I
106TH CONGRESS
2D SESSION
H. R. 5416
To promote economic development and stability in Southeast Europe by
providing countries in that region with additional trade benefits.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 6, 2000
Mr. HOUGHTON introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To promote economic development and stability in Southeast
Europe by providing countries in that region with addi-
tional trade benefits.
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 ‘‘Southeast Europe
Trade Preference Act’’.
SEC. 2. FINDINGS AND POLICY.
(a) FINDINGS.—Congress finds that—
(1) the economic development and stability of
certain countries in Southeast Europe will be en-
SEC. 5. BENEFICIARY COUNTRIES.
(a) COUNTRIES ELIGIBLE FOR DESIGNATION; CON-
GRESSIONAL NOTIFICATION.—(1) In designating coun-
tries as beneficiary countries under this Act, the President
shall consider only the following countries and territories:
(A) Albania.
(B) Bosnia and Herzegovina.
(C) Bulgaria.
(D) Croatia.
(E) Former Yugoslav Republic of Macedonia.
(F) Romania.
(G) Slovenia.
(H) Kosovo.
(I) Montenegro.
(2) Before the President designates any country a
beneficiary country for purposes of this Act, the President
shall notify the House of Representatives and the Senate
of the President’s intention to make such designation, to-
gether with the considerations entering into such decision.
(b) LIMITATIONS ON DESIGNATION.—The President
shall not designate any country a beneficiary country
under this Act—
(1) if such country—
(A) has nationalized, expropriated, or oth-
erwise seized ownership or control of property
owned by a United States citizen or by a cor-
poration, partnership, or association which is
50 percent or more beneficially owned by
United States citizens,
(B) has taken steps to repudiate or
nullify—
(i) any existing contract or agreement
with, or
(ii) any patent, trademark, or other
intellectual property of,
a United States citizen or a corporation, part-
nership, or association, which is 50 percent or
more beneficially owned by United States citi-
zens, the effect of which is to nationalize, expro-
priate, or otherwise seize ownership or control
of property so owned, or
(C) has imposed or enforced taxes or other
exactions, restrictive maintenance, or oper-
ational conditions, or other measures with re-
spect to property so owned, the effect of which
is to nationalize, expropriate, or otherwise seize
ownership or control of such property, unless
the President determines that—
(i) prompt, adequate, and effective com-
pensation has been or is being made to such
citizen, corporation, partnership, or association,
(ii) good-faith negotiations to provide
prompt, adequate, and effective compensation
under the applicable provisions of international
law are in progress, or such country is other-
wise taking steps to discharge its obligations
under international law with respect to such cit-
izen, corporation, partnership, or association, or
(iii) a dispute involving such citizen, cor-
poration, partnership, or association over com-
pensation for such a seizure has been submitted
to arbitration under the provisions of the Con-
vention for the Settlement of Investment Dis-
putes, or in another mutually agreed upon
forum,
and promptly furnishes a copy of such determination
to the Senate and the House of Representatives;
(2) if such country fails to act in good faith in
recognizing as binding or in enforcing arbitral
awards in favor of United States citizens or a cor-
poration, partnership, or association which is 50 per-
cent or more beneficially owned by United States
citizens, which have been made by arbitrators ap-
pointed for each case or by permanent arbitral bod-
ies to which the parties involved have submitted
their dispute;
(3) if such country affords preferential treat-
ment to the products of a developed country, other
than the United States, and if such preferential
treatment has, or is likely to have, a significant ad-
verse effect on United States, commerce;
(4) if a government-owned entity in such coun-
try engages in the broadcast of copyrighted material,
including films or television material, belonging to
United States copyright owners without their ex-
press consent or such country fails to work toward
the provision of adequate and effective protection of
intellectual property rights;
(5) unless a treaty, convention, protocol, or
other agreement regarding the extradition of United
States citizens is applicable to such country;
(6) if such country has not taken or is not tak-
ing steps to afford to workers in that country (in-
cluding any designated zone in that country) inter-
nationally recognized worker rights, including the
right of association, the right to organize and bar-
gain collectively, a prohibition on the use of any
form of coerced or compulsory labor (including traf-
ficking in persons), a minimum age for the employ-
ment of children, and acceptable conditions of work
with respect to minimum wages, hours of work, and
occupational safety and health; or
(7) if such country is a member of the Euro-
pean Union.
