into account in its financing operations the economic
and financial soundness of projects;
(2) to utilize private credit and investment in-
stitutions and the Corporation’s financing authority
as the principal means of mobilizing capital invest-
ment funds;
(3) to broaden private participation and revolve
its funds through selling its direct investments to
private investors whenever it can appropriately do so
on satisfactory terms;
(4) to conduct its insurance operations with due
regard to principles of risk management, including
efforts to share its insurance risks and reinsurance
risks;
(5) to consider in the conduct of its operations
the extent to which the governments of less devel-
oped countries are receptive to private enterprise,
domestic and foreign, and their willingness and abil-
ity to maintain conditions which enable private en-
terprise to make its full contribution to the develop-
ment process;
(6) to foster private initiative and competition
and discourage monopolistic practices;
(7) to further to the greatest degree possible, in
a manner consistent with its goals, the balance-of-
payments and economic and employment objectives
of the United States;
(8) to conduct its activities in consonance with
the international trade, investment, and financial
policies of the United States Government, and to
seek to support those developmental projects having
positive trade benefits for the United States; and
(9) to advise and assist, within its field of com-
petence, interested agencies of the United States and
other organizations, both public and private, na-
tional and international, with respect to projects and
programs relating to the development of private en-
terprise in less developed countries and areas.
SEC. 5102. INVESTMENT INSURANCE, FINANCING, AND
OTHER PROGRAMS.
(a) INVESTMENT INSURANCE.—
(1) RISKS FOR WHICH INSURANCE ISSUED.—
The Corporation is authorized to issue insurance,
upon such terms and conditions as the Corporation
may determine, to eligible investors assuring protec-
tion in whole or in part against any or all of the fol-
lowing risks with respect to projects which the Cor-
poration has approved:
(A) Inability to convert into United States
dollars other currencies, or credits in such cur-
rencies, received as earnings or profits from the
approved project, as repayment or return of the
investment in the project, in whole or in part,
or as compensation for the sale or disposition of
all or any part of the investment.
(B) Loss of investment, in whole or in
part, in the approved project due to expropria-
tion or confiscation by action of a foreign gov-
ernment.
(C) Loss due to war, revolution, insurrec-
tion, or civil strife.
(D) Loss due to business interruption
caused by any of the risks set forth in subpara-
graphs (A), (B), and (C).
(2) RISK SHARING ARRANGEMENTS WITH FOR-
EIGN GOVERNMENTS AND MULTILATERAL ORGANIZA-
TIONS.—Recognizing that major private investments
in emerging democracies, economies in trans-
formation and less developed friendly countries or
areas are often made by enterprises in which there
is multinational participation, including significant
United States private participation, the Corporation
may make arrangements with foreign governments
(including agencies, instrumentalities, and political
subdivisions thereof) and with multilateral organiza-
tions and institutions for sharing liabilities assumed
under investment insurance for such investments
and may, in connection with such arrangements,
issue insurance to investors not otherwise eligible for
insurance under this chapter, except that—
(A) liabilities assumed by the Corporation
under the authority of this paragraph shall be
consistent with the purposes of this chapter,
and
(B) the maximum share of liabilities so as-
sumed shall not exceed the proportionate par-
ticipation by eligible investors in the project.
(3) MAXIMUM
CONTINGENT
LIABILITY
WITH
RESPECT TO SINGLE INVESTOR.—Not more than 10
percent of the maximum contingent liability for in-
vestment insurance which the Corporation is per-
mitted to have outstanding under section 5104(a)(1)
shall be issued to a single investor.
(4) OTHER INSURANCE FUNCTIONS.—
(A) IN GENERAL.—The Corporation is au-
thorized to—
(i) make and carry out contracts of
insurance or reinsurance, or agreements to
associate or share risks, with insurance
companies, financial institutions, any other
persons, or groups thereof, and
(ii) employ such insurance companies,
financial institutions, other persons, or
groups, where appropriate, as its agent, or
to act as their agent, in the issuance and
servicing of insurance, the adjustment of
claims, the exercise of subrogation rights,
the ceding and accepting of reinsurance,
and in any other matter incident to an in-
surance business, except that such agree-
ments and contracts shall be consistent
with the purposes of the Corporation set
forth in section 5101 and shall be on equi-
table terms.
(B) 
RISK-SHARING
AGREEMENTS.—The
Corporation is authorized to enter into pooling
or other risk-sharing agreements with multilat-
eral insurance or financing agencies or groups
of such agencies.
(C) OWNERSHIP INTEREST IN RISK-SHAR-
ING ENTITIES.—The Corporation is authorized
to hold an ownership interest in any association
or other entity established for the purposes of
sharing risks under investment insurance.
(b) INVESTMENT FINANCING.—
(1) DIRECT LENDING.—
(A) IN GENERAL.—The Corporation is au-
thorized to make loans in United States dollars,
repayable in dollars, and to make loans in for-
eign currencies, to firms privately owned or of
mixed private and public ownership, upon such
terms and conditions as the Corporation may
determine.
(B) USE
OF
LOAN
FOR
NEW
TECH-
NOLOGIES, PRODUCTS, OR SERVICES.—The Cor-
poration may designate up to 25 percent of any
loan under this subsection for use in the devel-
opment or adaptation in the United States of
new technologies or new products or services
that are to be used in the project for which the
loan is made and are likely to contribute to the
economic or social development of less devel-
oped countries.
(2) EQUITY INVESTMENT.—
(A) IN GENERAL.—The Corporation is au-
thorized to purchase, invest in, or otherwise ac-
quire equity securities or securities with equity
characteristics of any firm or entity, upon such
terms and conditions as the Corporation may
determine, to be funded in the same manner as
direct loans under the Federal Credit Reform
Act of 1990 for the purpose of providing capital
for any project which is consistent with the pro-
visions of this chapter, except that—
(i) the aggregate amount of the Cor-
poration’s equity investment with respect
to any project shall not exceed 30 percent
of the aggregate amount of all equity in-
vestment made with respect to such project
at the time that the Corporation’s equity
investment is made, except for securities
acquired through the enforcement of any
lien, pledge, or contractual arrangement as
a result of a default by any party under
any agreement relating to the terms of the
Corporation’s investment; and
(ii) the Corporation’s equity invest-
ment under this paragraph with respect to
any project, when added to any other in-
vestments made or guaranteed by the Cor-
poration under this paragraph with respect
to such project, shall not cause the aggre-
gate amount of all such investment to ex-
ceed, at the time any such investment is
made or guaranteed by the Corporation,
75 per centum of the total investment com-
mitted to such project as determined by
the Corporation. Such determination under
this clause shall be conclusive for purposes
of the Corporation’s authority to make or
guarantee any such investment.
