only for the re21 covery of raw materials. 

22 (K) Recovered goods derived in the terri23 tory of Panama, the United States, or both 

24 from used goods, and used in the territory of 
48 

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1 Panama, the United States, or both, in the pro2 duction of remanufactured goods. 

3 (L) Goods, at any stage of production, pro4 duced in the territory of Panama, the United 

5 States, or both, exclusively from— 

6 (i) goods referred to in any of sub7 paragraphs (A) through (J), or 

8 (ii) the derivatives of goods referred 

9 to in clause (i). 

10 (6) IDENTICAL GOODS.—The term ‘‘identical 

11 goods’’ means goods that are the same in all re12 spects relevant to the rule of origin that qualifies the 

13 goods as originating goods. 

14 (7) INDIRECT MATERIAL.—The term ‘‘indirect 

15 material’’ means a good used in the production, test16 ing, or inspection of another good but not physically 

17 incorporated into that other good, or a good used in 

18 the maintenance of buildings or the operation of 

19 equipment associated with the production of another 

20 good, including— 

21 (A) fuel and energy; 

22 (B) tools, dies, and molds; 

23 (C) spare parts and materials used in the 

24 maintenance of equipment or buildings; 
49 

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1 (D) lubricants, greases, compounding ma2 terials, and other materials used in production 

3 or used to operate equipment or buildings; 

4 (E) gloves, glasses, footwear, clothing, 

5 safety equipment, and supplies; 

6 (F) equipment, devices, and supplies used 

7 for testing or inspecting the good; 

8 (G) catalysts and solvents; and 

9 (H) any other good that is not incor10 porated into the other good but the use of 

11 which in the production of the other good can 

12 reasonably be demonstrated to be a part of that 

13 production. 

14 (8) MATERIAL.—The term ‘‘material’’ means a 

15 good that is used in the production of another good, 

16 including a part or an ingredient. 

17 (9) MATERIAL THAT IS SELF-PRODUCED.—The 

18 term ‘‘material that is self-produced’’ means an orig19 inating material that is produced by a producer of 

20 a good and used in the production of that good. 

21 (10) MODEL LINE OF MOTOR VEHICLES.—The 

22 term ‘‘model line of motor vehicles’’ means a group 

23 of motor vehicles having the same platform or model 

24 name. 
50 

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1 (11) NET COST.—The term ‘‘net cost’’ means 

2 total cost minus sales promotion, marketing, and 

3 after-sales service costs, royalties, shipping and 

4 packing costs, and nonallowable interest costs that 

5 are included in the total cost. 

6 (12) NONALLOWABLE INTEREST COSTS.—The 

7 term ‘‘nonallowable interest costs’’ means interest 

8 costs incurred by a producer that exceed 700 basis 

9 points above the applicable official interest rate for 

10 comparable maturities of the country in which the 

11 producer is located. 

12 (13) NONORIGINATING GOOD OR NONORIGI13 NATING MATERIAL.—The term ‘‘nonoriginating 

14 good’’ or ‘‘nonoriginating material’’ means a good or 

15 material, as the case may be, that does not qualify 

16 as originating under this section. 

17 (14) PACKING MATERIALS AND CONTAINERS

18 FOR SHIPMENT.—The term ‘‘packing materials and 

19 containers for shipment’’ means goods used to pro20 tect another good during its transportation and does 

21 not include the packaging materials and containers 

22 in which the other good is packaged for retail sale. 

23 (15) PREFERENTIAL TARIFF TREATMENT.— 

24 The term ‘‘preferential tariff treatment’’ means the 

25 customs duty rate, and the treatment under article 
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1 3.10.4 of the Agreement, that are applicable to an 

2 originating good pursuant to the Agreement. 

3 (16) PRODUCER.—The term ‘‘producer’’ means 

4 a person who engages in the production of a good 

5 in the territory of Panama or the United States. 

6 (17) PRODUCTION.—The term ‘‘production’’ 

7 means growing, mining, harvesting, fishing, raising, 

8 trapping, hunting, manufacturing, processing, as9 sembling, or disassembling a good. 

10 (18) REASONABLY ALLOCATE.—The term ‘‘rea11 sonably allocate’’ means to apportion in a manner 

12 that would be appropriate under generally accepted 

13 accounting principles. 

14 (19) RECOVERED GOODS.—The term ‘‘recov15 ered goods’’ means materials in the form of indi16 vidual parts that are the result of— 

17 (A) the disassembly of used goods into in18 dividual parts; and 

19 (B) the cleaning, inspecting, testing, or 

20 other processing that is necessary for improve21 ment to sound working condition of such indi22 vidual parts. 

23 (20) REMANUFACTURED GOOD.—The term ‘‘re24 manufactured good’’ means a good that is classified 

25 under chapter 84, 85, 87, or 90, or heading 9402, 
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1 other than a good classified under heading 8418 or 

2 8516, and that— 

3 (A) is entirely or partially comprised of re4 covered goods; and 

5 (B) has a similar life expectancy and en6 joys a factory warranty similar to such a good 

7 that is new. 

8 (21) TOTAL COST.—The term ‘‘total cost’’ 

9 means all product costs, period costs, and other 

10 costs for a good incurred in the territory of Panama, 

11 the United States, or both. 

12 (22) USED.—The term ‘‘used’’ means utilized 

13 or consumed in the production of goods. 

14 (o) PRESIDENTIAL PROCLAMATION AUTHORITY.— 

15 (1) IN GENERAL.—The President is authorized 

16 to proclaim, as part of the HTS— 

17 (A) the provisions set forth in Annex 4.1 

18 of the Agreement; and 

19 (B) any additional subordinate category 

20 that is necessary to carry out this title con21 sistent with the Agreement. 

22 (2) FABRICS, YARNS, OR FIBERS NOT AVAIL23 ABLE IN COMMERCIAL QUANTITIES IN THE UNITED

24 STATES.—The President is authorized to proclaim 

25 that a fabric, yarn, or fiber is added to the list in 
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1 Annex 3.25 of the Agreement in an unrestricted 

2 quantity, as provided in article 3.25.4(e) of the 

3 Agreement. 

4 (3) MODIFICATIONS.— 

5 (A) IN GENERAL.—Subject to the consulta6 tion and layover provisions of section 104, the 

7 President may proclaim modifications to the 

8 provisions proclaimed under the authority of 

9 paragraph (1)(A), other than provisions of 

10 chapters 50 through 63 (as included in Annex 

11 4.1 of the Agreement). 

