[108th Congress Public Law 77]
[From the U.S. Government Printing Office]
[DOCID: f:publ077.108]
[[Page 117 STAT. 909]]
Public Law 108-77
108th Congress
An Act
To implement the United States-Chile Free Trade Agreement. <<NOTE: Sept.
3, 2003 - [H.R. 2738]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, <<NOTE: United States-
Chile Free Trade Agreement Implementation Act. 19 USC 3805 note.>>
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``United States-Chile
Free Trade Agreement Implementation Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Purposes.
Sec. 3. Definitions.
TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT
Sec. 101. Approval and entry into force of the Agreement.
Sec. 102. Relationship of the agreement to United States and State law.
Sec. 103. Consultation and layover provisions for, and effective date
of, proclaimed actions.
Sec. 104. Implementing actions in anticipation of entry into force and
initial regulations.
Sec. 105. Administration of dispute settlement proceedings.
Sec. 106. Arbitration of claims.
Sec. 107. Effective dates; effect of termination.
TITLE II--CUSTOMS PROVISIONS
Sec. 201. Tariff modifications.
Sec. 202. Rules of origin.
Sec. 203. Drawback.
Sec. 204. Customs user fees.
Sec. 205. Disclosure of incorrect information; denial of preferential
tariff treatment; false certificates of origin.
Sec. 206. Reliquidation of entries.
Sec. 207. Recordkeeping requirements.
Sec. 208. Enforcement of textile and apparel rules of origin.
Sec. 209. Conforming amendments.
Sec. 210. Regulations.
TITLE III--RELIEF FROM IMPORTS
Sec. 301. Definitions.
Subtitle A--Relief From Imports Benefiting From the Agreement
Sec. 311. Commencing of action for relief.
Sec. 312. Commission action on petition.
Sec. 313. Provision of relief.
Sec. 314. Termination of relief authority.
Sec. 315. Compensation authority.
Sec. 316. Confidential business information.
Subtitle B--Textile and Apparel Safeguard Measures
Sec. 321. Commencement of action for relief.
[[Page 117 STAT. 910]]
Sec. 322. Determination and provision of relief.
Sec. 323. Period of relief.
Sec. 324. Articles exempt from relief.
Sec. 325. Rate after termination of import relief.
Sec. 326. Termination of relief authority.
Sec. 327. Compensation authority.
Sec. 328. Business confidential information.
TITLE IV--TEMPORARY ENTRY OF BUSINESS PERSONS
Sec. 401. Nonimmigrant traders and investors.
Sec. 402. Nonimmigrant professionals; labor attestation.
Sec. 403. Labor disputes.
Sec. 404. Conforming amendments.
SEC. 2. PURPOSES. <<NOTE: 19 USC 3805 note.>>
The purposes of this Act are--
(1) to approve and implement the Free Trade Agreement
between the United States and the Republic of Chile entered into
under the authority of section 2103(b) of the Bipartisan Trade
Promotion Authority Act of 2002;
(2) to strengthen and develop economic relations between the
United States and Chile for their mutual benefit;
(3) to establish free trade between the 2 nations through
the reduction and elimination of barriers to trade in goods and
services and to investment; and
(4) to lay the foundation for further cooperation to expand
and enhance the benefits of such Agreement.
SEC. 3. DEFINITIONS. <<NOTE: 19 USC 3805 note.>>
In this Act:
(1) Agreement.--The term ``Agreement'' means the United
States-Chile Free Trade Agreement approved by the Congress under
section 101(a)(1).
(2) HTS.--The term ``HTS'' means the Harmonized Tariff
Schedule of the United States.
(3) Textile or apparel good.--The term ``textile or apparel
good'' means a good listed in the Annex to the Agreement on
Textiles and Clothing referred to in section 101(d)(4) of the
Uruguay Round Agreements Act (19 U.S.C. 3511(d)(4)).
TITLE I--APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT
SEC. 101. <<NOTE: 19 USC 3805 note.>> APPROVAL AND ENTRY INTO FORCE OF
THE AGREEMENT.
(a) Approval of Agreement and Statement of Administrative Action.--
Pursuant to section 2105 of the Bipartisan Trade Promotion Authority Act
of 2002 (19 U.S.C. 3805) and section 151 of the Trade Act of 1974 (19
U.S.C. 2191), the Congress approves--
(1) the United States-Chile Free Trade Agreement entered
into on June 6, 2003, with the Government of Chile and submitted
to the Congress on July 15, 2003; and
(2) the statement of administrative action proposed to
implement the Agreement that was submitted to the Congress on
July 15, 2003.
(b) Conditions for Entry Into Force of the Agreement.--At such time
as the President determines that Chile has taken
[[Page 117 STAT. 911]]
measures necessary to bring it into compliance with the provisions of
the Agreement that take effect on the date on which the Agreement enters
into force, the President is authorized to exchange notes with the
Government of Chile providing for the entry into force, on or after
January 1, 2004, of the Agreement for the United States.
SEC. 102. <<NOTE: 19 USC 3805 note.>> RELATIONSHIP OF THE AGREEMENT TO
UNITED STATES AND STATE LAW.
(a) Relationship to United States Law.--
(1) United states law to prevail in conflict.--No provision
of the Agreement, nor the application of any such provision to
any person or circumstance, which is inconsistent with any law
of the United States shall have effect.
(2) Construction.--Nothing in this Act shall be construed--
(A) to amend or modify any law of the United States,
or
(B) to limit any authority conferred under any law
of the United States,
unless specifically provided for in this Act.
(b) Relationship of Agreement to State Law.--
(1) Legal challenge.--No State law, or the application
thereof, may be declared invalid as to any person or
circumstance on the ground that the provision or application is
inconsistent with the Agreement, except in an action brought by
the United States for the purpose of declaring such law or
application invalid.
(2) Definition of state law.--For purposes of this
subsection, the term ``State law'' includes--
(A) any law of a political subdivision of a State;
and
(B) any State law regulating or taxing the business
of insurance.
(c) Effect of Agreement With Respect to Private Remedies.--No person
other than the United States--
(1) shall have any cause of action or defense under the
Agreement or by virtue of Congressional approval thereof; or
(2) may challenge, in any action brought under any provision
of law, any action or inaction by any department, agency, or
other instrumentality of the United States, any State, or any
political subdivision of a State on the ground that such action
or inaction is inconsistent with the Agreement.
SEC. 103. <<NOTE: President. 19 USC 3805 note.>> CONSULTATION AND
LAYOVER PROVISIONS FOR, AND EFFECTIVE DATE OF, PROCLAIMED
ACTIONS.
(a) Consultation and Layover Requirements.--If a provision of this
Act provides that the implementation of an action by the President by
proclamation is subject to the consultation and layover requirements of
this section, such action may be proclaimed only if--
(1) the President has obtained advice regarding the proposed
action from--
(A) the appropriate advisory committees established
under section 135 of the Trade Act of 1974 (19 U.S.C.
2155); and
(B) the United States International Trade
Commission;
[[Page 117 STAT. 912]]
(2) the <<NOTE: Reports.>> President has submitted a report
to the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the Senate that
sets forth--
(A) the action proposed to be proclaimed and the
reasons therefor; and
(B) the advice obtained under paragraph (1);
(3) a period of 60 calendar days, beginning on the first day
on which the requirements set forth in paragraphs (1) and (2)
have been met has expired; and
(4) the President has consulted with such Committees
regarding the proposed action during the period referred to in
paragraph (3).
(b) Effective <<NOTE: Federal Register, publication.>> Date of
Certain Proclaimed Actions.--Any action proclaimed by the President
under the authority of this Act that is not subject to the consultation
and layover provisions under subsection (a) may not take effect before
the 15th day after the date on which the text of the proclamation is
published in the Federal Register.
SEC. 104. <<NOTE: 19 USC 3805 note.>> IMPLEMENTING ACTIONS IN
ANTICIPATION OF ENTRY INTO FORCE AND INITIAL REGULATIONS.
(a) Implementing Actions.--
(1) Proclamation authority.--After the date of enactment of
this Act--
(A) the President may proclaim such actions, and
(B) other appropriate officers of the United States
Government may issue such regulations,
as may be necessary to ensure that any provision of this Act, or
amendment made by this Act, that takes effect on the date the
Agreement enters into force is appropriately implemented on such
date, but no such proclamation or regulation may have an
effective date earlier than the date of entry into force.
(2) Waiver of 15-day restriction.--The 15-day restriction
contained in section 103(b) on the taking effect of proclaimed
actions is waived to the extent that the application of such
restriction would prevent the taking effect on the date the
Agreement enters into force of any action proclaimed under this
section.
(b) Initial <<NOTE: Deadlines.>> Regulations.--Initial regulations
necessary or appropriate to carry out the actions required by or
authorized under this Act or proposed in the statement of administrative
action referred to in section 101(a)(2) to implement the Agreement
shall, to the maximum extent feasible, be issued within 1 year after the
date of entry into force of the Agreement. In the case of any
implementing action that takes effect on a date after the date of entry
into force of the Agreement, initial regulations to carry out that
action shall, to the maximum extent feasible, be issued within 1 year
after such effective date.