(B) ADDITIONAL
CRITERIA.—In making
investment decisions under this paragraph, the
Corporation shall give consideration to the ex-
tent to which the Corporation’s equity invest-
ment will assist in obtaining the financing re-
quired for such projects.
(C) DISPOSITION OF EQUITY INTEREST.—
Taking into consideration, among other things,
the Corporation’s financial interests and the de-
sirability of fostering the development of local
capital markets in emerging democracies,
economies in transformation and less developed
countries, the Corporation shall endeavor to dis-
pose of any equity interest it may acquire under
this subsection within a period of ten years
from the date of acquisition of such interest.
(3) INVESTMENT GUARANTEES.—
(A) AUTHORITY.—The Corporation is au-
thorized to issue to eligible investors guarantees
of loans and other investments made by such
investors assuring against loss due to such risks
and upon such terms and conditions as the Cor-
poration may determine, subject to subpara-
graphs (B), (C), and (D).
(B) GUARANTEES ON OTHER THAN LOAN
INVESTMENTS.—A guarantee issued under sub-
paragraph (A) on other than a loan investment
may not exceed 75 per centum of such invest-
ment.
(C) LIMIT
ON
AMOUNT
OF
INVESTMENT
GUARANTEED.—Except for loan investments for
credit unions made by eligible credit unions or
credit union associations, the aggregate amount
of investment (exclusive of interest and earn-
ings) for which guarantees are issued under
subparagraph (A) with respect to any project
shall not exceed, at the time of issuance of any
such guarantee, 75 per centum of the total in-
vestment committed to any such project as de-
termined by the Corporation. Such determina-
tion by the Corporation shall be conclusive for
purposes of the Corporation’s authority to issue
any such guarantee.
(D) MAXIMUM
CONTINGENT
LIABILITY
WITH
RESPECT
TO
SINGLE
INVESTOR.—Not
more than 15 per centum of the maximum con-
tingent liability for investment guarantees
which the Corporation is permitted to have out-
standing under section 5104(a)(2) may be is-
sued to a single investor.
(c) INVESTMENT ENCOURAGEMENT.—The Corpora-
tion is authorized to initiate and support through financial
participation, incentive grant, or otherwise, and on such
terms and conditions as the Corporation may determine,
the identification, assessment, surveying, and promotion
of private investment opportunities, using wherever fea-
sible and effective the facilities of private investors, except
that the Corporation shall not finance any survey to ascer-
tain the existence, location, extent, or quality of oil or gas
resources.
(d) SPECIAL ACTIVITIES.—The Corporation is au-
thorized to administer and manage special projects and
programs, including programs of financial and advisory
support, which provide private technical, professional, or
managerial assistance in the development of human re-
sources, skills, technology, capital savings, intermediate fi-
nancial and investment institutions, and cooperatives. The
funds for these projects and programs may, with the Cor-
poration’s concurrence, be transferred to it for such pur-
poses under the authority of section 8201 of this Act or
from other sources, public or private.
SEC. 5103. ENHANCING PRIVATE POLITICAL RISK INSUR-
ANCE INDUSTRY.
In order to encourage greater availability of political
risk insurance for eligible investors by enhancing the pri-
vate political risk insurance industry in the United States,
and to the extent consistent with this chapter, the Cor-
poration shall undertake programs of cooperation with
such industry, and in connection with such programs may
engage in the following activities:
(1) Utilizing its statutory authorities, encourage
the development of associations, pools, or consortia
of United States private political risk insurers.
(2) Share insurance risks (through coinsurance,
contingent insurance, or other means) in a manner
that is conducive to the growth and development of
the private political risk insurance industry in the
United States.
(3) Notwithstanding section 8544(e), upon the
expiration of insurance provided by the Corporation
for an investment, enter into risk-sharing agree-
ments with United States private political risk insur-
ers to insure any such investment; except that, in co-
operating in the offering of insurance under this
paragraph, the Corporation shall not assume respon-
sibility for more than 50 per centum of the insur-
ance being offered in each separate transaction.
SEC. 5104. ISSUING AUTHORITY AND RESERVES.
(a) ISSUING AUTHORITY.—
(1) INSURANCE.—The maximum contingent li-
ability outstanding at any one time pursuant to in-
surance issued under section 5102(a) shall not ex-
ceed in the aggregate $15,000,000,000.
(2) FINANCING.—The Corporation is authorized
to commit investment financing under section
5102(b) of up to $5,000,000,000 for the period of
fiscal years beginning October 1, 1994, terminating
on the date specified in paragraph (3).
(3) TERMINATION
OF
AUTHORITY.—The au-
thority of subsection (a) and (b) of section 5102
shall continue until September 30, 1999.
(b) INSURANCE RESERVE.—
(1) MAINTENANCE AND PURPOSES.—The Cor-
poration shall maintain an insurance reserve. Such
reserve shall be available for the discharge of liabil-
ities, as provided in subsection (d), until such time
as all such liabilities have been discharged or have
expired or until such reserve has been expended in
accordance with the provisions of this section.
(2) FUNDING.—The insurance reserve shall
consist of—
(A) any funds in the insurance reserve of
the Corporation on September 30, 1993,
(B) amounts transferred to the reserve
pursuant to this Act, and
(C) such sums as are appropriated pursu-
ant to subsection (d) of this section for such
purposes.
(c) ORDER OF PAYMENTS TO DISCHARGE LIABIL-
ITIES.—Any payment made to discharge liabilities under
investment insurance or reinsurance issued under section
5102, under similar predecessor guarantee authority, or
under section 5103, shall be paid first out of the insurance
reserve, as long as such reserve remains available, and
thereafter out of funds made available pursuant to sub-
section (d) of this section. Any payments made to dis-
charge liabilities under guarantees issued under section
5102(b) shall be paid in accordance with the Federal
Credit Reform Act of 1990.
(d) AVAILABILITY OF FUNDS.—
(1) AVAILABILITY.—Subject to paragraph (2),
funds shall be available to carry out the provisions
of this chapter as authorized and appropriated to
the President to replenish or increase the insurance
reserve, to discharge the liabilities under insurance
or reinsurance issued by the Corporation, or to dis-
charge obligations of the Corporation purchased by
the Secretary of the Treasury pursuant to subsection
(e).
