shall be eligible for such treatment by virtue of having
merely undergone—
(A) simple combining or packaging operations,
or
(B) mere dilution with water or mere dilution
with another substance that does not materially alter
the characteristics of the article.
(3)(A) As used in this subsection, the term ‘‘direct
costs of processing operations’’ includes, but is not limited
to—
(i) all actual labor costs involved in the growth,
production, manufacture, or assembly of the specific
merchandise, including fringe benefits, on-the-job
training, and the cost of engineering, supervisory,
quality control, and similar personnel; and
(ii) dies, molds, tooling, and depreciation on
machinery and equipment which are allocable to the
specific merchandise.
(B) The term ‘‘direct costs of processing operations’’
does not include costs which are not directly attributable
to the merchandise concerned or are not costs of manufac-
turing the product, such as—
(i) profit; and
(ii) general expenses of doing business which
are either not allocable to the specific merchandise
or are not related to the growth, production, manu-
facture, or assembly of the merchandise, such as ad-
ministrative salaries, casualty and liability insurance,
advertising, interest, and salesperson’s salaries, com-
missions, or expenses.
(b) EXCEPTION TO DUTY-FREE TREATMENT.—The
duty-free treatment provided under this Act shall not
apply to textile and apparel articles which are not eligible
for duty-free treatment under section 503(b)(1)(A) of the
Trade Act of 1974 (19 U.S.C. 2463(b)(1)(A)).
(c) SUSPENSION OF DUTY-FREE TREATMENT.—(1)
The President may by proclamation suspend the duty-free
treatment provided by this Act with respect to any eligible
article and may proclaim a duty rate for such article if
such action is proclaimed under chapter 1 of title II of
the Trade Act of 1974 or section 232 of the Trade Expan-
sion Act of 1962.
(2) In any report by the United States International
Trade Commission to the President under section 202(f)
of the Trade Act of 1974 regarding any article for which
duty-free treatment has been proclaimed by the President
pursuant to this Act, the Commission shall state whether
and to what extent its findings and recommendations
apply to such article when imported from beneficiary coun-
tries.
(3) For purposes of section 203 of the Trade Act of
1974, the suspension of duty-free treatment provided by
this Act shall be treated as an increase in duty.
(4) No proclamation providing solely for a suspension
referred to in paragraph (3) of this subsection with respect
to any articles shall be taken under section 203 of the
Trade Act of 1974 unless the United States International
Trade Commission, in addition to making an affirmative
determination with respect to such article under section
202(b) of the Trade Act of 1974, determines in the course
of its investigation under such section that the serious in-
jury (or threat thereof) substantially caused by imports
to the domestic industry producing a like or directly com-
petitive article results from the duty-free treatment pro-
vided by this Act.
(5)(A) Any action taken under section 203 of the
Trade Act of 1974 that is in effect when duty-free treat-
ment is proclaimed under section 3 of this Act shall re-
main in effect until modified or terminated.
(B) If any article is subject to any such action at
the time duty-free treatment is proclaimed under section
3 of this Act, the President may reduce or terminate the
application of such action to the importation of such arti-
cle from beneficiary countries prior to the otherwise sched-
uled date on which such reduction or termination would
occur pursuant to the criteria and procedures of section
204 of the Trade Act of 1974.
(d) EMERGENCY RELIEF WITH RESPECT TO PER-
ISHABLE PRODUCTS.—(1) If a petition is filed with the
United States International Trade Commission pursuant
to the provisions of section 201 of the Trade Act of 1974
regarding a perishable product and alleging injury from
imports from beneficiary countries, then the petition may
also be filed with the Secretary of Agriculture with a re-
quest that emergency relief be granted pursuant to para-
graph (3) of this subsection with respect to such article.
(2) Within 14 days after the filing of a petition under
paragraph (1)—
(A) if the Secretary of Agriculture has reason
to believe that a perishable product from a bene-
ficiary country is being imported into the United
States in such increased quantities as to be a sub-
stantial cause of serious injury, or the threat there-
of, to the domestic industry producing a perishable
product like or directly competitive with the im-
ported product and that emergency action is war-
ranted, the Secretary shall advise the President and
recommend that the President take emergency ac-
tion; or
(B) the Secretary of Agriculture shall publish a
notice of the Secretary’s determination not to rec-
ommend the imposition of emergency action and so
advise the petitioner.
(3) Within 7 days after the President receives a rec-
ommendation from the Secretary of Agriculture to take
emergency action pursuant to paragraph (2), the Presi-
dent shall issue a proclamation withdrawing the duty-free
treatment provided by this Act or publish a notice of the
President’s determination not to take emergency action.
(4) The emergency action provided by paragraph (3)
shall cease to apply—
(A) upon the taking of action under section 203
of the Trade Act of 1974,
(B) on the day that a determination by the
President not to take action under section 203(b)(2)
of such Act becomes final,
(C) in the event of a report of the United
States International Trade Commission containing a
negative finding, on the day that the Commission’s
report is submitted to the President, or
(D) whenever the President determines that be-
cause of changed circumstances such relief is no
longer warranted.
