An act to provide for the operation and maintenance of the Panama Canal under the Panama Canal Treaty of 1977, and for other purposes.
PL 96-70 (H.R.111), enacted 09/27/1979

93 STAT. 452 
PUBLIC LAW 96-70—SEPT. 27, 1979 
Public Law 96-70 
• . rr-s^r 
1 
96th Congress 
An Act 
Sept. 27,1979 
TQ provide for the operation and maintenance of the Panama Canal under the 
[H.R. Ill] 
Panama Canal Treaty of 1977, and for other purposes. 
Be it enacted by the Senate and House of Representatives of the 
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I7;ijterf States of 
America in Congress assembled, 
SHORT TITLE 
22 use 3601 
SECTION 1. This Act may be cited as the "Panama Canal Act of 
note. 
i^rjQ,, 
TABLE OF CONTENTS 
Sec. 
1. Short title. 
2. Statement of purpose. 
3. Definitions and recommendation for legislation. 
TITLE I-ADMINISTRATION AND REGULATIONS 
CHAPTER 1—PANAMA CANAL COMMISSION 
1101 Establishment of Commission. 
1102. Supervisory Board. 
1103. Administrator 
1104. Deputy Administrator and Chief Engineer 
1105. Consultative Committee. 
1106. Joint Commission on the Environment. 
1107 Travel expenses. 
1108. Defense of the Panama Canal. 
1109. Joint Sea Level Canal Study Committee. 
1110. Authority of the Ambassador. 
1111. Security legislation. 
1112. Code of Conduct for Commission personnel. 
1113. Office of Ombudsman. 
CHAPTER 2—EMPLOYEES 
Subchapter I—Panama Canal Commission Personnel 
1201. Definitions. 
1202. Appointment and compensation; duties. 
1203. Transfer of Federal employees. 
1204. Compensation of individuals in the uniformed services. 
1205. Deduction from basic pay of amounts due for supplies or services. 
1206. Cost of living allowance. 
1207. Educational travel benefits. 
1208. Privileges and immunities of certain employees. 
1209. Inapplicability of certain benefits to certain noncitizens. 
Subchapter II—Wage and Employment Practices 
1211. Definitions. 
1212. Panama Canal Employment System; merit and other employment require-
ments. 
1213. Employment standards. 
1214. Interim application of Canal Zone Merit System. 
1215. Basic pay. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 453 
Sec. 
1216. Uniform application of standards and rates. 
1217. Recruitment and retention remuneration. 
1218. Benefits based on basic pay. 
1219. Salary protection upon conversion of pay base. 
1220. Review and adjustment of classifications, grades, and pay level. 
1221. Panama Canal Board of Appeals; duties. 
1222. Appeals to Board; procedure; finality of decisions. 
1223. Administration by the President. 
1224. Applicability of certain laws. 
1225. Minimum level of pay; minimum annual increases. 
Subchapter III—Conditions of Employment and Placement 
1231. Transferred or reemployed employees. 
1232. Placement. 
Subchapter IV—Retirement 
1241. Early retirement eligibility. 
1242. Early retirement computation, 
1243. Retirement under special treaty provisions. 
1244. Obligation of Commission for unfunded liability. 
1245. Cash relief to certain former employees. 
1246. Appliances for employees injured before September 7,1916. 
Subchapter V—Leave 
1251. Leave for jury or witness service. 
Subchapter VI—Application to Related Personnel 
1261. Law enforcement; Canal Zone Civilian Personnel Policy Coordinating Board; 
related employees. 
Subchapter VII—Labor-Management Relations 
1271. Labor-management relations. 
CHAPTER 3—FUNDS AND ACCOUNTS 
Subchapter I—Funds 
1301. Canal Zone Government funds. 
1302. Panama Canal Company funds; Commission funds. 
1303. Emergency fund. 
Subchapter II—Accounting Policies and Audits 
1311. Accounting policies. 
1312. Reports. 
1313. Audit by the Comptroller General of the United States. 
Subchapter HI-Interagency Accounts 
1321. Interagency services; reimbursements. 
Subchapter IV—Postal Matters 
1831. Postal service. 
Subchapter V—Accounts With the Republic of Panama 
1341. Payments to the Republic of Panama. 
1342. Transactions with the Republic of Panama. 
1343. Disaster relief. 
1844. Congressional restraints on property transfers and tax expenditures. 
93 STAT. 454 
PUBLIC LAW 96-70—SEPT. 27, 1979 
CHAPTER 4—CLAIMS FOR INJURIES TO PERSONS OR PROPERTY 
Subchapter I—General Provisions 
Sec. 
1401. Settlement of claims generally. 
Subchapter II—Vessel Damage 
1411. Iryuries in locks of Canal. 
1412. Injuries outside locks. 
1413. Measures of damages generally. 
1414. Delays for which no responsibility is assumed. 
1415. S e t t l e m e n t of claims. 
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1416. Actions on claims. 
1417. Investigation of accident or injury giving rise to claim. 
1418. Board of Local Inspectors. 
CHAPTER 5—PUBUC PROPERTY 
1501. Assets and liabilities of Panama Canal Company. 
; 
1502. Transfers and cross-servicing between agencies. 
1503. Disposition of property of the United States. 
1504. Transfer of property to Panama. 
CHAPTER 6—TOLLS FOR USE OF THE PANAMA CANAL 
1601. Prescription of measurement rules and rates of tolls. 
1602. Bases of tolls. 
1603. Calculation of interest. 
1604. Procedures. 
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1605. Interim toll adjustment. 
CHAPTER 7—GENERAL REGULATIONS 
1701. Authority of President. 
1702. Authority of Commission. 
CHAPTER 8—SHIPPING AND NAVIGATION 
Subchapter I—Operation of Canal 
1801. Operating regulations. 
Subchapter II—Inspection of Vessels 
1811. Vessels subject to inspection. 
1812. Foreign vessels. 
1813. Regulations governing inspection. 
TITLE II—TREATY TRANSITION PERIOD 
CHAPTER 1—LAWS CONTINUED IN FORCE 
2101. Laws, regulations, and administrative authority. 
.; 
CHAPTER 2—COURTS 
2201. Jurisdiction. 
2202. Divisions and terms of District Court. 
2203. Terms of certain offices. 
2204. Residence requirements. 
2205. Special Distnct Judge. 
* 
2206. Magistrates' courts. 
CHAPTER 3—ATTORNEYS 
2301. Oath of attorneys. 
CHAPTER 4—^TRANSITION AUTHORITY 
2401. Transition authority of President. 
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2402. Prisons; parole; pardons. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 455 
TITLE m-GENERAL PROVISIONS 
CHAPTER 1—CEMETERIES 
Sec. 
3101. Disinterment, transportation, and reinterment of remains. 
CHAPTER 2—IMMIGRATION 
3201. Special immigrants. 
CHAPTER 3—REPORTS; AMENDMENTS; REPEALS AND REDESIGNATION; 
EFFECTIVE DATE 
3301. Report. 
3302. Amendments. 
3303. Repeals and redesignation. 
3304. Effective date. 
STATEMENT OF PURPOSE 
SEC. 2. It is the purpose of this Act to provide legislation necessary 22 use 3601. 
or desirable for the implementation of the Panama Canal Treaty of 
1977 between the United States of America and the Republic of 
Panama and of the related agreements accompanying that Treaty. 
DEFINITIONS AND RECOMMENDATION FOR LEGISLATION 
SEC. 3. (a) For purposes of this Act— 
22 use 3602. 
(1) references to the Panama Canal Treaty of 1977 refer to the 
Panama Canal Treaty between the United States of America and 
the Republic of Panama, signed September 7,1977; and 
(2) references to the Panama Canal Treaty of 1977 and related 
agreements refer to the Panama Canal Treaty of 1977, the 
agreements relating to and implementing that Treaty, signed 
September 7, 1977, and the Agreement Between the United 
States of America and the Republic of Panama Concerning Air 
Traffic Control and Related Services, concluded January 8,1979. 
(b) Subject to the provisions of subsection (c) of this section, for 
purposes of applying the Canal Zone Code or other laws of the United 7
6
A Stat. 1. 
States and regulations issued pursuant to such Code or other laws 
with respect to transactions, occurrences, or status on or after the 
effective date of this Act— 
(1) "Canal Zone" shall be deemed to refer to the areas and 
installations in the Republic of Panama made available to the 
United States pursuant to the Panama Canal Treaty of 1977 and 
related agreements; 
(2) "Canal Zone waters" and "waters of the Canal Zone" shall 
be deemed to refer to "Panama Canal waters" and "waters of the 
Panama Canal", respectively; 
(3) "Government of the Canal Zone" or "Canal Zone Govern-
ment" shall be deemed to refer to the United States of America; 
(4) "Governor of the Canal Zone" or "Governor", wherever the 
reference is to the Governor of the Canal Zone, shall be deemed 
to refer to the Panama Canal Commission; 
(5) "Panama Canal Company" or "Company", wherever the 
reference is to the Panama Canal Company, shall be deemed to 
refer to the Panama Canal Commission; 
93 STAT. 456 
PUBLIC LAW 96-70—SEPT. 27, 1979 
76A Stat. 353. 
76A Stat. 540. 
76A Stat. 559. 
Request for 
legislation; 
submittal to 
Congress. 
(6) in chapter 57 of title 5 of the Canal Zone Code, "hospitals" 
and "Health Bureau" shall be deemed to refer, respectively, to 
the hospitals operated by the United States in the Republic of 
Panama, and to the organizational unit operating such hospitals; 
and 
(7) in chapter 57 of title 5 of the Canal Zone Code, in section 
4784 of title 6 of such Code, and in section 2 of title 7 of such Code, 
"health director" shall be deemed to refer to the senior official in 
charge of the hospitals operated by the United States in the 
Republic of Panama. 
(c) Any reference set forth in subsection (b) of this section shall 
apply except as otherwise provided in this Act or unless (1) such 
reference is inconsistent with the provisions of this Act, (2) in the 
context in which a term is used such reference is clearly not intended, 
or (3) a term refers to a time before the effective date of this Act. 
(d) The President shall, within two years after the Panama Canal 
Treaty of 1977 enters into force, submit to the Congress a request for 
legislation which would— 
(1) amend or repeal provisions of law which in their present 
form are applicable only during the transition period prescribed 
in Article XI of that Treaty, 
(2) repeal the Canal Zone Code, and 
(3) contain provisions considered necessary and appropriate in 
light of the experience as of that time under that Treaty. 
TITLE I—ADMINISTRATION AND REGULATIONS 
CHAPTER 1—PANAMA CANAL COMMISSION 
22 u s e 3611. 
ESTABLISHMENT OF COMMISSION 
SEC. 1101. There is established in the executive branch of the 
United States Government an agency to be known as the Panama 
Canal Commission (hereinafter in this Act referred to as the "Com-
mission"). The Commission shall, under the general supervision of 
the Board established by section 1102 of this Act, be responsible for 
the maintenance and operation of the Panama Canal and the 
facilities and appurtenances related thereto. The authority of the 
President with respect to the Commission shall be exercised through 
the Secretary of Defense. 
Membership. 
22 u s e 3612. 
SUPERVISORY BOARD 
SEC. 1102. (a) The Commission shall be supervised by a Board 
composed of nine members, one of whom shall be the Secretary of 
Defense or an officer of the Department of Defense designated by the 
Secretary. Not less than five members of the Board shall be nationals 
of 
the United States and the remaining members shall be nationals of 
the Republic of Panama. At least one of the members of the Board 
who are nationals of the United States shall be experienced and 
knowledgeable in the management or operation of an American-flag 
steamship line which has or had ships regularly transiting the 
Panama Canal, at least one other such member shall be experienced 
and knowledgeable in United States port operations or in the busi-
ness of exporting or importing one of the regular commodities 
dependent on the Panama Canal as a transportation route, and at 
least one other such member shall be experienced and knowledgeable 
in labor matters in the United States. Three members of the Board 
shall hold no other office in or be employed by the Government of the 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 457 
United States. Members of the Board who are nationals of the 
United States shall cast their votes as directed by the Secretary of 
Defense or his designee. 
(b) The President shall appoint the members of the Board. The 
members of the Board who are United States nationals shall be 
appointed by and with the advice and consent of the Senate. Each 
member of the Board shall hold office at the pleasure of the President 
and, before assuming the duties of such office, shall take an oath to 
discharge faithfully the duties of his office. Members of the Board 
shall serve without compensation but shall be allowed travel or 
transportation expenses, including per diem in lieu of subsistence, in 
accordance with section 1107 of 
this Act. 
(c) The Board shall hold meetings as provided in regulations 
adopted by the Commission and approved by the Secretary of 
Defense. A quorum for the transaction of business shall consist of a Quorum 
majority of the Board members of which a majority of those present 
are nationals of the United States. 
Compensation, 
travel expenses. 
ADMINISTRATOR 
SEC. 1103. There shall be an Administrator of the Commission, who 22 use 3613. 
shall be appointed by the President, by and with the advice and 
consent of the Senate, and shall hold office at the pleasure of the 
President. 
DEPUTY ADMINISTRATOR AND CHIEF ENGINEER 
SEC. 1104. (a) There shall be a Deputy Administrator and a Chief 22 use 3614. 
Engineer of the Commission, both of whom shall be appointed by the 
President. The Deputy Administrator and the Chief Engineer shall 
perform such duties as may be prescribed by the President. 
(b) The Deputy Administrator and the Chief Engineer shall each be 
paid compensation at a rate of pay established by the President which 
does not exceed the rate of basic pay in effect for grade GS-18 of the 
General Schedule under section 5332 of title 5, United States Code. 5 use 5332 note. 
CONSULTATIVE COMMITTEE 
SEC. 1105. (a) The President shall designate, and the Secretary of 22 use 3615. 
State shall coordinate the participation of, representatives of the 
United States to the Consultative Committee to be established under 
paragraph 7 of Article III of the Panama Canal Treaty of 1977. 
(b) The Consultative Committee shall function as a diplomatic 
forum for the exchange of views between the United States and the 
Republic of Panama. The Committee shall advise the United States 
Government and the Government of the Republic of Panama on 
matters of policy affecting the operation of the Panama Canal. The 
Committee shall have no authority to direct the Commission or any 
other department or agency of the United States to initiate or 
withhold action. 
JOINT COMMISSION ON THE ENVIRONMENT 
SEC. 1106. (a) The United States and the Republic of Panama, in Membership, 
accordance with the Panama Canal Treaty of 1977, shall establish a 22 use 3616. 
Joint Commission on the Environment (hereinafter in this section 
referred to as the "Joint Commission") to be composed of not more 
than three representatives of the United States and three representa-
tives of the Republic of Panama, or such other equivalent numbers of 
93 STAT. 458 
PUBLIC LAW 96-70—SEPT. 27, 1979 
Compensation, 
travel expenses. 
Compensation. 
Rules of 
procedure. 
representatives as may be agreed upon by the Governments of the 
two countries. The United States members of the Joint Commission 
shall periodically review the implementation of the Panama Canal 
Treaty of 1977 with respect to its impact on the environment and 
shall, jointly with the representatives of the Government of Panama, 
make recommendations to the United States Government and the 
Government of the Republic of Panama with respect to ways to avoid 
or mitigate adverse environmental impacts resulting from actions 
taken pursuant to such Treaty. 
(b) Representatives of the United States on the Joint Commission 
shall be appointed by the President and shall serve at the pleasure of 
the President. Such representatives shall serve without compensa-
tion but shall be allowed travel or transportation expenses, including 
per diem in lieu of subsistence, in accordance with section 1107 of this 
Act. 
(c) Any Federal employee subject to the civil service laws and 
regulations who is detailed to serve with, or appointed by, the United 
States representatives on the Joint Commission shall not lose any 
pay, seniority, or other rights or benefits by reason of such detail or 
appointment. 
(d) The United States representatives on the Joint Commission 
may, to such extent or in such amounts as are provided in advance in 
appropriation Acts, appoint and fix the compensation of such person-
nel as the representatives of the United States on the Joint Commis-
sion may consider necessary for the participation of the United States 
on the Joint Commission. 
(e) The United States representatives on the Joint Commission 
may, in cooperation with the representatives of the Republic of 
Panama on the Joint Commission, establish rules of procedure to be 
used by the Joint Commission in conducting its affairs, subject to the 
approval of such rules by the Governments of the United States and 
the Republic of Panama. 
TRAVEL EXPENSES 
22 use 3617. 
SEC. 1107. While away from their homes, regular places of business, 
or official stations in performance of services under this chapter, 
members of the Board of the Commission and the representatives of 
the United States on the Consultative Committee referred to in 
section 1105 of this Act and on the Joint Commission on the 
Environment referred to in section 1106 of this Act shall be allowed 
travel or transportation expenses, including per diem in lieu of 
subsistence, in the same manner as persons employed intermittently 
in Government service are allowed expenses under section 5703 of 
title 5, United States Code. 
DEFENSE OF THE PANAMA CANAL 
22 use 3618. 
