TEAMS Act
Bill: H.R.6309 | Sponsor: Rep. Kinzinger, Adam (R-IL)
Policy area: Foreign Trade and International Finance

Summary:
Trade Encourages Allied Manufacturing and Security Act or the TEAMS Act
This bill directs the U.S. Trade Representative (USTR) to take certain actions to strengthen supply chains for critical goods. It also incentivizes the manufacturing of critical goods.
Specifically, the bill requires the USTR to develop and implement a strategy to support the resilience, diversity, security, and strength of supply chains. This strategy must be submitted to Congress and published on the USTR's website.
Additionally, the bill authorizes the USTR to provide duty-free treatment for any eligible article (i.e., any critical good that is the growth, product, or manufacture of a beneficiary country) from any ally or key international partner. This authority terminates on September 30, 2030.
The bill temporarily allows for increased expensing of the costs of certain qualified manufacturing property.
The bill also allows a new tax credit for American security products manufactured in the United States or in ally or key international partner countries.

To establish a United States strategy to counter threats to supply 
           chains for critical goods, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Trade Encourages Allied 
Manufacturing and Security Act'' or the ``TEAMS Act''.

SEC. 2. SENSE OF CONGRESS.

    It is the sense of Congress that--
            (1) resilient supply chains are paramount to our national 
        security and economic security;
            (2) a coordinated and whole-of-Government approach to 
        safeguarding supply chains will benefit all Americans and 
        ensure disruptions are avoided or mitigated; and
            (3) the United States Trade Representative, in coordination 
        with other appropriate interagency stakeholders, should 
        incentivize the manufacturing of critical goods to increase 
        manufacturing capacity of the United States, and of an ally or 
        key international partner country, including by seeking new and 
        revised trade agreements.

SEC. 3. UNITED STATES STRATEGY TO COUNTER THREATS TO SUPPLY CHAINS FOR 
              CRITICAL GOODS.

    (a) In General.--In accordance with Executive Order 14017 (86 Fed. 
Reg. 11849; relating to America's supply chains), the United States 
Trade Representative, not later than 1 year after enactment of this 
Act, shall develop and implement a strategy taking a governmentwide 
approach to support the resilience, diversity, security, and strength 
of supply chains.
    (b) Elements.--The strategy required by subsection (a) shall 
include a plan to do the following:
            (1) Support a unified national effort to reduce reliance on 
        concentrated supply chains and protect against threats from 
        countries of concern relating to supply chains.
            (2) Support sufficient access to critical goods by 
        mitigating supply chain vulnerabilities, including supply 
        chains concentrated in countries of concern.
            (3) Collaborate with other relevant Federal agencies to 
        assist allies or key international partners build capacity for 
        manufacturing critical goods.
            (4) Incentivize through trade preferences, and identify tax 
        incentives, loans and loan guarantees, equity investment, and 
        other means, as appropriate--
                    (A) for domestic manufacturers that manufacture 
                critical goods to--
                            (i) relocate manufacturing facilities, 
                        industrial equipment, or operations related to 
                        the production of critical goods from countries 
                        of concern to the United States or to other 
                        allies or key international partners; and
                            (ii) support manufacturing facilities, 
                        industrial equipment, or operations to increase 
                        the production of critical goods and meet 
                        demand for such goods; and
                    (B) for domestic manufacturers that do not 
                manufacture critical goods to make necessary or 
                appropriate modifications to existing manufacturing 
                facilities, industrial equipment, manufacturing 
                technology or operations in order to manufacture 1 or 
                more critical good.
            (5) Strengthen and increase trade and other forms of 
        engagement between the United States and allies or key 
        international partners in order to mitigate--
                    (A) supply chain vulnerabilities; and
                    (B) the effects of supply chain shocks.
            (6) Identify, in coordination with other relevant Federal 
        agencies, actions relating to supply chains with which the 
        United States might--
                    (A) raise living standards;
                    (B) increase employment opportunities;
                    (C) address the underlying causes of irregular 
                migration; and
                    (D) improve critical industry supply chain response 
                to supply chain shocks.
            (7) Protect against supply chain shocks from countries of 
        concern relating to supply chains.
            (8) Provide recommendations to effectuate the strategy 
        under this section.
    (c) Submission of Strategy.--
            (1) In general.--Not later than 450 days after the date of 
        the enactment of this Act, the United States Trade 
        Representative shall submit to the Committee on Ways and Means 
        of the House of Representatives and the Committee on Finance of 
        the Senate, and publish on the website of the Office of the 
        United States Trade Representative, a report containing the 
        strategy developed under this section.
            (2) Update.--Not less than once every 4 years after the 
        date on which the strategy is submitted under paragraph (1), 
        the United States Trade Representative shall submit to Congress 
        an update to such strategy.
            (3) Form.--The report submitted under paragraph (1), and 
        any update submitted under paragraph (2), shall be submitted in 
        unclassified form and may include a classified annex.