SEC. 105. <<NOTE: 19 USC 3805 note.>> ADMINISTRATION OF DISPUTE
SETTLEMENT PROCEEDINGS.
(a) Establishment or Designation of Office.--The President is
authorized to establish or designate within the Department of Commerce
an office that shall be responsible for providing administrative
assistance to panels established under chapter 22 of the Agreement. The
office may not be considered to be an agency for purposes of section 552
of title 5, United States Code.
[[Page 117 STAT. 913]]
(b) Authorization of Appropriations.--There are authorized to be
appropriated for each fiscal year after fiscal year 2003 to the
Department of Commerce such sums as may be necessary for the
establishment and operations of the office under subsection (a) and for
the payment of the United States share of the expenses of panels
established under chapter 22 of the Agreement.
SEC. 106. <<NOTE: 19 USC 3805 note.>> ARBITRATION OF CLAIMS.
(a) Submission of Certain Claims.--The United States is authorized
to resolve any claim against the United States covered by article
10.15(1)(a)(i)(C) or 10.15(1)(b)(i)(C) of the Agreement, pursuant to the
Investor-State Dispute Settlement procedures set forth in section B of
chapter 10 of the Agreement.
(b) Contract Clauses.--All contracts executed by any agency of the
United States on or after the date of entry into force of the Agreement
shall contain a clause specifying the law that will apply to resolve any
breach of contract claim.
SEC. 107. <<NOTE: 19 USC 3805 note.>> EFFECTIVE DATES; EFFECT OF
TERMINATION.
(a) Effective Dates.--Except as provided in subsection (b), the
provisions of this Act and the amendments made by this Act take effect
on the date the Agreement enters into force.
(b) Exceptions.--Sections 1 through 3 and this title take effect on
the date of the enactment of this Act.
(c) Termination of the Agreement.--On the date on which the
Agreement ceases to be in force, the provisions of this Act (other than
this subsection) and the amendments made by this Act shall cease to be
effective.
TITLE II--CUSTOMS PROVISIONS
SEC. 201. <<NOTE: 19 USC 3805 note.>> TARIFF MODIFICATIONS.
(a) Tariff Modifications Provided for in the Agreement.--
(1) Proclamation authority.--The President may proclaim--
(A) such modifications or continuation of any duty,
(B) such continuation of duty-free or excise
treatment, or
(C) such additional duties,
as the President determines to be necessary or appropriate to
carry out or apply articles 3.3, 3.7, 3.9, article 3.20 (8),
(9), (10), and (11), and Annex 3.3 of the Agreement.
(2) Effect <<NOTE: President. Termination date.>> on chilean
gsp status.--Notwithstanding section 502(a)(1) of the Trade Act
of 1974 (19 U.S.C. 2462(a)(1)), the President shall terminate
the designation of Chile as a beneficiary developing country for
purposes of title V of the Trade Act of 1974 on the date of
entry into force of the Agreement.
(b) Other Tariff Modifications.--Subject to the consultation and
layover provisions of section 103(a), the President may proclaim--
(1) such modifications or continuation of any duty,
(2) such modifications as the United States may agree to
with Chile regarding the staging of any duty treatment set forth
in Annex 3.3 of the Agreement,
(3) such continuation of duty-free or excise treatment, or
(4) such additional duties,
[[Page 117 STAT. 914]]
as the President determines to be necessary or appropriate to maintain
the general level of reciprocal and mutually advantageous concessions
with respect to Chile provided for by the Agreement.
(c) Additional Tariffs on Agricultural Safeguard Goods.--
(1) In general.--In addition to any duty proclaimed under
subsection (a) or (b), and subject to paragraphs (3) through
(5), the Secretary of the Treasury shall assess a duty, in the
amount prescribed under paragraph (2), on an agricultural
safeguard good if the Secretary of the Treasury determines that
the unit import price of the good when it enters the United
States, determined on an F.O.B. basis, is less than the trigger
price indicated for that good in Annex 3.18 of the Agreement or
any amendment thereto.
(2) Calculation of additional duty.--The amount of the
additional duty assessed under this subsection shall be
determined as follows:
(A) If the difference between the unit import price
and the trigger price is less than, or equal to, 10
percent of the trigger price, no additional duty shall
be imposed.
(B) If the difference between the unit import price
and the trigger price is greater than 10 percent, but
less than or equal to 40 percent, of the trigger price,
the additional duty shall be equal to 30 percent of the
difference between the preferential tariff rate and the
column 1 general rate of duty imposed under the HTS on
like articles at the time the additional duty is
imposed.
(C) If the difference between the unit import price
and the trigger price is greater than 40 percent, but
less than or equal to 60 percent, of the trigger price,
the additional duty shall be equal to 50 percent of the
difference between the preferential tariff rate and the
column 1 general rate of duty imposed under the HTS on
like articles at the time the additional duty is
imposed.
(D) If the difference between the unit import price
and the trigger price is greater than 60 percent, but
less than or equal to 75 percent, of the trigger price,
the additional duty shall be equal to 70 percent of the
difference between the preferential tariff rate and the
column 1 general rate of duty imposed under the HTS on
like articles at the time the additional duty is
imposed.
(E) If the difference between the unit import price
and the trigger price is greater than 75 percent of the
trigger price, the additional duty shall be equal to 100
percent of the difference between the preferential
tariff rate and the column 1 general rate of duty
imposed under the HTS on like articles at the time the
additional duty is imposed.
(3) Exceptions.--No additional duty under this subsection
shall be assessed on an agricultural safeguard good if, at the
time of entry, the good is subject to import relief under--
(A) subtitle A of title III of this Act; or
(B) chapter 1 of title II of the Trade Act of 1974
(19 U.S.C. 2251 et seq.).
(4) Termination.--This <<NOTE: Applicability.>> subsection
shall cease to apply on the date that is 12 years after the date
on which the Agreement enters into force.
[[Page 117 STAT. 915]]
(5) Tariff-rate quotas.--If <<NOTE: Applicability.>> an
agricultural safeguard good is subject to a tariff-rate quota,
and the in-quota duty rate for the good proclaimed pursuant to
subsection (a) or (b) is zero, any additional duty assessed
under this subsection shall be applied only to over-quota
imports of the good.
(6) Notice.--Not <<NOTE: Deadline.>> later than 60 days
after the Secretary of the Treasury first assesses additional
duties on an agricultural safeguard good under this subsection,
the Secretary shall notify the Government of Chile in writing of
such action and shall provide to the Government of Chile data
supporting the assessment of additional duties.
(7) Modification <<NOTE: Deadline. President.>> of trigger
prices.--Not later than 60 calendar days before agreeing with
the Government of Chile pursuant to article 3.18(2)(b) of the
Agreement on a modification to a trigger price for a good listed
in Annex 3.18 of the Agreement, the President shall notify the
Committees on Ways and Means and Agriculture of the House of
Representatives and the Committees on Finance and Agriculture of
the Senate of the proposed modification and the reasons
therefor.
(8) Definitions.--In this subsection:
(A) Agricultural safeguard good.--The term
``agricultural safeguard good'' means a good--
(i) that qualifies as an originating good
under section 202;
(ii) that is included in the United States
Agricultural Safeguard Product List set forth in
Annex 3.18 of the Agreement; and
(iii) for which a claim for preferential
tariff treatment under the Agreement has been
made.
(B) F.O.B.--The term ``F.O.B.'' means free on board,
regardless of the mode of transportation, at the point
of direct shipment by the seller to the buyer.
(C) Unit import price.--The term ``unit import
price'' means the price expressed in dollars per
kilogram.
(d) Conversion to Ad Valorem Rates.--For purposes of subsections (a)
and (b), with respect to any good for which the base rate in the
Schedule of the United States to Annex 3.3 of the Agreement is a
specific or compound rate of duty, the President may substitute for the
base rate an ad valorem rate that the President determines to be
equivalent to the base rate.
SEC. 202. <<NOTE: 19 USC 3805 note.>> RULES OF ORIGIN.
(a) Originating Goods.--
(1) In general.--For purposes of this Act and for purposes
of implementing the tariff treatment provided for under the
Agreement, except as otherwise provided in this section, a good
is an originating good if--
(A) the good is wholly obtained or produced entirely
in the territory of Chile, the United States, or both;
(B) the good--
(i) is produced entirely in the territory of
Chile, the United States, or both, and
(I) each of the nonoriginating
materials used in the production of the
good undergoes an applicable change in
tariff classification specified in Annex
4.1 of the Agreement, or
[[Page 117 STAT. 916]]
(II) the good otherwise satisfies
any applicable regional value-content or
other requirements specified in Annex
4.1 of the Agreement; and
(ii) satisfies all other applicable
requirements of this section; or
(C) the good is produced entirely in the territory
of Chile, the United States, or both, exclusively from
materials described in subparagraph (A) or (B).
(2) Simple combination or mere dilution.--A good shall not
be considered to be an originating good and a material shall not
be considered to be an originating material by virtue of having
undergone--
(A) simple combining or packaging operations; or
(B) mere dilution with water or another substance
that does not materially alter the characteristics of
the good or material.