12 (B) ADDITIONAL PROCLAMATIONS.—Not13 withstanding subparagraph (A), and subject to 

14 the consultation and layover provisions of sec15 tion 104, the President may proclaim before the 

16 end of the 1-year period beginning on the date 

17 on which the Agreement enters into force, 

18 modifications to correct any typographical, cler19 ical, or other nonsubstantive technical error re20 garding the provisions of chapters 50 through 

21 63 (as included in Annex 4.1 of the Agree22 ment). 

23 (4) FABRICS, YARNS, OR FIBERS NOT AVAIL24 ABLE IN COMMERCIAL QUANTITIES IN PANAMA AND

25 THE UNITED STATES.— 
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1 (A) IN GENERAL.—Notwithstanding para2 graph (3)(A), the list of fabrics, yarns, and fi3 bers set forth in Annex 3.25 of the Agreement 

4 may be modified as provided for in this para5 graph. 

6 (B) DEFINITIONS.—In this paragraph: 

7 (i) INTERESTED ENTITY.—The term 

8 ‘‘interested entity’’ means the Government 

9 of Panama, a potential or actual purchaser 

10 of a textile or apparel good, or a potential 

11 or actual supplier of a textile or apparel 

12 good. 

13 (ii) DAY; DAYS.—All references to 

14 ‘‘day’’ and ‘‘days’’ exclude Saturdays, Sun15 days, and legal holidays observed by the 

16 Government of the United States. 

17 (C) REQUESTS TO ADD FABRICS, YARNS, 

18 OR FIBERS.— 

19 (i) IN GENERAL.—An interested entity 

20 may request the President to determine 

21 that a fabric, yarn, or fiber is not available 

22 in commercial quantities in a timely man23 ner in Panama and the United States and 

24 to add that fabric, yarn, or fiber to the list 
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1 in Annex 3.25 of the Agreement in a re2 stricted or unrestricted quantity. 

3 (ii) DETERMINATIONS.—After receiv4 ing a request under clause (i), the Presi5 dent may determine whether— 

6 (I) the fabric, yarn, or fiber is 

7 available in commercial quantities in a 

8 timely manner in Panama or the 

9 United States; or 

10 (II) any interested entity objects 

11 to the request. 

12 (iii) PROCLAMATION AUTHORITY.— 

13 The President may, within the time peri14 ods specified in clause (iv), proclaim that 

15 the fabric, yarn, or fiber that is the subject 

16 of the request is added to the list in Annex 

17 3.25 of the Agreement in an unrestricted 

18 quantity, or in any restricted quantity that 

19 the President may establish, if the Presi20 dent has determined under clause (ii) 

21 that— 

22 (I) the fabric, yarn, or fiber is 

23 not available in commercial quantities 

24 in a timely manner in Panama and 

25 the United States; or 
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1 (II) no interested entity has ob2 jected to the request. 

3 (iv) TIME PERIODS.—The time peri4 ods within which the President may issue 

5 a proclamation under clause (iii) are— 

6 (I) not later than 30 days after 

7 the date on which a request is sub8 mitted under clause (i); or 

9 (II) not later than 44 days after 

10 the request is submitted, if the Presi11 dent determines, within 30 days after 

12 the date on which the request is sub13 mitted, that the President does not 

14 have sufficient information to make a 

15 determination under clause (ii). 

16 (v) EFFECTIVE DATE.—Notwith17 standing section 103(a)(2), a proclamation 

18 made under clause (iii) shall take effect on 

19 the date on which the text of the proclama20 tion is published in the Federal Register. 

21 (vi) ELIMINATION OF RESTRICTION.— 

22 Not later than 6 months after proclaiming 

23 under clause (iii) that a fabric, yarn, or 

24 fiber is added to the list in Annex 3.25 of 

25 the Agreement in a restricted quantity, the 
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1 President may eliminate the restriction if 

2 the President determines that the fabric, 

3 yarn, or fiber is not available in commer4 cial quantities in a timely manner in Pan5 ama and the United States. 

6 (D) DEEMED APPROVAL OF REQUEST.—If, 

7 after an interested entity submits a request 

8 under subparagraph (C)(i), the President does 

9 not, within the applicable time period specified 

10 in subparagraph (C)(iv), make a determination 

11 under subparagraph (C)(ii) regarding the re12 quest, the fabric, yarn, or fiber that is the sub13 ject of the request shall be considered to be 

14 added, in an unrestricted quantity, to the list in 

15 Annex 3.25 of the Agreement beginning— 

16 (i) 45 days after the date on which 

17 the request is submitted; or 

18 (ii) 60 days after the date on which 

19 the request is submitted, if the President 

20 made a determination under subparagraph 

21 (C)(iv)(II). 

22 (E) REQUESTS TO RESTRICT OR REMOVE

23 FABRICS, YARNS, OR FIBERS.— 

24 (i) IN GENERAL.—Subject to clause 

25 (ii), an interested entity may request the 
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1 President to restrict the quantity of, or re2 move from the list in Annex 3.25 of the 

3 Agreement, any fabric, yarn, or fiber— 

4 (I) that has been added to that 

5 list in an unrestricted quantity pursu6 ant to paragraph (2) or subparagraph 

7 (C)(iii) or (D) of this paragraph; or 

8 (II) with respect to which the 

9 President has eliminated a restriction 

10 under subparagraph (C)(vi). 

11 (ii) TIME PERIOD FOR SUBMISSION.— 

12 An interested entity may submit a request 

13 under clause (i) at any time beginning on 

14 the date that is 6 months after the date of 

15 the action described in subclause (I) or (II) 

16 of that clause. 

