I
104TH CONGRESS
2D SESSION
H. R. 3654
To ensure the competitiveness of the United States textile and apparel
industry.
IN THE HOUSE OF REPRESENTATIVES
JUNE 13, 1996
Mr. SPRATT (for himself, Mr. COBLE, Mr. PAYNE of Virginia, Mr. BURR, Mr.
COLLINS of Georgia, Mr. RANGEL, Mr. ROGERS, Mr. CARDIN, Mr. NEAL
of Massachusetts, Mr. COYNE, Mr. FORD, Mr. LEWIS of Georgia, Mr.
LEVIN, Mr. MATSUI, Mr. HUNTER, Mr. FLANAGAN, Mr. BAKER of Cali-
fornia, Mr. CHAMBLISS, Mr. BROWDER, Mr. FRANK of Massachusetts,
Mr. HEFNER, Mr. QUILLEN, Ms. KAPTUR, Mr. SPENCE, Mr. MONTGOM-
ERY, Mr. LEWIS of Kentucky, Mr. GRAHAM, Mr. DEAL of Georgia, Mr.
FUNDERBURK, Mr. JONES, Mr. CLYBURN, Mr. WATT of North Carolina,
Mr. BALLENGER, Mr. HEINEMAN, Mr. RAHALL, Mr. ANDREWS, Mr.
THOMPSON, Mr. ROSE, Mr. PETERSON of Minnesota, Mr. SISISKY, Mr.
GORDON, Mr. MCHALE, Mr. HOLDEN, Mr. BISHOP, Mr. BOUCHER, Mr.
WOLF, Mr. CRAMER, Mr. ENGEL, Mr. CONDIT, Mr. STENHOLM, Mr.
REED, Mr. WHITFIELD, Mr. HALL of Texas, Mr. INGLIS of South Caro-
lina, Mr. NADLER, Mr. DEFAZIO, Mr. MILLER of California, Mrs.
MYRICK, Mrs. CLAYTON, Mr. STUPAK, Mr. NORWOOD, Ms. JACKSON-LEE
of Texas, Mr. KINGSTON, Mr. LINDER, Mr. TANNER, Ms. SLAUGHTER,
and Ms. DANNER) introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To ensure the competitiveness of the United States textile
and apparel industry.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Textile and Apparel
Global Competitiveness Act of 1996’’.
SEC. 2. FINDINGS.
The Congress finds that—
(1) the textile and apparel industry is a key
part of the United States manufacturing base and
the third largest manufacturing sector in the United
States economy;
(2) textile and apparel facilities are often lo-
cated in economically sensitive regions;
(3) the industry has demonstrated an ability to
compete in the global economy where market access
is available;
(4) the domestic textile and apparel industry
has committed significant resources to be competi-
tive and productive;
(5) workers in the industry make the highest
quality textile and apparel goods in the world and
are the world’s most productive;
(6) the industry is preparing to compete in the
world market without the protection of import
quotas authorized by the Multifiber Arrangement;
and
(7) United States trade policy should be ori-
ented toward expanding exports and ensuring that
United States trade laws are vigorously enforced.
(8) The Committee for the Implementation of
Textile Agreements, the Office of Textiles, Apparel,
and Consumer Goods of the Department of Com-
merce, and the Ambassador for Textiles and Apparel
in the Office of the United States Trade Representa-
tive—
(A) play central and indispensable roles in
administering the laws governing trade in tex-
tile and apparel goods;
(B) have diligently carried out laws en-
acted by the Congress and under powers dele-
gated to them by the President; and
(C) have acted in accordance with United
States and international law.
SEC. 3. MARKET ACCESS FOR U.S. TEXTILE AND APPAREL
PRODUCTS.
(a) ACCESSION PROTOCOLS.—In any case in which
the United States negotiates a protocol for accession of
a country to the World Trade Organization, the Trade
Representative shall negotiate for inclusion in that proto-
col, in addition to any other provisions, the following:
(1) Provisions for effective market access to
that country’s domestic markets for textile and ap-
parel products of the United States.
(2) Provisions allowing the suspension or rev-
ocation of the provisions of paragraph 14 (relating
to increasing import levels based on growth rates) of
the Agreement on Textiles and Clothing if the Unit-
ed States determines that the country has failed to
enforce the provisions referred to in paragraph (1).