(2) LIMITATION ON APPROPRIATIONS.—No ap-
propriation shall be made under paragraph (1) to
augment the insurance reserve until the amount of
funds in the insurance reserve is less than
$25,000,000. Any appropriations to augment the in-
surance reserve shall then only be made to satisfy
the full faith and credit provision of section 8545(c).
(e) ISSUANCE OF OBLIGATIONS.—In order to dis-
charge liabilities under investment insurance or reinsur-
ance, the Corporation is authorized to issue from time to
time for purchase by the Secretary of the Treasury its
notes, debentures, bonds, or other obligations; except that
the aggregate amount of such obligations outstanding at
any one time may not exceed $100,000,000. Any such ob-
ligation shall be repaid to the Treasury within one year
after the date of issue of such obligation. Any such obliga-
tion shall bear interest at a rate determined by the Sec-
retary of the Treasury, taking into consideration the cur-
rent average market yield on outstanding marketable obli-
gations of the United States of comparable maturities dur-
ing the month preceding the issuance of any obligation
authorized by this subsection. The Secretary of the Treas-
ury shall purchase any obligation of the Corporation is-
sued under this subsection, and for such purchase the Sec-
retary may use as a public debt transaction the proceeds
of the sale of any securities issued under chapter 31 of
title 31, United States Code. The purpose for which secu-
rities may be issued under chapter 31 of title 31, United
States Code, shall include any such purchase.
SEC. 5105. GUIDELINES AND REQUIREMENTS FOR OPIC
SUPPORT.
(a) DEVELOPMENT IMPACT PROFILE.—In order to
carry out the policy set forth in section 5101(b)(1), the
Corporation shall prepare and maintain for each invest-
ment project it insures, reinsures, or finances a develop-
ment impact profile consisting of data appropriate to
measure the projected and actual effects of such project
on development.
(b) SMALL BUSINESS DEVELOPMENT.—
(1) BROADENED
PARTICIPATION
BY
SMALL
BUSINESSES.—The Corporation shall undertake, in
cooperation with appropriate departments, agencies,
and instrumentalities of the United States as well as
private entities and others, to broaden the participa-
tion of United States small business, cooperatives,
and other small United States investors in the devel-
opment of small private enterprise in less developed
friendly countries or areas.
(2) PREFERENTIAL CONSIDERATION.—The Cor-
poration shall undertake to the maximum degree
possible consistent with its purposes—
(A) to give preferential consideration in its
investment insurance, reinsurance, financing,
and investment encouragement activities to in-
vestment projects sponsored by or involving
United States small business or cooperatives;
(B) to maintain the proportion of projects
sponsored by or significantly involving United
States small business to at least 30 per centum
of all projects insured, reinsured, financed or
encouraged by the Corporation.
(c) ENVIRONMENTAL CONSIDERATIONS.—
(1) ENVIRONMENTAL, HEALTH, OR
SAFETY
HAZARD.—The Corporation shall refuse to insure,
reinsure, or finance any investment in connection
with a project which the Corporation determines will
pose an unreasonable or major environmental,
health, or safety hazard, or will result in the signifi-
cant degradation of national parks or similar pro-
tected areas.
(2) RESOURCE SUSTAINABLE DEVELOPMENT.—
The Corporation, in determining whether to provide
insurance, reinsurance, or financing for a project,
shall ensure that the project is consistent with the
goals set forth in section 7210 of this Act.
(3) ENVIRONMENTAL IMPACT STATEMENTS AND
ASSESSMENTS.—The 
requirements 
of 
section
7210(b) relating to environmental impact statements
and environmental assessments shall apply to any
investment which the Corporation insures, reinsures,
guarantees, or finances under this chapter in con-
nection with a project in a country.
(4) 
NOTIFICATION
OF
FOREIGN
GOVERN-
MENTS.—Before finally providing insurance, reinsur-
ance, guarantees, or financing under this chapter for
any environmentally sensitive investment in connec-
tion with a project in a country, the Corporation
shall notify appropriate government officials of that
country of—
(A) all guidelines and other standards
adopted by the International Bank for Recon-
struction and Development and any other inter-
national organization relating to the public
health or safety or the environment which are
applicable to the project; and
(B) to the maximum extent practicable,
any restriction under any law of the United
States relating to public health or safety or the
environment that would apply to the project if
the project were undertaken in the United
States.
The notification under the preceding sentence shall in-
clude a summary of the guidelines, standards, and restric-
tions referred to in subparagraphs (A) and (B).
(5) 
CONSIDERATION
OF
COMMENTS
RE-
CEIVED.—Before finally providing insurance, rein-
surance, or financing for any investment subject to
paragraph (4), the Corporation shall take into ac-
count any comments it receives on the project in-
volved.
(d) HUMAN RIGHTS.—The Corporation shall take
into account in the conduct of its programs in a country,
in consultation with the Secretary of State, all available
information about observance of and respect for human
rights and fundamental freedoms in such country and the
effect the operation of such programs will have on human
rights and fundamental freedoms in such country.
(e) WORKER RIGHTS.—
(1) LIMITATION
ON
OPIC
ACTIVITIES.—The
Corporation may insure, reinsure, or finance a
project only if the country in which the project is to
be undertaken is taking steps to adopt and imple-
ment laws that extend internationally recognized
worker rights, as defined in section 502(a)(4) of the
Trade Act of 1974 (19 U.S.C. 2462(a)(4)), to work-
ers in that country (including any designated zone in
that country). The Corporation shall also include the
following language, in substantially the following
form, in all contracts which the Corporation enters
into with eligible investors to provide financial sup-
port under this chapter: ‘‘The investor agrees not to
take actions to prevent employees of the foreign en-
terprise from lawfully exercising their right of asso-
ciation and their right to organize and bargain col-
lectively. The investor further agrees to observe ap-
plicable laws relating to a minimum age for employ-
ment of children, acceptable conditions of work with
respect to minimum wages, hours of work, and occu-
pational health and safety, and not to use forced
labor. The investor is not responsible under this
paragraph for the actions of a foreign government.’’.
(2) USE
OF
ANNUAL
REPORTS
ON
WORKER
RIGHTS.—The Corporation shall, in making its de-
terminations under paragraph (1), use the reports
submitted to the Congress pursuant to section
505(c) of the Trade Act of 1974 (19 U.S.C.
2465(c)).