SEC. 1108. In the event of an armed attack against the Panama 
Canal, or when, in the opinion of the President, conditions exist 
which threaten the security of the Canal, the Administrator of the 
Commission shall, upon the order of the President, comply with such 
directives as the United States military officer charged with the 
protection and defense of the Panama Canal may consider necessary 
in the exercise of his duties. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 459 
JOINT SEA LEVEL CANAL STUDY COMMITTEE 
SEC. 1109. (a) The President shall appoint the representatives of the 22 use 3619 
United States to any joint committee or body with the Republic of 
Panama to study the possibility of a sea level canal in the Republic of 
Panama pursuant to Article XII of the Panama Canal Treaty of 1977. 
(b) Upon the completion of any joint study between the United 
States and the Republic of Panama concerning the feasibility of a sea 
level canal in the Republic of Panama pursuant to paragraph 1 of 
Article XII of the Panama Canal Treaty of 1977, the text of the study 
shall be transmitted by the President to the President of the Senate 
and to the Speaker of the House of Representatives. 
(c) No construction of a sea level canal by the United States in the 
Republic of Panama shall be undertaken except with express congres-
sional authorization after submission of the study by the President as 
provided in subsection O
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) of this section. 
Transmittal to 
President of the 
Senate and 
House of 
Representatives. 
AUTHORITY OF THE AMBASSADOR 
SEC. 1110. (a) The United States Ambassador to the Republic of 
Panama shall have full responsibility for the coordination of the 
transfer to the Republic of Panama of those functions that are to be 
assumed by the Republic of Panama pursuant to the Panama Canal 
Treaty of 1977 and related agreements. 
Ot)Xl) The Commission shall not be subject to the direction or 
supervision of the United States Chief of Mission in the Republic of 
Panama with respect to the responsibilities of the Commission for the 
operation, management, or maintenance of the Panama Canal, as 
established in this or any other Act or in the Panama Canal Treaty of 
1977 and related agreements, except that the Commission shall keep 
the Ambassador fully and currently informed with respect to all 
activities and operations of 
the Commission. 
(2) Except as provided in paragraph (1) of this subsection, section 16 
of the Act of August 1,1956 (22 U.S.C. 2680a), shall apply with respect 
to the activities of 
the Commission. 
Coordination of 
transfer of 
functions. 
22 u s e 3620. 
SECURITY LEGISLATION 
SEC. 1111. It is the sense of the Congress that the best interests of 22 use 3621. 
the United States require that the President enter into negotiations 
with the Republic of Panama for the purpose of arranging for the 
stationing of United States military forces, after the termination of 
the Panama Canal Treaty of 1977, in the area comprising the Canal 
Zone before the effective date of this Act, and for the maintenance of 
installations and facilities, after the termination of such Treaty, for 
the use of United States military forces stationed in such area. The Report to 
President shall report to the Congress in a timely manner the status Congress. 
of negotiations conducted pursuant to this section. 
CODE O F CONDUCT FOR COMMISSION PERSONNEL 
SEC. 1112. (a) Before assuming the duties of his office or employ-
ment, each member of the Board of the Commission and each officer 
and employee of the Commission shall take an oath to discharge 
faithfully the duties of his office or employment. All employees of the 
Commission shall be subject to the laws of the United States regard-
ing duties and responsibilities of Federal employees. 
O
t
>
) Not later than 60 days after all the members of the Board of the 
Commission have been appointed, the Board shall adopt a code of 
conduct applicable to the persons referred to in subsection (a) of this 
Oath of office. 
22 u s e 3622. 
93 STAT. 460 
PUBLIC LAW 96-70—SEPT. 27, 1979 
18 use 201 et 
seq. 
2 use 701. 
Investigation. 
Negotiations. 
section. The code of conduct shall contain provisions substantially 
equivalent to those contained in part 735 of title 5 of the Code of 
Federal Regulations on the effective date of this Act. The code of 
conduct shall, at a minimum, contain provisions substantially equiva-
lent to the following provisions of law: 
(1) the provisions of chapter 11 of title 18, United States Code, 
as amended, relating to bribery, graft, or conflicts of interest, as 
appropriate to the employees concerned; 
(2) section 7352 of title 5, United States Code, as amended; 
(3) sections 207, 208, 285, 508, 641, 645, 1001, 1917, and 2071 of 
title 18, United States Code, as amended; 
(4) section 5 of the Act of July 16, 1914 (31 U.S.C. 638a), as 
amended; 
(5) the Ethics in Government Act of 1978 (92 Stat. 1824), as 
amended; and 
(6) those provisions of the laws and regulations of the Republic 
of Panama which are substantially equivalent to those of the 
United States set forth in this subsection. 
(c) The Commission shall investigate any allegations regarding the 
violation of the code of conduct adopted pursuant to subsection (b) of 
this section. The Commission may recommend that the President 
suspend from the performance of his duties any member of the Board 
of the Commission or any officer or employee of the Commission, 
pending judicial proceedings by appropriate authorities concerning 
such allegations. 
(d) The President shall negotiate suitable arrangements with the 
Republic of Panama whereby each nation shall agree to take all 
measures within its legal authority to assure that members of the 
Board of the Commission comply with the code of conduct established 
pursuant to subsection (b) of this section. Without prejudice to such 
jurisdiction as the United States may have with respect to members 
of the Board, the provisions of law enumerated in subsection (b) of 
this section shall be enforced with respect to members of the Board 
only in accordance with such arrangements. 
Establishment. 
22 use 3623. 
Functions. 
OFFICE OF OMBUDSMAN 
SEC. 1113. (a) There is established within the Commission an Office 
of Ombudsman, to be directed by an Ombudsman, who shall be 
appointed by the Commission. It shall be the function of the Office of 
Ombudsman to receive individual complaints, grievances, requests, 
and suggestions of employees (and their dependents) of the Commis-
sion and other departments and agencies of the United States, 
including the Smithsonian Institution, conducting operations before 
the effective date of this Act in the area then comprising the Canal 
Zone concerning administrative problems, inefficiencies, and con-
flicts caused within departments and agencies of the United States, 
including the Smithsonian Institution, as a result of the implementa-
tion of the Panama Canal Treaty of 1977 and related agreements. 
(b) The Ombudsman shall make findings and render assistance 
with respect to the complaints, grievances, requests, and suggestions 
submitted to the Office of Ombudsman, and shall make appropriate 
recommendations to the Commission or any other department or 
agency of the United States, including the Smithsonian Institution. 
(c) The establishment of the Office of Ombudsman shall not affect 
any procedures for grievances, appeals, or administrative matters in 
any other provision of this Act, any other provision of law, or any 
Federal regulation. 
(d) The Ombudsman shall be a citizen of the United States. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 461 
(e) The Office of Ombudsman shall terminate upon the termination Termination, 
of the Panama Canal Treaty of 1977. 
CHAPTER 2—EMPLOYEES 
Subchapter I—Panama Canal Commission Personnel 
DEFINITIONS 
SEC. 1201. As used in this chapter— 
(1) "Executive agency" has the meaning given that term in 
section 105 of title 5, United States Code; 
(2) "uniformed services" has the meaning given that term in 
section 2101(3) of title 5, United States Code; 
(3) "competitive service" has the meaning given that term in 
section 2102 of title 5, United States Code; and 
(4) "United States", when used in a geographic sense, means 
each of the several States and the District of Columbia. 
22 u s e 3641. 
APPOINTMENT AND COMPENSATION; DUTIES 
SEC. 1202. (a) In accordance with this chapter, the Panama Canal 22 use 3642. 
Commission may appoint without regard to the provisions of title 5, ^ ^^ ^^^ ^
* *^9-
United States Code, relating to appointments in the competitive 
service, fix the compensation of, and define the authority and duties 
of, officers, agents, attorneys, and employees (other than the Admin-
istrator, Deputy Administrator, and Chief Engineer) necessary for 
the management, operation, and maintenance of the Panama Canal 
and its complementary works, installations, and equipment. 
(b) Individuals serving in any Executive agency (other than the 
Commission) or the Smithsonian Institution, including individuals 
serving in the uniformed services, may, if appointed under this 
section or section 1103 or 1104 of this Act, serve as officers or 
employees of the Commission. 
TRANSFER OF FEDERAL EMPLOYEES 
SEC. 1203. (a) The head of any agency may enter into agreements 22 use 3643. 
for the transfer or detail to the Commission of any employee of that 
agency serving under a permanent appointment. Any employee who 
so transfers or is so detailed shall, upon completion of the employee's 
tour of duty with the Commission, be entitled to reemployment with 
the agency from which the employee was transferred or detailed 
without loss of pay, seniority, or other rights or benefits to which the 
employee would have been entitled had the employee not been so 
transferred or been so detailed. 
O
t
)
) For purposes of this section, the term "agency" means an "Agency." 
Executive agency, the United States Postal Service, and the Smithso-
nian Institution. 
(c) The Office of Personnel Management shall prescribe regulations Regulations, 
to carry out the purposes of this section. 
COMPENSATION OF INDIVIDUALS IN THE UNIFORMED SERVICES 
SEC. 1204. (a) Except as provided in subsection (b) of this section, 22 use 3644. 
any individual who is serving in a position in the Commission and 
who is a member of a uniformed service shall continue to be paid 
basic pay by such uniformed service and shall not be paid by the 
Commission for the period of the service in the uniformed service 
involved. 
93 STAT. 462 
PUBLIC LAW 96-70—SEPT. 27, 1979 
(b) If the individual appointed as Administrator, Deputy Adminis-
trator, or Chief Engineer of the Commission is a member of a 
uniformed service, the amount of basic pay otherwise payable to the 
individual for service in that position shall be reduced, up to the 
amount of that basic pay, by the amount of the basic pay payable to 
the individual as a member of a uniformed service. 
(c) The Commission shall annually pay to each uniformed service 
amounts sufficient to reimburse that uniformed service for any basic 
pay paid by that uniformed service to any member of that service 
during any period of service in the Commission by the member. 
DEDUCTION FROM BASIC PAY OF AMOUNTS DUE FOR SUPPLIES OR 
SERVICES 
22 use 3645. 
SEC. 1205. The Commission may deduct from the basic pay other-
wise payable by the Commission to any officer or employee of the 
Commission any amount due from the officer or employee to the 
Commission or to any contractor of the Commission for transporta-
tion, board, supplies, or any other service. Any amount so deducted 
may be paid by the Commission to any contractor to whom it is due or 
may be credited by the Commission to any appropriation from which 
the Commission has expended such amount. 
COST OF LIVING ALLOWANCE 
22 use 3646. 
SEC. 1206. Effective beginning October 1, 1984, each officer and 
employee of the Commission who is a citizen of the United States and 
was employed by the Panama Canal Company or the Canal Zone 
Government on September 30, 1979, or who is an individual of any 
nationality recruited outside the Republic of Panama after Septem-
ber 30,1979, may be paid an allowance to offset any increased cost of 
living which may result from the termination of the eligibility of the 
officer or employee and his dependents to use military postal services, 
sales stores, and exchanges. The amount of the allowance may be 
determined by the Commission. 
EDUCATIONAL TRAVEL BENEFITS 
22 use 3647. 
SEC. 1207. (a) The Commission shall provide by regulation for 
round-trip transportation between the Republic of Panama and the 
United States or, in the case of an employee described in paragraph 
(2) of this subsection, between the Republic of Panama and the 
country in which such employee is recruited, for undergraduate 
college education for dependents of employees of the Commission 
who— 
(1) are United States citizens who were employed by the 
Panama Canal Company or the Canal Zone Government on 
September 30,1979, or 
(2) are recruited outside the Republic of Panama after that 
date. 
(b) The regulations prescribed by the Commission under this 
section shall— 
(1) provide eligibility requirements which must be met by such 
dependents to qualify for transportation under this section, 
including a requirement that all eligible dependents must be 
under 23 years of age; and 
(2) limit the transportation provided to one round trip during 
any one-year period. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 463 
PRIVILEGES AND IMMUNITIES OF CERTAIN EMPLOYEES 
SEC. 1208. The Secretary of Defense shall designate those officers 22 use 3648. 
and employees of the Commission and other individuals entitled to 
the privileges and immunities accorded under paragraph 3 of Article 
VIII of the Panama Canal Treaty of 1977. The Department of State 
shall furnish to the Republic of Panama a list of the names of such 
officers, employees, and other individuals and shall notify the Repub-
lic of Panama of any subsequent additions to or deletions from the 
list. 
INAPPLICABILITY OF CERTAIN BENEFITS TO CERTAIN NONCITIZENS 
22 u s e 3649. 
5 u s e 8101 et 
sea. 
5 u s e 8301 et 
seq. 
5 u s e 8701 et 
seq. 
5 u s e 8901 et 
seq. 
SEC 1209. (a) Chapter 81 of title 5, United States Code, relating to 
compensation for work injuries, chapter 83 of such title 5, relating to 
civil service retirement, chapter 87 of such title 5, relating to life 
insurance, and chapter 89 of such title 5, relating to health insurance, 
are inapplicable to any individual— 
(1) who is not a citizen of 
the United States; 
(2) whose initial appointment by the Commission occurs after 
October 1,1979; and 
(3) who is covered by the Social Security System of 
the Republic 
of Panama pursuant to any provision of the Panama Canal 
Treaty of 1977 and related agreements. 
(b) Subparagraph (B) of section 8701(a) of title 5, United States Employee. 
Code, defining the term employee for purposes of life insurance, is 
amended to read as follows: 
"(B) an individual who is not a citizen or national of the United 
States and whose permanent duty station is outside the United 
States, unless the individual was an employee for the purpose of 
this chapter on September 30, 1979, by reason of service in an 
Executive agency, the United States Postal Service, or the 
Smithsonian Institution in the area which was then Imown as 
the Canal Zone; or". 
(c) Clause (ii) of section 8901(1) of title 5, United States Code, Employee, 
defining the term employee for purposes of health insurance, is 
amended to read as follows: 
"(ii) an individual who is not a citizen or national of the 
United States and whose permanent duty station is outside 
the United States, unless the individual was an employee for 
the purpose of this chapter on September 30,1979, by reason 
of service in an Executive agency, the United States Postal 
Service, or the Smithsonian Institution in the area which 
was then known as the Canal Zone;". 
Subchapter II—Wage and Employment Practices 
M ' J 
DEFINITIONS 
SEC. 
1211. 
As 
used 
in 
this 
subchapter— 
(1) "agency" means— 
(A) the Commission, and 
(B) an Executive agency or the Smithsonian Institution, to 
the extent of any election in effect under section 1212(b)(2) of 
this Act; 
(2) "position" means a civilian position in the Commission, or 
in any other agency if a substantial portion of the duties and 
responsibilities are performed in the Republic of Panama; and 
(3) "employee" means an individual serving in a position. 
22 u s e 3651. 
93 STAT. 464 
PUBLIC LAW 96-70—SEPT. 27, 1979 
22 u s e 3652. 
Functions. 
Powers. 
PANAMA CANAL EMPLOYMENT SYSTEM; MERIT AND OTHER 
EMPLOYMENT REQUIREMENTS 
SEC. 1212. (a) After considering any recommendations of the Com-
mission, the President shall establish a Panama Canal Employment 
System. The Panama Canal Employment System shall— 
(1) be established in accordance with and be subject to the 
provisions of the Panama Canal Treaty of 1977 and related 
agreements, the provisions of this chapter, and any other appli-
cable provision of law; 
(2) be based on the consideration of the merit of each employee 
or candidate for employment and the qualifications and fitness of 
the employee to hold the position concerned; 
(3) conform, to the extent practicable and consistent with the 
provisions of this Act, to the policies, principles, and standards 
applicable to the competitive service; and 
(4) in the case of employees who are citizens of the United 
States, provide for the appropriate interchange of those em-
ployees between positions under the Panama Canal Employment 
System and positions in the competitive service. 
(b)(1) The Commission, and any Executive agency and the Smithso-
nian Institution to the extent of any election under paragraph (2) of 
this subsection, shall conduct their employment and pay practices 
relating to employees in accordance with the Panama Canal Employ-
ment System and regulations prescribed by, or under the authority 
of, the President in accordance with this subchapter. 
(2) The head of any Executive agency and the Smithsonian Institu-
tion may elect to have the Panama Canal Employment System made 
applicable in whole or in part to personnel of that agency in the 
Republic of Panama. 
(c) Subject to the provisions of this chapter, the President may, 
from time to time and after considering any recommendation of the 
Commission, amend or modify any provision of the Panama Canal 
Employment System, including any provision relating to selection for 
appointment, reappointment, reinstatement, reemployment, and 
retention, with respect to positions, employees, and candidates for 
employment. 
(d) The President may, to the extent the President determines 
appropriate— 
(1) exclude any employee or position from coverage under any 
provision of this subchapter; and 
(2) notwithstanding section 1202 of this Act, extend to any 
employee, whether or not the employee is a citizen of the United 
States, the rights and privileges which are provided by applicable 
laws and regulations for citizens of the United States employed 
in the competitive service. 
EMPLOYMENT STANDARDS 
22 use 3653. 
SEC. 1213. The head of each agency shall establish written stand-
ards for— 
(1) determining the qualifications and fitness of employees and 
of candidates for employment in positions; and 
(2) selecting individuals for appointment, promotion, or trans-
fer to positions. 