SEC. 4. ALLIES TRADE PREFERENCE PROGRAM.

    (a) Authority To Provide Duty-Free Treatment.--Notwithstanding any 
other provision of law and subject to subsection (b), the President, 
acting through the United States Trade Representative, is authorized to 
provide duty-free treatment for any eligible article from any ally or 
key international partner in accordance with the provisions of this 
section.
    (b) Designation of Beneficiary Countries.--
            (1) Authority to designate.--The United States Trade 
        Representative shall engage in an interagency process by which 
        to designate an ally or key international partner described in 
        section 7 of this Act as a beneficiary country for purposes of 
        this section.
            (2) Countries ineligible for designation.--The United 
        States Trade Representative may not designate a country as a 
        beneficiary country under this section if such country--
                    (A) does not have a democratically elected 
                government or a market economy;
                    (B) has nationalized, expropriated, or otherwise 
                seized ownership or control of property owned by a 
                United States citizen or by a corporation, partnership, 
                or association that is 50 percent or more beneficially 
                owned by United States citizens;
                    (C) affords preferential treatment to the products 
                of a developed country, other than the United States, 
                which has, or is likely to have, a significant adverse 
                effect on United States commerce, unless--
                            (i) the United States Trade Representative 
                        receives satisfactory assurances that such 
                        preferential treatment will be eliminated or 
                        that action will be taken to assure that there 
                        will be no such significant adverse effect; and
                            (ii) the United States Trade Representative 
                        reports such assurances to Congress;
                    (D) is not a signatory to a treaty, convention, 
                protocol, or other agreement regarding the extradition 
                of United States citizens;
                    (E) does not afford and enforce in law and practice 
                internationally recognized worker rights for workers in 
                the country; or
                    (F) is a country of concern.
    (c) Eligible Articles.--
            (1) In general.--Subject to paragraphs (2) and (3), the 
        duty-free treatment provided under this section shall apply to 
        any critical good that is the growth, product, or manufacture 
        of a beneficiary country.
            (2) Rules of origin.--The duty-free treatment provided 
        under this section shall apply to any eligible article that is 
        the growth, product, or manufacture of a beneficiary country 
        if--
                    (A) such article is imported directly from such 
                country into the customs territory of the United 
                States; and
                    (B) the sum of--
                            (i) the cost or value of the materials 
                        produced in the beneficiary country or any two 
                        or more such countries that are members of the 
                        same association of countries, plus
                            (ii) the direct costs of processing 
                        operations performed in such beneficiary 
                        country or such member countries,
                is not less than 35 percent of the appraised value of 
                such article at the time it is entered.
            (3) Ineligible articles.--An article may not be treated as 
        the growth, product, or manufacture of a beneficiary country by 
        virtue of having merely undergone--
                    (A) simple combining or packaging operations; or
                    (B) mere dilution with water or another substance 
                that does not materially alter the characteristics of 
                the article.
    (d) Definitions.--In this section, the terms ``entered'' and 
``internationally recognized worker rights'' have the meanings given 
such terms in section 507 of the Trade Act of 1974 (19 U.S.C. 2467).
    (e) Termination.--No duty-free treatment provided under this 
section shall remain in effect after September 30, 2030.