(3) WAIVER.—Paragraph (1) shall not prohibit
the Corporation from providing any insurance, rein-
surance, or financing with respect to a country if the
President determines that such activities by the Cor-
poration would be in the national economic interests
of the United States. Any such determination shall
be reported in writing to the Congress, together with
the reasons for the determination.
(f) HARM
TO
EMPLOYMENT
IN
THE
UNITED
STATES.—
(1) REPLACEMENT
OF
UNITED
STATES
PRO-
DUCTION.—(A) The Corporation shall refuse to in-
sure, reinsure, or finance an investment if the Cor-
poration determines that such investment is likely to
cause such investor (or the sponsor of an investment
project in which such investor is involved) signifi-
cantly to reduce the number of the investor’s or
sponsor’s employees in the United States because
the investor or sponsor is replacing his or her United
States production with production from such invest-
ment, and the production from such investment in-
volves substantially the same product for substan-
tially the same market as the investor’s or sponsor’s
United States production.
(B) If the Corporation determines that an in-
vestment is not likely to have the effects described
in subparagraph (A), the Corporation shall monitor
conformance with the representations made by the
investor on which the Corporation relied in making
that determination.
(2) REDUCTION OF EMPLOYEES IN THE UNITED
STATES.—The Corporation shall refuse to insure, re-
insure, or finance an investment if the Corporation
determines that such investment is likely to cause a
significant reduction in the number of employees in
the United States.
(3) EXPORT
PROCESSING
ZONES.—Notwith-
standing any other provision of law, the Corporation
shall refuse to insure, reinsure, or finance an invest-
ment for the purpose of establishing or developing in
a foreign country any export processing zone or des-
ignated area in which the tax, tariff, labor, environ-
ment, and safety laws of that country do not apply,
in part or in whole, to activities carried out within
that zone or area, unless such assistance is not likely
to cause a loss of jobs within the United States as
determined in consideration of the restrictions con-
tained in paragraphs (1) and (2).
(g) PERFORMANCE REQUIREMENTS.—The Corpora-
tion shall refuse to insure, reinsure, or finance an invest-
ment which is subject to performance requirements which
would reduce substantially the positive trade benefits like-
ly to accrue to the United States from the investment.
(h) PROHIBITED TRADE PRACTICES.—
(1) PAYMENTS
TO
VIOLATORS
BARRED.—No
payment may be made under any insurance or rein-
surance which is issued under this chapter on or
after April 24, 1978, for any loss occurring with re-
spect to a project, if the preponderant cause of such
loss was an act by the investor seeking payment
under this chapter, by a person possessing majority
ownership and control of the investor at the time of
the act, or by any agent of such investor or control-
ling person, and a court of the United States has en-
tered a final judgment that such act constituted a
violation of section 30A of the Securities Exchange
Act of 1934 or section 104 of the Foreign Corrupt
Practices Act of 1977.
(2) REGULATIONS.—The Corporation shall have
in effect regulations setting forth appropriate condi-
tions under which any person who has been finally
determined by a court of the United States to have
violated section 30A of the Securities Exchange Act
of 1934 or section 104 of the Foreign Corrupt Prac-
tices Act of 1977 shall be suspended, for a period
of not more than 5 years, from eligibility to receive
any insurance, reinsurance, guarantee, financing, or
other financial support authorized by this chapter, if
that violation related to a project insured, reinsured,
guaranteed, financed, or otherwise supported by the
Corporation under this chapter.
(i) FRAUD OR MISREPRESENTATION.—No payment
may be made under any guarantee, insurance, or reinsur-
ance issued under this chapter for any loss arising out
of fraud or misrepresentation for which the party seeking
payment is responsible.
(j) PUBLIC HEARING.—The Board shall hold at least
one public hearing each year in order to afford an oppor-
tunity for any person to present views as to whether the
Corporation is carrying out its activities in accordance
with this chapter 1 and this section or whether any invest-
ment in a particular country shall have been or shall be
extended insurance, reinsurance, or financing under this
chapter.
(k) RESTRICTIONS.—Restrictions in this or any other
Act to the government of a country do not apply with re-
spect to this title.
CHAPTER 2—TRADE AND DEVELOPMENT AGENCY
SEC. 5201. PURPOSES.
The Trade and Development Agency shall be an
agency of the United States under the foreign policy guid-
ance of the Secretary of State. The purpose of the Trade
and Development Agency is to promote United States pri-
vate sector participation in developing and middle-income
countries.
SEC. 5202. AUTHORITY TO PROVIDE ASSISTANCE.
(a) AUTHORITY.—The Director of the Trade and De-
velopment Agency is authorized to work with foreign coun-
tries to carry out the purposes of this chapter by providing
funds for feasibility studies, architectural and engineering
design, and other activities related to development projects
which provide opportunities for the use of United States
exports.
(b) USE OF FUNDS.—Funds under this chapter may
be used to provide support for feasibility studies for plan-
ning, development, and management of, and procurement
for, bilateral and multilateral development projects, in-
cluding training activities undertaken in connection with
a project, for the purpose of promoting the use of United
States goods and services in such projects. Funds under
this chapter may also be used for architectural and engi-
neering design, including—
(1) concept design, which establishes the basic
technical and operational criteria for a project, such
as architectural drawings for a proposed facility,
evaluation of site constraints, procurement require-
ments, and equipment specifications; and
(2) detail design, which sets forth specific di-
mensions and criteria for structural, mechanical,
electrical, and architectural operations, and identi-
fies other resources required for project operations.
(c) INFORMATION DISSEMINATION.—
(1) The Trade and Development Agency shall
disseminate information about its project activities
to the private sector.
(2) Other agencies of the United States Govern-
ment shall cooperate with the Trade And Develop-
ment Agency in order for the Agency to provide
more effectively informational services to persons in
the private sector concerning trade and development
and export promotion related to development
projects.
(d) NONAPPLICABILITY OF OTHER PROVISIONS.—
Funds made available to carry out this chapter may be
made available notwithstanding any other provision of law.
SEC. 5203. AVAILABILITY OF FUNDS.
Funds shall be available to carry out the provisions
of this chapter as authorized and appropriated to the
President each fiscal year.
CHAPTER 3—ROLE OF RELATED PROGRAMS
SEC. 5301. STATEMENT OF POLICY REGARDING ROLE OF
PUBLIC LAW 480 TITLE I PROGRAMS.
(1) Public Law 480 Title I programs provide an
important resource in the efforts of the United
States to support continued growth in the world
economy.