(b) BILATERAL AGREEMENTS WITH COUNTRIES
THAT ARE NOT WTO MEMBERS.—In any case in which
the United States negotiates a textile agreement with a
country that is not a WTO member, including any agree-
ment negotiated pursuant to section 5 of this Act, the
Trade Representative shall negotiate for inclusion in that
textile agreement, in addition to any other provisions, the
following:
(1) Provisions for effective market access to
that country’s domestic markets for textile and ap-
parel products of the United States.
(2) Provisions that recognize the right of the
United States to pursue remedies under United
States law, including section 301 of the Trade Act
of 1974, to respond to the denial of market access
described in paragraph (1).
(c) REVIEW OF TEXTILE AGREEMENTS.—The Trade
Representative shall take into account the compliance of
countries with the provisions negotiated under subsections
(a) and (b) in identifying countries for purposes of section
183 of the Trade Act of 1974, as added by subsection
(d) of this section.
(d) PRIORITY FOREIGN COUNTRIES.—
(1) IN GENERAL.—Chapter 8 of title I of the
Trade Act of 1974 (19 U.S.C. 2241 and following)
is amended by adding at the end the following new
section:
‘‘SEC. 183. IDENTIFICATION OF COUNTRIES THAT DENY
MARKET ACCESS FOR TEXTILE AND APPAREL
PRODUCTS.
‘‘(a) IN GENERAL.—By no later than the date that
is 30 days after the date on which the annual report is
submitted to congressional committees under section
181(b), the United States Trade Representative (hereafter
referred to as the ‘Trade Representative’) shall identify—
‘‘(1) those foreign countries that deny fair and
equitable market access to United States persons
that produce or sell textile or apparel products, and
‘‘(2) those foreign countries identified under
paragraph (1) that are determined by the Trade
Representative to be priority foreign countries.
‘‘(b) SPECIAL RULES
FOR IDENTIFICATIONS.—In
identifying priority foreign countries under subsection (a),
the following shall apply:
‘‘(1) In identifying priority foreign countries
under subsection (a)(2), the Trade Representative
shall identify only those foreign countries—
‘‘(A) that have the most onerous or egre-
gious acts, policies, or practices that deny fair
and equitable market access to United States
persons that sell or produce textile or apparel
products,
‘‘(B) whose acts, policies, or practices de-
scribed in subparagraph (A) have the greatest
adverse impact (actual or potential) on the rel-
evant United States products, and
‘‘(C) that are not—
‘‘(i) entering into good faith negotia-
tions, or
‘‘(ii) making significant progress in
bilateral or multilateral negotiations,
to provide adequate and effective market access
for textile and apparel products of the United
States.
‘‘(2) In identifying foreign countries under sub-
section (a)(2), the Trade Representative shall—
‘‘(A) consult with the Chair of the Com-
mittee for the Implementation of Textile Agree-
ments and other appropriate officers of the
Federal Government, and
‘‘(B) take into account information from
such sources as may be available to the Trade
Representative and such information as may be
submitted to the Trade Representative in re-
ports submitted under section 181(b) and peti-
tions submitted under section 302.
‘‘(3) The Trade Representative may identify a
foreign country under subsection (a)(1) only if the
Trade Representative finds that there is a factual
basis for the denial of fair and equitable market ac-
cess as a result of the violation of international law
or an international agreement, or the existence of
barriers referred to in subsection (d)(1).
‘‘(4) In identifying foreign countries under
paragraphs (1) and (2) of subsection (a), the Trade
Representative shall take into account—
‘‘(A) the history of market access laws and
practices of the foreign country, including any
previous identification under subsection (a)(2);
and
‘‘(B) the history of efforts of the United
States, and the response of the foreign country,
to achieve fair and equitable market access for
textile and apparel products.
‘‘(c) REVOCATIONS AND ADDITIONAL IDENTIFICA-
TIONS.—
‘‘(1) IN GENERAL.—The Trade Representative
may at any time—
‘‘(A) revoke the identification of any for-
eign country as a priority foreign country under
this section, or
‘‘(B) identify a foreign country as a prior-
ity foreign country under this section,
if information available to the Trade Representative
indicates that such action is appropriate.
‘‘(2) REPORTS TO CONGRESS.—The Trade Rep-
resentative shall include in the semiannual report
submitted to the Congress under section 309(3) a
detailed explanation of the identification of any for-
eign country as a priority foreign country under this
section.