(b) De Minimis Amounts of Nonoriginating Materials.--
(1) In general.--Except as provided in paragraphs (2) and
(3), a good that does not undergo a change in tariff
classification pursuant to Annex 4.1 of the Agreement is an
originating good if--
(A) the value of all nonoriginating materials that
are used in the production of the good and do not
undergo the applicable change in tariff classification
does not exceed 10 percent of the adjusted value of the
good;
(B) the value of such nonoriginating materials is
included in the value of nonoriginating materials for
any applicable regional value-content requirement; and
(C) the good meets all other applicable requirements
of this section.
(2) Exceptions.--Paragraph (1) does not apply to the
following:
(A) A nonoriginating material provided for in
chapter 4 of the HTS, or a nonoriginating dairy
preparation containing over 10 percent by weight of milk
solids provided for in subheading 1901.90 or 2106.90 of
the HTS, that is used in the production of a good
provided for in chapter 4 of the HTS.
(B) A nonoriginating material provided for in
chapter 4 of the HTS, or nonoriginating dairy
preparations containing over 10 percent by weight of
milk solids provided for in subheading 1901.90 of the
HTS, that are used in the production of the following
goods:
(i) Infant preparations containing over 10
percent in weight of milk solids provided for in
subheading 1901.10 of the HTS.
(ii) Mixes and doughs, containing over 25
percent by weight of butterfat, not put up for
retail sale, provided for in subheading 1901.20 of
the HTS.
(iii) Dairy preparations containing over 10
percent by weight of milk solids provided for in
subheading 1901.90 or 2106.90 of the HTS.
(iv) Goods provided for in heading 2105 of the
HTS.
(v) Beverages containing milk provided for in
subheading 2202.90 of the HTS.
[[Page 117 STAT. 917]]
(vi) Animal feeds containing over 10 percent
by weight of milk solids provided for in
subheading 2309.90 of the HTS.
(C) A nonoriginating material provided for in
heading 0805 of the HTS, or any of subheadings
2009.11.00 through 2009.39 of the HTS, that is used in
the production of a good provided for in any of
subheadings 2009.11.00 through 2009.39 of the HTS, or in
fruit or vegetable juice of any single fruit or
vegetable, fortified with minerals or vitamins,
concentrated or unconcentrated, provided for in
subheading 2106.90 or 2202.90 of the HTS.
(D) A nonoriginating material provided for in
chapter 15 of the HTS that is used in the production of
a good provided for in any of headings 1501.00.00
through 1508, 1512, 1514, and 1515 of the HTS.
(E) A nonoriginating material provided for in
heading 1701 of the HTS that is used in the production
of a good provided for in any of headings 1701 through
1703 of the HTS.
(F) A nonoriginating material provided for in
chapter 17 of the HTS or in heading 1805.00.00 of the
HTS that is used in the production of a good provided
for in subheading 1806.10 of the HTS.
(G) A nonoriginating material provided for in any of
headings 2203 through 2208 of the HTS that is used in
the production of a good provided for in heading 2207 or
2208 of the HTS.
(H) A nonoriginating material used in the production
of a good provided for in any of chapters 1 through 21
of the HTS, unless the nonoriginating material is
provided for in a different subheading than the good for
which origin is being determined under this section.
(3) Goods provided for in chapters 50 through 63 of the
hts.--
(A) In general.--Except as provided in subparagraph
(B), a good provided for in any of chapters 50 through
63 of the HTS that is not an originating good because
certain fibers or yarns used in the production of the
component of the good that determines the tariff
classification of the good do not undergo an applicable
change in tariff classification set out in Annex 4.1 of
the Agreement, shall be considered to be an originating
good if the total weight of all such fibers or yarns in
that component is not more than 7 percent of the total
weight of that component.
(B) Certain textile or apparel goods.--A textile or
apparel good containing elastomeric yarns in the
component of the good that determines the tariff
classification of the good shall be considered to be an
originating good only if such yarns are wholly formed in
the territory of Chile or the United States.
(c) Accumulation.--
(1) Originating goods incorporated in goods of other
country.--Originating goods or materials of Chile or the United
States that are incorporated into a good in the territory of the
other country shall be considered to originate in the territory
of the other country.
[[Page 117 STAT. 918]]
(2) Multiple procedures.--A good that is produced in the
territory of Chile, the United States, or both, by 1 or more
producers, is an originating good if the good satisfies the
requirements of subsection (a) and all other applicable
requirements of this section.
(d) Regional Value-Content.--
(1) In general.--For purposes of subsection (a)(2), the
regional value-content of a good referred to in Annex 4.1 of the
Agreement shall be calculated, at the choice of the person
claiming preferential tariff treatment for the good, on the
basis of the build-down method described in paragraph (2) or the
build-up method described in paragraph (3), unless otherwise
provided in Annex 4.1 of the Agreement.
(2) Build-down method.--
(A) In general.--The regional value-content of a
good may be calculated on the basis of the following
build-down method:
AV - VNM
RVC = ------------ <dbl-dagger>
AV 100
------------------------------------------------------------------------
(B) Definitions.--For purposes of subparagraph (A):
(i) The term ``RVC'' means the regional value-
content, expressed as a percentage.
(ii) The term ``AV'' means the adjusted value.
(iii) The term ``VNM'' means the value of
nonoriginating materials used by the producer in
the production of the good.
(3) Build-up method.--
(A) In general.--The regional value-content of a
good may be calculated on the basis of the following
build-up method:
VOM
RVC = ------------ <dbl-dagger>
AV 100
------------------------------------------------------------------------
(B) Definitions.--For purposes of subparagraph (A):
(i) The term ``RVC'' means the regional value-
content, expressed as a percentage.
(ii) The term ``AV'' means the adjusted value.
(iii) The term ``VOM'' means the value of
originating materials used by the producer in the
production of the good.
(e) Value of Materials.--
(1) In general.--For purposes of calculating the regional
value-content of a good under subsection (d), and for purposes
of applying the de minimis rules under subsection (b), the value
of a material is--
(A) in the case of a material that is imported by
the producer of the good, the adjusted value of the
material with respect to that importation;
(B) in the case of a material acquired in the
territory in which the good is produced, except for a
material to which subparagraph (C) applies, the
producer's price actually paid or payable for the
material;
[[Page 117 STAT. 919]]
(C) in the case of a material provided to the
producer without charge, or at a price reflecting a
discount or similar reduction, the sum of--
(i) all expenses incurred in the growth,
production, or manufacture of the material,
including general expenses; and
(ii) an amount for profit; or
(D) in the case of a material that is self-produced,
the sum of--
(i) all expenses incurred in the production of
the material, including general expenses; and
(ii) an amount for profit.
(2) Further adjustments to the value of materials.--
(A) Originating materials.--The following expenses,
if not included in the value of an originating material
calculated under paragraph (1), may be added to the
value of the originating material:
(i) The costs of freight, insurance, packing,
and all other costs incurred in transporting the
material to the location of the producer.
(ii) Duties, taxes, and customs brokerage fees
on the material paid in the territory of Chile,
the United States, or both, other than duties and
taxes that are waived, refunded, refundable, or
otherwise recoverable, including credit against
duty or tax paid or payable.
(iii) The cost of waste and spoilage resulting
from the use of the material in the production of
the good, less the value of renewable scrap or
byproduct.
(B) Nonoriginating materials.--The following
expenses, if included in the value of a nonoriginating
material calculated under paragraph (1), may be deducted
from the value of the nonoriginating material:
(i) The costs of freight, insurance, packing,
and all other costs incurred in transporting the
material to the location of the producer.
(ii) Duties, taxes, and customs brokerage fees
on the material paid in the territory of Chile,
the United States, or both, other than duties and
taxes that are waived, refunded, refundable, or
otherwise recoverable, including credit against
duty or tax paid or payable.
(iii) The cost of waste and spoilage resulting
from the use of the material in the production of
the good, less the value of renewable scrap or
byproducts.
(iv) The cost of originating materials used in
the production of the nonoriginating material in
the territory of Chile or the United States.
(f) Accessories, Spare Parts, or Tools.--Accessories, spare parts,
or tools delivered with a good that form part of the good's standard
accessories, spare parts, or tools shall be regarded as a material used
in the production of the good, if--
(1) the accessories, spare parts, or tools are classified
with and not invoiced separately from the good; and
(2) the quantities and value of the accessories, spare
parts, or tools are customary for the good.
(g) Fungible Goods and Materials.--
(1) In general.--
[[Page 117 STAT. 920]]
(A) Claim for preferential treatment.--A person
claiming preferential tariff treatment for a good may
claim that a fungible good or material is originating
either based on the physical segregation of each
fungible good or material or by using an inventory
management method.
(B) Inventory management method.--In this
subsection, the term ``inventory management method''
means--
(i) averaging;
(ii) ``last-in, first-out'';
(iii) ``first-in, first-out''; or
(iv) any other method--
(I) recognized in the generally
accepted accounting principles of the
country in which the production is
performed (whether Chile or the United
States); or
(II) otherwise accepted by that
country.