(2) By using the abundant agricultural produc-
tivity of the United States to enhance the food secu-
rity of developing countries, these programs com-
plement other international programs of the United
States to—
(A) help to combat world hunger and mal-
nutrition and their causes,
(B) promote broad-based, equitable, and
sustainable development,
100
(C) expand international trade, and
(D) develop and expand export markets for
United States agricultural commodities.
(3) By fostering the demand for United States
agricultural commodities and helping to meet the
food needs of developing countries that have dif-
ficulty meeting those needs through commercial
channels, Public Law 480 title I programs are an in-
tegral part of United States efforts to encourage ex-
pansion of the world economy and the participation
of the United States private sector in that expan-
sion.
SEC. 5302. STATEMENT OF POLICY REGARDING ROLE OF
EXPORT-IMPORT BANK.
(1) While the Export-Import Bank of the United
States does not provide foreign assistance, its programs
can complement sustainable development programs in
helping to expand United States exports.
(2) The purpose of the Export-Import Bank of the
United States is to provide financing support for United
States exports, thereby creating and maintaining jobs in
the United States.
(3) The role of the Export-Import Bank of the United
States is an important factor in bolstering global free
101
trade and fair trade, and its programs help to level the
global playing field in export financing.
(4) The Export-Import Bank of the United States is
an important supplement to the private sector’s export fi-
nancing capacities for creating and maintaining jobs.
(5) With one out of every six manufacturing jobs in
the United States dependent on exports, it is necessary
to promote trade with both existing and developing mar-
kets.
(6) The programs of the Export-Import Bank of the
United States serve to provide inroads for United States
exporters into developing country markets.
(7) The role of the Export-Import Bank of the United
States in providing trade and project finance supports
United States domestic employment and global economic
growth and development.
TITLE VI—ADVANCING DIPLOMACY
SEC. 6001. STATEMENT OF POLICY.
(1) Success in achieving the goals of this Act depends
above all on the skills of those who serve America in the
Department of State and other United States government
departments and agencies engaged in international pro-
grams.
(2) Diplomacy is the most cost-effective foreign policy
instrument for promoting American prosperity and safe-
102
guarding United States security by managing crises and
preventing future conflict.
(3) United States leadership in addressing emerging
global challenges will depend increasingly on skillful diplo-
macy to build cooperative arrangements with major allies
and multilateral organizations that leverage our political
influence, and our economic, technical, military and hu-
manitarian assistance.
(4) Diplomacy is essential to the realization of each
of the five other Titles of this Act—
(A) Promoting Sustainable Development re-
quires integrated and coordinated efforts between
diplomats and aid specialists to deal with immediate
environmental, economic, and cultural challenges
and opportunities abroad while building the founda-
tion for long-term bilateral, regional and global co-
operation.
(B) Promoting Democracy requires foreign af-
fairs professionals in the Department of State and
other United States government departments and
agencies engaged in international programs to reach
out beyond traditional bilateral and multilateral rela-
tions to inform foreign publics about the virtues and
challenges of democracy and market economics and
103
to promote human rights, democratic institution
building, and development of open, civil societies.
(C) Promoting Peace requires creative and sus-
tained diplomacy—backed by economic, technical,
humanitarian and military resources—to avert con-
flict, facilitate negotiated resolution of disputes, and
render peace processes irreversible; and to build re-
gimes to restrain proliferation, narcotics trafficking,
terrorism and other forms of criminal activity.
(D) Humanitarian Assistance requires dip-
lomats and other involved United States government
personnel to respond promptly to facilitate bilateral
relief, engage relevant multilateral organizations,
and ensure that relief programs do not become ob-
jects of political manipulation locally or among
donor agencies; at the same time, effective preven-
tive diplomacy can forestall costly political and mili-
tary disasters.
(E) Promoting Growth Through Trade and In-
vestment requires diplomats with advanced technical
knowledge, legal skills, and shrewd political judg-
ment to assist economic reform, develop commercial
opportunities, and structure regional and global
agreements to achieve more open markets and great-
er economic integration.
104
(5) Advancing diplomacy in all of the above areas will
require—
(A) Funds that can be used flexibly by the
President to respond decisively to unforeseen oppor-
tunities and dangers and for structuring new multi-
lateral arrangements that can become the basis for
sustainable cooperation to prevent future crises and
solve long-term problems.
(B) 
Foreign 
assistance, 
public 
diplomacy
abroad, and a national consensus at home in support
of the goals of American foreign policy.
(C) Modern technology and infrastructure to
support foreign and civil service professionals who
must deal with international transactions that are
rising exponentially in volume, speed and complexity.
(D) Greater harmonization of our foreign af-
fairs institutions and instruments, with a view to
avoiding duplicative administrative structures, staffs
and programs.
TITLE VII—SPECIAL AUTHORITIES,
RESTRICTIONS ON ASSISTANCE, AND REPORTS
CHAPTER 1—SPECIAL AUTHORITIES
SEC. 7101. AUTHORITY TO TRANSFER BETWEEN ACCOUNTS.
(a) GENERAL TRANSFER AUTHORITY.—Whenever
the President determines it to be necessary for the pur-
105
poses of this Act, not to exceed 10 per centum of the funds
made available to carry out any provision of this Act—
(1) may be transferred to, and consolidated
with, the funds in any other account or fund avail-
able to carry out any provision of this Act; and
(2) may be used for any of the purposes for
which funds in that account or fund may be used.
(b) LIMITATION ON AMOUNT OF INCREASE IN AN AC-
COUNT.—The total amount in the account or fund for the
benefit of which a transfer is made under subsection (a)
during any fiscal year may not be increased by more than
20 per centum of the amount of funds otherwise made
available for such account or fund.
(c) EXCEPTIONS.—
(1) The percentage limitations contained in
subsections (a) and (b) shall not be applicable with
regard to transfers of funds to carry out the provi-
sions of subchapter A of chapter 1 of title II or of
chapter 1 of title III.
(2) The authority of this section shall not be
used to transfer funds from amounts made available
to carry out the provisions of title I of this Act, ex-
cept that the authority of this section may be used
to transfer such funds for the purposes of section
8509 in an amount not to exceed 5 per centum of
106
the amount of the funds made available for section
8509(a).
(d) NOTIFICATION TO CONGRESS.—The authority of
subsection (a) may be exercised only if the Committee on
Foreign Affairs and the Committee on Appropriations of
the House of Representatives and the Committee on For-
eign Relations and the Committee on Appropriations of
the Senate are notified in advance of the exercise of that
authority.
SEC. 7102. SPECIAL WAIVER AUTHORITY.