‘‘(d) DEFINITIONS.—For the purposes of this sec-
tion—
‘‘(1) a foreign country denies fair and equitable
market access if the foreign country effectively de-
nies access for textile or apparel products of the
United States through the use of laws, procedures,
practices, or regulations which—
‘‘(A) violate provisions of international law
or international agreements to which both the
United States and the foreign country are par-
ties, or
‘‘(B) constitute discriminatory nontariff
trade barriers;
‘‘(2) a foreign country may be determined to
deny fair and equitable market access for textile or
apparel products, notwithstanding the fact that the
foreign country may be in compliance with the spe-
cific obligations of the Agreement on Textiles and
Clothing referred to in section 101(d)(4) of the Uru-
guay Round Agreements Act; and
‘‘(3) fair and equitable market access is not
demonstrated only by access for those textile and ap-
parel products that are subsequently reexported to
the United States as finished textile or apparel prod-
ucts.
‘‘(e) PUBLICATION.—The Trade Representative shall
publish in the Federal Register a list of foreign countries
identified under subsection (a) and shall make such revi-
sions to the list as may be required by reason of action
under subsection (c).’’.
(2) CONFORMING AMENDMENT.—The table of
contents for the Trade Act of 1974 is amended by
inserting after the item relating to section 182 the
following new item:
‘‘Sec. 183. Identification of countries that deny market access for textile and
apparel products.’’.
(3) TITLE III ACTION.—Section 302(b)(2)(A) of
the Trade Act of 1974 (19 U.S.C. 2412(b)(2)(A)) is
amended by inserting ‘‘or section 183(a)(2)’’ after
‘‘182(a)(2)’’.
SEC. 4. TEXTILE GLOBAL COMPETITIVENESS RESEARCH
FUND.
(a) ESTABLISHMENT.—There is established in the
United States Treasury a Textile Global Competitiveness
Research Fund (hereafter in this Act referred to as the
‘‘Fund’’).
(b) USE OF FUND.—Amounts in the Fund shall be
available, in accordance with subsection (c)—
(1) to the Office of Textiles, Apparel, and
Consumer Goods of the Department of Commerce,
which is authorized to use such amounts to provide
funds for—
(A) the American Textile Partnership
(commonly referred to as ‘‘AMTEX’’);
(B) the Textile/Clothing Technology Center
(commonly referred to as ‘‘TC2’’); and
(C) the National Textile Center (commonly
referred to as ‘‘NTC’’);
(2) for adjustment assistance for firms in the
textile and apparel industry under chapter 3 of title
II of the Trade Act of 1974 (19 U.S.C. 2341 and
following); and
(3) to the Customs Service for the enforcement
of laws governing trade in textile and apparel goods.
(c) FUNDING.—
(1) DEPOSITS.—There shall be deposited in the
Fund in each fiscal year the amount by which—
(A) the amounts collected in fines by virtue
of the amendments made by section 9 exceed
(B) the total amount collected under those
provisions of law amended by section 9 during
the fiscal year ending before the enactment of
this Act, as such amount is adjusted under
paragraph (2).
(2) ADJUSTMENT.—(A) The amount referred to
in paragraph (1)(B) shall be increased in each fiscal
year following the fiscal year described in paragraph
(1)(B) by the cost-of-living adjustment for the most
recent calendar year.
(B) For purposes of subparagraph (A), the
cost-of-living adjustment for any calendar year is the
percentage (if any) by which—
(i) the CPI for the preceding calendar
year, exceeds
(ii) the CPI for the calendar year ending
before the enactment of this Act.
(C) For purposes of subparagraph (B), the CPI
for any calendar year is the average of the
Consumer Price Index as of the close of the 12-
month period ending on August 31 of such calendar
year.
(D) For purposes of subparagraph (C), the
term ‘‘Consumer Price Index’’ means the last
Consumer Price Index for all-urban consumers pub-
lished by the Department of Labor.
(3) ALLOCATIONS.—(A) 25 percent of the
amounts deposited in the Funds in each fiscal year
shall be made available to the Customs Service
under subsection (b)(3).
(B) Subject to subparagraph (C), amounts re-
maining in the Fund after the deduction is made
under subparagraph (A) shall be made available in
each fiscal year to each program referred to in para-
graphs (1) and (2) of subsection (b) based on the
proportion that the amounts otherwise available to
such program during the preceding fiscal year bears
to the amounts otherwise available to all such pro-
grams during the preceding fiscal year.
(C) Amounts made available under subpara-
graph (A) for adjustment assistance for firms under
subsection (b)(2) may not exceed $2,000,000 in any
fiscal year.