(2) Election of inventory method.--A person selecting an
inventory management method under paragraph (1) for particular
fungible goods or materials shall continue to use that method
for those goods or materials throughout the fiscal year of that
person.
(h) Packaging Materials and Containers for Retail Sale.--Packaging
materials and containers in which a good is packaged for retail sale, if
classified with the good, shall be disregarded in determining whether
all nonoriginating materials used in the production of the good undergo
the applicable change in tariff classification set out in Annex 4.1 of
the Agreement, and, if the good is subject to a regional value-content
requirement, the value of such packaging materials and containers shall
be taken into account as originating or nonoriginating materials, as the
case may be, in calculating the regional value-content of the good.
(i) Packing Materials and Containers for Shipment.--Packing
materials and containers for shipment shall be disregarded in
determining whether--
(1) the nonoriginating materials used in the production of
the good undergo an applicable change in tariff classification
set out in Annex 4.1 of the Agreement; and
(2) the good satisfies a regional value-content requirement.
(j) Indirect Materials.--An indirect material shall be considered to
be an originating material without regard to where it is produced.
(k) Transit and Transshipment.--A good that has undergone production
necessary to qualify as an originating good under subsection (a) shall
not be considered to be an originating good if, subsequent to that
production, the good undergoes further production or any other operation
outside the territory of Chile or the United States, other than
unloading, reloading, or any other process necessary to preserve the
good in good condition or to transport the good to the territory of
Chile or the United States.
(l) Textile and Apparel Goods Classifiable as Goods Put Up in
Sets.--Notwithstanding the rules set forth in Annex 4.1 of the
Agreement, textile and apparel goods classifiable as goods put up in
sets for retail sale as provided for in General Rule of Interpretation 3
of the Harmonized System shall not be considered to be originating goods
unless each of the goods in the set is an originating good or the total
value of the nonoriginating
[[Page 117 STAT. 921]]
goods in the set does not exceed 10 percent of the value of the set
determined for purposes of assessing customs duties.
(m) Application and Interpretation.--In this section:
(1) The basis for any tariff classification is the HTS.
(2) <<NOTE: Records.>> Any cost or value referred to in this
section shall be recorded and maintained in accordance with the
generally accepted accounting principles applicable in the
territory of the country in which the good is produced (whether
Chile or the United States).
(n) Definitions.--In this section:
(1) Adjusted value.--The term ``adjusted value'' means the
value determined in accordance with articles 1 through 8,
article 15, and the corresponding interpretive notes of the
Agreement on Implementation of Article VII of the General
Agreement on Tariffs and Trade 1994 referred to in section
101(d)(8) of the Uruguay Round Agreements Act, except that such
value may be adjusted to exclude any costs, charges, or expenses
incurred for transportation, insurance, and related services
incident to the international shipment of the merchandise from
the country of exportation to the place of importation.
(2) Fungible goods or fungible materials.--The terms
``fungible goods'' and ``fungible materials'' mean goods or
materials, as the case may be, that are interchangeable for
commercial purposes and the properties of which are essentially
identical.
(3) Generally accepted accounting principles.--The term
``generally accepted accounting principles'' means the
principles, rules, and procedures, including both broad and
specific guidelines, that define the accounting practices
accepted in the territory of Chile or the United States, as the
case may be.
(4) Goods wholly obtained or produced entirely in the
territory of chile, the united states, or both.--The term
``goods wholly obtained or produced entirely in the territory of
Chile, the United States, or both'' means--
(A) mineral goods extracted in the territory of
Chile, the United States, or both;
(B) vegetable goods, as such goods are defined in
the Harmonized System, harvested in the territory of
Chile, the United States, or both;
(C) live animals born and raised in the territory of
Chile, the United States, or both;
(D) goods obtained from hunting, trapping, or
fishing in the territory of Chile, the United States, or
both;
(E) goods (fish, shellfish, and other marine life)
taken from the sea by vessels registered or recorded
with Chile or the United States and flying the flag of
that country;
(F) goods produced on board factory ships from the
goods referred to in subparagraph (E), if such factory
ships are registered or recorded with Chile or the
United States and fly the flag of that country;
(G) goods taken by Chile or the United States or a
person of Chile or the United States from the seabed or
beneath the seabed outside territorial waters, if Chile
or the United States has rights to exploit such seabed;
(H) goods taken from outer space, if the goods are
obtained by Chile or the United States or a person of
[[Page 117 STAT. 922]]
Chile or the United States and not processed in the
territory of a country other than Chile or the United
States;
(I) waste and scrap derived from--
(i) production in the territory of Chile, the
United States, or both; or
(ii) used goods collected in the territory of
Chile, the United States, or both, if such goods
are fit only for the recovery of raw materials;
(J) recovered goods derived in the territory of
Chile or the United States from used goods, and used in
the territory of that country in the production of
remanufactured goods; and
(K) goods produced in the territory of Chile, the
United States, or both, exclusively--
(i) from goods referred to in any of
subparagraphs (A) through (I), or
(ii) from the derivatives of goods referred to
in clause (i),
at any stage of production.
(5) Harmonized system.--The term ``Harmonized System'' means
the Harmonized Commodity Description and Coding System.
(6) Indirect material.--The term ``indirect material'' means
a good used in the production, testing, or inspection of a good
but not physically incorporated into the good, or a good used in
the maintenance of buildings or the operation of equipment
associated with the production of a good, including--
(A) fuel and energy;
(B) tools, dies, and molds;
(C) spare parts and materials used in the
maintenance of equipment or buildings;
(D) lubricants, greases, compounding materials, and
other materials used in production or used to operate
equipment or buildings;
(E) gloves, glasses, footwear, clothing, safety
equipment, and supplies;
(F) equipment, devices, and supplies used for
testing or inspecting the good;
(G) catalysts and solvents; and
(H) any other goods that are not incorporated into
the good but the use of which in the production of the
good can reasonably be demonstrated to be a part of that
production.
(7) Material.--The term ``material'' means a good that is
used in the production of another good, including a part,
ingredient, or indirect material.
(8) Material that is self-produced.--The term ``material
that is self-produced'' means a material that is an originating
good produced by a producer of a good and used in the production
of that good.
(9) Nonoriginating good or nonoriginating material.--The
terms ``nonoriginating good'' and ``nonoriginating material''
mean a good or material, as the case may be, that does not
qualify as an originating good under this section.
(10) Packing materials and containers for shipment.--The
term ``packing materials and containers for shipment''
[[Page 117 STAT. 923]]
means the goods used to protect a good during its
transportation, and does not include the packaging materials and
containers in which a good is packaged for retail sale.
(11) Preferential tariff treatment.--The term ``preferential
tariff treatment'' means the customs duty rate that is
applicable to an originating good pursuant to chapter 3 of the
Agreement.
(12) Producer.--The term ``producer'' means a person who
engages in the production of a good in the territory of Chile or
the United States.
(13) Production.--The term ``production'' means growing,
mining, harvesting, fishing, raising, trapping, hunting,
manufacturing, processing, assembling, or disassembling a good.
(14) Recovered goods.--
(A) In general.--The term ``recovered goods'' means
materials in the form of individual parts that are the
result of--
(i) the complete disassembly of used goods
into individual parts; and
(ii) the cleaning, inspecting, testing, or
other processing of those parts as necessary for
improvement to sound working condition by one or
more of the processes described in subparagraph
(B), in order for such parts to be assembled with
other parts, including other parts that have
undergone the processes described in this
paragraph, in the production of a remanufactured
good.
(B) Processes.--The processes referred to in
subparagraph (A)(ii) are welding, flame spraying,
surface machining, knurling, plating, sleeving, and
rewinding.
(15) Remanufactured good.--The term ``remanufactured good''
means an industrial good assembled in the territory of Chile or
the United States, that is listed in Annex 4.18 of the
Agreement, and--
(A) is entirely or partially comprised of recovered
goods;
(B) has the same life expectancy and meets the same
performance standards as a new good; and
(C) enjoys the same factory warranty as such a new
good.
(o) Presidential Proclamation Authority.--
(1) In general.--The President is authorized to proclaim, as
part of the HTS--
(A) the provisions set out in Annex 4.1 of the
Agreement; and
(B) any additional subordinate category necessary to
carry out this title consistent with the Agreement.
(2) Modifications.--
(A) In general.--Subject to the consultation and
layover provisions of section 103(a), the President may
proclaim modifications to the provisions proclaimed
under the authority of paragraph (1)(A), other than
provisions of chapters 50 through 63 of the HTS, as
included in Annex 4.1 of the Agreement.
(B) Additional proclamations.--Notwithstanding
subparagraph (A), and subject to the consultation and
layover provisions of section 103(a), the President may
proclaim--
[[Page 117 STAT. 924]]
(i) modifications to the provisions proclaimed
under the authority of paragraph (1)(A) that are
necessary to implement an agreement with Chile
pursuant to article 3.20(5) of the Agreement; and
(ii) before the 1st anniversary of the date of
the enactment of this Act, modifications to
correct any typographical, clerical, or other
nonsubstantive technical error regarding the
provisions of chapters 50 through 63 of the HTS,
as included in Annex 4.1 of the Agreement.