17 (iii) PROCLAMATION AUTHORITY.— 

18 Not later than 30 days after the date on 

19 which a request under clause (i) is sub20 mitted, the President may proclaim an ac21 tion provided for under clause (i) if the 

22 President determines that the fabric, yarn, 

23 or fiber that is the subject of the request 

24 is available in commercial quantities in a 
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1 timely manner in Panama or the United 

2 States. 

3 (iv) EFFECTIVE DATE.—A proclama4 tion issued under clause (iii) may not take 

5 effect earlier than the date that is 6 

6 months after the date on which the text of 

7 the proclamation is published in the Fed8 eral Register. 

9 (F) PROCEDURES.—The President shall 

10 establish procedures— 

11 (i) governing the submission of a re12 quest under subparagraphs (C) and (E); 

13 and 

14 (ii) providing an opportunity for inter15 ested entities to submit comments and sup16 porting evidence before the President 

17 makes a determination under subpara18 graph (C) (ii) or (vi) or (E)(iii). 

19 SEC. 204. CUSTOMS USER FEES. 

20 Section 13031(b) of the Consolidated Omnibus Budg21 et Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is 

22 amended by adding after paragraph (20) the following: 

23 ‘‘(21) No fee may be charged under subsection (a)(9) 

24 or (10) with respect to goods that qualify as originating 

25 goods under section 203 of the United States–Panama 
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1 Trade Promotion Agreement Implementation Act. Any 

2 service for which an exemption from such fee is provided 

3 by reason of this paragraph may not be funded with 

4 money contained in the Customs User Fee Account.’’. 

5 SEC. 205. DISCLOSURE OF INCORRECT INFORMATION; 

6 FALSE CERTIFICATIONS OF ORIGIN; DENIAL 

7 OF PREFERENTIAL TARIFF TREATMENT. 

8 (a) DISCLOSURE OF INCORRECT INFORMATION.— 

9 Section 592 of the Tariff Act of 1930 (19 U.S.C. 1592) 

10 is amended— 

11 (1) in subsection (c)— 

12 (A) by redesignating paragraph (13) as 

13 paragraph (14); and 

14 (B) by inserting after paragraph (12) the 

15 following new paragraph: 

16 ‘‘(13) PRIOR DISCLOSURE REGARDING CLAIMS

17 UNDER THE UNITED STATES–PANAMA TRADE PRO18 MOTION AGREEMENT.—An importer shall not be 

19 subject to penalties under subsection (a) for making 

20 an incorrect claim that a good qualifies as an origi21 nating good under section 203 of the United States– 

22 Panama Trade Promotion Agreement Implementa23 tion Act if the importer, in accordance with regula24 tions issued by the Secretary of the Treasury, 

25 promptly and voluntarily makes a corrected declara-
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1 tion and pays any duties owing with respect to that 

2 good.’’; and 

3 (2) by adding at the end the following new sub4 section: 

5 ‘‘(l) FALSE CERTIFICATIONS OF ORIGIN UNDER THE

6 UNITED STATES–PANAMA TRADE PROMOTION AGREE7 MENT.— 

8 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

9 it is unlawful for any person to certify falsely, by 

10 fraud, gross negligence, or negligence, in a Panama 

11 TPA certification of origin (as defined in section 

12 508 of this Act) that a good exported from the 

13 United States qualifies as an originating good under 

14 the rules of origin provided for in section 203 of the 

15 United States–Panama Trade Promotion Agreement 

16 Implementation Act. The procedures and penalties 

17 of this section that apply to a violation of subsection 

18 (a) also apply to a violation of this subsection. 

19 ‘‘(2) PROMPT AND VOLUNTARY DISCLOSURE OF

20 INCORRECT INFORMATION.—No penalty shall be im21 posed under this subsection if, promptly after an ex22 porter or producer that issued a Panama TPA cer23 tification of origin has reason to believe that such 

24 certification contains or is based on incorrect infor25 mation, the exporter or producer voluntarily provides 
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1 written notice of such incorrect information to every 

2 person to whom the certification was issued. 

3 ‘‘(3) EXCEPTION.—A person shall not be con4 sidered to have violated paragraph (1) if— 

5 ‘‘(A) the information was correct at the 

6 time it was provided in a Panama TPA certifi7 cation of origin but was later rendered incorrect 

8 due to a change in circumstances; and 

9 ‘‘(B) the person promptly and voluntarily 

10 provides written notice of the change in cir11 cumstances to all persons to whom the person 

12 provided the certification.’’. 

13 (b) DENIAL OF PREFERENTIAL TARIFF TREAT14 MENT.—Section 514 of the Tariff Act of 1930 (19 U.S.C. 

15 1514) is amended by adding at the end the following new 

16 subsection: 

17 ‘‘(l) DENIAL OF PREFERENTIAL TARIFF TREATMENT

18 UNDER THE UNITED STATES–PANAMA TRADE PRO19 MOTION AGREEMENT.—If U.S. Customs and Border Pro20 tection or U.S. Immigration and Customs Enforcement of 

21 the Department of Homeland Security finds indications 

22 of a pattern of conduct by an importer, exporter, or pro23 ducer of false or unsupported representations that goods 

24 qualify under the rules of origin provided for in section 

25 203 of the United States–Panama Trade Promotion 
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1 Agreement Implementation Act, U.S. Customs and Border 

2 Protection, in accordance with regulations issued by the 

3 Secretary of the Treasury, may suspend preferential tariff 

4 treatment under the United States–Panama Trade Pro5 motion Agreement to entries of identical goods covered by 

6 subsequent representations by that importer, exporter, or 

7 producer until U.S. Customs and Border Protection deter8 mines that representations of that person are in con9 formity with such section 203.’’. 

10 SEC. 206. RELIQUIDATION OF ENTRIES. 

11 Section 520(d) of the Tariff Act of 1930 (19 U.S.C. 

12 1520(d)) is amended in the matter preceding paragraph 

13 (1)— 

14 (1) by striking ‘‘or’’; and 

15 (2) by striking ‘‘for which’’ and inserting ‘‘, or 

16 section 203 of the United States–Panama Trade 

17 Promotion Agreement Implementation Act for 

18 which’’. 