(d) ANNUAL REPORT TO CONGRESS.—The Secretary
of Commerce shall submit to the Congress, not later than
April 1 of each year, a report on the contribution to the
United States economy of the domestic textile and apparel
industry.
SEC. 5. TEXTILE AND APPAREL QUOTA LEVELS.
(a) FOR COUNTRIES THAT ARE NOT WTO MEMBERS
AND DO NOT HAVE TEXTILE AGREEMENTS WITH THE
UNITED STATES.—
(1) IF EXPORTS TO THE UNITED STATES EX-
CEED $100,000,000 ANNUALLY OR ARE CREATING SE-
RIOUS DAMAGE OR ACTUAL THREAT THEREOF.—The
Trade Representative shall take the necessary steps
to negotiate an agreement, in accordance with para-
graph (2), between the United States and any coun-
try that—
(A) is not a WTO member and is not a
country to which section 3(a) applies,
(B) is not a party to a textile agreement
with the United States, and
(C) whose exports to the United States of
textile and apparel goods are valued at more
than $100,000,000 in the most recent 12-
month period ending on the last day of the pre-
ceding month, or are creating serious damage
or actual threat thereof to the domestic indus-
try in the United States in any textile category
established by CITA.
(2) CONTENTS
OF
AGREEMENTS.—It is the
sense of the Congress that an agreement negotiated
with a country under paragraph (1) should establish
maximum amounts of textile and apparel products of
that country that may be imported into the United
States that do not exceed—
(A) in the first 12-month period that the
agreement is in effect, an increase of more than
8 percent of the total volume in square meter
equivalents of all textile and apparel products of
that country imported in the 12-month period
ending on the date the negotiations began; and
(B) in each subsequent 12-month period
that the agreement is in effect, an increase of
more than the percentage of growth in the do-
mestic market in the United States for all tex-
tile and apparel products in the preceding 12-
month period.
(3) INCLUSION OF OTHER PROVISIONS.—Those
provisions required to be included in an agreement
under section 3(b) may be included in the agreement
negotiated under this subsection.
(4) DETERMINATIONS OF SERIOUS DAMAGE OR
ACTUAL THREAT THEREOF.—CITA shall make the
determinations of serious damage or actual threat
thereof referred to in paragraph (2), using the cri-
teria set forth in paragraph 3 of Article 6 of the
Agreement on Textiles and Clothing.
(b) FOR COUNTRIES THAT ARE NOT WTO MEMBERS
AND HAVE TEXTILE AGREEMENTS WITH THE UNITED
STATES.—In the case of a country that is not a WTO
member but is a party to a textile agreement with the
United States, the Trade Representative shall take the
necessary steps to negotiate a textile agreement to go into
effect when the current agreement expires, that allows im-
ports of textile and apparel products of that country, dur-
ing each 12-month period that the agreement is in effect,
to increase by not more than the percentage of growth
in the domestic market in the United States for all textile
and apparel products in the preceding 12-month period.
(c) FOR COUNTRIES THAT ARE ACCEDING TO THE
WTO.—In any case in which the United States negotiates
a protocol for accession to the WTO under section 3(a),
the Trade Representative shall negotiate for inclusion in
that protocol provisions that require that the 10-year pe-
riod provided in the Agreement on Textiles and Clothing
for phasing out of quotas under that Agreement begin,
with respect to that country, on the day on which that
country accedes to the WTO.
SEC. 6. CIRCUMVENTION OF TEXTILE AGREEMENTS.
(a) POLICY FOR COUNTRIES THAT ARE NOT WTO
MEMBERS.—In the case of any country that is not a WTO
member and—
(1) is negotiating a protocol with the United
States for that country’s accession to the World
Trade Organization,
(2) is a party to a bilateral agreement with the
United States that governs imports into the United
States of textile and apparel products of that coun-
try, or
(3) is a country with which the United States
is negotiating an agreement under section 5(a),
the Trade Representative shall ensure that the protocol
under paragraph (1), a subsequent agreement to replace
the agreement under paragraph (2) when it expires, or
the agreement described in paragraph (3), as the case may
be, provides for a reduction in the quantity of textile and
apparel goods of that country that may be imported into
the United States if CITA determines that the agreement
is being circumvented and that no, or inadequate meas-
ures, are being applied by that country to take action
against such circumvention. Any determination by CITA
under the preceding sentence shall be made in accordance
with the standards set forth in section 8.