SEC. 203. <<NOTE: 19 USC 3805 note.>> DRAWBACK.
(a) Definition of a Good Subject to Chile FTA Drawback.--For
purposes of this Act and the amendments made by subsection (b), the term
``good subject to Chile FTA drawback'' means any imported good other
than the following:
(1) A good entered under bond for transportation and
exportation to Chile.
(2)(A) A good exported to Chile in the same condition as
when imported into the United States.
(B) For purposes of subparagraph (A)--
(i) processes such as testing, cleaning, repacking,
inspecting, sorting, or marking a good, or preserving it
in its same condition, shall not be considered to change
the condition of the good; and
(ii) if a good described in subparagraph (A) is
commingled with fungible goods and exported in the same
condition, the origin of the good for the purposes of
subsection (j)(1) of section 313 of the Tariff Act of
1930 (19 U.S.C. 1313(j)(1)) may be determined on the
basis of the inventory methods provided for in the
regulations implementing this title.
(3) A good--
(A) that is--
(i) deemed to be exported from the United
States;
(ii) used as a material in the production of
another good that is deemed to be exported to
Chile; or
(iii) substituted for by a good of the same
kind and quality that is used as a material in the
production of another good that is deemed to be
exported to Chile; and
(B) that is delivered--
(i) to a duty-free shop;
(ii) for ship's stores or supplies for a ship
or aircraft; or
(iii) for use in a project undertaken jointly
by the United States and Chile and destined to
become the property of the United States.
(4) A good exported to Chile for which a refund of customs
duties is granted by reason of--
(A) the failure of the good to conform to sample or
specification; or
(B) the shipment of the good without the consent of
the consignee.
(5) A good that qualifies under the rules of origin set out
in section 202 that is--
(A) exported to Chile;
[[Page 117 STAT. 925]]
(B) used as a material in the production of another
good that is exported to Chile; or
(C) substituted for by a good of the same kind and
quality that is used as a material in the production of
another good that is exported to Chile.
(b) Consequential Amendments.--
(1) Bonded manufacturing warehouses.--Section 311 of the
Tariff Act of 1930 (19 U.S.C. 1311) is amended by adding at the
end the following new paragraph:
``No article manufactured in a bonded warehouse from materials that
are goods subject to Chile FTA drawback, as defined in section 203(a) of
the United States-Chile Free Trade Agreement Implementation Act, may be
withdrawn from warehouse for exportation to Chile without assessment of
a duty on the materials in their condition and quantity, and at their
weight, at the time of importation into the United States. The duty
shall be paid before the 61st day after the date of exportation, except
that the duty may be waived or reduced by--
``(1) 100 percent during the 8-year period beginning on
January 1, 2004;
``(2) 75 percent during the 1-year period beginning on
January 1, 2012;
``(3) 50 percent during the 1-year period beginning on
January 1, 2013; and
``(4) 25 percent during the 1-year period beginning on
January 1, 2014.''.
(2) Bonded smelting and refining warehouses.--Section 312 of
the Tariff Act of 1930 (19 U.S.C. 1312) is amended--
(A) in paragraph (1) of subsection (b), by striking
``except that'' and all that follows through
subparagraph (B) and inserting the following: ``except
that--
``(A) in the case of a withdrawal for exportation of
such a product to a NAFTA country, as defined in section
2(4) of the North American Free Trade Agreement
Implementation Act, if any of the imported metal-bearing
materials are goods subject to NAFTA drawback, as
defined in section 203(a) of that Act, the duties on the
materials shall be paid, and the charges against the
bond canceled, before the 61st day after the date of
exportation; but upon the presentation, before such 61st
day, of satisfactory evidence of the amount of any
customs duties paid to the NAFTA country on the product,
the duties on the materials may be waived or reduced
(subject to section 508(b)(2)(B)) in an amount that does
not exceed the lesser of--
``(i) the total amount of customs duties owed
on the materials on importation into the United
States, or
``(ii) the total amount of customs duties paid
to the NAFTA country on the product, and
``(B) in the case of a withdrawal for exportation of
such a product to Chile, if any of the imported metal-
bearing materials are goods subject to Chile FTA
drawback, as defined in section 203(a) of the United
States-Chile Free Trade Agreement Implementation Act,
the duties on the materials shall be paid, and the
charges against the
[[Page 117 STAT. 926]]
bond canceled, before the 61st day after the date of
exportation, except that the duties may be waived or
reduced by--
``(i) 100 percent during the 8-year period
beginning on January 1, 2004,
``(ii) 75 percent during the 1-year period
beginning on January 1, 2012,
``(iii) 50 percent during the 1-year period
beginning on January 1, 2013, and
``(iv) 25 percent during the 1-year period
beginning on January 1, 2014, or'';
(B) in paragraph (4) of subsection (b), by striking
``except that'' and all that follows through
subparagraph (B) and inserting the following: ``except
that--
``(A) in the case of a withdrawal for exportation of
such a product to a NAFTA country, as defined in section
2(4) of the North American Free Trade Agreement
Implementation Act, if any of the imported metal-bearing
materials are goods subject to NAFTA drawback, as
defined in section 203(a) of that Act, the duties on the
materials shall be paid, and the charges against the
bond canceled, before the 61st day after the date of
exportation; but upon the presentation, before such 61st
day, of satisfactory evidence of the amount of any
customs duties paid to the NAFTA country on the product,
the duties on the materials may be waived or reduced
(subject to section 508(b)(2)(B)) in an amount that does
not exceed the lesser of--
``(i) the total amount of customs duties owed
on the materials on importation into the United
States, or
``(ii) the total amount of customs duties paid
to the NAFTA country on the product, and
``(B) in the case of a withdrawal for exportation of
such a product to Chile, if any of the imported metal-
bearing materials are goods subject to Chile FTA
drawback, as defined in section 203(a) of the United
States-Chile Free Trade Agreement Implementation Act,
the duties on the materials shall be paid, and the
charges against the bond canceled, before the 61st day
after the date of exportation, except that the duties
may be waived or reduced by--
``(i) 100 percent during the 8-year period
beginning on January 1, 2004,
``(ii) 75 percent during the 1-year period
beginning on January 1, 2012,
``(iii) 50 percent during the 1-year period
beginning on January 1, 2013, and
``(iv) 25 percent during the 1-year period
beginning on January 1, 2014, or''; and
(C) in subsection (d), in the matter preceding
paragraph (1), by striking ``except that'' and all that
follows through the end of paragraph (2) and inserting
the following: ``except that--
``(1) in the case of a withdrawal for exportation to a NAFTA
country, as defined in section 2(4) of the North American Free
Trade Agreement Implementation Act, if any of the imported
metal-bearing materials are goods subject to NAFTA drawback,
[[Page 117 STAT. 927]]
as defined in section 203(a) of that Act, charges against the
bond shall be paid before the 61st day after the date of
exportation; but upon the presentation, before such 61st day, of
satisfactory evidence of the amount of any customs duties paid
to the NAFTA country on the product, the bond shall be credited
(subject to section 508(b)(2)(B)) in an amount not to exceed the
lesser of--
``(A) the total amount of customs duties paid or
owed on the materials on importation into the United
States, or
``(B) the total amount of customs duties paid to the
NAFTA country on the product; and
``(2) in the case of a withdrawal for exportation to Chile,
if any of the imported metal-bearing materials are goods subject
to Chile FTA drawback, as defined in section 203(a) of the
United States-Chile Free Trade Agreement Implementation Act,
charges against the bond shall be paid before the 61st day after
the date of exportation, and the bond shall be credited in an
amount equal to--
``(A) 100 percent of the total amount of customs
duties paid or owed on the materials on importation into
the United States during the 8-year period beginning on
January 1, 2004,
``(B) 75 percent of the total amount of customs
duties paid or owed on the materials on importation into
the United States during the 1-year period beginning on
January 1, 2012,
``(C) 50 percent of the total amount of customs
duties paid or owed on the materials on importation into
the United States during the 1-year period beginning on
January 1, 2013, and
``(D) 25 percent of the total amount of customs
duties paid or owed on the materials on importation into
the United States during the 1-year period beginning on
January 1, 2014.''.
(3) Drawback.--Section 313 of the Tariff Act of 1930 (19
U.S.C. 1313) is amended--
(A) in paragraph (4) of subsection (j)--
(i) by striking ``(4)'' and inserting
``(4)(A)''; and
(ii) by adding at the end the following new
subparagraph:
``(B) <<NOTE: Effective date.>> Beginning on January 1,
2015, the exportation to Chile of merchandise that is fungible
with and substituted for imported merchandise, other than
merchandise described in paragraphs (1) through (5) of section
203(a) of the United States-Chile Free Trade Agreement
Implementation Act, shall not constitute an exportation for
purposes of paragraph (2). The preceding sentence shall not be
construed to permit the substitution of unused drawback under
paragraph (2) of this subsection with respect to merchandise
described in paragraph (2) of section 203(a) of the United
States-Chile Free Trade Agreement Implementation Act.'';
(B) in subsection (n)--
(i) by striking ``(n)'' and inserting the
following:
``(n) Refunds, Waivers, or Reductions Under Certain Free Trade
Agreements.--'';
(ii) in paragraph (1)--
[[Page 117 STAT. 928]]
(I) by striking ``; and'' at the end
of subparagraph (B);
(II) by striking the period at the
end of subparagraph (C) and inserting
``; and''; and
(III) by adding at the end the
following new subparagraph:
``(D) the term `good subject to Chile FTA drawback' has the
meaning given that term in section 203(a) of the United States-
Chile Free Trade Agreement Implementation Act.''; and
(iii) by adding the following new paragraph at
the end:
``(4)(A) For purposes of subsections (a), (b), (f), (h), (j)(2),
(p), and (q), if an article that is exported to Chile is a good subject
to Chile FTA drawback, no customs duties on the good may be refunded,
waived, or reduced, except as provided in subparagraph (B).
