I

103D CONGRESS

1ST SESSION H. R. 1835

To extend to the People’s Republic of China renewal of nondiscriminatory

(most-favored-nation) treatment provided certain conditions are met.

IN THE HOUSE OF REPRESENTATIVES

APRIL 22, 1993

Ms. PELOSI (for herself, Mr. GEPHARDT, Mr. BONIOR, Mr. LEWIS of Georgia,

Mr. RICHARDSON, Mr. STARK, Mr. CARDIN, Mr. ROSE, Mr. SOLOMON,

Mr. ABERCROMBIE, Mr. BACCHUS of Florida, Mr. BERMAN, Mr.

BILBRAY, Mrs. CLAYTON, Mr. COOPER, Mr. CUNNINGHAM, Mr. DELLUMS, Mr. DURBIN, Mr. FOGLIETTA, Mr. FRANK of Massachusetts, Mr.

HEFNER, Mr. KASICH, Mr. KENNEDY, Mr. LANTOS, Mr. MARKEY, Mr.

MARTINEZ, Mr. MILLER of California, Mr. MINETA, Mrs. MINK, Mr.

MORAN, Mr. OLVER, Ms. SLAUGHTER, Mr. TORRICELLI, Mr. WAXMAN,

Ms. WOOLSEY, Mr. WYNN, and Mr. MCCLOSKEY) introduced the following bill; which was referred jointly to the Committees on Ways and

Means, Rules, and Foreign Affairs

A BILL

To extend to the People’s Republic of China renewal of

nondiscriminatory (most-favored-nation) treatment provided certain conditions are met.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘United States-China

5 Act of 1993’’.
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1 SEC. 2. FINDINGS AND POLICY.

2 (a) FINDINGS.—The Congress makes the following

3 findings:

4 (1) On June 4, 1989, thousands of Chinese citi5 zens courageously demonstrated that they were pre6 pared to risk their lives and futures in pursuit of

7 democratic freedom and respect for human rights.

8 (2) The People’s Republic of China, as a mem9 ber of the United Nations Security Council, is obli10 gated to respect and uphold the United Nations

11 Charter and Universal Declaration of Human

12 Rights.

13 (3) Despite the massive demonstration for self14 determination and fundamental principles of human

15 rights and despite the People’s Republic of China’s

16 membership in the United Nations, the Government

17 of the People’s Republic of China continues to fla18 grantly violate internationally recognized standards

19 of human rights, and engages in—

20 (A) torture and cruel, inhuman, or degrad21 ing treatment or punishment;

22 (B) arbitrary arrest, unacknowledged de23 tention without charges and trial, and jailing of

24 persons solely for the nonviolent expression of

25 their political views; and
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1 (C) use of prison labor to produce cheap

2 products for export to countries, including the

3 United States, in violation of international labor

4 treaties and United States law.

5 (4) The Government of the People’s Republic of

6 China continues to deny Chinese citizens and others,

7 who have supported the prodemocracy movement,

8 the right of free emigration despite having pledged

9 to do so in 1991.

10 (5) The Government of the People’s Republic of

11 China continues to use military and police forces to

12 intimidate and repress the Tibetan people seeking

13 political and religious freedom, and continues to vio14 late the provisions of the Fourth Geneva Convention

15 by encouraging the resettlement of large numbers of

16 Chinese in Tibet.

17 (6) The Government of the People’s Republic of

18 China continues to engage in unfair trade practices

19 against the United States by raising tariffs, employ20 ing taxes as a surcharge on tariffs, using discrimina21 tory customs rates, imposing import quotas and

22 other quantitative restrictions, barring the importa23 tion of certain items, using licensing and testing re24 quirements to limit imports, and falsifying country

25 of origin documentation to transship textiles and
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1 other items to the United States through Hong

2 Kong and third countries.

3 (7) Although the Government of the People’s

4 Republic of China has pledged to adhere to the

5 guidelines and parameters of the Missile Technology

6 Control Regime, there are continuing reports of Chi7 nese transfers of military technology covered by such

8 Regime to the Middle East, Africa, and Asia.

9 (8) The Government of the People’s Republic of

10 China continues to unjustly restrict and imprison re11 ligious leaders and members of religious groups who

12 do not adhere to the dogma and control of state13 sponsored religious organizations.