19 SEC. 207. RECORDKEEPING REQUIREMENTS. 

20 Section 508 of the Tariff Act of 1930 (19 U.S.C. 

21 1508) is amended— 

22 (1) by redesignating subsection (k) as sub23 section (l); 

24 (2) by inserting after subsection (j) the fol25 lowing new subsection: 
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1 ‘‘(k) CERTIFICATIONS OF ORIGIN FOR GOODS EX2 PORTED UNDER THE UNITED STATES–PANAMA TRADE

3 PROMOTION AGREEMENT.— 

4 ‘‘(1) DEFINITIONS.—In this subsection: 

5 ‘‘(A) RECORDS AND SUPPORTING DOCU6 MENTS.—The term ‘records and supporting 

7 documents’ means, with respect to an exported 

8 good under paragraph (2), records and docu9 ments related to the origin of the good, includ10 ing— 

11 ‘‘(i) the purchase, cost, and value of, 

12 and payment for, the good; 

13 ‘‘(ii) the purchase, cost, and value of, 

14 and payment for, all materials, including 

15 indirect materials, used in the production 

16 of the good; and 

17 ‘‘(iii) the production of the good in 

18 the form in which it was exported. 

19 ‘‘(B) PANAMA TPA CERTIFICATION OF ORI20 GIN.—The term ‘Panama TPA certification of 

21 origin’ means the certification established under 

22 article 4.15 of the United States–Panama 

23 Trade Promotion Agreement that a good quali24 fies as an originating good under such Agree25 ment. 
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1 ‘‘(2) EXPORTS TO PANAMA.—Any person who 

2 completes and issues a Panama TPA certification of 

3 origin for a good exported from the United States 

4 shall make, keep, and, pursuant to rules and regula5 tions promulgated by the Secretary of the Treasury, 

6 render for examination and inspection all records 

7 and supporting documents related to the origin of 

8 the good (including the certification or copies there9 of). 

10 ‘‘(3) RETENTION PERIOD.—The person who 

11 issues a Panama TPA certification of origin shall 

12 keep the records and supporting documents relating 

13 to that certification of origin for a period of at least 

14 5 years after the date on which the certification is 

15 issued.’’; and 

16 (3) in subsection (l), as so redesignated, by 

17 striking ‘‘(i), or (j)’’ and inserting ‘‘(i), (j), or (k)’’. 

18 SEC. 208. ENFORCEMENT RELATING TO TRADE IN TEXTILE 

19 OR APPAREL GOODS. 

20 (a) ACTION DURING VERIFICATION.— 

21 (1) IN GENERAL.—If the Secretary of the 

22 Treasury requests the Government of Panama to 

23 conduct a verification pursuant to article 3.21 of the 

24 Agreement for purposes of making a determination 

25 under paragraph (2), the President may direct the 
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1 Secretary to take appropriate action described in 

2 subsection (b) while the verification is being con3 ducted. 

4 (2) DETERMINATION.—A determination under 

5 this paragraph is a determination of the Secretary 

6 that— 

7 (A) an enterprise in Panama is complying 

8 with applicable customs laws, regulations, and 

9 procedures regarding trade in textile or apparel 

10 goods, or 

11 (B) a claim that a textile or apparel good 

12 exported or produced by such enterprise— 

13 (i) qualifies as an originating good 

14 under section 203, or 

15 (ii) is a good of Panama, 

16 is accurate. 

17 (b) APPROPRIATE ACTION DESCRIBED.—Appropriate 

18 action under subsection (a)(1) includes— 

19 (1) suspension of preferential tariff treatment 

20 under the Agreement with respect to— 

21 (A) any textile or apparel good exported or 

22 produced by the person that is the subject of a 

23 verification under subsection (a)(1) regarding 

24 compliance described in subsection (a)(2)(A), if 

25 the Secretary of the Treasury determines that 
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1 there is insufficient information to support any 

2 claim for preferential tariff treatment that has 

3 been made with respect to any such good; or 

4 (B) the textile or apparel good for which a 

5 claim of preferential tariff treatment has been 

6 made that is the subject of a verification under 

7 subsection (a)(1) regarding a claim described in 

8 subsection (a)(2)(B), if the Secretary deter9 mines that there is insufficient information to 

10 support that claim; 

11 (2) denial of preferential tariff treatment under 

12 the Agreement with respect to— 

13 (A) any textile or apparel good exported or 

14 produced by the person that is the subject of a 

15 verification under subsection (a)(1) regarding 

16 compliance described in subsection (a)(2)(A), if 

17 the Secretary determines that the person has 

18 provided incorrect information to support any 

19 claim for preferential tariff treatment that has 

20 been made with respect to any such good; or 

21 (B) the textile or apparel good for which a 

22 claim of preferential tariff treatment has been 

23 made that is the subject of a verification under 

24 subsection (a)(1) regarding a claim described in 

25 subsection (a)(2)(B), if the Secretary deter-
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1 mines that a person has provided incorrect in2 formation to support that claim; 

3 (3) detention of any textile or apparel good ex4 ported or produced by the person that is the subject 

5 of a verification under subsection (a)(1) regarding 

6 compliance described in subsection (a)(2)(A) or a 

7 claim described in subsection (a)(2)(B), if the Sec8 retary determines that there is insufficient informa9 tion to determine the country of origin of any such 

10 good; and 

11 (4) denial of entry into the United States of 

12 any textile or apparel good exported or produced by 

13 the person that is the subject of a verification under 

14 subsection (a)(1) regarding compliance described in 

15 subsection (a)(2)(A) or a claim described in sub16 section (a)(2)(B), if the Secretary determines that 

17 the person has provided incorrect information as to 

18 the country of origin of any such good. 