``(B) The customs duties referred to in subparagraph (A) may be
refunded, waived, or reduced by--
``(i) 100 percent during the 8-year period beginning on
January 1, 2004;
``(ii) 75 percent during the 1-year period beginning on
January 1, 2012;
``(iii) 50 percent during the 1-year period beginning on
January 1, 2013; and
``(iv) 25 percent during the 1-year period beginning on
January 1, 2014.''; and
(C) in subsection (o)--
(i) by striking ``(o)'' and inserting the
following:
``(o) Special Rules for Certain Vessels and Imported Materials.--'';
and
(ii) by adding at the end the following new
paragraphs:
``(3) For purposes of subsection (g), if--
``(A) a vessel is built for the account and ownership of a
resident of Chile or the Government of Chile, and
``(B) imported materials that are used in the construction
and equipment of the vessel are goods subject to Chile FTA
drawback, as defined in section 203(a) of the United States-
Chile Free Trade Agreement Implementation Act,
no customs duties on such materials may be refunded, waived, or reduced,
except as provided in paragraph (4).
``(4) The customs duties referred to in paragraph (3) may be
refunded, waived or reduced by--
``(A) 100 percent during the 8-year period beginning on
January 1, 2004;
``(B) 75 percent during the 1-year period beginning on
January 1, 2012;
``(C) 50 percent during the 1-year period beginning on
January 1, 2013; and
``(D) 25 percent during the 1-year period beginning on
January 1, 2014.''.
(4) Manipulation in warehouse.--Section 562 of the Tariff
Act of 1930 (19 U.S.C. 1562) is amended--
(A) in paragraph (3), by striking ``to a NAFTA
country'' and inserting ``to Chile, to a NAFTA
country,'';
(B) by striking ``and'' at the end of paragraph
(4)(B);
[[Page 117 STAT. 929]]
(C) by striking the period at the end of paragraph
(5) and inserting ``; and''; and
(D) by inserting after paragraph (5) the following:
``(6)(A) without payment of duties for exportation to Chile,
if the merchandise is of a kind described in any of paragraphs
(1) through (5) of section 203(a) of the United States-Chile
Free Trade Agreement Implementation Act; and
``(B) for exportation to Chile if the merchandise consists
of goods subject to Chile FTA drawback, as defined in section
203(a) of the United States-Chile Free Trade Agreement
Implementation Act, except that--
``(i) the merchandise may not be withdrawn from
warehouse without assessment of a duty on the
merchandise in its condition and quantity, and at its
weight, at the time of withdrawal from the warehouse
with such additions to, or deductions from, the final
appraised value as may be necessary by reason of a
change in condition, and
``(ii) duty shall be paid on the merchandise before
the 61st day after the date of exportation, except that
such duties may be waived or reduced by--
``(I) 100 percent during the 8-year period
beginning on January 1, 2004,
``(II) 75 percent during the 1-year period
beginning on January 1, 2012,
``(III) 50 percent during the 1-year period
beginning on January 1, 2013, and
``(IV) 25 percent during the 1-year period
beginning on January 1, 2014.''.
(5) Foreign trade zones.--Section 3(a) of the Act of June
18, 1934 (commonly known as the ``Foreign Trade Zones Act''; 19
U.S.C. 81c(a)) is amended by striking the end period and
inserting the following: ``: Provided further, That no
merchandise that consists of goods subject to Chile FTA
drawback, as defined in section 203(a) of the United States-
Chile Free Trade Agreement Implementation Act, that is
manufactured or otherwise changed in condition shall be exported
to Chile without an assessment of a duty on the merchandise in
its condition and quantity, and at its weight, at the time of
its exportation (or if the privilege in the first proviso to
this subsection was requested, an assessment of a duty on the
merchandise in its condition and quantity, and at its weight, at
the time of its admission into the zone) and the payment of the
assessed duty before the 61st day after the date of exportation
of the article, except that the customs duty may be waived or
reduced by (1) 100 percent during the 8-year period beginning on
January 1, 2004; (2) 75 percent during the 1-year period
beginning on January 1, 2012; (3) 50 percent during the 1-year
period beginning on January 1, 2013; and (4) 25 percent during
the 1-year period beginning on January 1, 2014.''.
(c) Inapplicability to Countervailing and Antidumping Duties.--
Nothing in this section or the amendments made by this section shall be
considered to authorize the refund, waiver, or reduction of
countervailing duties or antidumping duties imposed on an imported good.
[[Page 117 STAT. 930]]
SEC. 204. <<NOTE: 19 USC 3805 note.>> CUSTOMS USER FEES.
Section 13031(b) of the Consolidated Omnibus Budget Reconciliation
Act of 1985 (19 U.S.C. 58c(b)) is amended by inserting after paragraph
(11) the following:
``(12) No fee may be charged under subsection (a) (9) or (10) with
respect to goods that qualify as originating goods under section 202 of
the United States-Chile Free Trade Agreement Implementation Act. Any
service for which an exemption from such fee is provided by reason of
this paragraph may not be funded with money contained in the Customs
User Fee Account.''.
SEC. 205. <<NOTE: 19 USC 3805 note.>> DISCLOSURE OF INCORRECT
INFORMATION; DENIAL OF PREFERENTIAL TARIFF TREATMENT; FALSE
CERTIFICATES OF ORIGIN.
(a) Disclosure of Incorrect Information.--Section 592 of the Tariff
Act of 1930 (19 U.S.C. 1592) is amended--
(1) in subsection (c)--
(A) by redesignating paragraph (6) as paragraph (7);
and
(B) by inserting after paragraph (5) the following
new paragraph:
``(6) Prior disclosure regarding claims under the united
states-chile free trade agreement.--An importer shall not be
subject to penalties under subsection (a) for making an
incorrect claim that a good qualifies as an originating good
under section 202 of the United States-Chile Free Trade
Agreement Implementation Act if the importer, in accordance with
regulations issued by the Secretary of the Treasury, voluntarily
makes a corrected declaration and pays any duties owing.''; and
(2) by adding at the end the following new subsection:
``(g) False Certifications of Origin Under the United States-Chile
Free Trade Agreement.--
``(1) In general.--Subject to paragraph (2), it is unlawful
for any person to certify falsely, by fraud, gross negligence,
or negligence, in a Chile FTA Certificate of Origin (as defined
in section 508(f)(1)(B) of this Act that a good exported from
the United States qualifies as an originating good under the
rules of origin set out in section 202 of the United States-
Chile Free Trade Agreement Implementation
Act. <<NOTE: Applicability.>> The procedures and penalties of
this section that apply to a violation of subsection (a) also
apply to a violation of this subsection.
``(2) Immediate and voluntary disclosure of incorrect
information.--No penalty shall be imposed under this subsection
if, immediately after an exporter or producer that issued a
Chile FTA Certificate of Origin has reason to believe that such
certificate contains or is based on incorrect information, the
exporter or producer voluntarily provides written notice of such
incorrect information to every person to whom the certificate
was issued.
``(3) Exception.--A person may not be considered to have
violated paragraph (1) if--
``(A) the information was correct at the time it was
provided in a Chile FTA Certificate of Origin but was
later rendered incorrect due to a change in
circumstances; and
[[Page 117 STAT. 931]]
``(B) the person immediately and voluntarily
provides written notice of the change in circumstances
to all persons to whom the person provided the
certificate.''.
(b) Denial of Preferential Tariff Treatment.--Section 514 of the
Tariff Act of 1930 (19 U.S.C. 1514) is amended by adding at the end the
following new subsection:
``(g) Denial of Preferential Tariff Treatment Under United States-
Chile Free Trade Agreement.--If the Bureau of Customs and Border
Protection or the Bureau of Immigration and Customs Enforcement finds
indications of a pattern of conduct by an importer of false or
unsupported representations that goods qualify under the rules of origin
set out in section 202 of the United States-Chile Free Trade Agreement
Implementation Act, the Bureau of Customs and Border Protection, in
accordance with regulations issued by the Secretary of the Treasury, may
deny preferential tariff treatment under the United States-Chile Free
Trade Agreement to entries of identical goods imported by that person
until the person establishes to the satisfaction of the Bureau of
Customs and Border Protection that representations of that person are in
conformity with such section 202.''.