(b) DEFINITIONS.—For purposes of this section, a
reduction in a country’s textile and apparel quotas is a
reduction in quantitative limitations otherwise applicable
to imports into the United States of that country’s textile
and apparel products that is equal to—
(1) the quantity of the goods involved in the
circumvention if the circumvention is the first within
the most recent 36-month period;
(2) twice the quantity of goods involved in the
circumvention if the circumvention is the second in
the most recent 36-month period; or
(3) three times the quantity of goods involved
in the circumvention if the circumvention is the
third or more in the most recent 36-month period.
(c) POLICY FOR WTO MEMBERS.—In any case in
which a WTO member is found by CITA to have cir-
cumvented the Agreement on Textiles and Clothing or any
other textile agreement, CITA shall pursue the maximum
penalty consistent with the WTO.
SEC. 7. CUSTOMS ENFORCEMENT ACTION.
(a) SHARING
OF CUSTOMS INFORMATION WITH
CITA.—The Customs Service shall, upon initiating an in-
vestigation relating to a violation of the laws of the United
States governing international trade in textile and apparel
goods, inform CITA of the investigation in any case in
which the alleged violation, if true, would constitute a cir-
cumvention of any textile agreement. In any such case,
the Customs Service shall provide to CITA—
(1) all information CITA requests that is rel-
evant to the alleged violation and required in order
for CITA to pursue a charge against the quotas on
imports of textile and apparel products of that coun-
try as a result of the violation; and
(2) notification, at least every 30 days until the
investigation is referred to the Department of Jus-
tice or the Customs Service closes the investigation,
of the progress of the investigation.
(b) FACTORS
IN
PROCEEDING
WITH
CHARGES
AGAINST QUOTAS.—In deciding whether to pursue a
charge described in subsection (a) as a result of an alleged
violation described in subsection (a), CITA, in addition to
any other relevant factors which CITA may consider, shall
weigh the impact of proceeding with such charge on poten-
tial prosecutions or civil penalties and future enforcement
of textile agreements, and shall consider the amount of
the alleged violation, the probability of successful criminal
prosecution, the degree of compliance by the true country
of origin with textile agreements, and the damage the al-
leged violation would inflict on the domestic textile and
apparel industry.
(c) DECISION NOT TO PURSUE A CHARGE.—In any
case in which CITA decides under subsection (b) not to
pursue a charge, the Customs Service shall, as long as
that decision is in effect, report to CITA, in lieu of the
reports under subsection (a)(2)—
(1) at least once every 6 months from the date
on which the Customs Service initiated the case, on
the status of the investigation; and
(2) within 10 business days after the Customs
Service obtains new information or evidence materi-
ally relevant to the alleged violation.
(d) STANDING NOT PROVIDED.—Nothing in this Act
shall be construed to provide standing in any court or ad-
ministrative proceeding for legal action against the United
States arising from actions taken in carrying out the laws
governing trade in textile or apparel goods.
(e) REFERRAL OF CASES TO DEPARTMENT OF JUS-
TICE.—In any case in which—
(1) the Customs Service refers an alleged viola-
tion described in subsection (a) to the Department
of Justice for prosecution, and
(2) no indictment has been brought in the case
within 6 months after the referral,
the Attorney General shall provide to CITA all informa-
tion relevant to imposing a charge against the quotas on
imports of textile and apparel products of the country con-
cerned as a result of the violation. CITA may extend the
6-month period referred to in paragraph (2) if requested
to do so by the Attorney General.
(f) DISCLOSURE OF CERTAIN CONFIDENTIAL INFOR-
MATION NOT REQUIRED.—Nothing in this section shall
be construed to require the disclosure by the Customs
Service or the Department of Justice of confidential infor-
mation relevant to possible imposition of criminal or civil
penalties when that information is not relevant to the im-
position of a charge by CITA against the quotas on im-
ports of textile and apparel products of a country.
(g) INITIATION OF INVESTIGATIONS.—
(1) BASIS FOR INITIATION.—Subject to para-
graph (2), whenever the Customs Service receives
credible evidence that circumvention of a textile
agreement has occurred, the Customs Service shall
initiate an investigation, to which a customs officer
shall be assigned, to determine if such circumvention
has occurred, unless such evidence is directly related
to an open investigation commenced prior to the re-
ceipt of such evidence.
(2) WAIVER.—The head of the Division of Tex-
tile Enforcement established under section 10 may
determine not to initiate an investigation under
paragraph (1) if he or she transmits to CITA a re-
port setting forth the reasons for that determination.
SEC. 8. STANDARDS OF PROOF.