14 (9) It is the policy and practice of the Govern15 ment of the People’s Republic of China’s Communist

16 Party to control all trade unions and suppress and

17 harass members of the independent labor union

18 movement.

19 (10) The Government of the People’s Republic

20 of China continues to harass and restrict the activi21 ties of accredited journalists and to restrict broad22 casts by the Voice of America.

23 (b) POLICY.—It is the sense of the Congress that—

24 (1) with respect to the actions of the People’s

25 Republic of China in the areas of human rights,
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1 weapons proliferation, and unfair trade practices,

2 the President should take such action as is necessary

3 to achieve the purposes of this Act, including—

4 (A) urging the Communist Chinese leaders

5 to release all political and religious prisoners in

6 China and Tibet, and to cease forcing the large7 scale influx of Chinese settlers into Tibet which

8 is threatening the survival of the Tibetan cul9 ture;

10 (B) conducting diplomatic negotiations

11 with the Government of the People’s Republic

12 of China to encourage them to allow inter13 national human rights and humanitarian orga14 nizations access to prisoners in China and

15 Tibet;

16 (C) directing the United States Trade Rep17 resentative to take necessary and appropriate

18 action pursuant to section 301 of the Trade Act

19 of 1974 and the Memorandum of Understand20 ing between the Governments of the United

21 States and People’s Republic of China concern22 ing market access, signed October 10, 1992,

23 with respect to the continuing unfair trade

24 practices of the People’s Republic of China that
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1 are discriminatory and unreasonably restrict

2 United States commerce; and

3 (D) encouraging members of the Missile

4 Technology Control Regime and other countries

5 to develop a common policy concerning the Peo6 ple’s Republic of China’s transfer of missile

7 technology to other countries;

8 (2) sanctions being applied against the People’s

9 Republic of China on the date of the enactment of

10 this Act should be continued and strictly enforced;

11 and

12 (3) the President should direct the Secretary of

13 Commerce to consult with American business lead14 ers, having significant trade with or investments in

15 the People’s Republic of China, to encourage them

16 to adopt a voluntary code of conduct that—

17 (A) follows internationally recognized

18 human rights principles;

19 (B) ensures that the employment of Chi20 nese citizens is not discriminatory in terms of

21 sex, ethnic origin, or political belief;

22 (C) refrains from knowingly using prison

23 labor;

24 (D) recognizes workers right to organize

25 and bargain collectively; and
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1 (E) discourages mandatory political indoc2 trination on business sites.

3 SEC. 3. MINIMUM STANDARDS WHICH THE GOVERNMENT

4 OF THE PEOPLE’S REPUBLIC OF CHINA MUST

5 MEET TO CONTINUE TO RECEIVE NON6 DISCRIMINATORY MOST-FAVORED-NATION

7 TREATMENT.

8 Notwithstanding any other provisions of law, the

9 President may not recommend continuation of a waiver

10 for the 12-month period beginning July 3, 1994, under

11 section 402(d) of the Trade Act of 1974 (19 U.S.C.

12 2432(d)) for the People’s Republic of China, unless the

13 President reports in the document required to be submit14 ted by such section that the government of that country—

15 (1) has taken appropriate actions to begin ad16 hering to the provisions of the Universal Declaration

17 of Human Rights in China and Tibet;

18 (2) is allowing unrestricted emigration of the

19 citizens who desire to leave China for reasons of po20 litical or religious persecution to join family mem21 bers abroad, or for other valid reasons;

22 (3) has provided an acceptable accounting for

23 and release of Chinese citizens detained, accused, or

24 sentenced as a result of the nonviolent expression of

25 their political beliefs in relation to events which oc-
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1 curred during and after the violent repression of