SEC. 206. <<NOTE: 19 USC 3805 note.>> RELIQUIDATION OF ENTRIES.
Subsection (d) of section 520 of the Tariff Act of 1930 (19 U.S.C.
1520(d)) is amended--
(1) by striking ``(d)'' and inserting the following:
``(d) Goods Qualifying Under Free Trade Agreement Rules of Origin.--
'';
(2) in the matter preceding paragraph (1), by inserting ``or
section 202 of the United States-Chile Free Trade Agreement
Implementation Act'' after ``Act'';
(3) in paragraph (1), by striking ``those'' and inserting
``the applicable''; and
(4) in paragraph (2), by inserting before the semicolon ``,
or other certificates of origin, as the case may be''.
SEC. 207. <<NOTE: 19 USC 3805 note.>> RECORDKEEPING REQUIREMENTS.
Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended--
(1) by striking the heading of subsection (b) and inserting
the following: ``Exportations to NAFTA Countries.--''; and
(2) by adding at the end the following:
``(f) Certificates of Origin for Goods Exported Under the United
States-Chile Free Trade Agreement.--
``(1) Definitions.--In this subsection:
``(A) Records and supporting documents.--The term
`records and supporting documents' means, with respect
to an exported good under paragraph (2), records and
documents related to the origin of the good, including--
``(i) the purchase, cost, and value of, and
payment for, the good;
``(ii) if applicable, the purchase, cost, and
value of, and payment for, all materials,
including recovered goods, used in the production
of the good; and
``(iii) if applicable, the production of the
good in the form in which it was exported.
``(B) Chile fta certificate of origin.--The term
`Chile FTA Certificate of Origin' means the
certification, established under article 4.13 of the
United States-Chile
[[Page 117 STAT. 932]]
Free Trade Agreement, that a good qualifies as an
originating good under such Agreement.
``(2) Exports to chile.--Any person who completes and issues
a Chile FTA Certificate of Origin for a good exported from the
United States shall make, keep, and, pursuant to rules and
regulations promulgated by the Secretary of the Treasury, render
for examination and inspection all records and supporting
documents related to the origin of the good (including the
Certificate or copies thereof).
``(3) Retention period.--Records and supporting documents
shall be kept by the person who issued a Chile FTA Certificate
of Origin for at least 5 years after the date on which the
certificate was issued.
``(g) Penalties.--Any person who fails to retain records and
supporting documents required by subsection (f) or the regulations
issued to implement that subsection shall be liable for the greater of--
``(1) a civil penalty not to exceed $10,000; or
``(2) the general record keeping penalty that applies under
the customs laws of the United States.''.
SEC. 208. <<NOTE: 19 USC 3805 note.>> ENFORCEMENT OF TEXTILE AND APPAREL
RULES OF ORIGIN.
(a) Action During Verification.--If the Secretary of the Treasury
requests the Government of Chile to conduct a verification pursuant to
article 3.21 of the Agreement for purposes of determining that--
(1) an exporter or producer in Chile is complying with
applicable customs laws, regulations, and procedures regarding
trade in textile and apparel goods, or
(2) claims that textile or apparel goods exported or
produced by such exporter or producer--
(A) qualify as originating goods under section 202
of this Act, or
(B) are goods of Chile,
are accurate,
the President may direct the Secretary to take appropriate action
described in subsection (b) while the verification is being conducted.
(b) Appropriate Action Described.--Appropriate action under
subsection (a) includes--
(1) suspension of liquidation of entries of textile and
apparel goods exported or produced by the person that is the
subject of the verification, in a case in which the request for
verification was based on a reasonable suspicion of unlawful
activity related to such goods; and
(2) publication of the name of the person that is the
subject of the verification.
(c) Action When Information is Insufficient.--If the Secretary of
the Treasury determines that the information obtained within 12 months
after making a request for a verification under subsection (a) is
insufficient to make a determination under subsection (a), the President
may direct the Secretary to take appropriate action described in
subsection (d) until such time as the Secretary receives information
sufficient to make a determination under subsection (a) or until such
earlier date as the President may direct.
(d) Appropriate Action Described.--Appropriate action under
subsection (c) includes--
[[Page 117 STAT. 933]]
(1) publication of the identity of the person that is the
subject of the verification;
(2) denial of preferential tariff treatment under the
Agreement to any textile or apparel goods exported or produced
by the person that is the subject of the verification; and
(3) denial of entry into the United States of any textile or
apparel goods exported or produced by the person that is the
subject of the verification.
SEC. 209. <<NOTE: 19 USC 3805 note.>> CONFORMING AMENDMENTS.
Section 508(b)(2)(B)(i)(I) of the Tariff Act of 1930 (19 U.S.C.
1508(b)(2)(B)(i)(I)) is amended--
(1) by striking ``the last paragraph of section 311'' and
inserting ``the eleventh paragraph of section 311''; and
(2) by striking ``the last proviso to section 3(a)'' and
inserting ``the proviso preceding the last proviso to section
3(a)''.
SEC. 210. <<NOTE: 19 USC 3805 note.>> REGULATIONS.
The Secretary of the Treasury shall prescribe such regulations as
may be necessary to carry out--
(1) subsections (a) through (n) of section 202, and sections
203 and 204;
(2) amendments made by the sections referred to in paragraph
(1); and
(3) proclamations issued under section 202(o).
TITLE III--RELIEF FROM IMPORTS
SEC. 301. <<NOTE: 19 USC 3805 note.>> DEFINITIONS.
In this title:
(1) Commission.--The term ``Commission'' means the United
States International Trade Commission.
(2) Chilean article.--The term ``Chilean article'' means an
article that qualifies as an originating good under section
202(a) of this Act.
(3) Chilean textile or apparel article.--The term ``Chilean
textile or apparel article'' means an article--
(A) that is listed in the Annex to the Agreement on
Textiles and Clothing referred to in section 101(d)(4)
of the Uruguay Round Agreements Act (19 U.S.C.
3511(d)(4)); and
(B) that is a Chilean article.
Subtitle A--Relief From Imports Benefiting From the Agreement
SEC. 311. <<NOTE: 19 USC 3805 note.>> COMMENCING OF ACTION FOR RELIEF.
(a) Filing of Petition.--A petition requesting action under this
subtitle for the purpose of adjusting to the obligations of the United
States under the Agreement may be filed with the Commission by an
entity, including a trade association, firm, certified or recognized
union, or group of workers, that is representative of an
industry. <<NOTE: Records.>> The Commission shall transmit a copy of any
[[Page 117 STAT. 934]]
petition filed under this subsection to the United States Trade
Representative.
(b) Investigation and Determination.--Upon the filing of a petition
under subsection (a), the Commission, unless subsection (d) applies,
shall promptly initiate an investigation to determine whether, as a
result of the reduction or elimination of a duty provided for under the
Agreement, a Chilean article is being imported into the United States in
such increased quantities, in absolute terms or relative to domestic
production, and under such conditions that imports of the Chilean
article constitute a substantial cause of serious injury or threat
thereof to the domestic industry producing an article that is like, or
directly competitive with, the imported article.
(c) Applicable Provisions.--The following provisions of section 202
of the Trade Act of 1974 (19 U.S.C. 2252) apply with respect to any
investigation initiated under subsection (b):
(1) Paragraphs (1)(B) and (3) of subsection (b).
(2) Subsection (c).
(3) Subsection (i).
(d) Articles Exempt From Investigation.--No investigation may be
initiated under this section with respect to any Chilean article if,
after the date that the Agreement enters into force, import relief has
been provided with respect to that Chilean article under this subtitle,
or if, at the time the petition is filed, the article is subject to
import relief under chapter 1 of title II of the Trade Act of 1974.
SEC. 312. <<NOTE: 19 USC 3805 note.>> COMMISSION ACTION ON PETITION.
(a) Determination.--Not <<NOTE: Deadline.>> later than 120 days
after the date on which an investigation is initiated under section
311(b) with respect to a petition, the Commission shall make the
determination required under that section.
(b) Applicable Provisions.--For purposes of this subtitle, the
provisions of paragraphs (1), (2), and (3) of section 330(d) of the
Tariff Act of 1930 (19 U.S.C. 1330(d) (1), (2), and (3)) shall be
applied with respect to determinations and findings made under this
section as if such determinations and findings were made under section
202 of the Trade Act of 1974 (19 U.S.C. 2252).
(c) Additional Finding and Recommendation if Determination
Affirmative.--If the determination made by the Commission under
subsection (a) with respect to imports of an article is affirmative, or
if the President may consider a determination of the Commission to be an
affirmative determination as provided for under paragraph (1) of section
330(d) of the Tariff Act of 1930 (19 U.S.C. 1330(d)), the Commission
shall find, and recommend to the President in the report required under
subsection (d), the amount of import relief that is necessary to remedy
or prevent the injury found by the Commission in the determination and
to facilitate the efforts of the domestic industry to make a positive
adjustment to import competition. The import relief recommended by the
Commission under this subsection shall be limited to the relief
described in section 313(c). Only those members of the Commission who
voted in the affirmative under subsection (a) are eligible to vote on
the proposed action to remedy or prevent the injury found by the
Commission. Members of the Commission who did not vote in the
affirmative may submit, in the report required
[[Page 117 STAT. 935]]
under subsection (d), separate views regarding what action, if any,
should be taken to remedy or prevent the injury.