(a) IN GENERAL.—CITA may determine that a coun-
try has circumvented a textile agreement if CITA deter-
mines, after consultations with the country concerned,
that there is a substantial likelihood that the circumven-
tion occurred.
(b) FAILURE OF COUNTRY TO COOPERATE.—
(1) RELIANCE ON BEST AVAILABLE INFORMA-
TION.—If a country fails to cooperate with CITA in
an investigation to determine if a textile agreement
has been circumvented, CITA shall base its deter-
mination on the best available information.
(2) ACTS CONSTITUTING FAILURE TO COOPER-
ATE.—Acts indicating failure of a country to cooper-
ate under paragraph (1) include, but are not limited
to—
(A) denying entry of officials of the Cus-
toms Service to investigate violations of, or pro-
mote compliance with, any textile agreement;
(B) providing appropriate United States
officials with inaccurate or incomplete informa-
tion, including information demonstrating com-
pliance with United States rules of origin for
textile and apparel products; and
(C) denying appropriate United States offi-
cials access to information or documentation re-
lating to production capacity of, and outward
processing done by, manufacturers within the
country.
SEC. 9. PENALTIES FOR VIOLATIONS OF CUSTOMS LAWS IN-
VOLVING TEXTILE AND APPAREL GOODS.
(a) PENALTIES.—Section 592 of the Tariff Act of
1930 (19 U.S.C. 1592) is amended by adding at the end
the following:
‘‘(g) PENALTIES INVOLVING TEXTILE AND APPAREL
GOODS.—
‘‘(1) FRAUD.—Notwithstanding subsection (c),
the civil penalty for a fraudulent violation of sub-
section (a) involving textile and apparel goods—
‘‘(A) shall, subject to subparagraph (B), be
double the amount that would otherwise apply
under subsection (c)(1); and
‘‘(B) shall be an amount not to exceed 300
percent of the declared value in the United
States of the merchandise if the violation has
the effect of circumventing any quota on textile
and apparel goods.
‘‘(2) GROSS
NEGLIGENCE.—Notwithstanding
subsection (c), the civil penalty for a grossly neg-
ligent violation of subsection (a) involving textile and
apparel goods—
‘‘(A) shall, subject to subparagraphs (B)
and (C), be double the amount that would oth-
erwise apply under subsection (c)(2);
‘‘(B) shall, if the violation has the effect of
circumventing any quota of the United States
on textile and apparel goods, and subject to
subparagraph (C), be 200 percent of the de-
clared value of the merchandise; and
‘‘(C) shall, if the violation is a third or
subsequent offense occurring within 3 years
after another violation under this paragraph, be
the penalty for a fraudulent violation under
paragraph (1).
‘‘(3) 
NEGLIGENCE.—Notwithstanding 
sub-
section (c), the civil penalty for a negligent violation
of subsection (a) involving textile and apparel
goods—
‘‘(A) shall, subject to subparagraphs (B)
and (C), be double the amount that would oth-
erwise apply under subsection (a)(3);
‘‘(B) shall, if the violation has the effect of
circumventing any quota of the United States
on textile and apparel goods, and subject to
subparagraph (C), be 100 percent of the de-
clared value of the merchandise; and
‘‘(C) shall, if the violation is a third or
subsequent offense occurring within 3 years
after another violation under this paragraph, be
the penalty for a grossly negligent violation
under paragraph (2).
‘‘(4) MITIGATION.—In the case of a violation of
subsection (a) involving textile and apparel goods—
‘‘(A) paragraph (4) of subsection (c) shall
apply only if the disclosure under such sub-
section is made within 180 days after the entry
of the goods, and the reference to subsection (c)
in that paragraph shall be deemed to refer to
paragraph (1), (2), or (3) of this subsection, as
the case may be;
‘‘(B) in the case of disclosure made after
the end of that 180-day period, the penalty that
would apply under paragraph (1), (2), or (3)
may be reduced, but to not less than 50 percent
of the penalty that would otherwise apply under
paragraph (1), (2), or (3); and
‘‘(C) no reduction in penalties may be
made in the case of a disclosure of a violation
by a person found guilty of 3 prior violations
under paragraph (3) or 2 prior violations under
paragraph (1) or (2), or both.’’.
