Title: Taiwan Non-Discrimination Act of 2020
Policy area: International Affairs

Summary:
Taiwan Non-Discrimination Act of 2020
This bill requires actions to improve Taiwan's standing in international financial institutions such as the International Monetary Fund (IMF).
The U.S. Governor of the IMF shall oppose any increase in China's IMF quota unless certain conditions are met. (A country's quota generally reflects its economic strength and affects factors such as that country's voting power within the IMF.)
Specifically, the governor shall oppose such a quota increase unless the Department of the Treasury reports to Congress that (1) the IMF is considering admitting Taiwan as a member, (2) Taiwan enjoys meaningful participation in the IMF, or (3) not opposing a quota increase will substantially support the objective of securing Taiwan's more equitable treatment in international financial institutions. (Taiwan is not a member of the IMF due to China's opposition, based on its position that Taiwan is part of China and not a separate country.)
Treasury shall instruct U.S. representatives at international financial institutions to oppose travel policies that impose conditions on Taiwan as a destination or transit point, if such conditions do not generally apply to a member of the institution as a destination or transit point. Treasury may waive this instruction if such a waiver (1) substantially supports the goal of improving Taiwan's position within that institution, or (2) is in U.S. national interest.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6974 Introduced in House (IH)]

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116th CONGRESS
  2d Session
                                H. R. 6974

   To require the Secretary of the Treasury to pursue more equitable 
 treatment of Taiwan at the international financial institutions, and 
                          for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 22, 2020

Mr. Gonzalez of Ohio introduced the following bill; which was referred 
                 to the Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
   To require the Secretary of the Treasury to pursue more equitable 
 treatment of Taiwan at the international financial institutions, 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 ``Taiwan Non-Discrimination Act of 
2020''.

SEC. 2. FINDINGS.

    The Congress finds as follows:
            (1) As enshrined in its Articles of Agreement, the 
        International Monetary Fund (IMF) is devoted to promoting 
        international monetary cooperation, facilitating the expansion 
        and balanced growth of international trade, encouraging 
        exchange stability, and avoiding competitive exchange 
        depreciation.
            (2) Taiwan is the 22nd largest economy in the world and the 
        10th largest goods trading partner of the United States.
            (3) Although Taiwan is not an IMF member, it is a member of 
        the World Trade Organization, the Asian Development Bank, and 
        the Asia-Pacific Economic Cooperation forum.
            (4) According to the January 2020 Report on Macroeconomic 
        and Foreign Exchange Policies of Major Trading Partners of the 
        United States, published by the Department of the Treasury, 
        Taiwan held $471,900,000,000 in foreign exchange reserves, more 
        than major economies such as India, South Korea, and Brazil.
            (5) According to section 4(d) of the Taiwan Relations Act 
        (Public Law 96-8), enacted on April 10, 1979, ``Nothing in this 
        Act may be construed as a basis for supporting the exclusion or 
        expulsion of Taiwan from continued membership in any 
        international financial institution or any other international 
        organization.''.
            (6) Taiwan held membership in the IMF for 9 years following 
        the recognition of the People's Republic of China (PRC) by the 
        United Nations, and 16 Taiwan staff members at the Fund were 
        allowed to continue their employment after the PRC was seated 
        at the IMF in 1980. As James M. Boughton has noted in his 
        Silent Revolution: The International Monetary Fund 1979-1989, 
        even as the PRC was seated, the United States Executive 
        Director to the IMF, Sam Y. Cross, expressed support on behalf 
        of the United States government for ``some kind of association 
        between Taiwan and the Fund''.
            (7) On September 27, 1994, in testimony before the Senate 
        Committee on Foreign Relations regarding the 1994 Taiwan Policy 
        Review, then-Assistant Secretary of State for East Asian and 
        Pacific Affairs Winston Lord stated: ``Recognizing Taiwan's 
        important role in transnational issues, we will support its 
        membership in organizations where statehood is not a 
        prerequisite, and we will support opportunities for Taiwan's 
        voice to be heard in organizations where its membership is not 
        possible.''.
            (8) The Congress has repeatedly reaffirmed support for this 
        policy, including in Public Laws 107-10, 107-158, 108-28, 108-
        235, 113-17, and 114-139, and the unanimous House and Senate 
        passage of the Taiwan Allies International Protection and 
        Enhancement Initiative (TAIPEI) Act of 2019.
            (9) In its fact sheet, entitled ``U.S. Relations with 
        Taiwan'', published on August 31, 2018, the Department of State 
        asserts: ``The United States supports Taiwan's membership in 
        international organizations that do not require statehood as a 
        condition of membership and encourages Taiwan's meaningful 
        participation in international organizations where its 
        membership is not possible.''.
            (10) According to the Articles of Agreement of the IMF, 
        ``membership shall be open to other countries'', subject to 
        conditions prescribed by the Board of Governors of the IMF.
            (11) In the IMF publication ``Membership and Nonmembership 
        in the International Monetary Fund: A Study in International 
        Law and Organization'', Joseph Gold, the then-General Counsel 
        and Director of the Legal Department of the IMF, elaborated on 
        the differences between the terms ``countries'' and ``states'', 
        noting that ``the word `country' may have been adopted because 
        of the absence of agreement on the definition of a `state''' 
        and, with respect to the use of ``countries'' and applications 
        for IMF membership, ``the absence of any adjective in the 
        Articles emphasizes the breadth of the discretion that the Fund 
        may exercise in admitting countries to membership''. According 
        to Mr. Gold, ``the desire to give the Fund flexibility in 
        dealing with applications may explain not only the absence of 
        any adjective that qualifies `countries' but also the choice of 
        that word itself''.
            (12) In his IMF study, Mr. Gold further observes, ``in the 
        practice of the Fund the concepts of independence and 
        sovereignty have been avoided on the whole as a mode of 
        expressing a criterion for membership in the Fund''. He 
        continues, ``Although the Fund usually takes into account the 
        recognition or nonrecognition of an entity as a state, there 
        are no rules or even informal understandings on the extent to 
        which an applicant must have been recognized by members or 
        other international organizations before the Fund will regard 
        it as eligible for membership.''. In fact, when considering an 
        application for membership where the status of an applicant may 
        not be resolved, Mr. Gold writes ``there have been occasions on 
        which the Fund has made a finding before decisions had been 
        taken by the United Nations or by most members or by members 
        with a majority of the total voting power.'' Mr. Gold 
        concludes, ``the Fund makes its own findings on whether an 
        applicant is a `country', and makes them solely for its own 
        purposes.''.
            (13) Although not a member state of the United Nations, the 
        Republic of Kosovo is a member of both the IMF and the World 
        Bank, having joined both organizations on June 29, 2009.