19 (c) ACTION ON COMPLETION OF A VERIFICATION.— 

20 On completion of a verification under subsection (a), the 

21 President may direct the Secretary of the Treasury to take 

22 appropriate action described in subsection (d) until such 

23 time as the Secretary receives information sufficient to 

24 make the determination under subsection (a)(2) or until 

25 such earlier date as the President may direct. 
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1 (d) APPROPRIATE ACTION DESCRIBED.—Appro2 priate action under subsection (c) includes— 

3 (1) denial of preferential tariff treatment under 

4 the Agreement with respect to— 

5 (A) any textile or apparel good exported or 

6 produced by the person that is the subject of a 

7 verification under subsection (a)(1) regarding 

8 compliance described in subsection (a)(2)(A), if 

9 the Secretary of the Treasury determines that 

10 there is insufficient information to support, or 

11 that the person has provided incorrect informa12 tion to support, any claim for preferential tariff 

13 treatment that has been made with respect to 

14 any such good; or 

15 (B) the textile or apparel good for which a 

16 claim of preferential tariff treatment has been 

17 made that is the subject of a verification under 

18 subsection (a)(1) regarding a claim described in 

19 subsection (a)(2)(B), if the Secretary deter20 mines that there is insufficient information to 

21 support, or that a person has provided incorrect 

22 information to support, that claim; and 

23 (2) denial of entry into the United States of 

24 any textile or apparel good exported or produced by 

25 the person that is the subject of a verification under 
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1 subsection (a)(1) regarding compliance described in 

2 subsection (a)(2)(A) or a claim described in sub3 section (a)(2)(B), if the Secretary determines that 

4 there is insufficient information to determine, or 

5 that the person has provided incorrect information 

6 as to, the country of origin of any such good. 

7 (e) PUBLICATION OF NAME OF PERSON.—In accord8 ance with article 3.21.9 of the Agreement, the Secretary 

9 of the Treasury may publish the name of any person that 

10 the Secretary has determined— 

11 (1) is engaged in intentional circumvention of 

12 applicable laws, regulations, or procedures affecting 

13 trade in textile or apparel goods; or 

14 (2) has failed to demonstrate that it produces, 

15 or is capable of producing, the textile or apparel 

16 goods that are the subject of a verification under 

17 subsection (a)(1). 

18 SEC. 209. REGULATIONS. 

19 The Secretary of the Treasury shall prescribe such 

20 regulations as may be necessary to carry out— 

21 (1) subsections (a) through (n) of section 203; 

22 (2) the amendment made by section 204; and 

23 (3) any proclamation issued under section 

24 203(o). 
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1 TITLE III—RELIEF FROM 

2 IMPORTS 

3 SEC. 301. DEFINITIONS. 

4 In this title: 

5 (1) PANAMANIAN ARTICLE.—The term ‘‘Pan6 amanian article’’ means an article that qualifies as 

7 an originating good under section 203(b). 

8 (2) PANAMANIAN TEXTILE OR APPAREL ARTI9 CLE.—The term ‘‘Panamanian textile or apparel ar10 ticle’’ means a textile or apparel good (as defined in 

11 section 3(4)) that is a Panamanian article. 

12 Subtitle A—Relief From Imports 

13 Benefitting From the Agreement 

14 SEC. 311. COMMENCING OF ACTION FOR RELIEF. 

15 (a) FILING OF PETITION.—A petition requesting ac16 tion under this subtitle for the purpose of adjusting to 

17 the obligations of the United States under the Agreement 

18 may be filed with the Commission by an entity, including 

19 a trade association, firm, certified or recognized union, or 

20 group of workers, that is representative of an industry. 

21 The Commission shall transmit a copy of any petition filed 

22 under this subsection to the United States Trade Rep23 resentative. 

24 (b) INVESTIGATION AND DETERMINATION.—Upon 

25 the filing of a petition under subsection (a), the Commis-
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1 sion, unless subsection (d) applies, shall promptly initiate 

2 an investigation to determine whether, as a result of the 

3 reduction or elimination of a duty provided for under the 

4 Agreement, a Panamanian article is being imported into 

5 the United States in such increased quantities, in absolute 

6 terms or relative to domestic production, and under such 

7 conditions that imports of the Panamanian article con8 stitute a substantial cause of serious injury or threat 

9 thereof to the domestic industry producing an article that 

10 is like, or directly competitive with, the imported article. 

11 (c) APPLICABLE PROVISIONS.—The following provi12 sions of section 202 of the Trade Act of 1974 (19 U.S.C. 

13 2252) apply with respect to any investigation initiated 

14 under subsection (b): 

15 (1) Paragraphs (1)(B) and (3) of subsection 

16 (b). 

17 (2) Subsection (c). 

18 (3) Subsection (i). 

19 (d) ARTICLES EXEMPT FROM INVESTIGATION.—No 

20 investigation may be initiated under this section with re21 spect to any Panamanian article if, after the date on which 

22 the Agreement enters into force, import relief has been 

23 provided with respect to that Panamanian article under 

24 this subtitle. 
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1 SEC. 312. COMMISSION ACTION ON PETITION. 

2 (a) DETERMINATION.—Not later than 120 days after 

3 the date on which an investigation is initiated under sec4 tion 311(b) with respect to a petition, the Commission 

5 shall make the determination required under that section. 

6 (b) APPLICABLE PROVISIONS.—For purposes of this 

7 subtitle, the provisions of paragraphs (1), (2), and (3) of 

8 section 330(d) of the Tariff Act of 1930 (19 U.S.C. 

9 1330(d) (1), (2), and (3)) shall be applied with respect 

10 to determinations and findings made under this section 

11 as if such determinations and findings were made under 

12 section 202 of the Trade Act of 1974 (19 U.S.C. 2252). 

13 (c) ADDITIONAL FINDING AND RECOMMENDATION IF

14 DETERMINATION AFFIRMATIVE.— 

15 (1) IN GENERAL.—If the determination made 

16 by the Commission under subsection (a) with respect 

17 to imports of an article is affirmative, or if the 

18 President may consider a determination of the Com19 mission to be an affirmative determination as pro20 vided for under paragraph (1) of section 330(d) of 

21 the Tariff Act of 1930 (19 U.S.C. 1330(d)(1)), the 

22 Commission shall find, and recommend to the Presi23 dent in the report required under subsection (d), the 

24 amount of import relief that is necessary to remedy 

25 or prevent the injury found by the Commission in 

26 the determination and to facilitate the efforts of the 
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1 domestic industry to make a positive adjustment to 

2 import competition. 

3 (2) LIMITATION ON RELIEF.—The import relief 

4 recommended by the Commission under this sub5 section shall be limited to the relief described in sec6 tion 313(c). 