(b) SEIZURE AND FORFEITURE.—Section 596(c)(2)
of the Tariff Act of 1930 (19 U.S.C. 15951(c)(2)) is
amended—
(1) in subparagraph (E) by striking ‘‘or’’ after
the semicolon;
(2) in subparagraph (F) by striking the period
and inserting ‘‘; or’’; and
(3) by inserting after subparagraph (F) the fol-
lowing:
‘‘(G) consists of textile or apparel goods in-
troduced into the United States for entry, tran-
sit, or exportation and
‘‘(i) the merchandise or its container
bears false or fraudulent markings with re-
spect to the country of origin; or
‘‘(ii) the merchandise or its container
is introduced or attempted to be intro-
duced into the United States by means of,
or such introduction or attempt is aided or
facilitated by means of, a material false
statement, act, or omission.’’.
(c) CERTIFICATES OF ORIGIN.—All importations of
textile and apparel goods shall be accompanied, in addition
to any other documentation required by law, by—
(1)(A) the name and address of the manufac-
turer or producer of the goods, and any other infor-
mation with respect to the manufacturer or producer
that the Customs Service may require; and
(B) if there is more than one manufacturer or
producer, or there is a contractor or subcontractor
of the manufacturer or producer with respect to the
manufacture or production of the goods, the infor-
mation required under subparagraph (A) with re-
spect to each such manufacturer, producer, contrac-
tor, or subcontractor, including a description of the
process performed by each such entity; and
(2) a certification by the importer that the im-
porter has used reasonable care to ascertain the true
country of origin of the textile and apparel goods
and the accuracy of all other information provided
on the documentation accompanying the imported
goods, as well as a certification of the specific action
taken by the importer to demonstrate reasonable
care for purposes of this paragraph.
Information provided under this subsection shall be suffi-
cient to demonstrate compliance with the United States
rules of origin for textile and apparel goods.
SEC. 10. DIVISION ON TEXTILE ENFORCEMENT.
(a) ESTABLISHMENT.—The Commissioner of Cus-
toms shall, not later than 6 months after the date of the
enactment of this Act, establish in the Customs Service
a Division on Textile Enforcement (hereafter in this sec-
tion referred to as the ‘‘DTE’’), using existing resources
available to the Customs Service. The head of the DTE
shall be an officer of the Customs Service in a position
at the level of an Assistant Commissioner of Customs.
(b) FUNCTIONS.—The DTE shall be responsible for
enforcing all laws of the United States, and all bilateral
and multilateral treaties and agreements, governing the
importation of textile and apparel goods, that the Customs
Service is responsible for enforcing.
(c) PERSONNEL.—The Commissioner of Customs
shall assign personnel to the DTE who have expertise in
textile and apparel goods, including, but not limited to,
import specialists, investigators, attorneys, accountants,
laboratory technicians, and members of the textile produc-
tion verification teams.
(d) SUBDIVISIONS.—The DTE shall establish a sepa-
rate subdivision for each geographic region which is a
major source of textile and apparel goods imported into
the United States, including a subdivision for each of the
following:
(1) The Far East.
(2) South Asia.
(3) South America.
(4) Central America and the Caribbean.
(5) The Middle East and Africa.
(e) ASSIGNMENTS ABROAD.—
(1) TO CERTAIN COUNTRIES.—If permitted by
the host country, at least 1 customs officer shall be
assigned in each country, other than Canada or
Mexico, whose annual exports to the United States
of textile and apparel goods equal or exceed
500,000,000 square meter equivalents. Each such
customs officer shall be responsible only for matters
relating to exports to the United States of textile
and apparel goods.
(2) 
RESPONSIBILITY
OF
SECRETARY
OF
STATE.—The Secretary of State shall take the nec-
essary steps to facilitate the assignment abroad of
customs officers under paragraph (1), by seeking to
obtain the approval of the foreign governments con-
cerned for such assignments.
(f) REPORTS.—
(1) REPORTS
BY
CUSTOMS
OFFICERS.—Each
customs officer assigned under subsection (e)(1)
shall prepare and submit to the Commissioner of
Customs, at least monthly, reports summarizing his
or her activities, assessing the compliance with appli-
cable textile agreements by the country concerned,
and assessing the intellectual property protection
provided to textile and apparel goods in that coun-
try.
(2) REPORTS BY DTE.—The DTE shall prepare
and submit to the Commissioner an annual report—
(A) evaluating the extent of circumvention
of textile agreements with the United States,
the extent of compliance with the rules of origin
of the United States relating to textile and ap-
parel goods, the extent to which countries act in
compliance with Article XX of the GATT 1994
(as defined in section 2 of the Uruguay Round
Agreements Act (19 U.S.C. 3501)) with respect
to textile and apparel goods, and the adequacy
of intellectual property protection provided to
textile and apparel goods; and
(B) recommending new methods, if nec-
essary, to address the matters evaluated under
subparagraph (A).