The standards shall conform to the provisions of this subchapter, any 
regulations prescribed thereunder, and the Panama Canal Employ-
ment System. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 465 
INTERIM APPLICATION OF CANAL ZONE MERIT SYSTEM 
SEC. 1214. Notwithstanding any repeal made by this Act or any 22 use 3654. 
provision of this chapter, the provisions of subchapter III of chapter 7 '^^^ Stat. I6. 
of title 2 of the Canal Zone Code establishing the Canal Zone Merit 
System, together with the regulations prescribed thereunder, as in 
effect on September 30,1979, shall continue in effect and shall apply 
with respect to employees until the Panama Canal Employment 
System is established and in effect pursuant to section 1212 of this 
Act. 
BASIC PAY 
SEC. 1215. (a) The head of each agency, in accordance with the 22 use 3655. 
provisions of this subchapter, shall establish, and from time to time 
may revise, the rates of basic pay for positions and employees in the 
agency. 
0?) The rates of basic pay may be established and revised in relation 
to the rates of 
basic pay for the same or similar work performed in the 
United States or in such areas outside the United States as may be 
designated in the regulations prescribed under section 1223 of this 
Act. 
(c) The head of each agency may make adjustments in rates of basic 
pay established under subsection (b) of this section in amounts not to 
exceed the amounts of the adjustments made from time to time by or 
under statute in the corresponding rates of basic pay for the same or 
similar work referred to in such subsection (b). The head of the 
agency may designate the effective date of any such adjustment, 
except that that date may not be earlier than the effective date of the 
adjustment in the corresponding rate of 
basic pay. 
UNIFORM APPLICATION OF STANDARDS AND RATES 
SEC. 1216. The standards established pursuant to section 1213 of 22 use 3656. 
this Act and the rates of basic pay established pursuant to section 
1215 of this Act shall be applied without regard to whether the 
employee or individual concerned is a citizen of the United States or a 
citizen of 
the Republic of Panama. 
RECRUITMENT AND RETENTION REMUNERATION 
SEC. 1217. (a) In addition to basic pay, additional compensation may Qualification 
be paid, in such amounts as the head of the agency concerned Provisions. 
determines, as an overseas recruitment or retention duferential to ^ ^ ^ ^
^
^
"
^ 
any individual who— 
(1) before October 1,1979, was employed by the Panama Canal 
Company, by the Canal Zone Government, or by any other 
agency in the area then known as the Canal Zone; 
(2) IS an employee who was recruited on or after October 1, 
1979, outside of the Republic of Panama for placement in the 
Republic of Panama; or 
(3) is a medical doctor employed by the Department of Defense 
in the Republic of 
Panama or by the Commission; 
if, in the judgment of the head of the agency concerned, the recruit-
ment or retention of 
the individual is essential. 
O
b
) Any employee described in more than one paragraph of subsec-
tion (a) of this section may qualify for a recruitment or retention 
differential under only one of 
mose paragraphs. 
(c) Additional compensation provided under this section may not 
exceed 25 percent of 
the rate of 
basic pay for the same or similar work 
59-194 O — 81 
32 : QL3 
93 STAT. 466 
PUBLIC LAW 96-70—SEPT. 27, 1979 
performed in the United States by individuals employed by the 
Government of 
the United States. 
5 use 5921. 
(d) Subchapter III of chapter 59 of title 5, United States Code, 
relating to overseas differentials and allowances, shall not apply with 
respect to any employee whose permanent duty station is in the 
Republic of Panama and who is employed by an agency. 
BENEFITS BASED ON BASIC PAY 
22 use 3658. 
SEC. 1218, For the purpose of determining— 
5 use 8101. 
(1) amounts of compensation for disability or death under 
chapter 81 of title 5, United States Code, relating to compensa-
tion for work injuries; 
(2) benefits under subchapter III of chapter 83 of title 5, United 
5 use 8331. 
States Code, relating to civil service retirement; 
(3) amounts of insurance under chapter 87 of title 5, United 
5 use 8701 et 
States Code, relating to life insurance; 
*^9- 
(4) amounts of overtime pay or other premium pay; 
(5) annual leave benefits; and 
(6) any other benefits related to basic pay; 
the basic pay of each employee shall include the rate of basic pay 
established for his position under section 1215 of this Act plus the 
amount of any additional compensation provided under section 1217 
of 
this Act. 
SALARY PROTECTION UPON CONVERSION OF PAY BASE 
22 use 3659. 
SEC. 1219. (a) In the case of any employee whose rate of basic pay is 
determined in relation to rates of basic pay for the same or similar 
work in the United States and which is converted to a rate of basic 
pay pursuant to section 1215(b) of this Act which is determined in 
relation to rates in areas other than the United States pursuant to 
such section 1215(b), the employee shall continue to receive a rate of 
basic pay not less than that to which the employee was entitled 
immediately before the conversion. 
(b) This section shall cease to apply with respect to any employee if 
the employee is placed in a position— 
(1) for which the rate of basic pay is determined in relation to 
rates of basic pay in the United States pursuant to section 1215(b) 
ofthisAct;or 
(2) which is of 
a lower grade. 
REVIEW AND ADJUSTMENT OF CLASSIFICATIONS, GRADES, AND PAY 
LEVEL 
22 use 3660. 
SEC 1220. An employee may request at any time that the 
employee's agency— 
(1) review the classification of the employee's position or the 
grade or pay level for the employee's position, or both; and 
(2) revise or adjust that classification, grade or pay level, or 
both, as the case may be. 
The request for review and revision or adjustment shall be submitted 
and adjudicated in accordance with the regularly established appeals 
procedures of the agency. 
PANAMA CANAL BOARD OF APPEALS; DUTIES 
22 use 3661. 
SEC. 1221. (a) Subject to the provisions of this chapter, the President 
shall prescribe regulations establishing a Panama Canal Board of 
Appeals. The regulations shall provide for the number of members of 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 467 
the Board and their appointment, compensation, and terms of office, 
the selection of a Chairman of the Board, the appointment and 
compensation of the Board's employees, and other appropriate mat-
ters relating to the Board. 
(b) The Board shall review and determine the appeals of employees 
in accordance with section 1222 of this Act. The decisions of the Board 
shall conform to the provisions of this subchapter. 
APPEALS TO BOARD; PROCEDURES; FINAUTY OF DECISIONS 
SEC. 1222. (a) An employee may appeal to the Panama Canal Board 22 use 3662. 
of Appeals from an adverse determination made by an agency under 
section 1220 of this Act. The appeal shall be made in writing within a 
reasonable time (as specified in regulations prescribed by, or under 
the authority of, the President) after the date of the transmittal by 
the agency to the employee of written notice of the adverse determi-
nation. 
(b) The Board may authorize, in connection with an appeal pursu-
ant to subsection (a) of this section, a personal appearance before the 
Board by the employee, or by a representative of the employee 
designated for that purpose. 
(c) After investigation and consideration of the evidence submitted, 
the Board sheill— 
(1) prepare a written decision on the appeal; 
(2) transmit its decision to the agency concerned; and 
(3) transmit copies of the decision to the employee concerned or 
to the designated representative. 
(d) The decision of the Board on any question or other matter 
relating to an appeal is final and conclusive. The agency concerned 
shall take action in accordance with the decision of the Board. 
ADMINISTRATION BY THE PRESIDENT 
SEC. 1223. (a) The President shall prescribe regulations necessary 
and appropriate to carry out the provisions of this subchapter and 
coordinate the policies and activities of agencies under this sub-
chapter. 
O
b
) The President may establish an office within the Commission as 
the successor to the Canal Zone Central Examining Office. The 
purpose of 
the office shall be to assist the President in— 
(1) carrying out the President's coordination responsibility 
under subsection (a) of 
this section; and 
(2) implementing the provisions of 
the Panama Canal Treaty of 
1977 and related agreements with respect to recruitment, exami-
nation, determination of qualification standards, and similar 
matters. 
(c) The President may delegate any authority vested in the Presi-
dent bjf this subchapter and may provide for the redelegation of that 
authority. 
APPLICABILITY OF CERTAIN LAWS 
Regulations. 
22 use 3663. 
Purpose. 
Delegation of 
authority. 
SEC. 1224. This chapter does not affect the applicability o
f
— 22 use 3664. 
(1) the provisions of title 5, United States Code, which relate to 
preference eligibles; 
(2) the provisions of title 5, United States Code, which relate to 
removal or suspension from the competitive service; and 
(3) the provisions of section 5544(a) of title 5, United States 
Code, which relate to wage-board overtime and Sunday rates, 
93 STAT. 468 
PUBLIC LAW 96-70—SEPT. 27, 1979 
with respect to classes of employees who were covered by those 
provisions on the date of the enactment of this Act. 
MINIMUM LEVEL OF PAY; MINIMUM ANNUAL INCREASES 
SEC. 1225. (a) Subsection (f) of section 13 of the Fair Labor Stand-
ards Act of 1938 (29 U.S.C. 213(f)), relating to applicability to em-
ployees in foreign countries and certain United States possessions, is 
amended by striking out "Johnston Island; and the Canal Zone." and 
inserting in lieu thereof "and Johnston Island.". 
22 use 3665. 
(b)(1) Effective October 1, 1979, each individual employed by an 
Executive agency or the Smithsonian Institution, whose permanent 
duty station is located within an area or installation in the Republic 
of Panama made available to the United States pursuant to the 
Panama Canal Treaty of 1977 and related agreements, shall be paid 
basic pay at a rate of not less than $2.90 an hour. 
(2) Effective on October 1 of each succeeding calendar year, the rate 
of basic pay for each individual referred to in paragraph (1) of this 
subsection whose basic pay is not fixed in relation to rates of 
basic pay 
for the same or similar work performed in the United States shall be 
increased by an amount equal to not less than 2 percent of the rate of 
basic pay for that individual in effect immediately before that date. 
Subchapter III—Conditions of Employment and Placement 
TRANSFERRED 
OR 
REEMPLOYED 
EMPLOYEES 
22 use 367L 
SEC. 1231. (a)(1) With respect to any individual employed in the 
Panama Canal Company or the Canal Zone Government— 
(A) who is transferred— 
(i) to a position in the Commission; or 
(ii) to a position in an Executive agency or in the Smithso-
nian Institution the permanent duty station of which is in 
the Republic of Panama (including the area known before 
October 1,1979, as the Canal Zone); or 
(B) who is separated by reason of a reduction in force on 
September 30, 1979, and is appointed to a position in the 
Commission before April 1,1980; 
the terms and conditions of employment set forth in paragraph (2) of 
this subsection shall be generally no less favorable, on or after the 
date of the transfer referred to in subparagraph (A) of this paragraph 
or the date of the appointment referred to in subparagraph (B) of this 
paragraph, as the case may be, than the terms and conditions of 
employment with the Panama Canal Company and Canal Zone 
Government on September 30, 1979, or, in the case of a transfer 
described in subparagraph (A)(ii) of this paragraph which takes place 
before that date, on the date of the transfer. 
Terms and 
(2) The terms and conditions of employment referred to in para-
conditions. 
graph (l)ofthissubsection are the following: 
(A) rates of 
basic pay; 
(B) tropical differential; 
(C) premium pay and night differential; 
(D) reinstatement and restoration rights; 
(E) injury and death compensation benefits; 
(F) leave and travel; 
(G) transportation and repatriation benefits; 
(H) group health and life insurance; 
(I) reduction-in-force rights; 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 469 
(J) an employee grievance system, and the right to appeal 
adverse and disciplinary actions and position classification 
actions; 
(K) veterans' preference eligibility; 
(L) holidays; 
(M) saved pay provisions; and 
(N) severance pay benefits. 
(3)(A) The provisions of this subsection shall take effect on the date Effective date, 
of the enactment of this Act. 
(B) No spending authority (as described in section 401(c)(2)(C) of the 
Congressional Budget Act of 1974) provided for under this subsection 31 use 1351. 
shall take effect before October 1,1979. 
(C) Effective October 1,1979, any individual who, but for subpara- Effective date, 
graph (B) of this paragraph, would have been entitled to one or more 
payments pursuant to this subsection for periods before October 1, 
1979, shall be entitled, to the extent or in such amounts as are 
provided in advance in appropriation Acts, to a lump sum payment 
equal to the total amount of all such payments. 
(b) Any individual described in subsection (a)(1)(B) of this section 
who would have met the service requirement for early retirement 
benefits under section 8336(i) or 8339(d)(2) of title 5, United States 
Code (as amended by sections 1241(a) and 1242 of this Act, respec-
tively), but for a break in service of more than 3 days immediately 
after September 30, 1979, shall be considered to meet that require-
ment. Any break in service by any such individual for purposes of 
section 8332 of such title 5 during the period beginning September 30, 
1979, and ending on the date of the appointment referred to in such 
subsection (a)(1)(B) shall be considered a period of creditable service 
under such section 8332 for such individual, except that such period 
shall not be taken into account for purposes of determining average 
pay (as defined in section 8331(4) of such title 5) and no deduction, 
contribution, or deposit shall be required for that period under 
section 8334 of such title 5. 
(c)(1) Section 5(c) of the Defense Department Overseas Teachers 
Pay and Personnel Practices Act (20 U.S.C. 903(c)) shall not apply 
with respect to any teacher who was employed by the Canal Zone 
Government school system on September 30, 1979, and who was 
transferred from such position to a teaching position which is under 
the Department of Defense Overseas Dependent School System and 
the permanent duty station of which is in the Republic of Panama, 
until the rates of basic compensation established under section 5(c) of 
such Act equal or exceed the rates of basic compensation then in 
effect for teachers who were so transferred. 
(2) Section 6(a)(2) of the Defense Department Overseas Teachers 
Pay and Personnel Practices Act (20 U.S.C. 904(a)(2)) shall not apply 
with respect to any teacher who was employed by the Canal Zone 
Government school system on September 30, 1979, and who was 
transferred from such position to a teaching position which is under 
the Department of Defense Overseas Dependent School System and 
the permanent duty station of which is in the Republic of Panama. 
(3)(A) The head of a department or agency of the United States may Sabbatical leave, 
grant a sabbatical to any teacher to whom paragraph (1) of this 
subsection applies for not to exceed 11 months in order to permit the 
teacher to engage in study or uncompensated work experience which 
is in the United States and which will contribute to the teacher's 
development and effectiveness. Basic compensation shall be paid to Compensation, 
teachers on sabbatical under this section in the same manner and to 
the same extent as basic compensation would have been paid to 
teachers on sabbatical while employed in the Canal Zone Govern-
93 STAT. 470 
PUBLIC LAW 96-70—SEPT. 27, 1979 
ment school system on the day before the effective date of this Act. A 
sabbatical shall not result in a loss of, or reduction in, leave to which 
the teacher is otherwise entitled, credit for time or service, or 
performance or efficiency rating. The head of the department or 
agency may authorize in accordance with chapter 57 of title 5, United 
5 use 5701 et 
States Code, such travel expenses (including per diem allowance) as 
^^- 
the head of the department or agency may determine to be essential 
for the study or experience. 
(B) A sabbatical under this paragraph may not be granted to any 
teacher— 
(i) more than once in any 10-year period; 
(ii) unless the teacher has completed 7 years of service as a 
teacher; and 
(iii) if the teacher is eligible for voluntary retirement with a 
right to an immediate annuity. 
(C)(i) Any teacher in a department or agency of the United States 
may be granted a sabbatical under this paragraph only if the teacher 
agrees, as a condition of accepting the sabbatical, to serve in the civil 
service upon the completion of the sabbatical for a period of two 
consecutive years. 
(ii) Each agreement required under clause (i) of this subparagraph 
shall provide that in the event the teacher fails to carry out the 
agreement (except for good and sufficient reason as determined by 
the head of the department or agency that granted the sabbatical) the 
teacher shall be liable to the United States for payment of all 
expenses (including salary) of the sabbatical. The amount shall be 
treated as a debt due the United States. 
(d) Sections 5595(a)(2)(iii), 5724a(a) (3) and (4), and 8102(b) of title 5, 
United States Code, are each amended by striking out "Canal Zone" 
each place it appears and inserting in lieu thereof "areas and 
installations in the Republic of Panama made available to the United 
States pursuant to the Panama Canal Treaty of 1977 and related 
agreements (as described in section 3(a) of the Panama Canal Act of 
Ante, p. 455. 
1979)". 
PLACEMENT 
22 use 3672. 
gEC. 1232. (a) Any citizen of the United States— 
(1) who, on March 31, 1979, was an employee of the Panama 
Canal Company or the Canal Zone Government; 
(2) who separates or is scheduled to separate on or after such 
date for any reason other than misconduct or delinquency; and 
(3) who is not placed in another appropriate position in the 
Government of the United States in the Republic of Panama; 
shall, upon the employee's request, be accorded appropriate assist-
ance for placement in vacant positions in the Government of the 
United States in the United States, 
(b) Any citizen of the United States— 
(1) who, on March 31,1979, was employed in the Canal Zone as 
an employee of an Executive agency (other than the Panama 
Canal Company or the Canal Zone Government) or the Smithso-
nian Institution; 
(2) whose position is eliminated as the result of the implemen-
tation of any provision of the Panama Canal Treaty of 1977 and 
related agreements; and 
(3) who is not appointed to another appropriate position in the 
Government of the United States in the Republic of Panama; 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 471 
shall, upon the employee's request, be accorded appropriate assist-
ance for placement in vacant positions in the Government of the 
United States in the United States. 