2 demonstrations in Tiananmen Square on June 4,

3 1989, and has provided an acceptable accounting for

4 and release of other citizens detained, accused, or

5 sentenced for the nonviolent expression of their po6 litical beliefs or for peacefully exercising their inter7 nationally guaranteed rights of freedom of speech,

8 association, and assembly;

9 (4) has taken effective, verifiable action to pre10 vent export of products to the United States manu11 factured wholly or in part by convict, forced, or in12 dentured labor and has complied with the terms of

13 the Memorandum of Understanding signed on Au14 gust 7, 1992, by allowing, without limitation or re15 striction, United States Customs officials to visit

16 places suspected of producing such goods for export;

17 and

18 (5) has made overall significant progress in—

19 (A) ceasing religious persecution and lift20 ing restrictions on freedom of religious belief in

21 the People’s Republic of China and Tibet and

22 ceasing to threaten the survival of the Tibetan

23 culture;

24 (B) releasing leaders and members of reli25 gious groups detained, imprisoned, or under
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1 house arrest for expression of their religious

2 beliefs;

3 (C) ceasing unfair and discriminatory

4 trade practices which restrict and unreasonably

5 burden American business;

6 (D) providing United States exporters fair

7 access to Chinese markets, including lowering

8 tariffs, removing nontariff barriers, and increas9 ing the purchase of United States goods and

10 services;

11 (E) adhering to the guidelines and param12 eters of the Missile Technology Control Regime

13 and the controls adopted by the Nuclear Suppli14 ers Group and the Australian Group on Chemi15 cal and Biological Arms;

16 (F) adhering to the Joint Declaration on

17 Hong Kong that was entered into between the

18 United Kingdom and the People’s Republic of

19 China;

20 (G) cooperating with United States efforts

21 to obtain an acceptable accounting of United

22 States military personnel who are listed as pris23 oners of war or missing in action as a result of

24 their service in—

25 (i) the Korean conflict; or
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1 (ii) the Vietnam conflict;

2 (H) ceasing the jamming of Voice of Amer3 ica broadcasts; and

4 (I) providing international human rights

5 and humanitarian groups access to prisoners,

6 trials, and places of detention.

7 SEC. 4. REPORT BY THE PRESIDENT.

8 If the President recommends in 1994 that the waiver

9 referred to in section 3 be continued for the People’s Re10 public of China, the President shall state in the document

11 required to be submitted to the Congress by section 402(d)

12 of the Trade Act of 1974, the extent to which the Govern13 ment of the People’s Republic of China has complied with

14 the provisions of section 3, during the period covered by

15 the document.

16 SEC. 5. NONDISCRIMINATORY TREATMENT FOR PRODUCTS

17 FROM NONSTATE-OWNED ENTERPRISES.

18 (a) IN GENERAL.—Notwithstanding any other provi19 sions of law, if nondiscriminatory treatment is not granted

20 to the People’s Republic of China by reason of the occur21 rence of an event described in subsection (b), nondiscrim22 inatory treatment shall—

23 (1) continue to apply to any good that is pro24 duced or manufactured by a person that is not a
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1 state-owned enterprise of the People’s Republic of

2 China, but

3 (2) not apply to any such good that is marketed

4 or otherwise exported by a state-owned enterprise of

5 the People’s Republic of China.

6 Nondiscriminatory treatment under this section shall be

7 in effect for the same period of time the waiver referred

8 to in section 3 would have been effective had it taken

9 effect.

10 (b) EVENTS.—An event described in this subsection

11 means—

12 (1) the President fails to request the waiver re13 ferred to in section 3 and reports to the Congress

14 that such failure was a result of the President’s in15 ability to report that the People’s Republic of China

16 has met the standards described in such section; or

17 (2) the President requests the waiver referred

18 to in section 3, but a disapproval resolution de19 scribed in subsection (c)(1) is enacted into law.