SEC. 5. TEMPORARY INCREASED EXPENSING FOR RELOCATING MANUFACTURING TO 
              ALLY OR KEY INTERNATIONAL PARTNER COUNTRIES.

    (a) In General.--For purposes of section 168(k) of the Internal 
Revenue Code of 1986, in the case of any qualified United States 
manufacturing property which is placed in service after December 31, 
2020, and before January 1, 2026--
            (1) such property shall be treated as qualified property 
        (within the meaning of such section),
            (2) the applicable percentage otherwise determined under 
        section 168(k)(6) of such Code with respect to such property 
        shall be--
                    (A) if placed in the United States, 100 percent, 
                and
                    (B) if placed within an ally or key international 
                partner country, 60 percent, and
            (3) paragraph (8) of such section shall not apply.
    (b) Qualified United States Manufacturing Property Defined.--In 
this section the term ``qualified United States manufacturing 
property'' means a domestic corporation that is engaged in the business 
of manufacturing critical goods with property outside an ally or key 
international partner country that places in service tangible property 
within an ally or key international partner country.
    (c) Termination.--This section shall not apply to any property 
placed in service after December 31, 2025.

SEC. 6. AMERICAN SECURITY PRODUCT TAX CREDIT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 45U. AMERICAN SECURITY PRODUCT TAX CREDIT.

    ``(a) In General.--For purposes of section 38, the American 
security product tax credit for any taxable year is an amount equal 
to--
            ``(1) 30 percent of the qualified costs of American 
        security products manufactured in the United States, or
            ``(2) 15 percent of the qualified costs of American 
        security products manufactured in an ally or key international 
        partner country.
    ``(b) Maximum Credit.--The aggregate credit determined under 
subsection (a) for any taxable year with respect to any taxpayer shall 
not exceed the excess (if any) of the taxpayer's net income tax over 
the greater of--
            ``(1) the tentative minimum tax for the taxable year, or
            ``(2) 25 percent of so much of the taxpayer's net regular 
        tax liability as exceeds $25,000.
    ``(c) Definitions.--In this section:
            ``(1) American security product.--The term `American 
        security product' means--
                    ``(A) a critical good as such term is defined in 
                section 7 of the Trade Encourages Allied Manufacturing 
                and Security Act; and
                    ``(B) at least 50 percent of the value of which 
                shall be derived from components manufactured in the 
                United States.
            ``(2) Qualified costs.--The term `qualified costs' means 
        costs incurred in the production of an American security 
        product.
            ``(3) United states.--The term `United States' shall 
        include the Commonwealth of Puerto Rico and the Commonwealth of 
        the Northern Mariana Islands.''.
    (b) Denial of Double Benefit.--Section 280C of such Code is amended 
by adding at the end the following new subsection:
                            ``(i) Credit for american security 
                        products.--No deduction shall be allowed for 
                        that portion of expenses otherwise allowable as 
                        a deduction taken into account in determining 
                        the credit under section 45U for the taxable''.
    (c) Credit Made Part of General Business Credit.--Section 38(b) of 
such Code is amended by striking ``plus'' at the end of paragraph (32), 
by striking the period at the end of paragraph (33) and inserting ``, 
plus'', and by adding at the end the following new paragraph:
            ``(34) the American security product tax credit determined 
        under section 45U.''.
    (d) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of such Code is amended by adding 
at the end the following new item:

``45U. American security product tax credit.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to expenses made or incurred beginning on the first day of the 
first full calendar quarter after the date of enactment of this 
section.

SEC. 7. DEFINITIONS.