7 (3) VOTING; SEPARATE VIEWS.—Only those 

8 members of the Commission who voted in the af9 firmative under subsection (a) are eligible to vote on 

10 the proposed action to remedy or prevent the injury 

11 found by the Commission. Members of the Commis12 sion who did not vote in the affirmative may submit, 

13 in the report required under subsection (d), separate 

14 views regarding what action, if any, should be taken 

15 to remedy or prevent the injury. 

16 (d) REPORT TO PRESIDENT.—Not later than the 

17 date that is 30 days after the date on which a determina18 tion is made under subsection (a) with respect to an inves19 tigation, the Commission shall submit to the President a 

20 report that includes— 

21 (1) the determination made under subsection 

22 (a) and an explanation of the basis for the deter23 mination; 

24 (2) if the determination under subsection (a) is 

25 affirmative, any findings and recommendations for 
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1 import relief made under subsection (c) and an ex2 planation of the basis for each recommendation; and 

3 (3) any dissenting or separate views by mem4 bers of the Commission regarding the determination 

5 referred to in paragraph (1) and any finding or rec6 ommendation referred to in paragraph (2). 

7 (e) PUBLIC NOTICE.—Upon submitting a report to 

8 the President under subsection (d), the Commission shall 

9 promptly make public the report (with the exception of 

10 information which the Commission determines to be con11 fidential) and shall publish a summary of the report in 

12 the Federal Register. 

13 SEC. 313. PROVISION OF RELIEF. 

14 (a) IN GENERAL.—Not later than the date that is 

15 30 days after the date on which the President receives a 

16 report of the Commission in which the Commission’s de17 termination under section 312(a) is affirmative, or which 

18 contains a determination under section 312(a) that the 

19 President considers to be affirmative under paragraph (1) 

20 of section 330(d) of the Tariff Act of 1930 (19 U.S.C. 

21 1330(d)(1)), the President, subject to subsection (b), shall 

22 provide relief from imports of the article that is the subject 

23 of such determination to the extent that the President de24 termines necessary to remedy or prevent the injury found 

25 by the Commission and to facilitate the efforts of the do-
76 

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1 mestic industry to make a positive adjustment to import 

2 competition. 

3 (b) EXCEPTION.—The President is not required to 

4 provide import relief under this section if the President 

5 determines that the provision of the import relief will not 

6 provide greater economic and social benefits than costs. 

7 (c) NATURE OF RELIEF.— 

8 (1) IN GENERAL.—The import relief that the 

9 President is authorized to provide under this section 

10 with respect to imports of an article is as follows: 

11 (A) The suspension of any further reduc12 tion provided for under Annex 3.3 of the Agree13 ment in the duty imposed on the article. 

14 (B) An increase in the rate of duty im15 posed on the article to a level that does not ex16 ceed the lesser of— 

17 (i) the column 1 general rate of duty 

18 imposed under the HTS on like articles at 

19 the time the import relief is provided; or 

20 (ii) the column 1 general rate of duty 

21 imposed under the HTS on like articles on 

22 the day before the date on which the 

23 Agreement enters into force. 

24 (2) PROGRESSIVE LIBERALIZATION.—If the pe25 riod for which import relief is provided under this 
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1 section is greater than 1 year, the President shall 

2 provide for the progressive liberalization (described 

3 in article 8.2.3 of the Agreement) of such relief at 

4 regular intervals during the period of its application. 

5 (d) PERIOD OF RELIEF.— 

6 (1) IN GENERAL.—Subject to paragraph (2), 

7 any import relief that the President provides under 

8 this section may not, in the aggregate, be in effect 

9 for more than 4 years. 

10 (2) EXTENSION.— 

11 (A) IN GENERAL.—If the initial period for 

12 any import relief provided under this section is 

13 less than 4 years, the President, after receiving 

14 a determination from the Commission under 

15 subparagraph (B) that is affirmative, or which 

16 the President considers to be affirmative under 

17 paragraph (1) of section 330(d) of the Tariff 

18 Act of 1930 (19 U.S.C. 1330(d)(1)), may ex19 tend the effective period of any import relief 

20 provided under this section, subject to the limi21 tation under paragraph (1), if the President de22 termines that— 

23 (i) the import relief continues to be 

24 necessary to remedy or prevent serious in-
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1 jury and to facilitate adjustment by the do2 mestic industry to import competition; and 

3 (ii) there is evidence that the industry 

4 is making a positive adjustment to import 

5 competition. 

6 (B) ACTION BY COMMISSION.— 

7 (i) INVESTIGATION.—Upon a petition 

8 on behalf of the industry concerned that is 

9 filed with the Commission not earlier than 

10 the date that is 9 months, and not later 

11 than the date that is 6 months, before the 

12 date on which any action taken under sub13 section (a) is to terminate, the Commission 

14 shall conduct an investigation to determine 

15 whether action under this section continues 

16 to be necessary to remedy or prevent seri17 ous injury and whether there is evidence 

18 that the industry is making a positive ad19 justment to import competition. 

20 (ii) NOTICE AND HEARING.—The 

21 Commission shall publish notice of the 

22 commencement of any proceeding under 

23 this subparagraph in the Federal Register 

24 and shall, within a reasonable time there25 after, hold a public hearing at which the 
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1 Commission shall afford interested parties 

2 and consumers an opportunity to be 

3 present, to present evidence, and to re4 spond to the presentations of other parties 

5 and consumers, and otherwise to be heard. 

6 (iii) REPORT.—The Commission shall 

7 submit to the President a report on its in8 vestigation and determination under this 

9 subparagraph not later than 60 days be10 fore the action under subsection (a) is to 

11 terminate, unless the President specifies a 

12 different date. 

13 (e) RATE AFTER TERMINATION OF IMPORT RE14 LIEF.—When import relief under this section is termi15 nated with respect to an article— 

16 (1) the rate of duty on that article after such 

17 termination and on or before December 31 of the 

18 year in which such termination occurs shall be the 

19 rate that, according to the Schedule of the United 

20 States to Annex 3.3 of the Agreement, would have 

21 been in effect 1 year after the provision of relief 

22 under subsection (a); and 

23 (2) the rate of duty for that article after De24 cember 31 of the year in which such termination oc-
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1 curs shall be, at the discretion of the President, ei2 ther— 

3 (A) the applicable rate of duty for that ar4 ticle set forth in the Schedule of the United 

5 States to Annex 3.3 of the Agreement; or 

6 (B) the rate of duty resulting from the 

7 elimination of the tariff in equal annual stages 

8 ending on the date set forth in the Schedule of 

9 the United States to Annex 3.3 of the Agree10 ment for the elimination of the tariff. 