(a) AUTHORITY.—The President may authorize the
taking of any action (or the refraining from the taking
of any action) under this Act, any annual (or periodic)
foreign assistance authorization or appropriations Acts, or
the Arms Export Control Act without regard to any of
the provisions described in subsection (c) if he deter-
mines—
(1) in cases under the Arms Export Control
Act, that to do so is essential to the national inter-
ests of the United States; and
(2) in any other cases under such Acts, that to
do so is important to the national interests of the
United States.
(b) OTHER ACTS.—The President may authorize the
taking of any action (or the refraining from the taking
107
of any action) under any other Act without regard to the
provisions described in paragraphs (1) and (2) of sub-
section (c), or of any annual (or periodic) foreign assist-
ance authorization or appropriations Acts, if the President
determines that to do so is important to the national inter-
est of the United States.
(c) LAWS WHICH MAY BE WAIVED.—The provisions
referred to in subsections (a) and (b) are—
(1) the provisions of this Act,
(2) the provisions of the Arms Export Control
Act,
(3) any other provisions of law that restrict the
authority to provide assistance, make sales or leases,
or take other actions (or refrain from taking ac-
tions) under the Acts in paragraphs (1) and (2), and
(4) any law relating to receipts and credits ac-
cruing to the United States, except for those provi-
sions of law contained in section 8551(a)(7).
(d) CONSULTATION WITH CONGRESS.—Before exer-
cising the authority granted in this section, the President
shall consult with, and shall provide a written policy jus-
tification to, the Committee on Foreign Affairs and the
Committee on Appropriations of the House of Representa-
tives and the Committee on Foreign Relations and the
Committee on Appropriations of the Senate.
108
(e) NOTIFICATION TO CONGRESS.—A determination
under subsection (a) or (b) shall be effective only if the
President notifies the Speaker of the House of Represent-
atives and the chairman of the Committee on Foreign Re-
lations of the Senate, in writing, of that determination.
(f) ANNUAL CEILINGS.—
(1) IN GENERAL.—The authority of this section
may not be used in any fiscal year to authorize—
(A) more than $1,000,000,000 in sales or
leases to be made under the Arms Export Con-
trol Act;
(B) the use of more than $500,000,000 of
funds made available for use under this Act;
and
(C) the use of more than $100,000,000 of
foreign currencies accruing under this Act or
any other law.
(2) SALES UNDER THE ARMS EXPORT CONTROL
ACT.—If the authority of this section is used both to
authorize a sale or lease under the Arms Export
Control Act and to authorize funds to be used under
this Act with respect to the financing of that sale or
lease, then the use of the funds shall be counted
against the limitation in paragraph (1)(B) and the
portion, if any, of the sale or lease which is not so
109
financed shall be counted against the limitation in
paragraph (1)(A).
(3) LEASES.—For purposes of paragraph
(1)(A) the replacement cost, less any depreciation in
the value, of the defense articles authorized to be
leased shall be counted against the limitation in that
paragraph.
(4) COUNTRY
LIMITS.—(A) Not more than
$100,000,000 of the $500,000,000 limitation pro-
vided in paragraph (1)(B) may be allocated to any
one country in any fiscal year unless that country is
a victim of active aggression.
(B) Not more than $750,000,000 of the aggre-
gate limitation of $1,500,000,000 provided in para-
graphs (1)(A) and (1)(B) may be allocated to any
one country in any fiscal year.
SEC. 7103. UNANTICIPATED CONTINGENCIES.
(a) AUTHORITY.—Notwithstanding any other provi-
sion of law, the President is authorized to use funds made
available to carry out any provision of this Act in order
to furnish, for any unanticipated contingency, assistance
or contributions authorized by any provision of this Act
in accordance with the provisions applicable to the furnish-
ing of such assistance or contributions.
110
(b) ANNUAL CEILING.—The authority of this section
may not be used to authorize the use of more than
$100,000,000 during any fiscal year.
(c) REPORT TO CONGRESS.—The President shall re-
port promptly to the Speaker of the House of Representa-
tives and to the Committee on Foreign Relations and the
Committee on Appropriations of the Senate each time the
authority of this section is exercised.
(d) PROHIBITION ON GIFTS.—Funds used under the
authority of this section may not be used to pay for any
gifts to any official of any foreign government.
SEC. 7104. ASSISTANCE FOR LAW ENFORCEMENT AGEN-
CIES.
(a) STATEMENT OF POLICY.—
(1) In many countries, law enforcement agen-
cies may lag behind other institutions in their devel-
opment as democratic organizations and in their
ability to contribute to civilian order and may lack
autonomy from military authorities.
(2) Absent external assistance and encourage-
ment, such agencies may, in fact, undermine civilian
democratic rule.
(3) United States and international assistance
to these agencies may therefore be critical for the
support of fragile and emerging democracies.
111
(b) USES OF ASSISTANCE.—In addition to assistance
provided in support of the functions of law enforcement
agencies under chapter 4 of title III, assistance may be
provided under other provisions of this Act in support of
the functions of law enforcement agencies only:
(1) to reinforce the civilian democratic role of
agencies through, to the extent practicable as part of
a larger effort to support the development of the ad-
ministration of justice in the country—
(A) programs to enhance professionalism
(including programs to improve investigative
and forensic capabilities, to enhance protection
of participants in judicial cases, and to improve
administrative and management functions);
(B) contacts with counterparts in estab-
lished democracies; and
(C) programs designed to enhance respect
for human rights and understanding of prin-
ciples of civilian control in a democratic society;
(2) to enhance the practical accountability of
law enforcement agencies to civil justice institutions;
(3) to improve penal institutions and the reha-
bilitation of offenders when doing so is considered
part of a larger administration of justice program;
112
(4) to assist a country which has a democratic
tradition, does not have standing armed forces, and
does not engage in a consistent pattern of gross vio-
lations of internationally recognized human rights;
(5) for maritime law enforcement and other
maritime skills, including training;
(6) to protect and maintain wildlife habitats
and to develop sound wildlife management and plant
conservation programs;
(7) to improve the functioning of customs agen-
cies, exclusive of traditional law enforcement activi-
ties;
(8) for assistance to police forces in connection
with their participation in the regional security sys-
tem of the Eastern Caribbean; and
(9) to meet the challenges described in section
2102(a)(3).
(c) OTHER ASSISTANCE.—Funds made available to
carry out the provisions of title I, and chapter 2 of title
IV (insofar as such funds are used for reconstruction ac-
tivities), may be used in support of law enforcement func-
tions only pursuant to subsections (b)(1), (2), and (6) of
this section.