(3) AVAILABILITY OF REPORTS.—Each report
submitted under this subsection shall be made avail-
able to appropriate agencies of the executive branch,
including the Office of Textiles, Apparel, and
Consumer Goods of the Department of Commerce.
SEC. 11. WITHDRAWAL OF UNILATERAL TRADE CONCES-
SIONS.
(a) WITHDRAWAL OF CONCESSIONS.—In any case in
which—
(1) CITA determines that a country—
(A) has demonstrated a consistent pattern
of circumventing textile agreements with the
United States,
(B) refuses to cooperate with investigations
by the United States of any such alleged cir-
cumvention,
(C) fails to provide adequate enforcement
of intellectual property rights with respect to
textile and apparel goods, or
(D) fails to provide fair and equitable mar-
ket access for textile and apparel products of
the United States, and
(2) the United States extends to the products
of that country preferential tariff or quota treatment
other than pursuant to a bilateral or multilateral
agreement,
then such preferential treatment shall be withdrawn from
the textile and apparel goods that are products of that
country for such period as shall be determined by the
Trade Representative, in consultation with CITA.
(b) NATIONAL INTEREST WAIVER.—The President
may waive the application of subsection (a) with respect
to a country if the President determines that the waiver
will allow the United States to secure effective commit-
ments from that country to prevent future circumvention
of textile agreements with the United States, or is other-
wise in the national interest. The President shall publish
any such waiver, and the reasons for the waiver, in the
Federal Register.
SEC. 12. DEFINITIONS.
As used in this Act:
(1) AGREEMENT
ON
TEXTILES
AND
CLOTH-
ING.—The term ‘‘Agreement on Textiles and Cloth-
ing’’ means the Agreement on Textiles and Clothing
referred to in section 101(d)(4) of the Uruguay
Round Agreements Act (19 U.S.C. 3511(d)(4)).
(2) CIRCUMVENT
AND
CIRCUMVENTION.—The
terms ‘‘circumvent’’ and ‘‘circumvention’’ refer to a
situation in which a country—
(A) takes no, or inadequate measures to
prevent illegal transshipment of goods that is
carried out by rerouting, false declaration con-
cerning country or place of origin, falsification
of official documents, evasion of United States
rules of origin for textile and apparel goods, or
any other means; or
(B) takes no or inadequate measures to
prevent being used as a transit point for the
shipment of goods in violation of an applicable
textile agreement.
(3) CITA.—The term ‘‘CITA’’ means the Com-
mittee for the Implementation of Textile Agreements
established under Executive Order 11651 of March
3, 1972 (7 U.S.C. 1854 note), or any successor en-
tity or officer performing functions of that commit-
tee after the enactment of this Act.
(4) COUNTRY.—The term ‘‘country’’ includes a
separate customs territory, within the meaning of
Article XII of the WTO Agreement or other applica-
ble international agreement.
(5) CUSTOMS
SERVICE.—The term ‘‘Customs
Service’’ means the United States Customs Service.
(6) MULTIFIBER
ARRANGEMENT.—The term
‘‘Multifiber Arrangement’’ means the Arrangement
Regarding International Trade in Textiles referred
to in Article 1(3) of the Agreement on Textiles and
Clothing.
(7) TEXTILE
AGREEMENT; TEXTILE
AGREE-
MENT WITH THE UNITED STATES.—The terms ‘‘tex-
tile agreement’’ and ‘‘textile agreement with the
United States’’ mean an agreement relating to tex-
tile and apparel goods that is negotiated under sec-
tion 204 of the Agricultural Act of 1956 (7 U.S.C.
1854), including the Agreement on Textiles and
Clothing.
(8) 
TRADE
REPRESENTATIVE.—The 
term
‘‘Trade Representative’’ means the United States
Trade Representative.
(9) WORLD TRADE ORGANIZATION AND WTO.—
The terms ‘‘World Trade Organization’’ and
‘‘WTO’’ mean the organization established pursuant
to the WTO Agreement.
(10) WTO AGREEMENT.—The term ‘‘WTO
Agreement’’ means the Agreement Establishing the
World Trade Organization entered into on April 15,
1994.
(11) WTO MEMBER.—The term ‘‘WTO mem-
ber’’ means a state, or separate customs territory
(within the meaning of Article XII of the WTO
Agreement).
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