11 (f) ARTICLES EXEMPT FROM RELIEF.—No import 

12 relief may be provided under this section on— 

13 (1) any article that is subject to import relief 

14 under— 

15 (A) subtitle B; or 

16 (B) chapter 1 of title II of the Trade Act 

17 of 1974 (19 U.S.C. 2251 et seq.); or 

18 (2) any article on which an additional duty as19 sessed under section 202(b) is in effect. 

20 SEC. 314. TERMINATION OF RELIEF AUTHORITY. 

21 (a) GENERAL RULE.—Subject to subsection (b), no 

22 import relief may be provided under this subtitle after the 

23 date that is 10 years after the date on which the Agree24 ment enters into force. 
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1 (b) EXCEPTION.—If an article for which relief is pro2 vided under this subtitle is an article for which the period 

3 for tariff elimination, set forth in the Schedule of the 

4 United States to Annex 3.3 of the Agreement, is greater 

5 than 10 years, no relief under this subtitle may be pro6 vided for that article after the date on which that period 

7 ends. 

8 SEC. 315. COMPENSATION AUTHORITY. 

9 For purposes of section 123 of the Trade Act of 1974 

10 (19 U.S.C. 2133), any import relief provided by the Presi11 dent under section 313 shall be treated as action taken 

12 under chapter 1 of title II of such Act (19 U.S.C. 2251 

13 et seq.). 

14 SEC. 316. CONFIDENTIAL BUSINESS INFORMATION. 

15 Section 202(a)(8) of the Trade Act of 1974 (19 

16 U.S.C. 2252(a)(8)) is amended in the first sentence— 

17 (1) by striking ‘‘and’’; and 

18 (2) by inserting before the period at the end ‘‘, 

19 and title III of the United States–Panama Trade 

20 Promotion Agreement Implementation Act’’. 

21 Subtitle B—Textile and Apparel 

22 Safeguard Measures 

23 SEC. 321. COMMENCEMENT OF ACTION FOR RELIEF. 

24 (a) IN GENERAL.—A request for action under this 

25 subtitle for the purpose of adjusting to the obligations of 
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1 the United States under the Agreement may be filed with 

2 the President by an interested party. Upon the filing of 

3 a request, the President shall review the request to deter4 mine, from information presented in the request, whether 

5 to commence consideration of the request. 

6 (b) PUBLICATION OF REQUEST.—If the President de7 termines that the request under subsection (a) provides 

8 the information necessary for the request to be considered, 

9 the President shall publish in the Federal Register a no10 tice of commencement of consideration of the request, and 

11 notice seeking public comments regarding the request. The 

12 notice shall include a summary of the request and the 

13 dates by which comments and rebuttals must be received. 

14 SEC. 322. DETERMINATION AND PROVISION OF RELIEF. 

15 (a) DETERMINATION.— 

16 (1) IN GENERAL.—If a positive determination is 

17 made under section 321(b), the President shall de18 termine whether, as a result of the elimination of a 

19 duty under the Agreement, a Panamanian textile or 

20 apparel article is being imported into the United 

21 States in such increased quantities, in absolute 

22 terms or relative to the domestic market for that ar23 ticle, and under such conditions as to cause serious 

24 damage, or actual threat thereof, to a domestic in-
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1 dustry producing an article that is like, or directly 

2 competitive with, the imported article. 

3 (2) SERIOUS DAMAGE.—In making a deter4 mination under paragraph (1), the President— 

5 (A) shall examine the effect of increased 

6 imports on the domestic industry, as reflected 

7 in changes in such relevant economic factors as 

8 output, productivity, utilization of capacity, in9 ventories, market share, exports, wages, em10 ployment, domestic prices, profits, and invest11 ment, no one of which is necessarily decisive; 

12 and 

13 (B) shall not consider changes in consumer 

14 preference or changes in technology as factors 

15 supporting a determination of serious damage 

16 or actual threat thereof. 

17 (3) DEADLINE FOR DETERMINATION.—The 

18 President shall make the determination under para19 graph (1) not later than 30 days after the comple20 tion of any consultations held pursuant to article 

21 3.24.4 of the Agreement. 

22 (b) PROVISION OF RELIEF.— 

23 (1) IN GENERAL.—If a determination under 

24 subsection (a) is affirmative, the President may pro25 vide relief from imports of the article that is the 
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1 subject of such determination, as provided in para2 graph (2), to the extent that the President deter3 mines necessary to remedy or prevent the serious 

4 damage and to facilitate adjustment by the domestic 

5 industry. 

6 (2) NATURE OF RELIEF.—The relief that the 

7 President is authorized to provide under this sub8 section with respect to imports of an article is an in9 crease in the rate of duty imposed on the article to 

10 a level that does not exceed the lesser of— 

11 (A) the column 1 general rate of duty im12 posed under the HTS on like articles at the 

13 time the import relief is provided; or 

14 (B) the column 1 general rate of duty im15 posed under the HTS on like articles on the 

16 day before the date on which the Agreement en17 ters into force. 

18 SEC. 323. PERIOD OF RELIEF. 

19 (a) IN GENERAL.—Subject to subsection (b), any im20 port relief that the President provides under section 

21 322(b) may not, in the aggregate, be in effect for more 

22 than 3 years. 

23 (b) EXTENSION.—If the initial period for any import 

24 relief provided under section 322 is less than 3 years, the 

25 President may extend the effective period of any import 
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1 relief provided under that section, subject to the limitation 

2 set forth in subsection (a), if the President determines 

3 that— 

4 (1) the import relief continues to be necessary 

5 to remedy or prevent serious damage and to facili6 tate adjustment by the domestic industry to import 

7 competition; and 

8 (2) there is evidence that the industry is mak9 ing a positive adjustment to import competition. 