113
SEC. 7105. TERMINATION EXPENSES.
(a) IN GENERAL.—Funds made available under this
Act, the former authority of the Foreign Assistance Act
of 1961, the former authority of section 23 of the Arms
Export Control Act, or other predecessor legislation shall
remain available for obligation for a period not to exceed
8 months from the date of any termination of assistance
under such Acts for the necessary expenses of winding up
programs related to such termination and may remain
available until expended. Funds obligated under the au-
thority of such Acts prior to the effective date of the termi-
nation of assistance may remain available for expenditure
for the necessary expenses of winding up programs related
to such termination notwithstanding any provision of law
restricting the expenditure of funds. In order to ensure
the effectiveness of such assistance, such expenses for or-
derly termination of programs may include the obligation
and expenditure of funds to complete the training or stud-
ies outside their countries of origin of students whose
course of study or training program began before assist-
ance was terminated.
(b) LIABILITY TO CONTRACTORS.—For the purpose
of making an equitable settlement of termination claims
under extraordinary contractual relief standards, the
President is authorized to adopt as a contract or other
obligation of the United States Government, and assume
114
(in whole or in part) any liabilities arising thereunder, any
contract with a United States or third-country contractor
that had been funded with assistance under such Acts
prior to the termination of assistance.
(c) TERMINATION EXPENSES.—Amounts certified as
having been obligated for assistance subsequently termi-
nated by the President, or pursuant to any provision of
law, shall continue to remain available and may be
reobligated to meet any necessary expenses arising from
the termination of such assistance.
(d) GUARANTY PROGRAMS.—Provisions of this or
any other Act requiring the termination of assistance
under this or any other Act shall not be construed to re-
quire the termination of guarantee commitments that were
entered into prior to the effective date of the termination
of assistance.
(e) RELATION TO OTHER PROVISIONS.—Unless spe-
cifically made inapplicable by another provision of law, the
provisions of this section shall be applicable to the termi-
nation of assistance pursuant to any provision of law.
SEC. 7106. EXEMPTION OF ASSISTANCE THROUGH NON-
GOVERNMENTAL ORGANIZATIONS FROM RE-
STRICTIONS.
(a) RESTRICTIONS NOT APPLICABLE.—Subject to
subsection (c), restrictions contained in this or any other
115
Act with respect to assistance for a country shall not be
construed to restrict assistance in support of programs of
nongovernmental organizations or programs of inter-
national organizations or arrangements.
(b) NATIONAL INTEREST CRITERIA.—The President
shall take into consideration, in any case in which a re-
striction on assistance would be applicable but for this sec-
tion, whether assistance for programs of nongovernmental
organizations or programs of international organizations
or arrangements is in the national interest of the United
States.
(c) NOTICE TO CONGRESS.—Whenever the authority
of this section is used to furnish assistance for a program
of a nongovernmental organization or of an international
organization or arrangement, the President shall notify
the Committee on Foreign Affairs and the Committee on
Appropriations of the House of Representatives and the
Committee on Foreign Relations and the Committee on
Appropriations of the Senate. Such notification shall de-
scribe the program assisted, the assistance provided, and
the reasons for furnishing such assistance.
SEC. 7107. EXEMPTION OF TRAINING ACTIVITIES FROM
PROHIBITIONS.
Provisions of this or any other Act shall not be con-
strued to prohibit assistance for any training activity
116
funded under this Act for a country as long as that coun-
try has a democratically elected government and the as-
sistance is otherwise consistent with section 7201(a)(1),
section 7201(a)(2) and section 7201(a)(5).
SEC. 7108. NONAPPLICABILITY TO DEFENSE ASSISTANCE
OF CERTAIN NEUTRALITY ACT PROVISIONS.
The functions authorized under this Act may be per-
formed without regard to such provisions as the President
may specify of the Neutrality Act of 1939.
SEC. 7109. EXEMPTION FROM PROHIBITIONS FOR ASSIST-
ANCE TO ADDRESS CERTAIN SPECIAL NEEDS.
(a) EXEMPTION.—Unless expressly provided to the
contrary, provisions of this or any other Act, including
provisions in previously enacted legislation, shall not be
construed to prohibit the following activities:
(1) meeting the needs of individuals with dis-
abilities;
(2) addressing the needs of displaced children;
(3) child survival activities;
(4) the prevention and control of acquired im-
mune deficiency syndrome (AIDS);
(5) environmentally sound, sustainable resource
management, and more efficient energy systems;
(6) reconstruction as a result of natural or
manmade disasters; or
117
(7) helping to reduce excessive population
growth rates.
(b) EXCEPTIONS.—Subsection (a) does not apply to
governments of countries to which assistance is prohibited
under paragraphs (2) and (5) of section 7201(a).
SEC. 7110. AUTHORITY TO CONDUCT REIMBURSABLE PRO-
GRAMS.
(a) GENERAL AUTHORITY.—Whenever the President
considers it consistent with and within the limitations of
this Act, any agency of the United States Government is
authorized to furnish services and articles on an advance-
of-funds or reimbursement basis to friendly countries,
international organizations and arrangements, and non-
governmental organizations and may contract in advance
of appropriations or reimbursement for such purposes.
(b) PERSONAL SERVICE CONTRACTS.—When any
agency of the United States Government provides services
on an advance-of-funds or reimbursable basis under this
section, such agency may contract with individuals for per-
sonal service abroad or in the United States to perform
such services or to replace officers or employees of the
United States Government in a manner otherwise per-
mitted by law (or Office of Management and Budget Cir-
cular A–76 or any successor circular) who are assigned
by the agency to provide such services. Such individuals
118
shall not be regarded as employees of the United States
Government for the purpose of any law administered by
the Office of Personnel Management.
(c) LIMITATIONS
ON ASSISTANCE NOT APPLICA-
BLE.—Limitations in this or any other Act on assistance
do not apply with respect to this section.
(d) USE OF PAYMENTS.—Advances and reimburse-
ments received under this section may either be credited
to the currently applicable appropriation, account, or fund
of the agency concerned or shall be available until ex-
pended.
SEC. 7111. DRAWDOWN AUTHORITY.
(a) UNFORESEEN EMERGENCIES.—If the President
determines that—
(1) an unforeseen emergency exists which re-
quires immediate military assistance to a foreign
country or international organization, and
(2) the emergency requirement cannot be met
under the authority of the Arms Export Control Act
or any other law except this section,
the President may direct, for the purposes of this Act, the
drawdown of articles and services, of an aggregate value
not to exceed $100,000,000 in any fiscal year, from the
inventory and resources of the Department of Defense.