SEC. 3. SENSE OF THE CONGRESS.

    It is the sense of the Congress that--
            (1) the size, significance, and connectedness of the Taiwan 
        economy highlight the importance of greater participation by 
        Taiwan in the International Monetary Fund, given the purposes 
        of the Fund articulated in its Articles of Agreement; and
            (2) the experience of Taiwan in developing a vibrant and 
        advanced economy under democratic governance and the rule of 
        law should inform the work of the international financial 
        institutions, including through increased participation by 
        Taiwan in the institutions.

SEC. 4. CONDITION ON IMF QUOTA INCREASE FOR THE PEOPLE'S REPUBLIC OF 
              CHINA.

    (a) In General.--The United States Governor of the International 
Monetary Fund (in this section referred to as the ``Fund'') shall use 
the voice and vote of the United States to oppose, and may not consent 
to, an increase in the quota of the People's Republic of China in the 
Fund, unless the Secretary of the Treasury reports to the Congress 
that--
            (1) the Board of Governors of the Fund is considering 
        admission of Taiwan as a member of the Fund, pursuant to the 
        recommendation of the Board of Executive Directors of the Fund; 
        or
            (2) Taiwan enjoys meaningful participation in the Fund, 
        including through--
                    (A) participation in regular surveillance 
                activities of the Fund with respect to the economic and 
                financial policies of Taiwan, consistent with Article 
                IV consultation procedures of the Fund;
                    (B) employment opportunities for Taiwan nationals, 
                without regard to any consideration that, in the 
                determination of the Secretary, does not generally 
                restrict the employment of nationals of member 
                countries of the Fund; and
                    (C) the ability to receive appropriate technical 
                assistance and training by the Fund.
    (b) Waiver.--The Secretary of the Treasury may waive subsection (a) 
of this section with respect to a proposal on reporting to the Congress 
that providing the waiver will substantially promote the objective of 
securing more equitable treatment of Taiwan at each international 
financial institution (as defined in section 1701(c)(2) of the 
International Financial Institutions Act).
    (c) Sunset.--This section shall have no force or effect beginning 
with the date that is 7 years after the date of the enactment of this 
Act.

SEC. 5. ENSURING NON-DISCRIMINATION WITH RESPECT TO TRAVEL POLICIES AT 
              THE INTERNATIONAL FINANCIAL INSTITUTIONS.

    (a) In General.--The Secretary shall instruct the United States 
Executive Director at each international financial institution to use 
the voice and vote of the United States to ensure that the travel 
policies and procedures of the respective institution with respect to 
Taiwan as a destination or transit point do not impose any 
administrative conditions, including through restrictions on logistical 
arrangements or meeting participants, that do not generally apply to a 
member country of the institution as a destination or transit point, 
except as required temporarily for reasons of public safety or public 
health.
    (b) Definitions.--In this section:
            (1) International financial institution.--The term 
        ``international financial institution'' has the meaning given 
        the term in section 1701(c)(2) of the International Financial 
        Institutions Act.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury.
    (c) Waiver.--The Secretary may waive subsection (a) with respect to 
an international financial institution for up to 1 year at a time on 
reporting to the Congress that providing the waiver--
            (1) will substantially promote the objective of securing 
        more equitable treatment of Taiwan at the international 
        financial institution; or
            (2) is in the national interest of the United States, with 
        a detailed explanation of the reasons therefor.
    (d) Progress Report.--The Chairman of the National Advisory Council 
on International Monetary and Financial Policies shall submit to the 
Congress an annual report that describes the progress made in advancing 
the travel policies and procedures described in subsection (a), and may 
consolidate that report with the annual report required by section 1701 
of the International Financial Institutions Act or any other report 
required to be submitted to the Secretary.
    (e) Sunset.--This section shall have no force or effect beginning 
with the earlier of--
            (1) the date that is 7 years after the date of the 
        enactment of this Act; or
            (2) the date on which the Secretary reports to the Congress 
        that each international financial institution has adopted the 
        travel policies and procedures described in subsection (a).

SEC. 6. TESTIMONY REQUIREMENT.

    In each of the next 7 years in which the Secretary of the Treasury 
is required by section 1705(b) of the International Financial 
Institutions Act to present testimony, the Secretary shall include in 
the testimony a description of the efforts of the United States to 
support the greatest participation practicable by Taiwan at each 
international financial institution (as defined in section 1701(c)(2) 
of such Act).
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