(5) For purposes of this subsection, the term ‘‘perish-
able product’’ means—
(A) live plants and fresh cut flowers provided
for in chapter 6 of the HTS;
(B) fresh or chilled vegetables provided for in
headings 0701 through 0709 (except subheading
0709.52.00) and heading 0714 of the HTS;
(C) fresh fruit provided for in subheadings
0804.20 through 0810.90 (except citrons of sub-
headings 0805.90.00, tamarinds of subheading
0810.90.25, 
and 
kiwi 
fruit 
of 
subheading
0810.50.00, and cashew apples, mameyes colorados,
sapodillas, soursops, and sweetsops of subheading
0810.90.40) of the HTS; and
(D) concentrated citrus fruit juice provided for
in subheadings 2009.11.00, 2009.19.40, 2009.20.40,
2009.30.20, and 2009.30.60 of the HTS.
(e) SECTION 22 FEES.—No proclamation issued pur-
suant to this Act shall affect fees imposed pursuant to
section 22 of the Agricultural Adjustment Act of 1933 (7
U.S.C. 624).
(f) TARIFF-RATE QUOTAS.—No quantity of an agri-
cultural product subject to a tariff-rate quota that exceeds
the in-quota quantity shall be eligible for duty-free treat-
ment under this Act.
SEC. 7. RELATED AMENDMENTS.
(a) INCREASE
IN DUTY-FREE TOURIST ALLOW-
ANCE.—Note 4 to subchapter IV of chapter 98 of the HTS
is amended by inserting before the final period the phrase
‘‘, or a country designated as a beneficiary country under
the Southeast Europe Trade Preference Act’’.
(b) TREATMENT OF INSULAR POSSESSIONS PROD-
UCTS.—General note 3(a)(iv) of the HTS (relating to
products of the insular possessions) is amended by redes-
ignating subdivision (F) as subdivision (G), and by insert-
ing after subdivision (E) the following:
‘‘(F) Subject to the provisions in section 5
of the Southeast Europe Trade Preference Act,
goods which are imported from the insular pos-
sessions of the United States shall receive duty
treatment no less favorable than the treatment
afforded such goods when they are imported
from a beneficiary country under that Act.’’.
(c) SECTION 301.—Section 301(c) of the Trade Act
of 1974 (19 U.S.C. 2411) is amended in paragraph (1)(C)
by striking ‘‘or’’ after ‘‘(19 U.S.C. 2702 (b) and (c))’’ and
inserting ‘‘or section 5 (b) and (c) of the Southeast Eu-
rope Trade Preference Act,’’ after ‘‘19 U.S.C. 3202 (b)
and (c)),’’.
SEC. 8. INTERNATIONAL TRADE COMMISSION REPORT ON
IMPACT OF THE SOUTHEAST EUROPE TRADE
PREFERENCE ACT.
(a) REPORTING REQUIREMENT.—(1) No later than
October 1, 2002, the United States International Trade
Commission (referred to in this section as the ‘‘Commis-
sion’’) shall submit to Congress and the President a report
regarding the economic impact of this Act on United
States industries and consumers, and, in conjunction with
other agencies, the effectiveness of this Act in promoting
regional reconstruction.
(2) For purposes of this section, industries in the
Commonwealth of Puerto Rico and the insular possessions
of the United States are considered to be United States
industries.
(b) REQUIREMENTS FOR REPORT.—(1) The report
required under subsection (a) shall include, but not be lim-
ited to, an assessment by the Commission regarding—
(A) the actual effect, during the period covered
by the report, of this Act on the United States econ-
omy generally as well as on those specific domestic
industries which produce articles that are like, or di-
rectly competitive with, articles being imported into
the United States from beneficiary countries; and
(B) the probable future effect that this Act will
have on the United States economy generally, as well
as on such domestic industries, before the provisions
of this Act terminate.
(2) In preparing the assessments required under
paragraph (1), the Commission shall, to the extent
practicable—
(A) analyze the production, trade, and con-
sumption of United States products affected by this
Act, taking into consideration employment, profit
levels, and use of productive facilities with respect to
the domestic industries concerned, and such other
economic factors in such industries as it considers
relevant, including prices, wages, sales, inventories,
patterns of demand, capital investment, obsolescence
of equipment, and diversification of production; and
(B) describe the nature and extent of any sig-
nificant change in employment, profit levels, and use
of productive facilities, and such other conditions as
it deems relevant in the domestic industries con-
cerned, which it believes are attributable to this Act.
(c) SUBMISSION DATES; PUBLIC COMMENT.—The
Commission shall provide an opportunity for the submis-
sion by the public, either orally or in writing, or both, of
information relating to matters that will be addressed in
the report.
SEC. 9. IMPACT STUDY BY THE SECRETARY OF LABOR.
(a) The Secretary of Labor, in consultation with
other appropriate Federal agencies, shall undertake a con-
tinuing review and analysis of the impact that the imple-
mentation of the provisions of this Act has with respect
to United States labor, shall review developments in labor
conditions in the beneficiary countries, and, no later than
October 1, 2002, shall make a report to Congress on the
results of such review and analysis.
(b) For purposes of this section, industries in the
Commonwealth of Puerto Rico and the insular possessions
of the United States are considered to be United States
industries.
SEC. 10. EFFECTIVE DATE AND TERMINATION OF DUTY-
FREE TREATMENT.
(a) EFFECTIVE DATE.—This Act shall take effect on
the date of enactment of this Act.
(b) TERMINATION OF DUTY-FREE TREATMENT.—
Duty-free treatment extended to beneficiary countries
under this Act shall terminate on the date that is 5 years
after the date of enactment of this Act.
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