119
(b) SPECIAL CIRCUMSTANCES.—If the President de-
termines that it is in the national interest of the United
States to do so, the President may direct the drawdown
of articles and services, of an aggregate value not to ex-
ceed $150,000,000 in any fiscal year, from the inventory
and resources of any agency of the United States Govern-
ment for the purposes and under the authorities of—
(1) chapter 4 of title III of this Act;
(2) chapter 1 of title IV of this Act; or
(3) chapter 2 of title IV of this Act.
(c)(1) The authority of this section may be exercised
only if the Committee on Foreign Affairs and the Commit-
tee on Appropriations of the House of Representatives and
the Committee on Foreign Relations and the Committee
on Appropriations of the Senate are notified in advance
of the exercise of that authority.
(2) CONTINUING
INFORMATION.—The President
shall keep the Congress fully and currently informed of
all articles and services provided under this section.
(d) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the President such
sums as may be necessary to reimburse the applicable ap-
propriation, fund, or account for articles and services pro-
vided under this section.
120
SEC. 7112. INTEREST ACCRUING TO NONGOVERNMENTAL
ORGANIZATIONS.
Upon the approval of the President, a nongovern-
mental organization may place in an interest bearing ac-
count—
(1) funds made available on a grant basis under
this Act (or predecessor legislation); and
(2) local currencies which accrue to that organi-
zation as a result of grant assistance provided under
this Act (or predecessor legislation) or assistance
under titles I through III of the Agricultural Trade
Development and Assistance Act of 1954, section
416(b) of the Agricultural Act of 1949, or the Food
for Progress Act of 1985.
Any interest so earned may be retained by the nongovern-
mental organization and used for the purpose for which
the assistance was provided to that organization, which
may include support for an endowment.
SEC. 7113. DEVELOPMENT EDUCATION.
The President may use funds made available for sus-
tainable development assistance under this Act to support
development education programs, with emphasis on those
conducted by private voluntary organizations and coopera-
tives, in order to assist in the education of United States
citizens about developing countries, the development proc-
ess, the interdependence of developed and developing coun-
121
tries, and the importance to the United States of develop-
ing countries.
SEC. 7114. STRENGTHENING THE CAPACITY OF NON-
GOVERNMENTAL ORGANIZATIONS, INCLUD-
ING RESEARCH AND EDUCATIONAL INSTITU-
TIONS.
The President may use funds made available for as-
sistance under this Act to furnish assistance to nongovern-
mental organizations, including research and educational
institutions, in the United States and abroad for the pur-
pose of strengthening their capacity to develop and carry
out programs concerned with the economic and social de-
velopment of developing countries.
SEC. 
7115. 
VIOLATIONS 
OF 
INTERNATIONAL 
HUMANI-
TARIAN LAW.
(a) AUTHORITY FOR USE OF FUNDS.—The President
may use funds made available to carry out the purposes
of chapters 1 and 4 of title III of this Act to support ac-
tivities of international tribunals, commissions, or panels
to investigate or prosecute persons responsible for geno-
cide, crimes against humanity, and other violations of
international humanitarian law.
(b) DRAWDOWN AUTHORITY.—If the President de-
termines that doing so is important to support the activi-
ties described in subsection (a), the President may direct
122
the drawdown of articles and services, of an aggregate
value not to exceed $25,000,000 in any fiscal year, from
the inventory and resources of any agency of the United
States.
(c) REIMBURSEMENT.—There are authorized to be
appropriated to the President such sums as may be nec-
essary to reimburse the applicable appropriation, fund, or
account for articles and services provided under this sub-
section (b).
SEC. 7116. LAWS RELATING TO CONTRACTS AND GOVERN-
MENT EXPENDITURES.
Whenever the President determines it to be in fur-
therance of the purposes of this Act, the functions author-
ized under this Act may be performed without regard to
such provisions of law regulating the making, perform-
ance, amendment, or modification of contracts and the ex-
penditure of funds of the United States Government as
the President may specify, except for those provisions con-
tained in section 8551(a)(7) of this Act.
SEC. 7117. TRANSPORTATION CHARGES INCURRED BY THE
RED CROSS AND NONGOVERNMENTAL ORGA-
NIZATIONS.
In order to further the efficient use of United States
voluntary contributions for development and for relief and
rehabilitation in furtherance of the purposes of this Act,
123
the President may use funds made available for assistance
under this Act, to pay transportation charges on ship-
ments by the American National Red Cross and by United
States nongovernmental organizations.
CHAPTER 2—RESTRICTIONS ON ASSISTANCE
SEC. 7201. INELIGIBLE COUNTRIES.
(a) Restrictions.—Except as provided in subsection
(b), assistance under this Act may not be furnished to the
government of a country that is:
(1) COMMUNIST
COUNTRIES.—A communist
country, as designated under subsection (d).
(2) HUMAN RIGHTS VIOLATORS.—A country de-
scribed in subsection (e).
(3) EXPROPRIATION OF UNITED STATES PROP-
ERTY.—A country whose government—
(A) has on or after January 1, 1962—
(i) expropriated the property of any
United States person,
(ii) repudiated or nullified any con-
tract with any United States person, or
(iii) taken any other action (such as
discriminatory taxes or other exactions)
which has the effect of seizing ownership
or control of the property of any United
States person, and
143
dent determines, at the time of the submission of the re-
port required by section 7303, that during the previous
fiscal year the country has not cooperated with the United
States, and has otherwise not taken adequate steps to con-
trol the illicit cultivation, production, and smuggling of,
trafficking in, and abuse of narcotic and psychotropic
drugs. The President may rescind such a determination,
and section 7201(a)(6) shall cease to apply, if the Presi-
dent subsequently determines that the country has re-
sumed cooperating with the United States, or otherwise
has taken adequate steps to control the illicit cultivation,
production, and smuggling of, trafficking in, and abuse
of narcotic and psychotropic drugs.
(b) WITHHOLDING.—For any country that was a
major illicit drug producing or drug-transit country (as
defined in sections 8551(a)(11) and (12)) during the pre-
vious fiscal year, the President may withhold from obliga-
tion or expenditure up to fifty percent of assistance which
is allocated to such country each fiscal year in the report
required by section 7304 until the determination provided
for in section 7206 is made.
(c) In implementing subsection (a), the President
should consider the extent to which the country has—