20 (c) DISAPPROVAL RESOLUTION.—

21 (1) IN GENERAL.—For purposes of this section,

22 the term ‘‘resolution’’ means only a joint resolution

23 of the two Houses of Congress, the matter after the

24 resolving clause of which is as follows: ‘‘That the

25 Congress does not approve the extension of the au-
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1 thority contained in section 402(c) of the Trade Act

2 of 1974 recommended by the President to the Con3 gress on llllllll with respect to the Peo4 ple’s Republic of China because the Congress does

5 not agree that the People’s Republic of China has

6 met the standards described in section 3 of the Unit7 ed States-China Act of 1993’’, with the blank space

8 being filled with the appropriate date.

9 (2) APPLICABLE RULES.—The provisions of

10 sections 153 (other than paragraphs (3) and (4) of

11 subsection (b) of such section) and 402(d)(2) (as

12 modified by this subsection) of the Trade Act of

13 1974 shall apply to a resolution described in para14 graph (1).

15 (d) DETERMINATION OF DUTY STATUS OF ENTER16 PRISES.—

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

18 the Secretary of the Treasury shall determine which

19 persons are state-owned enterprises of the People’s

20 Republic of China for purposes of this Act and com21 pile and maintain a list of such persons.

22 (2) DEFINITIONS AND SPECIAL RULES.—For

23 purposes of making the determination required by

24 paragraph (1), the following definitions apply:
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1 (A)(i) The term ‘‘state-owned enterprise of

2 the People’s Republic of China’’ means a person

3 affiliated with or wholly owned, controlled, or

4 subsidized by the Government of the People’s

5 Republic of China and whose means of produc6 tion, products, and revenues are owned or con7 trolled by a central or provincial government

8 authority. A person shall be considered to be

9 state-owned if—

10 (I) the person’s assets are primarily

11 owned by a central or provincial govern12 ment authority;

13 (II) a substantial proportion of the

14 person’s profits are required to be submit15 ted to a central or provincial government

16 authority;

17 (III) the person’s production, pur18 chases of inputs, and sales of output, in

19 whole or in part, are subject to state, sec20 toral, or regional plans; or

21 (IV) a license issued by a government

22 authority classifies the person as state23 owned.

24 (ii) Any person that—
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1 (I) is a qualified foreign joint venture

2 or is licensed by a governmental authority

3 as a collective, cooperative, or private en4 terprise; or

5 (II) is wholly owned by a foreign per6 son,

7 shall not be considered to be state-owned.

8 (B) The term ‘‘qualified foreign joint ven9 ture’’ means any person—

10 (i) which is registered and licensed in

11 the agency or department of the Govern12 ment of the People’s Republic of China

13 concerned with foreign economic relations

14 and trade as an equity, cooperative, con15 tractual joint venture, or joint stock com16 pany with foreign investment;

17 (ii) in which the foreign investor part18 ner and a person of the People’s Republic

19 of China share profits and losses and

20 jointly manage the venture;

21 (iii) in which the foreign investor

22 partner holds or controls at least 25 per23 cent of the investment and the foreign in24 vestor partner is not substantially owned
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1 or controlled by a state-owned enterprise of

2 the People’s Republic of China;

3 (iv) in which the foreign investor part4 ner is not a person of a country the gov5 ernment of which the Secretary of State

6 has determined under section 6(j) of the

7 Export Administration Act of 1979 to have

8 repeatedly provided support for acts of

9 international terrorism; and

10 (v) which does not use state-owned

11 enterprises of the People’s Republic of

12 China to export its goods or services.

13 (C) The term ‘‘person’’ means a natural

14 person, corporation, partnership, enterprise, in15 strumentality, agency, or other entity.

16 (D) The term ‘‘foreign investor partner’’

17 means—

18 (i) a natural person who is not a citi19 zen of the People’s Republic of China; and

20 (ii) a corporation, partnership, instru21 mentality, enterprise, agency, or other en22 tity that is organized under the laws of a

23 country other than the People’s Republic

24 of China and 50 percent or more of the

25 outstanding capital stock or beneficial in-
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1 terest of such entity is owned (directly or

2 indirectly) by natural persons who are not

3 citizens of the People’s Republic of China.