(c) The Office of Personnel Management shall establish and admin-
ister a Government-wide placement program for all eligible em-
ployees who request appointment to positions under this section. 
(d) The provisions of this section shall take effect on the date of the Effective date, 
enactment of this Act. 
22 use 3672 
note. 
Subchapter IV—Retirement 
EARLY RETIREMENT ELIGIBILITY 
SEC. 1241. (a) Section 8336 of title 5, United States Code, is 
amended— 
(1) in subsection (c), by inserting "(1)" after "(c)" and by adding 
at the end thereof the following new paragraph: 
"(2) An employee is entitled to an annuity if the employee— 
"(A) was a law enforcement officer or firefighter employed by 
the Panama Canal Company or the Canal Zone Government at 
any time during the period beginning March 31,1979, and ending 
September 30,1979; and 
(B) is separated from the service before January 1,2000, after 
becoming 48 years of age and completing 18 years of service as a 
law enforcement officer or firefighter, or any combination of 
such service totaling at least 18 years."; and 
(2) by redesignating subsection (i) as subsection 0) and by 
inserting after subsection (h) the following new subsection: 
"(i)(l) An employee of the Panama Canal Commission or of an 
Executive agency conducting operations in the Canal Zone or Repub-
lic of Panama who is separated from the service before January 1, 
2000, who was employed by the Canal Zone Government or the 
Panama Canal Company at any time during the period beginning 
March 31, 1979, and ending September 30, 1979, and who has had 
continuous Panama Canal service, without a break in service of more 
than 3 days, from that time until separation, is entitled to an annuity 
if the employee is separated— 
"(A) involuntarily, after completing 20 years of service or after 
becoming 48 years of age and completing 18 years of service, if 
the separation is a result of the implementation of any provision 
of the Panama Canal Treaty of 1977 and related agreements; or 
"(B) voluntarily, after completing 23 years of service or after 
becoming 48 years of age and completing 18 years of service. 
"(2) An employee of the Panama Canal Commission or of an 
Executive agency conducting operations in the Canal Zone or Repub-
lic of Panama who is separateid from the service before January 1, 
2000, who was employed, at a permanent duty station in the Canal 
Zone, by any Executive agency other than the Canal Zone Govern-
ment or the Panama Canal Company at any time during the period 
beginning March 31,1979, and ending September 30,1979, and who 
has had continuous Panama Canal service, without a break in service 
of more than 3 days, from that time until separation, is entitled to an 
annuitv i
f
— 
(A) the employee is separated involuntarily, after completing 
20 years of service oi after becoming 48 years of age and 
completing 18 years of 
service; and 
"(B) the separation is the result of the implementation of any 
provision of the Panama Canal Treaty of 1977 and related 
agreements. 
93 STAT. 472 
PUBLIC LAW 96-70—SEPT. 27, 1979 
"Panama Canal 
service." 
"Executive 
agency." 
Effective date. 
5 u s e 8336 note. 
5 u s e 8301 et 
seq. 
Lump sum 
pajmient. 
5 u s e 8336 note. 
"(3) For the purpose of this subsection— 
"(A) 'Panama Canal service' means— 
"(i) service as an employee of the Canal Zone Government, 
the Panama Canal Company, or the Panama Canal Commis-
sion; or 
"(ii) service at a permanent duty station in the Canal Zone 
or Republic of Panama as an employee of an Executive 
agency conducting operations in the Canal Zone or the 
Republic of Panama; and 
"(B) 'Executive agency' includes the United States District 
Court for the District of the Canal Zone and the Smithsonian 
Institution.". 
(b)(1) The amendments made by this section shall take effect on the 
date of the enactment of this Act, but no amount of annuity under 
chapter 83 of title 5, United States Code, accruing by reason of those 
amendments shall be payable for any period before October 1,1979. 
(2) Effective October 1,1979, any individual who, but for paragraph 
(1) of this subsection, would have been entitled to one or more annuity 
payments pursuant to the amendments made by this section for 
periods before October 1,1979, shall be entitled, to such extent or in 
such amounts as are provided in advance in appropriation Acts, to a 
lump sum payment equal to the total amount of all such annuity 
payments. 
EARLY RETIREMENT COMPUTATION 
"Panama Canal 
service." 
SEC. 1242. (a) Section 8339(d) of title 5, United States Code, is 
amended by inserting "(1)" after "(d)" and by adding at the end 
thereof the following new paragraphs: 
"(2) The annuity of an employee retiring under this subchapter 
who was employed by the Panama Canal Company or Canal Zone 
Government on September 30,1979, is computed with respect to the 
period of continuous Panama Canal service from that date, disregard-
ing any break in service of not more than 3 days, by adding— 
"(A) 2y2 percent of 
the employee's average pay multiplied by so 
much of that service as does not exceed 20 years; plus 
"(B) 2 percent of the employee's average pay multiplied by so 
much of that service as exceeds 20 years. 
"(3)(A) In the case of an employee who has service as a law 
enforcement officer or firefighter to which paragraph (2) of this 
subsection applies, the annuity of that employee is increased by $8 for 
each full month of that service which is performed in the Republic of 
Panama. 
"(B) In the case of an employee retiring under this subchapter 
who— 
"(i) was employed as a law enforcement officer or firefighter by 
the Panama Canal Company or Canal Zone Government at any 
time during the period beginning March 31, 1979, and ending 
September 30,1979; and 
"(ii) does not meet the age and service requirements of section 
8336(c) of 
this title; 
the annuity of that employee is increased by $12 for each full month 
of that service which occurred before October 1,1979. 
"(C) An annuity increase under this paragraph does not apply with 
respect to service performed after completion of 20 years of service (or 
any combination of service) as a law enforcement officer or fire-
fighter. 
"(4) For the purpose of 
this subsection— 
"(A) 'Panama Canal service' means— 
^' 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 473 
"(i) service as an employee of the Panama Canal Commis-
sion; or 
"(ii) service at a permanent duty station in the Canal Zone 
or Republic of Panama as an employee of an Executive 
agency conducting operations in the Canal Zone or Republic 
of Panama; and 
"(B) 'Executive agency' includes the Smithsonian Institution.". 
(b)(1) The amendments made by this section shall take effect on the 
date of the enactment of this Act, but no amount of annuity under 
chapter 83 of title 5, United States Code, accruing by reason of those 
amendments shall be payable for any period before October 1, 1979. 
(2) Effective October 1,1979, any individual who, but for paragraph 
(1) of this subsection, would have been entitled to one or more annuity 
payments pursuant to the amendments made by this section for 
periods before October 1,1979, shall be entitled, to such extent or in 
such amounts as are provided in advance in appropriation Acts, to a 
lump sum payment equal to the total amount of all such annuity 
payments. 
"Executive 
agency." 
5 u s e 8339 note. 
5 u s e 8301. 
5 u s e 8339 note. 
RETIREMENT UNDER SPECIAL TREATY PROVISIONS 
SEC. 1243. (a)(1) Subject to subsection (b) of this section, and under 
such regulations as the President may prescribe, the Secretary of the 
Treasury shall pay to the Social Security System of the Republic of 
Panama, out of funds deposited in the Treasury of the United States 
to the credit of the Civil Service Retirement and Disability Fund 
under section 8334(a)(2) of title 5, United States Code, such sums of 
money as may be necessary to aid in the purchase of a retirement 
equity in such System for each individual who— 
(A) meets the requirements of paragraph (2) of this subsection; 
(B) is separated from employment in the Panama Canal 
Company, the Canal Zone Government, or the Commission by 
reason of the implementation of any provision of the Panama 
Canal Treaty of 1977 and related agreements; and 
(C) becomes employed in a position covered by the Social 
Security System of the Republic of Panama through the transfer 
of a function or activity to the Republic of Panama from the 
United States or through a job placement assistance program. 
(2) This subsection applies with respect to any individual only if the 
individual— 
(A) has been credited with at least 5 years of civilian service 
under section 8332 of title 5, United States Code, relating to 
creditable service for purposes of civil service retirement; 
(B) is not eligible for an immediate retirement annuity under 
chapter 83 of title 5, United States Code, relating to civil service 
retirement, and elects not to receive a deferred annuity under 
that chapter based on any portion of that service; and 
(C) elects to withdraw from the Civil Service Retirement and 
Disability Fund the individual's entire lump-sum credit (as 
defined in section 8331(8) of title 5, United States Code) and to 
transfer that amount to the Social Security System of the 
Republic of Panama pursuant to the special regime referred to in 
paragraph 3 of Article VIII of the Agreement in Implementation 
of Article III of the Panama Canal Treaty of 1977. 
(b) The amount paid to the Social Security System of the Republic 
of Panama with respect to any individual under subsection (a) of this 
section shall not exceed the individual's entire lump-sum credit (as so 
defined). 
Social Security 
System of the 
Republic of 
Panama, 
payment. 
22 u s e 3681. 
Eligibility. 
5 u s e 8301. 
Pa3rment 
limitation. 
93 STAT. 474 
PUBLIC LAW 96-70—SEPT. 27, 1979 
(c)(1) Pursuant to paragraph 2(b) of Annex C to the Agreement in 
Implementation of Article IV of the Panama Canal Treaty of 1977, 
the President, or the President's designee, shall purchase from a 
source determined by the President to be appropriate, in accordance 
with such regulations as the President or the President's designee 
may prescribe, and to such extent or in such amounts as may be 
provided in advance in appropriation Acts, a nontransferable 
deferred annuity for the benefit of each employee of an agency or 
instrumentality of the Government of the United States in the 
Republic of Panama— 
(A) who is not a citizen of 
the United States; 
(B) who was employed on October 1, 1979, and during any 
period before that date by an agency or instrumentality of the 
Government of the United States at any permanent duty station 
in the Republic of Panama (including, with respect to employ-
ment before that date, the area then known as the Canal Zone); 
(C) who, for any period of service with such agency or instru-
mentality before October 1, 1979, at any such permanent duty 
station was not covered, by reason of that service, by the United 
States Civil Service Retirement system or any other Federal 
retirement system providing benefits similar to those retirement 
benefits provided by the Social Security System of the Republic 
of Panama; and 
(D) who, on October 1, 1979, is under a Federal retirement 
system and, on or before that date, has accrued in one or more 
agencies or instrumentalities of the United States a total of 5 
years or more of 
service which— 
(i) is creditable toward any Federal retirement system as 
in effect on October 1,1979; 
(ii) would have been creditable toward any such retire-
ment system if the retirement system were in effect at the 
time of the service accrued b^ the employee; or 
(iii) consists of any combination of service described in 
clauses (i) and (ii) of this subparagraph. 
Retroactivity 
(2) The retirement annuity referred to in paragraph (1) of this 
coverage. 
subsection with respect to any employee will cover retroactivity, from 
October 1,1979, all periods of service, described in subparagraph (D) 
of that paragraph, by that employee at any permanent duty station in 
the Republic of Panama (including the area known before that date 
as the Canal Zone) in agencies and instrumentalities of the Govern-
ment of the United States during which that employee was not 
covered by the United States Civil Service Retirement S5rstem or any 
other Federal retirement system providing benefits similar to those 
retirement benefits provided by the Social Security System of the 
Republic of Panama. 
OBUGATION OF COMMISSION FOR UNFUNDED LIABILITY 
SEC. 1244. Section 8348 of 
title 5, United States Code, is amended by 
adding at the end thereof the following new subsection: 
"(i)(l) Notwithstanding any other provision of law, the Panama 
Canal Commission shall be liable for that portion of any estimated 
increase in the unfunded liability of the fund which is attributable to 
any benefits payable from the Fund to or on behalf of employees and 
their survivors to the extent attributable to the amendments made by 
sections 1241 and 1242, and the provisions of sections 1231(b) and 
Ante, p. 452. 
1243(a)(1), of the Panama Canal Act of 1979. 
"(2) The estimated increase in the unfunded liability referred to in 
paragraph (1) of this subsection shall be determined by the Office of 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 475 
Personnel Management. The Secretary of the Treasury shall pay to 
the Fund from appropriations for that purpose the amount so 
determined in annual installments with interest computed at the 
rate used in the most recent valuation of the Civil Service Retirement 
System.". 
CASH RELIEF TO CERTAIN FORMER EMPLOYEES 
SEC. 1245. (a) The Commission, under the regulations prescribed by 
the President pursuant to the Act entitled "An Act authorizing cash 
relief for certain employees of the Panama Canal not coming within 
the provisions of the Canal Zone Retirement Act", approved July 8, 
1937, as amended (50 Stat. 478; 68 Stat. 17), may continue the 
payments of cash relief to those individual former employees of the 
Canal Zone Government or Panama Canal Company or their prede-
cessor agencies not coming within the scope of the former Canal Zone 
Retirement Act whose services were terminated prior to October 5, 
1958, because of unfitness for further useful service by reason of 
mental or physical disability resulting from age or disease. Subject to 
subsection (b) of this section, that cash relief may not exceed $1.50 per 
month for each year of service of the employees so furnished relief, 
with a maximum of $45 per month, plus the amount of any cost-of-
living increases in such cash relief granted before October 1, 1979, 
pursuant to section 181 of title 2 of the Canal Zone Code (as in effect 
on September 30,1979), nor be paid to any employee who, at the time 
of termination for disability prior to October 5,1958, had less than 10 
years' service with the Canal Zone Government, the Panama Canal 
Company, or their predecessor agencies on the Isthmus of Panama. 
(b) An additional amount of $20 per month shall be paid to each 
person who receives payment of cash relief under subsection (a) of 
this section and shall be allowed without regard to the limitations 
contained therein. 
(c) Each cash relief payment made pursuant to this section shall be 
increased on the same effective date and by the same percent, 
adjusted to the nearest dollar, as civil service retirement annuities 
are increased under the cost-of-living adjustment provisions of sec-
tion 8340(b) of title 5, United States Code. Such increase shall apply 
only to cash relief payments made after October 1,1979, as increased 
by annuity increases made after that date under such section 8340(b). 
(d) The Commission may pay cash relief to the widow of any former 
employee of the Canal Zone Government or the Panama Canal 
Company who, until the time of his death, receives or has received 
cash relief under subsection (a) of this section, under section 181 of 
title 2 of the Canal Zone Code (as in effect on September 30,1979), or 
under the Act of July 8,1937, referred to in such subsection (a). The 
term "widow" as used in this subsection includes only the following: 
(1) a woman legally married to such employee at the time of his 
termination for disability and at his death; 
(2) a woman who, although not legally married to such former 
employee at the time of his termination, had resided continu-
ously with him for at least five years immediately preceding the 
employee's termination under such circumstances as would at 
common law make the relationship a valid marriage and who 
continued to reside with him until his death; and 
(3) a woman who has not remarried or assumed a common-law 
relationship with any other person. 
Cash relief granted to such a widow shall not at any time exceed 50 
percent of the rate at which cash relief, inclusive of any additional 
Disabled 
employees. 
22 use 3682. 
76A Stat. 20. 
"Widow." 
93 STAT. 476 
PUBLIC LAW 96-70—SEPT. 27, 1979 
payment under subsection (b) of this section, would be payable to the 
former employee were he then alive. 
5 use 8331. 
(e) Subchapter III of chapter 83 of title 5, United States Code, 
applies with respect to those individuals who were in the service of 
the Canal Zone Government or the Panama Canal Company on 
October 5,1958, and who, except for the operation of section 13(a)(1) of 
the Act entitled "An Act to implement item 1 of a Memorandum of 
Understanding attached to the treaty of January 25, 1955, entered 
into by the Government of the United States of America and the 
Government of the Republic of Panama with respect to wage and 
employment practices of the Government of the United States of 
5 use 8331 note. America in the Canal Zone", approved July 25, 1958 (72 Stat. 405), 
would have been within the classes of individuals subject to the Act of 
July 8,1937, referred to in subsection (a) of this section. 
APPLIANCES FOR EMPLOYEES INJURED BEFORE SEPTEMBER 7, 1916 
22 use 3683. 
SEC. 1246. Artificial limbs or other appliances may be purchased by 
the Commission, out of any funds appropriated to the Commission, 
for persons who were injured in the service of the Isthmian Canal 
Commission or of the Panama Canal before September 7, 1916. 
Subchapter V—Leave 
LEAVE FOR JURY OR WITNESS SERVICE 
SEC. 1251. Section 6322(a) of title 5, United States Code, is 
amended— 
(1) by striking out "the Canal Zone, or"; and 
(2) by striking out "Islands." and inserting in lieu thereof 
"Islands, or the Republic of Panama.". 
Subchapter VI—Application to Related Personnel 
LAW ENFORCEMENT; CANAL ZONE CIVILIAN PERSONNEL POLICY 
COORDINATING BOARD; RELATED EMPLOYEES 
22 use 3691. 
SEC. 1261. (a) For the purposes of sections 1206, 1231, 1232, 1241, 
and 1242 of this Act, including any amendment made by those 
sections, the United States Attorney for the District of the Canal 
Zone and the Assistant United States Attorneys and their clerical 
assistants, and the United States Marshal for the District of the 
Canal Zone and his deputies and clerical assistants shall be consid-
ered employees of the Commission. 