Paragraphs (1) through (6) shall not prevent the designa-
tion of any country as a beneficiary country under this
Act if the President determines that such designation will
be in the national economic or security interest of the
United States and reports such determination to Congress
with the reasons therefor.
(c) FACTORS AFFECTING DESIGNATION.—In deter-
mining whether to designate any country a beneficiary
country under this Act, the President shall take into
account—
(1) an expression by such country of its desire
to be so designated;
(2) the economic conditions in such country, the
living standards of its inhabitants, and any other
factors which the President deems appropriate;
(3) the extent to which such country has as-
sured the United States it will provide equitable and
reasonable access to such country’s—
(A) basic commodity resources; and
(B) markets with respect to the products
for which benefits are provided under this Act,
and in other relevant product sectors as deter-
mined by the President;
(4) the degree to which such country follows the
accepted rules of international trade provided for
under the WTO Agreement and the multilateral
trade agreements (as such terms are defined in
paragraphs (9) and (4), respectively, of section 2 of
the Uruguay Round Agreements Act);
(5) the degree to which such country uses ex-
port subsidies or imposes export performance re-
quirements or local content requirements which dis-
tort international trade;
(6) the degree to which the trade policies of
such country as they relate to other beneficiary
countries are contributing to the revitalization of the
region;
(7) the degree to which such country is under-
taking self-help measures to promote its own eco-
nomic development;
(8) the extent to which such country affords to
workers in that country (including any designated
zone in that country) internationally recognized
worker rights, including the right of association, the
right to organize and bargain collectively, a prohibi-
tion on the use of any form of coerced or compulsory
labor (including trafficking in persons), a minimum
age for the employment of children, and acceptable
conditions of work with respect to minimum wages,
hours of work, and occupational safety and health;
(9) the extent to which the country adopts,
maintains, and effectively enforces laws providing for
high levels of environmental protection;
(10) the extent to which such country provides
under its law adequate and effective means for for-
eign nationals to secure, exercise, and enforce exclu-
sive rights in intellectual property, including patent,
trademark, and copyright rights;
(11) the degree to which such country prohibits
its nationals from engaging in the broadcast of copy-
righted material, including films or television mate-
rial, belonging to United States copyright owners
without their express consent;
(12) the degree to which the country is taking
effective measures to prevent production of, or traf-
ficking in, illicit drugs;
(13) the degree to which the country provides
for effective prohibitions on bribery and other cor-
rupt practices affecting international trade;
(14) the degree to which the country applies
transparent procedures in government procurement
and contributes to efforts in international fora to de-
velop and implement international rules on trans-
parency in government procurement; and
(15) the extent to which such country is pre-
pared to cooperate with the United States in the ad-
ministration of the provisions of this Act.
The President may consider that a country is not pro-
viding adequate and effective protection of intellectual
property rights under paragraph (10), even if the country
is in compliance with the country’s obligations under the
Agreement on Trade-Related Aspects of Intellectual Prop-
erty Rights described in section 101(d)(15) of the Uru-
guay Round Agreements Act (19 U.S.C. 3511(d)(15)).
(d) WITHDRAWAL
OR SUSPENSION
OF DESIGNA-
TION.—(1) The President may—
(A) withdraw or suspend the designation of any
country as a beneficiary country, or
(B) withdraw, suspend, modify, or limit the ap-
plication of preferential treatment under this Act to
any article of any country,
if, after such designation, the President determines that
such action is appropriate based on the limitations in sub-
section (b) or on the factors in subsection (c).
(2)(A) The United States Trade Representative shall
publish in the Federal Register notice of the action the
President proposes to take under paragraph (1) at least
30 days before taking such action.