4 (e) PETITION FOR CHANGE IN DUTY STATUS.—Any

5 person who believes that a person should be included on

6 or excluded from the list compiled by the Secretary under

7 subsection (d)(1) may request that the Secretary review

8 the status of such person.

9 SEC. 6. EFFECT OF GATT ENTRY ON MFN STATUS.

10 Notwithstanding the entry of the People’s Republic

11 of China into the General Agreement on Tariffs and

12 Trade, most-favored-nation treatment shall not be auto13 matically conferred on the products of the People’s Repub14 lic of China unless the People’s Republic of China satisfies

15 the standards described in section 3 and complies with sec16 tion 402 of the Trade Act of 1974 (19 U.S.C. 2432).

17 SEC. 7. SANCTIONS BY OTHER COUNTRIES.

18 If the President decides not to seek a continuation

19 of a waiver in 1994 under section 402(d) of the Trade

20 Act of 1974 for the People’s Republic of China, the Presi21 dent shall, during the 30-day period beginning on the date

22 that the President would have recommended to the Con23 gress that such a waiver be continued, undertake efforts

24 to ensure that members of the General Agreement on
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1 Tariffs and Trade take similar action with respect to the

2 People’s Republic of China.

3 SEC. 8. DEFINITIONS.

4 For purposes of this Act:

5 (1) DETAINED AND IMPRISONED.—The terms

6 ‘‘detained’’ and ‘‘imprisoned’’ include, but are not

7 limited to, incarceration in prisons, jails, labor re8 form camps, labor reeducation camps, and local po9 lice detention centers.

10 (2) ACCEPTABLE ACCOUNTING.—The term ‘‘ac11 ceptable accounting’’ includes—

12 (A) providing information regarding the lo13 cation of any person being held,

14 (B) the legal status of such person,

15 (C) if convicted, the sentence of such per16 son, and

17 (D) if released, when and with what re18 strictions.

19 (3) CONVICT, FORCED, OR INDENTURED

20 LABOR.—The term ‘‘convict, forced, or indentured

21 labor’’ has the meaning given such term by section

22 307 of the Tariff Act of 1930 (19 U.S.C. 1307).

23 (4) VIOLATIONS OF INTERNATIONALLY RECOG24 NIZED STANDARDS OF HUMAN RIGHTS.—The term

25 ‘‘violations of internationally recognized standards of
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1 human rights’’ includes, but is not limited to, tor2 ture, cruel, inhuman, or degrading treatment or

3 punishment, prolonged detention without charges

4 and trial, causing the disappearance of persons by

5 the abduction and clandestine detention of those per6 sons, secret judicial proceedings, and other flagrant

7 denial of the right to life, liberty, or the security of

8 any person.

9 (5) MISSILE TECHNOLOGY CONTROL REGIME.—

10 The term ‘‘Missile Technology Control Regime’’

11 means the agreement, as amended, between the

12 United States, the United Kingdom, the Federal Re13 public of Germany, France, Italy, Canada, and

14 Japan, announced on April 16, 1987, to restrict sen15 sitive missile-relevant transfers based on an annex of

16 missile equipment and technology.

17 (6) SIGNIFICANT PROGRESS.—(A) The term

18 ‘‘significant progress’’ in section 3, means the imple19 mentation of measures that will meaningfully reduce,

20 or lead to the end of, the practices identified in such

21 section.

22 (B) With regard to section 3(5)(E), progress

23 may not be determined to be ‘‘significant progress’’

24 if, after the date of the enactment of this Act, the
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1 President determines that the People’s Republic of

2 China has transferred—

3 (i) ballistic missiles or missile launchers for

4 the M–9 or M–11 weapons systems to Syria,

5 Pakistan, or Iran; or

6 (ii) material, equipment, or technology that

7 would contribute significantly to the manufac8 ture of a nuclear explosive device to another

9 country and that the material, equipment, or

10 technology is to be used by such country in the

11 manufacture of such device.

Æ