O
t
»
) For the purposes of this Act, including any amendment made by 
this Act, the Executive Director of the Canal Zone Civilian Personnel 
Policy Coordinating Board, the Manager, Central Examining Office, 
and their staffs shall be considered to have been employees of the 
Panama Canal Company with respect to service in those positions 
before October 1, 1979, and as employees of the Commission with 
respect to service in those positions on or after that date. 
Effective date. 
(c) The provisions of this section shall take effect on the date of the 
22 use 3691 
enactment of this Act. 
note. 
Subchapter VII—Labor-Management Relations 
LABOR-MANAGEMENT RELATIONS 
22 use 3701. 
SEC. 1271. (a) Nothing in this Act shall be construed to affect the 
5 use 7101 et 
applicability of chapter 71 of title 5, United States Code, relating to 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 477 
labor-management and employee relations, with respect to the Com-
mission or the operations of any other Executive agency conducted in 
that area of the Republic of Panama which, on September 30,1979, 
was the Canal Zone, except that in applying those provisions— 
(1) the definition of "employee" shall be applied without regard 
to clause (i) of section 7103(a)(2) of such title 5 which relates to 
nationality and citizenship; and 
(2) a unit shall be considered to be appropriate notwithstand-
ing the fact that it includes any supervisor if that supervisor's 
position (or type of position) was, before October 1,1979, repre-
sented before the Panama Canal Company by a labor organiza-
tion that included employees who were not supervisors. 
(b) Labor-management and employee relations of the Commission, 
other Executive agencies, and the Smithsonian Institution, their 
employees, and organizations of those employees, in connection with 
operations conducted in that area of the Republic of Panama which, 
on September 30, 1979, was the Canal Zone, shall be governed and 
regulated solely by the applicable laws, rules, and regulations of the 
United States. 
CHAPTER 3—FUNDS AND ACCOUNTS 
Subchapter I—Funds 
CANAL ZONE GOVERNMENT FUNDS 
SEC. 1801. On the effective date of this Act, any unexpended 22 use 3711. 
balances of the appropriation accounts appearing on the books of the 
United States Government as "Operating Expenses, Canal Zone 
Government (38-0116-0-1-806)" and "Capital Outlay, Canal Zone 
Government (38-0118-0-1-806)" shall be covered into the general 
fund of the Treasury, and any appropriations to which expenditures 
under such accounts have been chargeable before such effective date 
are repealed. The Commission may, to such extent or in such 
amounts as are provided in appropriation Acts to the Commission for 
such purpose, pay claims or make payments chargeable to such 
accounts, upon proper audit of such claims or payments. There are Appropriation 
authorized to be appropriated to the Commission such funds as may authorization. 
be necessary to pay claims and make payments pursuant to this 
section. 
PANAMA CANAL COMPANY FUNDS; COMMISSION FUNDS 
SEC. 1302. (a) On the effective date of this Act, the account 22 use 3712. 
appearing on the books of the United States Government as the 
"Panama Canal Company Fund (38-4060-0-3-403)" shall be termi-
nated, and any unexpended balances under such account as of that 
date shall be covered into the Treasury in an account to be known as 
the "Panama Canal Commission Fund . 
(b) On or after the effective date of this Act, tolls for the use of the 
Panama Canal and all other receipts of the Commission that, before 
such effective date, would have been credited to the account appear-
ing on the books of 
the Governments as the "Panama Canal Company 
Fund (38-4060-0-3-403)" shall be deposited in the Treasury in the 
Panama Canal Commission Fund. 
(c)(1) No funds may be appropriated to or for the use of the 
Commission, nor may any funds be obligated or expended by the 
Commission for any 
fiscal 
year, unless such appropriation, obligation, 
or expenditure has been specifically authorized by law 
93 STAT. 478 
PUBLIC LAW 96-70—SEPT. 27, 1979 
Report to 
Congress. 
Panama Canal 
Emergency 
Fund. 
22 use 3713. 
Appropriation 
authorization. 
Withdrawals. 
(2) No funds may be appropriated to or for the use of the Commis-
sion for any fiscal year in excess of (A) the amount of revenues 
deposited in the Panama Canal Commission Fund during such fiscal 
year, as such amount is estimated by the Secretary of Defense and 
certified by the Comptroller General of the United States at the time 
the budget request for the Commission for such fiscal year is 
submitted to the Congress, plus (B) the amount of revenues deposited 
in such Fund prior to such fiscal year and remaining unexpended at 
the beginning of such fiscal year. Not later than thirty days after the 
end of such fiscal year, the Secretary of the Treasury shall report to 
the Congress the actual amount of revenues deposited in the Panama 
Canal Commission Fund during such fiscal year. 
(d) The Commission may, to such extent or in such amounts as are 
provided in advance in appropriation Acts, enter into contracts in 
order to carry out its functions. 
(eXD It is the sense of the Congress that the additional costs 
resulting from implementation of the Panama Canal Treaty of 1977 
and related agreements should be kept to the absolute minimum 
level. To this end, the Congress declares that the direct appropriated 
costs of implementation to be borne by the taxpayers over the life of 
such Treaty should be kept to a level no greater than the March 1979 
estimate of those costs ($870,700,000) presented to the Congress by the 
executive branch during consideration of this Act by the Congress, 
less personnel retirement costs of $205,000,000, which were sub-
tracted and charged to tolls, therefore resulting in the net taxpayer 
cost of approximately $665,700,000, plus appropriate adjustment for 
inflation. 
(2) It is further the sense of the Congress that the actual costs of 
implementation be consistent with the obligations of the United 
States to operate the Panama Canal safely and efficiently and keep it 
secure. 
EMERGENCY FUND 
SEC. 1303. (a) On the effective date of this Act, the Secretary of the 
Treasury shall establish and thereafter shall maintain in the Treas-
ury a fund to be known as the "Panama Canal Emergency Fund". 
There are authorized to be appropriated for deposit in such Fund (1) 
for the fiscal year beginnmg on October 1,1979, $40,000,000, and (2) 
for any fiscal year beginning on or after October 1, 1980, such 
additional sums as may be specifically authorized by law for such 
fiscal year. 
O
t
)
) The Commission may make withdrawals from the Panama 
Canal Emergency Fund by check in order to defray emergency 
expenses and to insure the continuous, efficient, and safe operation of 
the Panama Canal, if funds appropriated for the operation and 
maintenance of the Canal are insufficient for such purposes. Any 
withdrawal from such Fund to cover increased costs attributable to 
unprogrammed increases in traffic may not be made in amounts 
greater than the revenues from such increased traffic. Such Fund 
shall not be available for payments to Panama under Article XIII of 
the Panama Canal Treaty of 1977. Any withdrawal from such fund or 
expenditure made under this subsection shall be reported forthwith 
by the Commission to the Congress and to the Office of Management 
and Budget. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
Subchapter II—Accounting Policies and Audits 
93 STAT. 479 
ACCOUNTING POLICIES 
SEC. 1311. (a) The Commission shall establish and maintain its 22 use 3721. 
accounts pursuant to the Accounting and Auditing Act of 1950 (31 
U.S.C. 65 et seq.) and the provisions of this chapter. Such accounts 
shall specify all revenues received by the Commission, including tolls 
for the use of the Panama Canal, expenditures for capital replace-
ment, expansion, and improvement, and all costs of maintenance and 
operation of the Panama Canal and of its complementary works, 
installations, and equipment, including depreciation, payments to 
the Republic of Panama under the Panama Canal Treaty of 1977, and 
interest on the investment of the United States calculated in accord-
ance with section 1603 of this Act. 
(b) The Commission may issue regulations establishing the basis of Regulations, 
accounting for the assets which are made available for the use of the 
Commission. Such regulations may provide for depreciation of the 
net replacement value of the assets which will ultimately require 
replacement to maintain the service capacity of the Panama Canal. 
Such regulations may also provide that depreciation of such assets be 
recorded ratably over their service lives. 
REPORTS 
SEC. 1312. The Commission shall, not later than January 31 of each 
year, submit to the President and the Congress a financial statement 
and a complete report with respect to the maintenance and operation 
of the Panama Canal during the preceding fiscal year. 
AUDIT BY THE COMPTROLLER GENERAL OF THE UNITED STATES 
Report to 
President and 
Congress. 
22 u s e 3722. 
SEC. 1313. (a) Financial transactions of the Commission shall be 22 USe 3723. 
audited by the Comptroller General of the United States (hereinafter 
in this Act referred to as the "Comptroller General") pursuant to the 
Accounting and Auditing Act of 1950 (31 U.S.C. 65 et seq.). In 
conducting any audit pursuant to such Act, the appropriate repre-
sentatives of the Comptroller General shall have access to all books, 
accounts, financial records, reports, files, and other papers, items, or 
property in use by the Commission and necessary to facilitate such 
audit, and such representatives shall be afforded full facilities for 
verifying transactions with the balances or securities held by deposi-
tories, fiscal agents, and custodians. An audit pursuant to such Act 
shall first be conducted with respect to the fiscal year in which this 
Act becomes effective. 
(b) The Comptroller General shall, not later than six months after Report to 
the end of each fiscal year, submit to the Congress a report of the Congress, 
audit conducted pursuant to subsection (a) of this section with respect 
to such fiscal year. Such report shall set forth the scope of the audit 
and shall include— 
(1) a statement of assets and liabilities, capital, and surplus or 
deficit, based on the accounts of the Commission established 
pursuant to this chapter, 
(2) a statement of income and expenses, 
(3) a statement of sources and application of funds, 
(4) a statement listing all direct and indirect costs incurred by 
the United States in implementing the Panama Canal Treaty of 
1977, including the cost of property transferred to the Republic of 
Panama during each fiscal year, and 
93 STAT. 480 
PUBLIC LAW 96-70—SEPT. 27, 1979 
(5) such comments and information £is the Comptroller Gen-
eral considers necessary to keep the Congress informed of the 
operations and financial transactions of the Commission, 
together with such recommendations with respect to such oper-
ations and transactions as the Comptroller General considers 
advisable. 
The report shall identify specifically any program, expenditure, or 
other financial transaction or undertaking observed in the course of 
the audit which, in the opinion of the Comptroller General, has been 
carried out or made and has not been authorized by law. The 
Comptroller General shall submit a copy of each such report to the 
President, the Secretary of the Treasury, and the Commission, 
(c) In conducting the audits and preparing the reports provided for 
in this section and in carrying out his other responsibilities pursuant 
to law, the Comptroller General shall, with respect to 
fiscal 
year 1980, 
take into account the problems inherent in converting the existing 
accounting system of the Panama Canal Company to conform to the 
requirements established in section 1311 of this Act. Accordingly, the 
Comptroller General shall take no adverse action with respect to the 
Commission, nor shall any violation of section 3679 of the Revised 
Statutes (31 U.S.C. 665) be considered to have taken place, so long as 
the Commission is in substantial compliance with the requirements 
of this Act. The Comptroller General shall make such recommenda-
tions to the Commission and to the Congress as he may consider 
appropriate to insure that full compliance with the financial controls 
provided for in the Accounting and Auditing Act of 1950 (31 U.S.C. 65 
et seq.) is achieved promptly. 
Subchapter III—Interagency Accounts 
INTERAGENCY SERVICES; REIMBURSEMENTS 
22 use 3731. 
SEC. 1321. (a) The Commission shall reimburse the Employees' 
Compensation Fund, Bureau of Employee's Compensation, Depart-
ment of Labor, for the benefit payments to the Commission's em-
ployees, and shall also reimburse other Government departments 
and agencies for payments of a similar nature made on its behalf. 
(b) The Department of Defense shall reimburse the Commission for 
amounts expended by the Commission in maintaining defense facili-
ties in standby condition for the Department of Defense. 
(c) Notwithstanding any other provision of law, funds appropriated 
(for any fiscal year beginning after September 30,1979) to or for the 
use of the Department of Defense, or to £my other department or 
agency of the United States as may be designated by the President to 
carry out the purposes of this subsection, shall be available for— 
(1) conducting the educational and health care activities, 
including kindergartens and college, carried out by the Canal 
Zone Government and the Panama Canal Company before the 
effective date of 
this Act, and 
(2) providing the services related thereto to the categories of 
persons to which such services were provided before such effec-
tive date. 
Notwithstanding any other provision of law, the Department of 
Defense, or any department or agency designated by the President to 
provide health care services to those categories of persons referred to 
in this subsection, shall provide such services to such categories of 
persons on a basis no less favorable than that applied to its own 
employees and their dependents. 
-
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 481 
(d) Amounts expended for furnishing services referred to in subsec-
tion (c) of this section to persons eligible to receive them, less amounts 
payable by such persons, shall be fully reimbursable to the depart-
ment or agency furnishing the services, except to the extent that such 
expenditures are the responsibility of that department or agency. The 
appropriations or funds of the Commission shall be available for such 
reimbursements on behalf of— 
(1) employees of the Commission, and 
(2) other persons authorized to receive such services who are 
eligible to receive them pursuant to the Panama Canal Treaty of 
1977 and related agreements. 
The appropriations or funds of any other department or agency of the 
United States conducting operations in the Republic of Panama, 
including the Smithsonian Institution, shall be available for reim-
bursements on behalf of employees of such department or agency and 
their dependents. 
(e) The appropriations or funds of the Commission, or of any other 
department or agency of the United States conducting operations in 
the Republic of Panama, shall be available, in accordance with 
subsection (d) of this section, to defray the cost of— 
(1) health care services to elderly or disabled persons who were 
eligible to receive such services before the effective date of this 
Act, less amounts payable by such persons, and 
(2) educational services provided by schools in the Republic of 
Panama, which are not operated by the United States, to persons 
who were receiving such services at the expense of the Canal 
Zone Government before the effective date of this Act. 
(f) For purposes of the reimbursement of the United States by the 
Republic of Panama for the salaries and other employment costs of 
employees of the Commission who are assigned to assist the Republic 
of Panama in the operation of activities which are transferred to that 
Government as a result of any provision of the Panama Canal Treaty 
of 1977 and related agreements, which reimbursement is provided for 
in paragraph 8 of Article 10 of that Treaty, the Commission shall be 
deemed to be the United States of America. 
(g) Notwithstanding any other provision of law, the President, 
through the appropriate department or agency of the United States, 
shall, until January 1, 2000, operate the educational institution 
known as the "Canal Zone College". Such institution shall continue 
to provide, insofar as practicable, the level of services which it offered 
immediately before the effective date of this Act. 
Subchapter IV—Postal Matters 
POSTAL SERVICE 
SEC. 1331. (a) The postal service established and governed by 22 use 3741. 
chapter 73 of title 2 of the Canal Zone Code shall be discontinued on 76A Stat 38 
October 1,1979. 
03) The provisions of chapter 73 of such title 2 relating to postal-
savings deposits, postal-savings certificates, postal money orders, and 
the accounting for funds shall continue to apply for the purpose of 
meeting the obligations of the United States concerning outstanding 
postal savings and money orders and disposition of funds. 
(c) The Commission shall take possession of and administer the 
funds of the postal service referred to in subsection (a) of this section 
and shall assume its obligations. The Commission and the United 
States Postal Service may enter into agreements for the transfer of 
^„^' 
funds or property and the assumption of administrative rights or 
,-^ 
59-194 O — 81 
33 : QL3 
93 STAT. 482 
PUBLIC LAW 96-70—SEPT. 27, 1979 
responsibilities with respect to the outstanding obligations of the 
postal service referred to in subsection (a) of this section. Any 
transfer or assumption (including any agreement for such transfer or 
assumption) pursuant to this subsection shall be effective only to such 
extent or in such amounts as are provided in advance in appropri-
ation Acts. 
(d) Mail addressed to the Canal Zone from or through the continen-
tal United States may be routed by the United States Postal Service 
to the military post offices of the United States Forces in the Republic 
of Panama. Such military post offices shall provide the required 
directory services and shall accept such mail to the extent permitted 
under the Panama Canal Treaty of 1977 and related agreements. The 
Commission shall furnish personnel, records, and other services to 
such military post offices to assure wherever appropriate the distri-
bution, rerouting, or return of such mail. 
(e)(1) The second sentence of section 403(a) of title 39, United States 
Code, is amended by striking out "Except as provided in the Canal 
39 use 3401. 
Zone Code, the" and inserting in lieu thereof "The". 
(2) Section 3401(b) of such title is amended— 
(A) by inserting "or" before "the Virgin Islands"; and 
(B) by striking out "or the Canal Zone,". 
Repeal. 
(3)( 
A) Section 3402 of such title is repealed. 
39 use 3402. 
(B) the table of sections for chapter 34 of title 39, United States 
39 use 3401. 
Code, is amended by repealing the item relating to section 3402. 
39 use 3682. 
(4) Section 3682(b)(5) of such title is amended by striking out "the 
Canal Zone and". 
Subchapter V—Accounts With the Republic of Panama 
PAYMENTS TO THE REPUBLIC OF PANAMA 
22 use 3751. 
SEC. 1341. (a) The Commission shall pay to the Republic of Panama 
those payments required under paragraph 5 of Article III and 
paragraph 4 of Article XIII of the Panama Canal Treaty of 1977. 