10 SEC. 324. ARTICLES EXEMPT FROM RELIEF. 

11 The President may not provide import relief under 

12 this subtitle with respect to an article if— 

13 (1) import relief previously has been provided 

14 under this subtitle with respect to that article; or 

15 (2) the article is subject to import relief 

16 under— 

17 (A) subtitle A; or 

18 (B) chapter 1 of title II of the Trade Act 

19 of 1974 (19 U.S.C. 2251 et seq.). 

20 SEC. 325. RATE AFTER TERMINATION OF IMPORT RELIEF. 

21 On the date on which import relief under this subtitle 

22 is terminated with respect to an article, the rate of duty 

23 on that article shall be the rate that would have been in 

24 effect but for the provision of such relief. 
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1 SEC. 326. TERMINATION OF RELIEF AUTHORITY. 

2 No import relief may be provided under this subtitle 

3 with respect to any article after the date that is 5 years 

4 after the date on which the Agreement enters into force. 

5 SEC. 327. COMPENSATION AUTHORITY. 

6 For purposes of section 123 of the Trade Act of 1974 

7 (19 U.S.C. 2133), any import relief provided by the Presi8 dent under this subtitle shall be treated as action taken 

9 under chapter 1 of title II of such Act (19 U.S.C. 2251 

10 et seq.). 

11 SEC. 328. CONFIDENTIAL BUSINESS INFORMATION. 

12 The President may not release information received 

13 in connection with an investigation or determination under 

14 this subtitle which the President considers to be confiden15 tial business information unless the party submitting the 

16 confidential business information had notice, at the time 

17 of submission, that such information would be released by 

18 the President, or such party subsequently consents to the 

19 release of the information. To the extent a party submits 

20 confidential business information, the party shall also pro21 vide a nonconfidential version of the information in which 

22 the confidential business information is summarized or, if 

23 necessary, deleted. 
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1 Subtitle C—Cases Under Title II of 

2 the Trade Act of 1974 

3 SEC. 331. FINDINGS AND ACTION ON PANAMANIAN ARTI4 CLES. 

5 (a) EFFECT OF IMPORTS.—If, in any investigation 

6 initiated under chapter 1 of title II of the Trade Act of 

7 1974 (19 U.S.C. 2251 et seq.), the Commission makes an 

8 affirmative determination (or a determination which the 

9 President may treat as an affirmative determination under 

10 such chapter by reason of section 330(d) of the Tariff Act 

11 of 1930 (19 U.S.C. 1330(d))), the Commission shall also 

12 find (and report to the President at the time such injury 

13 determination is submitted to the President) whether im14 ports of the Panamanian article are a substantial cause 

15 of serious injury or threat thereof. 

16 (b) PRESIDENTIAL DETERMINATION REGARDING IM17 PORTS OF PANAMANIAN ARTICLES.—In determining the 

18 nature and extent of action to be taken under chapter 1 

19 of title II of the Trade Act of 1974 (19 U.S.C. 2251 et 

20 seq.), the President may exclude from the action Panama21 nian articles with respect to which the Commission has 

22 made a negative finding under subsection (a). 
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1 TITLE IV—MISCELLANEOUS 

2 SEC. 401. ELIGIBLE PRODUCTS. 

3 Section 308(4)(A) of the Trade Agreements Act of 

4 1979 (19 U.S.C. 2518(4)(A)) is amended— 

5 (1) by striking ‘‘or’’ at the end of clause (viii); 

6 (2) by striking the period at the end of clause 

7 (ix) and inserting ‘‘; or’’; and 

8 (3) by adding at the end the following new 

9 clause: 

10 ‘‘(x) a party to the United States– 

11 Panama Trade Promotion Agreement, a 

12 product or service of that country or in13 strumentality which is covered under that 

14 agreement for procurement by the United 

15 States.’’. 

16 SEC. 402. MODIFICATION TO THE CARIBBEAN BASIN ECO17 NOMIC RECOVERY ACT. 

18 (a) IN GENERAL.—Section 212(b) of the Caribbean 

19 Basin Economic Recovery Act (19 U.S.C. 2702(b)) is 

20 amended by striking ‘‘Panama’’ from the list of countries 

21 eligible for designation as beneficiary countries. 

22 (b) EFFECTIVE DATE.—The amendment made by 

23 subsection (a) takes effect on the date on which the Presi24 dent terminates the designation of Panama as a bene25 ficiary country pursuant to section 201(a)(3) of this Act. 
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1 TITLE V—OFFSETS 

2 SEC. 501. EXTENSION OF CUSTOMS USER FEES. 

3 Section 13031(j)(3) of the Consolidated Omnibus 

4 Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)) 

5 is amended by adding at the end the following: 

6 ‘‘(D) Notwithstanding subparagraph (B)(i), fees may 

7 be charged under paragraphs (1) through (8) of sub8 section (a) during the period beginning on September 1, 

9 2021, and ending on September 30, 2021.’’. 

10 SEC. 502. TIME FOR PAYMENT OF CORPORATE ESTIMATED 

11 TAXES. 

12 Notwithstanding section 6655 of the Internal Rev13 enue Code of 1986, in the case of a corporation with assets 

14 of not less than $1,000,000,000 (determined as of the end 

15 of the preceding taxable year)— 

16 (1) the amount of any required installment of 

17 corporate estimated tax which is otherwise due in 

18 July, August, or September of 2012 shall be in19 creased by 0.25 percent of such amount (determined 

20 without regard to any increase in such amount not 

21 contained in such Code); 

22 (2) the amount of any required installment of 

23 corporate estimated tax which is otherwise due in 

24 July, August, or September of 2016 shall be in25 creased by 0.25 percent of such amount (determined 
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1 without regard to any increase in such amount not 

2 contained in such Code); and 

3 (3) the amount of the next required installment 

4 after an installment referred to in paragraph (1) or 

5 (2) shall be appropriately reduced to reflect the 

6 amount of the increase by reason of such paragraph. 

Passed the House of Representatives October 12, 

2011. 

Attest: 

Clerk. 

112TH CONGRESS 

1ST SESSION H. R. 3079 

AN ACT 

To implement the United States–Panama Trade 

Promotion Agreement.