(B) The United States Trade Representative shall,
within the 30-day period beginning on the date on which
the United States Trade Representative publishes under
subparagraph (A) notice of proposed action—
(i) accept written comments from the public re-
garding such proposed action;
(ii) hold a public hearing on such proposed ac-
tion; and
(iii) publish in the Federal Register—
(I) notice of the time and place of such
hearing prior to the hearing; and
(II) the time and place at which such writ-
ten comments will be accepted.
(3) In the event the President withdraws, suspends,
modifies, or limits the application of duty-free treatment
accorded to a country under the Generalized System of
Preferences based on one or more of the eligibility criteria
in section 501 of the Trade Act of 1974 (19 U.S.C. 2462)
that are the same or similar to one or more of the eligi-
bility criteria set forth in this section, the President shall
likewise withdraw, suspend, modify, or limit the applica-
tion of preferential treatment accorded to that country
under this Act.
(e) REPORT.—Not later than February 1, 2003, the
President shall submit to Congress a complete report re-
garding the operation of this Act, including the results of
a general review of beneficiary countries based on the con-
siderations described in subsections (b) and (c).
(f) KOSOVO AND MONTENEGRO.—Kosovo and Monte-
negro may be designated as beneficiary countries notwith-
standing the provisions of Public Law 102–420 (19 U.S.C.
2432 note), concerning the withdrawal of nondiscrim-
inatory treatment of goods that are the product of Serbia
or Montenegro, or any other law.
(g) FEDERAL REPUBLIC OF YUGOSLAVIA.—Notwith-
standing the limitation in subsection (a)(1), the Federal
Republic of Yugoslavia may be considered eligible for des-
ignation as a beneficiary country under this Act if the
President determines that relevant authorities in the Gov-
ernment of the Federal Republic of Yugoslavia and the
Government of the Republic of Serbia have made signifi-
cant progress in meeting the following objectives:
(1) Participation in a political process designed
to determine Kosovo’s future status, taking into ac-
count the Rambouillet accords.
(2) Compliance with the General Framework
Agreement for Peace in Bosnia and Herzegovina.
(3) Implementation of internal democratic re-
form.
(4) Cooperation on all succession issues with
the other republics that emerged from the dissolu-
tion of the Socialist Federal Republic of Yugoslavia.
(5) Cooperation with the International Criminal
Tribunal for the Former Yugoslavia, including
transfer of all indicted war criminals in the Federal
Republic of Yugoslavia to The Hague.
(6) Peaceful and democratic resolution of dif-
ferences between its constituent republics, Serbia
and Montenegro, over the structure of shared gov-
ernmental institutions.
SEC. 6. ELIGIBLE ARTICLES.
(a) IN GENERAL.—(1) Unless otherwise excluded
from eligibility by this Act, the duty-free treatment pro-
vided under this Act shall apply to any article which is
the growth, product, or manufacture of a beneficiary coun-
try if—
(A) that article is imported directly from a ben-
eficiary country into the customs territory of the
United States; and
(B) the sum of—
(i) the cost or value of the materials pro-
duced in a beneficiary country or 2 or more
beneficiary countries under this Act, plus
(ii) the direct costs of processing oper-
ations performed in a beneficiary country or
countries,
is not less than 35 percent of the appraised value of
such article at the time it is entered.
If the cost or value of materials produced in the customs
territory of the United States is included with respect to
an article to which this paragraph applies, an amount not
to exceed 15 percent of the appraised value of the article
at the time it is entered that is attributed to such United
States cost or value may be applied toward determining
the percentage referred to in subparagraph (B).
(2) The Secretary of the Treasury shall prescribe
such regulations as may be necessary to carry out sub-
section (a), including, but not limited to, regulations pro-
viding that, in order to be eligible for duty-free treatment
under this Act, an article must be wholly the growth, prod-
uct, or manufacture of a beneficiary country, or must be
a new or different article of commerce which has been
grown, produced, or manufactured in the beneficiary coun-
try; but no article or material of a beneficiary country