Payments made under paragraph 5 of Article III of such Treaty shall 
be audited annually by the Comptroller General and any overpay-
ment, as determined in accordance with Understanding (1) incorpo-
rated in the Resolution of Ratification of the Panama Canal Treaty 
(adopted by the United States Senate on April 18, 1978), for the 
services described in that paragraph which are provided shall be 
refunded by the Republic of Panama or set off against amounts 
payable by the United States to the Republic of Panama under 
paragraph 5 of Article III of the Panama Canal Treaty of 1977. 
(b) In determining whether operating revenues exceed expendi-
tures for the purpose of pajinents to the Republic of Panama under 
paragraph 4(c) of Article XIII of the Panama Canal Treaty of 1977, 
such operating revenues in a fiscal period shall be reduced by (1) all 
costs of such period as shown by the accounts established pursuant to 
section 1311 of this Act, and (2) the cumulative sum from prior years 
O^eginning with the year in which the Panama Canal Treaty of 1977 
enters into force) of any excess of costs of the Panama Canal 
Commission over operating revenues. 
(c) The President shall not accede to any interpretation of para-
graph 1 of Article IX of the Panama Canal Treaty of 1977 which 
would permit the Republic of Panama to tax retroactively organiza-
tions and businesses operating, and citizens of the United States 
living, in the Canal Zone before the effective date of this Act. 
(d) Any accumulated unpaid balance under paragraph 4(c) of 
Article 3QII of the Panama Canal Treaty of 1977 at the termination of 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 483 
such Treaty shall be payable only to the extent of any operating 
surplus in the last year of the Treaty's duration, and nothing in such 
paragraph may be construed as obligating the United States to pay 
after the date of the termination of the Treaty any such unpaid 
balance which has accrued before such date. 
(e) As provided in section 1602(b) of this Act, tolls shall not be 
prescribed at rates calculated to cover payments to the Republic of 
Panama pursuant to paragraph 4(c) of Article XIII of the Panama 
Canal Treaty of 1977. Moreover, no payments may be made to the 
Republic of Panama under paragraph 4(c) of Article XIII of the 
Panama Canal Treaty of 1977 unless unexpended funds are used to 
pay all costs of operation and maintenance of the canal, including but 
not limited to (1) operating expenses determined in accordance with 
generally accepted accounting principles, (2) payments to the Repub-
lic of Panama under paragraphs 4(a) and 4(b) of such Article XIII and 
under paragraph (5) of Article III of such Treaty, (3) amounts in 
excess of depreciation and amortization which are programed for 
plant replacement, expansion, and improvements, (4) payments to 
the Treasury of the United States under section 1603 of this Act, (5) 
reimbursement to the Treasury of the United States for costs in-
curred by other departments and agencies of the United States in 
providing educational, health, and other services to the Commission, 
its employees and their dependents, and other categories of persons 
in accordance with section 1321 of this Act, and (6) any costs of Treaty 
implementation associated with the maintenance and operation of 
the Panama Canal. 
(f) The prohibitions contained in this section and in sections 1302(c) 
and 1503 of this Act shall apply notwithstanding any other provision 
of law authorizing transfers of funds between accounts, reprograming 
of funds, use of funds for contingency purposes, or waivers of 
prohibitions. 
TRANSACTIONS WITH THE REPUBLIC OF PANAMA 
SEC. 1342. The Commission may, on a reimbursable basis, provide 22 use 3752. 
to the Republic of Panama materials, supplies, equipment, work, or 
services, including water and electric power, requested by the Repub-
lic of Panama, at such rates as may be agreed upon by the Commis-
sion and the Republic of Panama. Payment for such materials, 
supplies, equipment, work, or services may be made by direct pay-
ment by the Republic of Panama to the Commission or by offset 
against amounts due the Republic of Panama by the United States. 
DISASTER RELIEF 
SEC. 1343. If an emergency arises because of disaster or calamity by 22 use 3753. 
flood, hurricane, earthquake, fire, pestilence, or like cause, not 
foreseen or otherwise provided for, and occurring in the Republic of 
Panama in such circumstances as to constitute an actual or potential 
hazard to health, safety, security, or property in the areas and 
installations made available to the United States pursuant to the 
Panama Canal Treaty of 1977 and related agreements, the Commis-
sion may expend available funds appropriated to the Commission for 
such purpose, and utilize or furnish materials, supplies, equipment, 
and services for relief, assistance, and protection. 
93 STAT. 484 
PUBLIC LAW 96-70—SEPT. 27, 1979 
CONGRESSIONAL RESTRAINTS ON PROPERTY TRANSFERS AND TAX 
EXPENDITURES 
Rules and 
SEC. 1344. (a) The Congress enacts this section in the exercise of its 
Regulations. 
authority under Article IV, section 3, clause 2 of the Constitution of 
use m
^
e
c tkle 1 ^^® United States to dispose of and make necessary rules and 
regulations with respect to property of the United States. 
(b) Prior to the transfer of property of the United States located in 
the Republic of Panama to the Republic of Panama pursuant to 
section 1504 of this Act the President shall formally advise the 
Government of Panama that— 
(1) in fulfilling its obligations under the Panama Canal Treaty 
of 1977, the United States shall make no payments to the 
Republic of Panama derived from tax revenues of the United 
States; 
(2) the United States retains full discretion and authority to 
determine whether and the extent to which tax revenues of the 
United States may be expended in exercising United States 
rights and carrying out United States responsibilities under the 
Panama Canal Treaty of 1977 and related agreements; 
(3) no tax revenues of the United States shall be made avail-
able for obligations and expenditure after the effective date of 
this Act for purposes of implementing the Panama Canal Treaty 
of 1977 and related agreements, unless hereafter specifically 
approved by the Congress through the authorization and appro-
priation process; 
(4) the total amount expended by the Commission from funds 
appropriated to or for the use of the Commission shall not exceed 
the total amount deposited in the Pansmia Canal Commission 
Fund; and 
(5) the foregoing paragraphs of this subsection do not apply to 
expenditures made by the United States in fulfilling United 
States obligations to transfer the remains of our honored dead 
from Mount Hope Cemetery in the former Canal Zone to an 
appropriate and dignified resting place in accordance with Reser-
vation 3 to the Treaty Concerning the Permanent Neutrality and 
Operation of the Panama Canal. 
CHAPTER 4—CLAIMS FOR INJURIES TO PERSONS OR PROPERTY 
Subchapter I—General Provisions 
SETTLEMENT OF CLAIMS GENERALLY 
22 use 3761. 
SEC. 1401. (a) Subject to the provisions of this chapter, the Commis-
sion may adjust and pay claims for injury to, or loss of, property or for 
personal injury or death, arising from the operation of the Panama 
Canal or related facilities and appurtenances. 
(b) No claim for an amount exceeding $50,000 shall be adjusted and 
paid by the Commission under the provisions of this subchapter. 
(c) An award made to a claimant under this section shall be payable 
out of any moneys appropriated for or made available to the Commis-
sion. The acceptance by the claimant of the award shall be final and 
conclusive on the claimant, and shall constitute a complete release by 
the claimant of his claim against the United States and against any 
employee of the United States acting in the course of his emplo3mient 
who is involved in the matter giving rise to the claim. 
(d) Except as provided in section 1416 of this Act, no action for 
damages on claims cognizable under this chapter shall lie against the 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 485 
United States or the Commission, and no such action shall lie against 
any officer or employee of the United States. Neither this section nor 
section 1416 of this Act shall preclude actions against officers or 
employees of the United States for injuries resulting from their acts 
outside the scope of their employment or not in the line of their 
duties, or from their acts committed with the intent to injure the 
person or property of another. 
(e) The provisions of section 1346(b) of title 28, United States Code, 
and the provisions of chapter 171 of such title shall not apply to 28 use 2671 et 
claims cognizable under this chapter. 
«
«
9
-
Subchapter II—Vessel Damage 
INJURIES IN LOCKS OF CANAL 
SEC. 1411. The Commission shall promptly adjust and pay damages 22 use 3771. 
for injuries to vessels, or to the cargo, crew, or passengers of vessels, 
which may arise by reason of their passage through the locks of the 
Panama Canal under the control of officers or employees of the 
United States. Damages may not be paid where the injury was 
proximately caused by the negligence or fault of the vessel, master, 
crew, or passengers. If the negligence or fault of the vessel, master, 
crew, or passengers proximately contributed to the injury, the award 
of damages shall be diminished in proportion to the negligence or 
fault attributable to the vessel, master, crew, or passengers. Damages 
may not be allowed and paid for injuries to any protrusion beyond 
any portion of the hull of a vessel, whether it is permanent or 
temporary in character. A vessel is considered to be passing through 
the locks of the Canal, under the control of officers or employees of 
the United States, from the time the first towing line is made fast on 
board before entrance into the locks and until the towing lines are 
cast off upon, or immediately prior to, departure from the lock 
chamber. 
INJURIES OUTSIDE LOCKS 
SEC. 1412. The Commission shall promptly adjust and pay damages 22 use 3772. 
for injuries to vessels, or to the cargo, crew, or passengers of vessels 
which may arise by reason of their presence in the Panama Canal, or 
waters adjacent thereto, other than the locks, when the injury was 
proximately caused by negligence or fault on the part of an officer or 
employee of the United States acting within the scope of his employ-
ment and in the line of his duties in connection with the operation of 
the Canal, and when the amount of the claim does not exceed 
$120,000. If the negligence or fault of the vessel, master, crew, or 
passengers proximately contributed to the injury, the award of 
damages shall be diminished in proportion to the negligence or fault 
attributable to the vessel, m£ister, crew, or passengers. In the case of a 
vessel which is required by or pursuant to regulations prescribed 
pursuant to section 1801 of this Act to have a Panama Canal pilot on 
duty aboard, damages may not be adjusted and paid for injuries to the 
vessel, or its cargo, crew, or passenge/s, incurred while the vessel was 
underway and in motion, unless at the time the injuries were 
incurred the navigation or movement of the vessel was under the 
control of a Panama Canal pilot. 
93 STAT. 486 
PUBLIC LAW 96-70—SEPT. 27, 1979 
MEASURE OF DAMAGES GENERALLY 
22 use 3773. 
SEC. 1413. In determining the amount of the award of damages for 
injuries to a vessel for which the Commission is determined to be 
liable, there may be included— 
(1) the actual or estimated cost of repairs; 
(2) charter hire actually lost by the owners, or charter hire 
actually paid, depending upon the terms of the charter party, for 
the time the vessel is undergoing repairs; 
(3) maintenance of the vessel and wages of the crew, if they are 
found to be actual additional expenses or losses incurred outside 
of the charter hire; and 
(4) other expenses which are definitely and accurately shown 
to have been incurred necessarily and by reason of the accident 
or injuries. 
Agent's fees, or commissions, or other incidental expenses of similar 
character, or any items which are indefinite, indeterminable, specu-
lative, or conjectural may not be allowed. The Commission shall be 
furnished such vouchers, receipts, or other evidence as may be 
necessary in support of any item of a claim. If a vessel is not operated 
under charter but by the owner directly, evidence shall be secured if 
available as to the sum for which vessels of the same size and class 
can be chartered in the market. If the charter value cannot be 
determined, the value of the vessel to its owners in the business in 
which it was engaged at the time of the injuries shall be used as a 
basis for estimating the damages for the vessel's detention; and the 
books of the owners showing the vessel's earnings about the time of 
the accident or injuries shall be considered as evidence of probable 
earnings during the time of detention. If the books are unavailable, 
such other evidence shall be furnished as may be necessary. 
DELAYS FOR WHICH NO RESPONSIBILITY IS ASSUMED 
22 use 3774. 
SEC. 1414. The Commission is not responsible, and may not consider 
any claim, for demurrage or delays caused by— 
(1) landslides or other natural causes; 
(2) necessary construction or maintenance work on Canal 
locks, terminals, or equipment; 
(3) obstruction arising from accidents; 
(4) time necessary for admeasurement; 
(5) congestion of traffic; 
(6) time necessary for investigation of marine accidents; or 
(7) except as specially set forth in this subchapter, any other 
cause. 
SETTLEMENT OF CLAIMS 
22 use 3775. 
SEC. 1415. (a) Subject to subsection (b) of this section, the Commis-
sion, by mutual agreement, compromise, or otherwise, may adjust 
and determine the amounts of the respective awards of damages 
pursuant to this subchapter. Such amounts shall be payable promptly 
out of any moneys appropriated or allotted for the maintenance and 
operation of the Panama Canal. Acceptance by a claimant of the 
amount awarded to him shall be deemed to be in full settlement of 
such claim against the Government of the United States. 
(b) The Commission shall not adjust and pay any claim for damages 
for injuries arising by reason of the presence of the vessel in the 
Panama Canal or adjacent waters outside the locks where the 
amount of the claim exceeds $120,000 but shall submit the claim to 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 487 
the Congress in a special report containing the material facts and the 
recommendation of the Commission thereon. 
ACTIONS ON CLAIMS 
SEC. 1416. A claimant for damages pursuant to section 1411 of this 22 use 3776. 
Act who considers himself aggrieved by the findings, determination, 
or award of the Commission in reference to his claim may bring an 
action on the claim against the Commission in the United States 
District Court for the Eastern District of Louisiana. Subject to the 
provisions of this chapter and of applicable regulations issued pursu-
ant to section 1801 of this Act relative to navigation of the Panama 
Canal and adjacent waters, such actions shall proceed and be heard 
by the court without a jury according to the principles of law and 
rules of practice obtaining generally in like cases between a private 
party and a department or agency of the United States. Any judg-
ment obtained against the Commission in an action under this 
subchapter shall be paid out of any moneys appropriated or allotted 
for the maintenance and operation of the Panama Canal. An action 
for damages cognizable under this section shall not otherwise lie 
against the United States or the Commission, nor in any other court, 
than as provided in this section; nor may it lie against any officer or 
employee of the United States or of the Commission. 
INVESTIGATION OF ACCIDENT OR INJURY GIVING RISE TO CLAIM 
SEC. 1417. Notwithstanding any other provision of law, a claim may 22 use 3777. 
not be considered under this subchapter, or an action for damages lie 
thereon, unless, prior to the departure from the Panama Canal of the 
vessel involved— 
(1) an investigation by the competent authorities of the acci-
dent or injury giving rise to the claim has been completed; and 
(2) the basis for the claim has been laid before the Commission. 
Regulations. 
22 u s e 3778. 
BOARD OF LOCAL INSPECTORS 
SEC. 1418. (a) The President shall provide for the establishment of a 
Board of Local Inspectors of the Panama Canal Commission which 
shall perform, in accordance with regulations prescribed by the 
President— 
(1) the investigations required by section 1417 of this Act; and 
(2) such other duties with respect to marine matters as may be 
assigned by the President. 
(b) In conducting any investigation pursuant to subsection (a) of Investigations, 
this section, the Board of Local Inspectors established pursuant to 
such subsection may summon witnesses, administer oaths, and 
require the production of books and papers necessary for such 
investigation. 
CHAPTER 5—PUBLIC PROPERTY 
ASSETS AND LIABILITIES OF PANAMA CANAL COMPANY 
SEC. 1501. All property and other assets of the Panama Canal 22 use 3781. 
Company shall revert to the United States on the effective date of this 
Act, and, except as otherwise provided by law, the United States shall 
assume the liabilities, including contractual obligations, of the 
Panama Canal Company then outstanding. The Commission may use 
such property, facilities, and records of the Panama Canal Company 
as are necessary to carry out its functions. 
93 STAT. 488 
PUBLIC LAW 96-70—SEPT. 27, 1979 
TRANSFERS AND CROSS-SERVICING BETWEEN AGENCIES 
22 use 3782. 
SEC. 1502. (a) In the interest of economy and maximum efficiency in 
the utihzation of property and facilities of the United States, there 
are authorized to be transferred between departments and agencies 
of the United States, with or without reimbursement, such faciUties, 
buildings, structures, improvements, stock, and equipment located in 
the Republic of Panama, and used for their activities therein, as may 
be mutually agreed upon by the departments and agencies involved 
and approved by the President of the United States or his designee. 
Qo) The Commission may enter into cross-servicing agreements 
with any other department or agency of the United States for the use 
of facilities, furnishing of services, or performance of functions. 
(c) The Commission, any department or agency of the United 
States, or any United States court in the Republic of Panama is 
authorized to transfer to the Government of the Republic of Panama 
any record of such Commission, department, agency, or court, or copy 
thereof, including any record acquired from the Canal Zone Govern-
ment or Panama Canal Company (including any vital statistics 
record), to any other department, agency, or court of the United 
States if such action is determined by the Commission, the head of the 
department or agency concerned, or the judge of the court concerned 
to be in the interest of the United States. Transfer of any record or 
copy thereof under this section to the Government of the Republic of 
Panama shall be made under the coordination of and with the 
approval of the United States Ambassador to the Republic of 
Panama. 
(d) The provisions of this section shall apply to the Smithsonian 
Institution. 
DISPOSITION OF PROPERTY OF THE UNITED STATES 
22 use 3783. 
SEC. 1503. No property of the United States located in the Republic 
of Panama may be disposed of except pursuant to law enacted by the 
Congress. 
