Countering China Through American Export Competitiveness Act

Bill: 116-hr-8163
Sponsor: full_name: Rep. Barr, Andy [R-KY-6]
Introduced: 2020-09-04
Policy area: Foreign Trade and International Finance
Subjects: Advisory bodies

Asia

Buy American requirements

China

Competitiveness, trade promotion, trade deficits

Congressional oversight

Foreign and international corporations

Government lending and loan guarantees
Latest action: action_date: 2020-09-04
text: Referred to the House Committee on Financial Services.

Summaries:
action_date: 2020-09-04
action_desc: Introduced in House
text: <p><b>Countering China Through American Export Competitiveness Act</b></p> <p>This bill modifies certain responsibilities of the Export-Import Bank of the United States related to its Program on China and Transformational Exports. The program supports financing at rates and on terms that are fully competitive with rates and terms established by China in order to (1) directly neutralize export subsidies for competing goods and services, or (2) advance the comparative leadership of the United States through specified exports.</p> <p>The bill prohibits the bank generally from guaranteeing, insuring, or extending credit for which the end user, lender, or obligor is China. The bill also raises from 20% to 33% the dedicated amount that the bank should reserve for the program, and it sets the default rate limit for program loans at 5%. </p> <p>The bill authorizes the bank to waive some, or all, of the domestic content requirements that would otherwise apply to a transaction if it determines that doing so would be in the national security interest of the United States. The bill also establishes an advisory committee to advise the bank on the development of policies and programs that support the expansion of the bank's financial commitments in accordance with the program to counter China. </p>

tv_txt: I 116th CONGRESS 2d Session H. R. 8163 IN THE HOUSE OF REPRESENTATIVES September 4, 2020 Mr. Barr introduced the following bill; which was referred to the Committee on Financial Services A BILL To limit support for deals with Chinese state-owned enterprises, to increase the set-aside goal for the Program on China and Transformational Exports, and for other purposes.

1. Short title This Act may be cited as the Countering China Through American Export Competitiveness Act . 2. Limitation on support for deals with Chinese state-owned enterprises Section 408 of division I of the Further Consolidated Appropriations Act, 2020 ( 12 U.S.C. 635 note; Public Law 116–94 ) is amended to read as follows: 408. Limitation on support for deals with Chinese state-owned enterprises (a) In general The Export-Import Bank of the United States (in this section referred to as the Bank ) shall not guarantee, insure, or extend (or participate in the extension of) credit for which the end user, lender, or obligor is the government of the People’s Republic of China, except that the Bank may provide a working capital guarantee or export credit insurance to a United States exporter. In the case of such a transaction that involves an amount greater than or equal to $25,000,000, the Bank may provide a working capital guarantee or export credit insurance to a United States exporter with respect to such an export if the Bank obtains from the President of the United States, who may consult with the Secretary of State, the Secretary of the Treasury, the Secretary of Commerce, the Secretary of Defense, the United States Trade Representative, and the heads of other interested Executive agencies, a determination that the provision of the guarantee or insurance would not violate the national security interests of the United States. (b) National interest report (1) In general Before providing a working capital guarantee or export credit insurance to a United States exporter in a transaction involving an amount equal to or greater than $25,000,000, pursuant to subsection (a), the President of the Bank shall— (A) report to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate that the Bank has obtained from the President of the United States and any other relevant department or agency, as deemed appropriate by the President of the United States, a determination that the provision of the guarantee or insurance would not violate the national security interests of the United States; (B) include a verification from the Bank that the transaction does not violate any export law of the United States; and (C) include a summary of the transaction and the consultation. (2) Form The report described in paragraph (1) shall be submitted in unclassified form but may include a classified annex. (c) Definition of government of the People’s Republic of China In this section, the term government of the People’s Republic of China means any person that the Bank has reason to believe is— (1) the state and the government of the People’s Republic of China, including any political subdivision, agency, or instrumentality thereof; (2) any entity controlled, directly or indirectly, by any of the foregoing, including any partnership, association, or other entity in which any of the foregoing owns a 50 percent or greater interest or a controlling interest, and any entity which is otherwise controlled by any of the foregoing; (3) any person that is or has been acting or purporting to act, directly or indirectly, for or on behalf of any of the foregoing; and (4) any other person that the Secretary of the Treasury has notified the Bank is included in any of the foregoing. . 3. Increase in reserve goal for the Program on China and Transformational Exports Section 2(l)(3) of the Export-Import Bank Act of 1945 ( 12 U.S.C. 635(l)(3) ) is amended in each of subparagraphs (A) and (B) by striking 20 and inserting 33 . 4. Suspension of loan authority under the Program on China and Transformational Exports while default rate is excessive (a) In general Section 2(l) of the Export-Import Bank Act of 1945 ( 12 U.S.C. 635(l) ) is amended by adding at the end the following: (4) Freezing of loans under the Program on China and Transformational Exports if default rate for loans under that program is 5 percent or more If the rate calculated under section 8(g)(1) with respect to loans under section 2(l) is 5 percent or more for a quarter, the Bank may not exceed the amount of loans under such section that are outstanding on the last day of that quarter until the rate calculated under section 8(g)(1) with respect to loans under such section is less than 5 percent. . (b) Conforming amendment Section 6(a)(3) of such Act ( 12 U.S.C. 635e(a)(3) ) is amended by adding at the end the following: If the rate calculated under section 8(g)(1) with respect to loans under section 2(l) is 2 percent or more for a quarter, then loans under section 2(l) shall not be taken into account for the quarter for purposes of this paragraph. . 5. Advisory committee for Program on China and Transformational Exports (a) In general Section 2(b) of the Export-Import Bank Act of 1945 ( 12 U.S.C. 635(b) ) is amended by inserting after paragraph (12) the following: (14) (A) The Board of Directors of the Bank shall take prompt measures, consistent with the credit standards otherwise required by law, to promote the expansion of the financial commitments of the Bank in accordance with the Program on China and Transformational Exports under the loan, guarantee, and insurance programs of the Bank. (B) (i) The Board of Directors shall establish and use an advisory committee to advise the Board of Directors on the development and implementation of policies and programs designed to support the expansion described in subparagraph (A). (ii) At least 1 member of the advisory committee shall be a member of the U.S.-China Economic and Security Review Commission. (iii) The advisory committee shall make recommendations to the Board of Directors on how the Bank can facilitate greater support by United States commercial banks for trade in accordance with the Program on China and Transformational Exports. (iv) The advisory committee shall terminate on the date on which the authority of the Bank expires under section 7. . (b) Reports to the Congress Within 6 months after the date of the enactment of this Act, and annually thereafter, the Board of Directors of the Export-Import Bank of the United States shall submit to the Congress a report on the steps that the Board has taken to implement section 2(b)(14)(B) of the Export-Import Bank Act of 1945 (as added by subsection (a) of this section) and any recommendations of the advisory committee established pursuant to such section 2(b)(14)(B). 6. Waiver of domestic content requirements for certain transactions subject to the Program on China and Transformational Exports Section 2(l) of the Export-Import Bank Act of 1945 ( 12 U.S.C. 635(l) ), as amended by section 4(a) of this Act, is amended by adding at the end the following: (5) Waiver of domestic content requirements (A) In general The Bank may waive some or all of the domestic content requirements that would otherwise apply to a transaction described in paragraph (1)(B), if the Bank determines that doing so would be in the national security interest of the United States, and shall establish a process for requesting such a waiver. (B) Reports to the Congress Not less frequently than twice each year, the Bank shall submit to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report specifying the transactions for which a waiver is provided under subparagraph (A) during the period covered by the report. .