    In this Act:
            (1) Ally or key international partner.--
                    (A) In general.--The term ``ally or key 
                international partner'' means a country designated by 
                the Federal Government, after an appropriate 
                interagency consultation has taken place among relevant 
                Federal agencies, and--
                            (i) is--
                                    (I) a member state of the North 
                                Atlantic Treaty Organization (NATO);
                                    (II) a country designated as a 
                                major non-NATO ally pursuant to section 
                                517(a) of the Foreign Assistance Act of 
                                1961 (22 U.S.C. 2321k(a)); or
                                    (III) a country that is located in 
                                the Western Hemisphere and included on 
                                the list of countries described in 
                                subparagraph (B); and
                            (ii) is not a country of concern.
                    (B) List of countries described.--The list of 
                countries described in subclause (A)(i)(III) are the 
                following: Anguilla, Antigua and Barbuda, Argentina, 
                Aruba, The Bahamas, Barbados, Belize, Bermuda, Bolivia, 
                Brazil, The British Virgin Islands, Canada, Chile, 
                Colombia, Costa Rica, Dominica, Dominican Republic, 
                Ecuador, El Salvador, Grenada, Guatemala, Guyana, 
                Haiti, Honduras, Jamaica, Mexico, Montserrat, 
                Netherlands Antilles, Panama, Paraguay, Peru, Saint 
                Kitts and Nevis, Saint Lucia, Saint Vincent and the 
                Grenadines, Suriname, Trinidad and Tobago, Turks and 
                Caicos Islands, Uruguay, and the sovereign government 
                recognized by the United States in Venezuela.
            (2) Concentrated.--With respect to a supply chain, the term 
        ``concentrated'' means a supply chain that is--
                    (A) under a level of control or influence by the 
                government of a country of concern that presents an 
                unreasonable risk to national security or economic 
                security; and
                    (B) subject to undue manipulation by the government 
                of a country of concern.
            (3) Country of concern.--The term ``country of concern'' 
        means a country in which a concentrated supply chain is located 
        and--
                    (A) that poses a significant national security or 
                economic security threat to the United States; and
                    (B) whose government, or elements of such 
                government, has proven, or has been credibly alleged to 
                have, committed crimes against humanity or genocide.
            (4) Critical good.--
                    (A) In general.--The term ``critical good'' means 
                any raw, in process, or manufactured material 
                (including any mineral, metal, or advanced processed 
                material), article, commodity, supply, product, or item 
                of supply that--
                            (i) the absence of which would have a 
                        significant effect on--
                                    (I) the national security or 
                                economic security of the United States; 
                                and
                                    (II) critical infrastructure; and
                            (ii) is designated as a critical good in 
                        accordance with the requirements of 
                        subparagraph (B).
                    (B) Designation requirements.--Not later than 270 
                days after the date of the enactment of this Act, the 
                President shall--
                            (i) designate critical goods for purposes 
                        of this Act;
                            (ii) provide for a period of public comment 
                        and review in carrying out clause (i); and
                            (iii) update the designations made under 
                        clause (i) not less frequently than once every 
                        four years.
            (5) Critical infrastructure.--The term ``critical 
        infrastructure'' has the meaning given to that term in the 
        Critical Infrastructures Protection Act of 2001 (42 U.S.C. 
        5195c(e)).
            (6) Manufacture.--The term ``manufacture'' means any 
        activity that is necessary for or incidental to the 
        development, production, processing, distribution, or delivery 
        of any raw, in process, or manufactured material (including 
        minerals, metals, and advanced processed materials), article, 
        commodity, supply, product, critical good, or item of supply.
            (7) Supply chain.--The term ``supply chain'' means a supply 
        chain for a critical good.
            (8) Supply chain shock.--The term ``supply chain shock'' 
        includes the following:
                    (A) A natural disaster or extreme weather event.
                    (B) An accidental or human-caused event.
                    (C) An economic disruption.
                    (D) A pandemic.
                    (E) A biological threat.
                    (F) A cyberattack.
                    (G) A great power conflict.
                    (H) A terrorist or geopolitical attack.
                    (I) A public health emergency declared by the 
                Secretary of Health and Human Services pursuant to 
                section 319 of the Public Health Service Act (42 U.S.C. 
                247d).
                    (J) An event for which the President declares a 
                major disaster or an emergency under section 401 or 
                501, respectively, of the Robert T. Stafford Disaster 
                Relief and Emergency Assistance Act (42 U.S.C. 5170 and 
                5191).
                    (K) A national emergency declared by the President 
                under the National Emergencies Act (50 U.S.C. 1601 et 
                seq.).
                    (L) Any other supply chain disruption or threat 
                that affects the national security or economic security 
                of the United States.
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