TRANSFER OF PROPERTY TO PANAMA 
22 use 3784. 
SEC. 1504. (a)(1) On the date on which the Panama Canal Treaty of 
1977 enters into force, the Secretary of State may convey to the 
Republic of Panama the Panama Railroad and such property located 
in the area which, immediately before such date, comprised the Canal 
Zone and which is not within the land and water areas the use of 
which is made available to the United States pursuant to the Panama 
Canal Treaty of 1977 and related agreements. 
(2) Property transferred pursuant to paragraph (1) of this subsec-
tion may not include buildings and other facilities, except housing, 
located outside such areas, the use of which is retained by the United 
States pursuant to the Panama Canal Treaty of 1977 and related 
agreements. 
(b) With respect to the transfer of all other property (not described 
in subsection (a)(1) of this section) to be transferred in accordance 
with the terms of the Panama Canal Treaty of 1977 and related 
agreements, the Secretary of State may convey such property from 
time to time in accordance with the terms of such Treaty and related 
Report to 
agreements. At least 180 days before the transfer of any such 
eongress. 
property, the President must submit a written report to the 
Congress— 
(1) precisely identifying and describing the particular property 
to be transferred; 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 489 
(2) certifying the state of compliance by the Republic of 
Panama with such Treaty and related agreements; and 
(3) setting forth the reasons for the conveyance being made at 
the particular time. 
(c) The Panama Canal, and such other property referred to in 
paragraph 2(d) of Article XIII of the Panama Canal Treaty of 
1977 that has not been previously transferred in accordance with 
paragraphs 2(a), 2(b), and 2(c) of such Article, shall not be 
transferred to the Republic of Panama prior to December 31, 
1999. 
CHAPTER 6—TOLLS FOR USE OF THE PANAMA CANAL 
PRESCRIPTION OF MEASUREMENT RULES AND RATES OF TOLLS 
SEC. 1601. (a) The President is authorized, subject to the provisions 22 USC 3791. 
of this chapter, to prescribe and from time to time change— 
(1) the rules for the measurement of vessels for the Panama 
Canal; and 
(2) the tolls that shall be levied for the use of the Canal, 
(b) Such rules of measurement and tolls prevailing on the effective 
date of this Act shall continue in effect until changed as provided in 
this chapter. 
BASES OF TOLLS 
SEC. 1602. (a) Tolls on merchant vessels, army and navy transports, 22 USC 3792. 
colliers, tankers, hospital ships, supply ships, and yachts shall be 
based on net vessel tons of one hundred cubic feet each of actual 
earning capacity determined in accordance with the rules for the 
measurement of vessels for the Panama Canal, and tolls on other 
floating craft shall be based on displacement tonnage. The tolls on 
vessels in ballast without passengers or cargo may be less than the 
tolls for vessels with passengers or cargo. 
(b) Tolls shall be prescribed at rates calculated to produce revenues 
to cover as nearly as practicable all costs of maintaining and 
operating the Panama Canal, together with the facilities and appur-
tenances related thereto, including unrecovered costs incurred on or 
after the effective date of this Act, interest, depreciation, payments to 
the Republic of Panama pursuant to paragraph 5 of Article III and 
paragraph 4 (a) and (b) of Article XIII of the Panama Canal Treaty of 
1977, and capital for plant replacement, expansion, and improve-
ments. Tolls shall not be prescribed at rates calculated to produce 
revenues sufficient to cover payments to the Republic of Panama 
pursuant to paragraph 4(c) of Article XIII of the Panama Canal 
Treaty of 1977. 
(c) Vessels operated by the United States, including vessels of war United States 
and auxiliary vessels, and ocean-going training ships owned by the vessels. 
United States and operated by State nautical schools, shall pay tolls. 
(d) The levy of tolls is subject to the provisions of section 1 of Article 
III of the treaty between the United States of America and Great 
Britain signed November 18, 1901, of Article I of the treaty between 
the United States of America and the Republic of Colombia signed 
April 6,1914, and of Articles II, III, and VI of the Treaty Concerning 
Permanent Neutrality and Operation of the Panama Canal, between 
the United States of America and the Republic of Panama, signed 
September 7,1977. 
93 STAT. 490 
PUBLIC LAW 96-70—SEPT. 27, 1979 
CALCULATION OF INTEREST 
22 use 3793. 
SEC. 1603. (a) For purposes of sections 1311 and 1602 of this Act, 
interest shall be computed, at a rate determined by the Secretary of 
the Treasury, on the investment of the United States in the Panama 
Canal as shown in the accounts of the Panama Canal Company at the 
close of business on the day preceding the effective date of this Act, 
and as adjusted in accordance with subsections (b) and (c) of this 
section. Capital investment for interest purposes shall not include 
any interest during construction. 
(b) The investment of the United States described in subsection (a) 
of this section— 
(1) shall be increased by— 
(A) the amount of expenditures from appropriations to the 
Commission made on or after the effective date of this Act, 
and 
(B) the value of property transferred to the Commission by 
any other department or agency of the United States, as 
determined in accordance with subsection (c) of this section; 
and 
(2) shall be decreased by— 
(A) the amount of the funds covered into the Treasury 
pursuant to section 1302 of this Act. 
(B) the value of property transferred to the Republic of 
Panama pursuant to this or any other Act on or after the 
date on which the Panama Canal Treaty of 1977 enters into 
force, and 
(C) the value of property transferred by the Commission to 
any other department or agency of the United States, 
(c) The value of property transferred to the Commission by any 
other department or agency of the United States shall be determined 
by the Director of the Office of Management and Budget. In comput-
ing such value, such Director shall give due consideration to the cost 
and probable earning power of the transferred property, or the usable 
value to the Commission if clearly less than cost, and shall make 
adequate provisions for depreciation, obsolesence, and other deter-
minable decreases in value. Insofar as practicable, the value of such 
transferred property shall exclude any portion of such value properly 
allocable to national defense. 
PROCEDURES 
Publication in 
SEC. 1604. (a) The Commission shall publish in the Federal Register 
Federal 
notice of any proposed change in the rules of measurement or rates of 
^1^^3794 
^°^^^ referred to in section 1601(a) of this Act. The Commission shall 
Hearing. 
give interested parties an opportunity to participate in the proceed-
ings through submission of written data, views, or arguments, and 
participation in a public hearing to be held not less than 30 days after 
the date of publication of the notice. The notice shall include the 
substance of the proposed change and a statement of the time, place, 
and nature of the proceedings. At the time of publication of such 
notice, the Commission shall make available to the public an analysis 
showing the basis and justification for the proposed change, which, in 
the case of a change in rates of tolls, shall indicate the conformity of 
the existing and proposed rates of tolls with the requirements of 
section 1602 of this Act, and the Commission's adherence to the 
requirement for full consideration of the following factors set forth in 
Understanding (1) incorporated in the Resolution of Ratification of 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 491 
the Treaty Concerning the Permanent Neutrality and Operation of 
the Panama Canal (adopted by the United States Senate on March 16, 
1978): 
(1) the costs of operating and maintaining the Panama Canal; 
(2) the competitive position of the use of the Canal in relation 
to other means of transportation; 
(3) the interests of the United States and the Republic of 
Panama in maintaining their domestic fleets; 
(4) the impact of such a change in rates of tolls on the various 
geographical areas of each of the two countries; and 
(5) the interests of both countries in maximizing their interna-
tional commerce. 
(b) After consideration of the relevant matter presented, the 
Commission may revise the proposed rules of measurement or rates 
of tolls, as the case may be, except that, in the case of rates of tolls, if 
such revision proposes rates greater than those originally proposed, a 
new analysis of the proposed rates shall be made available to the 
public, and a new notice of the revised proposal shall be published in 
the Federal Register apprising interested persons of the opportunity 
to participate further in the proceedings through submission of 
written data, views, or arguments, and participation in a public 
hearing to be held not less than 30 days after the date of publication 
of the new notice. The procedure set forth in this subsection shall be 
followed for any subsequent revision of the proposed rates of tolls by 
the Commission which proposes rates higher than those in the 
preceding proposal. 
(c) After the proceedings have been conducted pursuant to subsec-
tions (a) and (b) of this section, the Commission shall publish in the 
Federal Register a notice of the changes in the rules of measurement 
or rates of tolls, as the case may be, to be recommended to the 
President. 
(d) Upon publication of the notice pursuant to subsection (c) of this 
section, the Commission shall forward a complete record of the 
proceedings, with the recommendation of the Commission, to the 
President for his consideration. The President may approve, disap-
prove, or modify any or all of the changes in the rules of measure-
ment or rates of tolls recommended by the Commission. 
(e) Rules of measurement or rates of tolls prescribed by the 
President pursuant to this chapter shall take effect on a date 
prescribed by the President which is not less than 30 days after the 
President publishes such rules or rates in the Federal Register. 
(f) Action to change the rules of measurement for the Panama 
Canal or the rates of tolls for the use of the Canal pursuant to this 
chapter shall be subject to judicial review in accordance with chapter 
7 of title 5, United States Code. 
Publication in 
Federal 
Register. 
Publication in 
Federal 
Register. 
Recommendations 
to President. 
Effective date. 
5 u s e 701 et seq. 
INTERIM TOLL ADJUSTMENT 
SEC. 1605. (a) After the effective date of this section, the Panama 22 use 3795. 
Canal Company or the Commission may, without regard to the 
procedures set forth in section 1604 of this Act for making changes in 
tolls by the Commission and the President, change the rates of tolls 
calculated to cover the cost of maintaining and operating the Panama 
Canal during the fiscal year beginning on October 1,1979. Such rates 
shall be calculated in accordance with the provisions of section 
1602(b) of this Act. Any such change in rates of tolls shall be subject to 
the approval of the President whose action in the matter shall be 
final. Any change in rates of tolls approved by the President shall 
become effective on a date prescribed by the President. 
93 STAT. 492 
PUBLIC LAW 96-70—SEPT. 27, 1979 
Effective date. 
(b) This section shall take effect on the date of the enactment of this 
22 u s e 3795 
Act. 
"°**- 
CHAPTER 7—GENERAL REGULATIONS 
AUTHORITY OF PRESIDENT 
22 use 3801. 
SEC. 1701. The President may prescribe, and from time to time 
amend, regulations applicable within the areas and installations 
made available to the United States for the operation and protection 
of the Panama Canal pursuant to the Panama Canal Treaty of 1977 
and related agreements concerning— 
(1) the use of aircraft; 
(2) the possession and use of alcoholic beverages; 
(3) exclusion and removal of persons; and 
(4) health and sanitation. 
AUTHORITY OF COMMISSION 
22 use 3802. 
SEC. 1702. The Commission may prescribe, and from time to time 
amend, regulations applicable within the areas and installations 
made available to the United States for the operation and protection 
of the Panama Canal pursuant to the Panama Canal Treaty of 1977 
and related agreements concerning— 
(1) the keeping and impounding of domestic animals; 
(2) fire prevention; 
(3) the sale or use of fireworks; 
(4) the use of roads and highways; 
(5) photographing of areas, objects, installations, or structures; 
(6) swimming in the Panama Canal and adjacent waters; and 
(7) the protection of wildlife, hunting, and fishing. 
CHAPTER 8—SHIPPING AND NAVIGATION 
Subchapter I—Operation of Canal 
OPERATING REGULATIONS 
22 use 3811. 
SEC. 1801. The President may prescribe, and from time to time 
amend, regulations governing— 
(1) the operation of the Panama Canal; 
(2) the navigation of the harbors and other waters of the 
Panama Canal and areas adjacent thereto, including the ports of 
Balboa and Cristobal; 
(3) the passage and control of vessels through the Panama 
Canal or any part thereof, including the locks and approaches 
thereto; 
(4) pilotage in the Panama Canal or the approaches thereto 
through the adjacent waters; and 
(5) the licensing of officers or other operators of vessels navi-
gating the waters of the Panama Canal and areas adjacent 
thereto, including the ports of Balboa and Cristobal. 
Subchapter II—Inspection of Vessels 
VESSELS SUBJECT TO INSPECTION 
22 use 3821. 
SEC. 1811. With the exception of private vessels merely transiting 
the Panama Canal, and of public vessels of all nations, vessels 
navigating the waters of the Panama Canal shall be subject to an 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 493 
annual inspection of hulls, boilers, machinery, equipment, and pas-
senger accommodations. 
FOREIGN VESSELS 
SEC. 1812. With respect to a foreign vessel of a country which has 22 use 3822. 
inspection laws approximating those of the United States, any such 
vessel having an unexpired certificate of inspection duly issued by the 
authorities of such country shall not be subject to an inspection other 
than that necessary to determine whether the vessel, its boilers, and 
its lifesaving equipment are as stated in the certificate of inspection. 
A certificate of inspection may not be accepted as evidence of lawful 
inspection under this section unless similar privileges are granted to 
vessels of the United States under the laws of the country to which 
the vessel belongs. 
REGULATIONS GOVERNING INSPECTION 
SEC. 1818. The Commission shall prescribe, and from time to time 22 use 3823. 
may amend, regulations concerning the inspection of vessels con-
forming as nearly as practicable to the laws and regulations govern-
ing marine inspection by the United States CoEist Guard. 
TITLE II—TREATY TRANSITION PERIOD 
CHAPTER 1—LAWS CONTINUED IN FORCE 
LAWS, REGULATIONS, AND ADMINISTRATIVE AUTHORITY 
SEC. 2101. To the extent not inconsistent with the Panama Canal 22 use 3831. 
Treaty of 1977 and related agreements and the provisions of this Act, 
the Canal Zone Code and other laws, regulations, and administrative 
authority of the United States applicable in the Canal Zone immedi-
ately before the date on which the Panama Canal Treaty of 1977 
enters into force shall continue in force for the purpose of the exercise 
by the United States of law enforcement and judicial jurisdiction 
during the transition period provided for in Article XI of the Panama 
Canal Treaty of 1977 (hereinafter in this Act referred to as the 
"transition period"). 
CHAPTER 2—COURTS 
JURISDICTION 
SEC. 2201. (a) During the transition period, the jurisdiction of the 22 use 3841. 
United States District Court for the District of the Canal Zone and 
the magistrates' courts under title 3 of the Canal Zone Code shall be 
continued, subject to the limitations set forth in Article XI of the 
Panama Canal Treaty of 1977. 
(b) For purposes of the exercise of the jurisdiction provided in 
Article XI of the Panama Canal Treaty of 1977, the United States 
District Court and magistrates' courts referred to in subsection (a) of 
this section shall construe the terms "United States citizen em-
ployees", "members of the United States Forces", "civilian compo-
nent", and "dependents" as such terms are defined in the Panama 
Canal Treaty of 1977 and related agreements, and shall construe the 
term "areas and installations made available for the use of the 
United States" to mean (1) the Panama Canal operating areas and 
housing areas described in Annex A to the Agreement in Implemen-
tation of Article III of the Panama Canal Treaty, (2) the Ports of 
Balboa and Cristobal described in Annex B to that Agreement, and (3) 
93 STAT. 494 
PUBLIC LAW 96-70—SEPT. 27, 1979 
22 u s e 3842. 
22 u s e 3843. 
76A Stat. 52-54. 
Effective date. 
22 u s e 8843 
note. 
Repeal. 
76A Stat. 52. 
76A Stat. 53. 
76A Stat. 52. 
28 u s e 291 et 
seq. 
22 u s e 3844. 
76A Stat. 54. 
the defense sites and Military Areas of Coordination described in 
Annex A to the Agreement in Implementation of Article IV of the 
Panama Canal Treaty. 
DIVISION AND TERMS OF DISTRICT COURT 
SEC. 2202. The United States District Court for the District of the 
Canal Zone may conduct its affairs at such places within the areas 
made available for the use of the United States pursuant to the 
Panama Canal Treaty of 1977 and related agreements, and at such 
times, as the district judge may designate by rule or order. 
TERMS OF CERTAIN OFFICES 
SEC. 2203. (a) Notwithstanding the provisions of sections 5, 41, 45, 
and 82 of title 3 of the Canal Zone Code, the term of office of a district 
judge, magistrate. United States attorney, or United States marshal 
shall extend for a period of 30 months beginning on the date on which 
the Panama Canal Treaty of 1977 enters into force, and any such 
term shall be subject to such extension of time as may be provided for 
the disposition of pending cases by agreement between the United 
States and the Republic of Panama, pursuant to the last sentence of 
paragraph 7 of Article XI of the Panama Canal Treaty of 1977. 
G
^
) The provisions of this section shall take effect on the date of the 
enactment of this Act. 
RESIDENCE REQUIREMENTS 
SEC. 2204. Section 5(d), 7(d), 41(d), and 45(d) of title 3 of the Canal 
Zone Code, the second sentence of section 42 of such title, and the 
second sentence of section 82(c) of such title, which provisions require 
that certain court officials reside in the Canal Zone, are repealed. 
SPECIAL DISTRICT JUDGE 
SEC. 2205. (a) Section 6 of title 3 of the Canal Zone Code is amended 
to read as follows: 
"§ 6. Special district judge 
"The chief 
judge of the judicial circuit of the United States in which 
the district court lies may designate and assign a special district 
judge to act when necessary— 
"(1) during the absence of the district judge; 
"(2) during the disability or disqualification of the district 
judge because of sickness or otherwise to discharge his duties; or 
"(3) when there is a vacancy in the office of district judge.". 
(b) Each designation and assignment by the chief judge under 
section 6 of title 3 of the Canal Zone Code, as amended by subsection 
(a) of this section, shall be made in accordance with chapter 13 of title 
28, United States Code, which shall be deemed to apply for such 
purposes. 
MAGISTRATES' COURTS 
SEC. 2206. (a) The two magistrates' courts established pursuant to 
section 81 of title 3 of the Canal Zone Code and existing immediately 
before the date on which the Panama Canal Treaty of 1977 enters 
into force shall continue in operation during the transition period 
unless terminated during such period under subsection (b) of this 
section. 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 495 
(b) During the transition period, the President may terminate one 
magistrate's court, together with the positions of magistrate and 
constable corresponding thereto, if the President determines that the 
workload is insufficient to warrant continuance of that court. If one 
of the magistrates' courts is so terminated, the remaining magis-
trate's court shall exercise the jurisdiction that otherwise would have 
been exercised by the terminated court and shall take custody of and 
administer all records of the terminated court. 
CHAPTER 3—ATTORNEYS 
OATH OF ATTORNEYS 
SEC. 2301. (a) Section 543 of title 3 of the Canal Zone Code is '76A Stat. 72. 
amended to read as follows: 
"§ 543. Oath of attorneys admitted to bar 
"Before receiving a certificate the applicant shall take and sub-
scribe in court an appropriate oath prescribed by the district judge.". 
(b) The table of sections for chapter 17 of title 3 of the Canal Zone 
Code is amended by amending the item relating to section 543 to read 
as follows: 
"543. Oath of attorneys admitted to bar.". 
CHAPTER 4—TRANSITION AUTHORITY 
- --——rz 
TRANSITION AUTHORITY OF PRESIDENT 
SEC. 2401. Except as expressly provided to the contrary in this or 22 USC 3851. 
any other Act, or in the Panama Canal Treaty of 1977 and related 
agreements, any authority necessary for the exercise during the 
transition period of the rights and responsibilities of the United 
States specified in Article XI of the Panama Canal Treaty of 1977 
shall be vested in the President. 
PRISONS; PAROLE; PARDONS 
SEC. 2402. (a) Subsection (c) of section 6503 of title 6 of the Canal 
Zone Code is amended to read as follows: 
^^^ ^^^- ^^^• 
"(c) Pursuant to the provisions of section 5003 of title 18, United 
States Code, the Governor may contract with the Attorney General of 
the United States for the transfer to the custody of the Attorney 
General of prisoners sentenced by the United States District Court 
for the District of the Canal Zone to terms of imprisonment in excess 
of one year.". 
(b) After entry into force of the Panama Canal Treaty of 1977— 22 USC 3852. 
(1) all prisoners imprisoned in United States prisons pursuant 
to contracts entered into pursuant io subsection (c) of section 
6503 of title 6 of the Canal Zone Code, as amended by subsection 
(a) of this section, shall be committed to the custody of the 
Attorney General as if committed in accordance with part III of 
title 18, United States Code; 
(2) all persons convicted of offenses in the United States 
District Court for the District of the Canal Zone, and sentenced to 
terms of imprisonment of one year or less, shall be committed to 
the custody of the Commission; and 
(3) the Commission shall prescribe, and from time to time may 
amend, regulations providing for the management of prisoners 
in the jails located in the areas and installations made available 
93 STAT. 496 
PUBLIC LAW 96-70—SEPT. 27, 1979 
Repeal. 
76A Stat. 555. 
Effective date. 
22 use 3852 
note. 
Repeal. 
76A Stat. 557. 
for the use of the United States pursuant to the Panama Canal 
Treaty of 1977 and related agreements, including provisions for 
treatment, care, assignment for work, discipline, and welfare. 
(c) After the entry into force of the Panama Canal Treaty of 1977, 
all persons convicted of offenses in the United States District Court 
for the District of the Canal Zone, and sentenced to terms of 
imprisonment in excess of one year, shall be committed to the custody 
of the Attorney General pursuant to parts III and IV of title 18, 
United States Code. 
(d)(1) Sections 6501 through 6505 of title 6 of the Canal Zone Code 
are repealed. 
(2) The table of sections for chapter 351 of title 6 of the Canal Zone 
Code is amended by repealing the items relating to sections 6501 
through 6505. 
(e) Subsections (c) and (d) of this section shall take effect 90 days 
after entry into force of the prisoner transfer agreement referred to 
in paragraph 11 of Article IX of the Panama Canal Treaty of 1977 but 
in no event later than 90 days prior to the end of the transition 
period. 
(0(1) Chapter 355 of title 6 of the Canal Zone Code is repealed. 
(2) The table of chapters for part 3 of title 6 of the Canal Zone Code 
is amended by repealing the item relating to chapter 355. 
TITLE III—GENERAL PROVISIONS 
Appropriation 
authorization. 
22 use 3861. 
CHAPTER 1—CEMETERIES 
DISINTERMENT, TRANSPORTATION, AND REINTERMENT OF REMAINS 
SEC. 3101. (a) There are authorized to be appropriated for the fiscal 
year beginning October 1, 1979, and subsequent fiscal years, such 
sums as may be necessary to carry out the purposes and provisions of 
Reservation (3) to the Resolution of Ratification of the Treaty 
Concerning the Permanent Neutrality and Operation of the Panama 
Canal, adopted by the United States Senate on March 16, 1978, such 
sums to be made available to those agencies that are directed and 
empowered by the President to carry out such purposes and 
provisions. 
(b) With regard to remains that are to be reinterred in the United 
States, the United States shall not bear the cost of funeral home 
services, vaults, plots, or crypts unless otherwise provided for by law. 
CHAPTER 2—IMMIGRATION 
Ante, p. 455. 
SPECIAL IMMIGRANTS 
SEC. 3201. (a) Section 101(a)(27) of the Immigration and Nationality 
Act (8 U.S.C. 1101(a)(27)), relating to the definition of special immi-
grants, is amended— 
(1) by striking out "or" at the end of subparagraph (C); 
(2) by striking out the period at the end of subparagraph (D) 
and inserting in lieu thereof a semicolon; and 
(3) by adding after subparagraph (D) the following new 
subparagraphs: 
"(E) an immigrant, and his accompanying spouse and children, 
who is or has been an employee of the Panama Canal Company 
or Canal Zone Government before the date on which the Panama 
Canal Treaty of 1977 (as described in section 3(a)(1) of the 
Panama Canal Act of 1979) enters into force, who was resident in 
PUBLIC LAW 96-70—SEPT. 27, 1979 
93 STAT. 497 
the Canal Zone on the effective date of the exchange of instru-
ments of ratification of such Treaty, and who has performed 
faithful service as such an employee for one year or more; 
"(F) an immigrant, and his accompanying spouse and children, 
who is a Panamanian national and (i) who, before the date on 
which such Panama Canal Treaty of 1977 enters into force, has 
been honorably retired from United States Government employ-
ment in the Canal Zone with a total of 15 years or more of 
faithful service, or (ii) who, on the date on which such Treaty 
enters into force, has been employed by the United States 
Government in the Canal Zone with a total of 15 years or more of 
faithful service and who subsequently is honorably retired from 
such employment; or 
"(G) an immigrant, and his accompanying spouse and children, 
who was an employee of the Panama Canal Company or Canal 
Zone Government on the effective date of the exchange of 
instruments of ratification of such Panama Canal Treaty of 1977, 
who has performed faithful service for five years or more as such 
an employee, and whose personal safety, or the personal safety of 
whose spouse or children, as a direct result of such Treaty, is 
reasonably placed in danger because of the special nature of any 
of that employment.". 
(b) Section 212(d) of such Act (8 U.S.C. 1182(d)), relating to waivers 
of conditions of inadmissibility to the United States, is amended by 
adding after paragraph (8) the following new paragraphs: 
"(9) The provisions of paragraph (7) of subsection (a) shall not be 
applicable to any alien who is seeking to enter the United States as a 
special immigrant under subparagraph (E), (F), or (G) of section 
101(a)(27). 
8 use 1101. 
"(10) The provisions of paragraph (15) of subsection (a) shall not be 
applicable to any alien who is seeking to enter the United States as a 
special immigrant under subparagraph (E), (F), or (G) of section 
101(a)(27) and who applies for admission as such a special immigrant 
not later than March 31,1982.". 
(c) Notwithstanding any other provision of law, not more than 8 use iioi note. 
15,000 individuals may be admitted to the United States as special 
immigrants under subparagraphs (E), (F), and (G) of section 101(a)(27) 
of the Immigration and Nationality Act, as added by subsection (a) of 
this section, of which not more than 5,000 may be admitted in any 
fiscal year. 
(d)(1) The amendments made by this section shall take effect on the Effective date, 
date of the enactment of this Act. 
8 use noi note. 
(2) Paragraph (9) of section 212(d) of the Immigration and National- %^^ ^^^^ ''°^-
ity Act, as added by subsection O
t
)
) of this section, shall cease to be 
effective at the end of the transition period. 
Supra. 
CHAPTER 3—REPORTS; AMENDMENTS; REPEALS AND REDESIGNATION; 
EFFECTIVE DATE 
REPORT 
SEC. 3301. Until the termination of the Panama Canal Treaty of 22 use 3871. 
1977, the President shall report annually on the status of the exercise 
of the rights and responsibilities of the United States under that 
Treaty. Such report shall include a discussion of the following: 
(1) The actions taken by the Government of the Republic of 
Panama with respect to the living conditions of persons who 
resided in the Canal Zone before the effective date of this Act and 
who continue to reside in those areas made available to the 
.'59-194 O — 81
93 STAT. 498 
PUBLIC LAW 96-70—SEPT. 27, 1979 
United States under the Agreement in Implementation of Arti-
cle III of the Panama Canal Treaty. 
(2) The terms, conditions, and charges for land-use licenses 
within the canal operating areas specified in the Agreement in 
Implementation of Article III of the Panama Canal Treaty. 
(3) The condition of former employees (and their dependents) of 
the Panama Canal Company and the Canal Zone Government 
who reside in the Republic of Panama on or after the effective 
date of this Act. 
AMENDMENTS 
SEC. 3302. (a) Section 1 of title II of the Act of June 15, 1917 (50 
U.S.C. 191), is amended— 
(1) by striking out the second paragraph; and 
(2) in subsection (b) of the last paragraph, by striking out", the 
Canal Zone,". 
03) Section 1 of title XIII of the Act of June 15,1917 (50 U.S.C. 195), 
is amended by striking out "the Canal Zone and". 
(c) The first section of the Act of August 9,1954 (50 U.S.C. 196), is 
amended by striking out", including the Canal Zone,". 
(d) The Department of State, Justice, and Commerce, the Judiciary, 
and Related Agencies Appropriation Act, 1974 (87 Stat. 636 et seq.) is 
amended by striking out the heading "PAYMENT TO THE REPUBLIC OF 
PANAMA" and all that follows that relates to the heading. 
(e) Title 5, United States Code, is amended— 
(1) in sections 305(a)(7), 5102(a)(l)(vii), 5342(a)(1)(G), 5348(b), and 
5541(2)(xii), by striking out "Panama Canal Company" and 
inserting in lieu thereof "Panama Canal Commission ; 
(2) in sections 5504(a)(A) and 6301(2)(iv), by striking out "Canal 
Zone Government or the Panama Canal Company" and inserting 
in lieu thereof "Panama Canal Commission"; 
(3) in section 8335(e), by striking out "Panama Canal Company 
or the Canal Zone Government and inserting in lieu thereof 
"Panama Canal Commission"; 
(4) in section 5373(1), by striking out "section 121 of title 2, 
Canal Zone Code (76A Stat. 15)" and inserting in lieu thereof 
"section 1202 of the Panama Canal Act of 1979"; 
(5) in section 6323(c)(2)(B), by striking out "the Canal Zone,"; 
(6) in section 5102(c), by amending paragraph (12) to read as 
follows: 
"(12) any Executive agency to the extent of any election under 
section 1212(b)(2) (relating to the Panama Canal Employment 
System) of the Panama Canal Act of 1979;"; 
(7) in section 5583(b), by— 
(A) adding "and" at the end of paragraph (1); 
(B) striking out paragraph (2); and 
(C) redesignating paragraph (3) as paragraph (2); 
(8) in section 5533(d)(7), by— 
(A) striking out the semicolon at the end of subparagraph 
(E) and inserting in lieu thereof "; or"; 
(B) striking out "; or" at the end of subparagraph (F) and 
inserting in lieu thereof a period; and 
(C) striking out subparagraph (G); 
(9) in section 8146— 
(A) by striking out "Canal Zone" in the catchline and 
inserting in lieu thereof "Panama Canal Commission"; 
(B) in subsection (a)(1), by striking out "Canal Zone Gov-
ernment and of the Panama Canal Company are concerned 
PUBLIC LAW 96-70-SEPT. 27, 1979 
93 STAT. 499 
to the Governor of the Canal Zone" and inserting in lieu 
thereof "Panama Canal Commission are concerned to the 
Commission"; 
(C) in the first sentence of subsection (b), by striking out 
"Canal Zone Government" and inserting "Panama Canal 
Commission" in lieu thereof; 
(D) in the first sentence of subsection (b), by striking out 
"or from funds of the Panama Canal Company"; 
(E) in the second sentence of subsection (b), by striking out 
"Governor of the Canal Zone" and inserting "Panama Canal 
Commission" in lieu thereof and by striking out "Canal Zone 
Government" and inserting "Panama Canal Commission" in 
lieu thereof; 
(F) by amending subsection (c) to read as follows: 
"(c) The President may authorize the Panama Canal Commission to 5 U
S
C 8146. 
waive, at its discretion, the making of the claim required by section 
8121 of this title in the case of compensation to an employee of the 
Panama Canal Commission for temporary disability, either total or 
partial."; and 
(G) in subsection (e), by striking out "Canal Zone Govern-
ment and of the Panama Canal Company" and inserting in 
lieu thereof "Panama Canal Commission"; 
(10) in section 5343(a)(5), by striking out "Canal Zone" and 
inserting in lieu thereof "areas and installations in the Republic 
of Panama made available to the United States pursuant to the 
Panama Canal Treaty of 1977 and related agreements (as 
described in section 3(a) of the Panama Canal Act of 1979)."; ^«^«' P- 54-
(11) in section 5316(87), by striking out "Governor of the Canal 
Zone" and inserting in lieu thereof "Administrator of the 
Panama Canal Commission"; and 
(12) in the table of sections for chapter 81, by striking out 
"Canal Zone" in the item relating to section 8146 and inserting in 
lieu thereof "Panama Canal Commission". 
REPEALS AND REDESIGNATION 
SEC. 3303. (a) The following provisions of law are repealed: 
(1) title 2 of the Canal Zone Code; 
7
6
A Stat. 6. 
(2) sections 2 and 3 of title 3 of the Canal Zone Code, and the '
^
6
A Stat. 5i. 
items relating to such sections in the table of sections for chapter 
1 of title 3 of the Canal Zone Code; 
(3) subchapter III of chapter 237 of title 6 of the Canal Zone 
Code and the items relating to such subchapter in the table of TBA Stat. 414. 
sections for chapter 237 of such title; 
(4) subsection (d) of section 38 of the Arms Export Control Act 
(22 U.S.C. 2778(d)); and 
(5) section 4 of the Act of November 15, 1941 (50 U.S.C. 191b). 
(b) Those provisions of the Canal Zone Code not repealed by this Act 22 use 3602 
are redesignated as the "Panama Canal Code". Any reference to the note. 
Canal Zone Code in those laws and regulations referred to in section 
3(b) of this Act shall, subject to the provisions of such section, be 
deemed to refer to the Panama Canal Code. 
93 STAT. 500 
PUBLIC LAW 96-70—SEPT. 27, 1979 
EFFECTIVE DATE 
22 u s e 3601 
note. 
SEC. 3304. Except as provided in sections 1231, 1232, 1241, 1242, 
1261, 1605, 2203, 2402, 3101, and 3201 of this Act, the preceding 
provisions of this Act shall take effect on the date on which the 
Panama Canal Treaty of 1977 enters into force. 
Approved September 27, 1979. 
LEGISLATIVE HISTORY: 
HOUSE REPORTS: No. 96-98, pt. I and No. 96-98, pt. 2 (Comm. on Merchant Marine 
and Fisheries) and Nos. 96-438 and 96-473 (Comm. of Conference). 
S E N A T E REPORTS: No. 96-255 (Comm. on Armed Services) and Nos. 96-320 and 
96-330 (Comm. of Conference). 
CONGRESSIONAL RECORD, Vol. 125 (1979): 
May 21, June 20, 21, considered and passed House. 
July 26, considered and passed Senate, amended. 
Sept. 19, 20, Senate considered and agreed to conference report. 
Sept. 20, House considered and rejected conference report. 
Sept. 25, Senate agreed to second conference report. 
Sept. 26, House agreed to second conference report. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 15, No. 39: 
Sept. 27, Presidential statement.