(d) Report to President.--Not <<NOTE: Deadline.>> later than the
date that is 30 days after the date on which a determination is made
under subsection (a) with respect to an investigation, the Commission
shall submit to the President a report that includes--
(1) the determination made under subsection (a) and an
explanation of the basis for the determination;
(2) if the determination under subsection (a) is
affirmative, any findings and recommendations for import relief
made under subsection (c) and an explanation of the basis for
each recommendation; and
(3) any dissenting or separate views by members of the
Commission regarding the determination and recommendation
referred to in paragraphs (1) and (2).
(e) Public Notice.--Upon <<NOTE: Federal Register,
publication.>> submitting a report to the President under subsection
(d), the Commission shall promptly make public such report (with the
exception of information which the Commission determines to be
confidential) and shall cause a summary thereof to be published in the
Federal Register.
SEC. 313. <<NOTE: 19 USC 3805 note.>> PROVISION OF RELIEF.
(a) In General.--Not <<NOTE: Deadline. President.>> later than the
date that is 30 days after the date on which the President receives the
report of the Commission in which the Commission's determination under
section 312(a) is affirmative, or which contains a determination under
section 312(a) that the President considers to be affirmative under
paragraph (1) of section 330(d) of the Tariff Act of 1930 (19 U.S.C.
1330(d)(1)), the President, subject to subsection (b), shall provide
relief from imports of the article that is the subject of such
determination to the extent that the President determines necessary to
remedy or prevent the injury found by the Commission and to facilitate
the efforts of the domestic industry to make a positive adjustment to
import competition.
(b) Exception.--The President is not required to provide import
relief under this section if the President determines that the provision
of the import relief will not provide greater economic and social
benefits than costs.
(c) Nature of Relief.--
(1) In general.--The import relief that the President is
authorized to provide under this section with respect to imports
of an article is as follows:
(A) The suspension of any further reduction provided
for under Annex 3.3 of the Agreement in the duty imposed
on such article.
(B) An increase in the rate of duty imposed on such
article to a level that does not exceed the lesser of--
(i) the column 1 general rate of duty imposed
under the HTS on like articles at the time the
import relief is provided; or
(ii) the column 1 general rate of duty imposed
under the HTS on like articles on the day before
the date on which the Agreement enters into force.
(2) Progressive liberalization.--If the period for which
import relief is provided under this section is greater than
[[Page 117 STAT. 936]]
1 year, the President shall provide for the progressive
liberalization (described in article 8.2(2) of the Agreement) of
such relief at regular intervals during the period of its
application.
(d) Period of Relief.--
(1) In general.--Subject to paragraph (2), the import relief
that the President is authorized to provide under this section,
including any extensions thereof, may not, in the aggregate,
exceed 3 years.
(2) Extension.--
(A) In general.--If the initial period for any
import relief provided under this section is less than 3
years, the President, after receiving an affirmative
determination from the Commission under subparagraph
(B), may extend the effective period of any import
relief provided under this section, subject to the
limitation under paragraph (1), if the President
determines that--
(i) the import relief continues to be
necessary to remedy or prevent serious injury and
to facilitate adjustment; and
(ii) there is evidence that the industry is
making a positive adjustment to import
competition.
(B) Action by commission.--(i) Upon a petition on
behalf of the industry concerned, filed with the
Commission not earlier than the date which is 9 months,
and not later than the date which is 6 months, before
the date on which any action taken under subsection (a)
is to terminate, the Commission shall conduct an
investigation to determine whether action under this
section continues to be necessary to remedy or prevent
serious injury and whether there is evidence that the
industry is making a positive adjustment to import
competition.
(ii) <<NOTE: Notice. Federal Register,
publication.>> The Commission shall publish notice of
the commencement of any proceeding under this
subparagraph in the Federal Register and shall, within a
reasonable time thereafter, hold a public hearing at
which the Commission shall afford interested parties and
consumers an opportunity to be present, to present
evidence, and to respond to the presentations of other
parties and consumers, and otherwise to be heard.
(iii) The <<NOTE: Reports. Deadline.>> Commission
shall transmit to the President a report on its
investigation and determination under this subparagraph
not later than 60 days before the action under
subsection (a) is to terminate, unless the President
specifies a different date.
(e) Rate After Termination of Import Relief.--When import relief
under this section is terminated with respect to an article--
(1) the rate of duty on that article after such termination
and on or before December 31 of the year in which such
termination occurs shall be the rate that, according to the
Schedule of the United States in Annex 3.3 of the Agreement for
the staged elimination of the tariff, would have been in effect
1 year after the provision of relief under subsection (a); and
(2) the rate of duty for that article after December 31 of
the year in which termination occurs shall be, at the discretion
of the President, either--
[[Page 117 STAT. 937]]
(A) the applicable rate of duty for that article set
out in the Schedule of the United States in Annex 3.3 of
the Agreement; or
(B) the rate of duty resulting from the elimination
of the tariff in equal annual stages ending on the date
set out in the United States Schedule in Annex 3.3 of
the Agreement for the elimination of the tariff.
(f) Articles Exempt From Relief.--No import relief may be provided
under this section on any article subject to import relief under chapter
1 of title II of the Trade Act of 1974.
SEC. 314. <<NOTE: 19 USC 3805 note.>> TERMINATION OF RELIEF AUTHORITY.
(a) General Rule.--No import relief may be provided under this
subtitle after the date that is 10 years after the date on which the
Agreement enters into force.
(b) Exception.--If an article for which relief is provided under
this subtitle is an article for which the period for tariff elimination,
set out in the Schedule of the United States to Annex 3.3 of the
Agreement, is 12 years, no relief under this subtitle may be provided
for that article after the date that is 12 years after the date on which
the Agreement enters into force.
SEC. 315. <<NOTE: 19 USC 3805 note.>> COMPENSATION AUTHORITY.
For purposes of section 123 of the Trade Act of 1974 (19 U.S.C.
2133), any import relief provided by the President under section 313
shall be treated as action taken under chapter 1 of title II of such
Act.
SEC. 316. <<NOTE: 19 USC 3805 note.>> CONFIDENTIAL BUSINESS INFORMATION.
Section 202(a)(8) of the Trade Act of 1974 (19 U.S.C. 2252(a)(8)) is
amended in the first sentence--
(1) by striking ``and''; and
(2) by inserting before the period at the end ``, and title
III of the United States-Chile Free Trade Agreement
Implementation Act''.
Subtitle B--Textile and Apparel Safeguard Measures
SEC. 321. <<NOTE: President. 19 USC 3805 note.>> COMMENCEMENT OF ACTION
FOR RELIEF.
(a) In General.--A request under this subtitle for the purpose of
adjusting to the obligations of the United States under the Agreement
may be filed with the President by an interested party. Upon the filing
of a request, the President shall review the request to determine, from
information presented in the request, whether to commence consideration
of the request.
(b) Publication of Request.--If <<NOTE: Federal Register,
publication. Notice.>> the President determines that the request under
subsection (a) provides the information necessary for the request to be
considered, the President shall cause to be published in the Federal
Register a notice of commencement of consideration of the request, and
notice seeking public comments regarding the request. The notice shall
include the request and the dates by which comments and rebuttals must
be received.
SEC. 322. <<NOTE: President. 19 USC 3805 note.>> DETERMINATION AND
PROVISION OF RELIEF.
(a) Determination.--
[[Page 117 STAT. 938]]
(1) In general.--If a positive determination is made under
section 321(b), the President shall determine whether, as a
result of the elimination of a duty under the Agreement, a
Chilean textile or apparel article is being imported into the
United States in such increased quantities, in absolute terms or
relative to the domestic market for that article, and under such
conditions as to cause serious damage, or actual threat thereof,
to a domestic industry producing an article that is like, or
directly competitive with, the imported article.
(2) Serious damage.--In making a determination under
paragraph (1), the President--
(A) shall examine the effect of increased imports on
the domestic industry, as reflected in changes in such
relevant economic factors as output, productivity,
utilization of capacity, inventories, market share,
exports, wages, employment, domestic prices, profits,
and investment, none of which is necessarily decisive;
and
(B) shall not consider changes in technology or
consumer preference as factors supporting a
determination of serious damage or actual threat
thereof.
(b) Provision of Relief.--
(1) In general.--If a determination under subsection (a) is
affirmative, the President may provide relief from imports of
the article that is the subject of such determination, as
provided in paragraph (2), to the extent that the President
determines necessary to remedy or prevent the serious damage and
to facilitate adjustment by the domestic industry.
(2) Nature of relief.--The relief that the President is
authorized to provide under this subsection with respect to
imports of an article is an increase in the rate of duty imposed
on the article to a level that does not exceed the lesser of--
(A) the column 1 general rate of duty imposed under
the HTS on like articles at the time the import relief
is provided; or
(B) the column 1 general rate of duty imposed under
the HTS on like articles on the day before the date on
which the Agreement enters into force.
SEC. 323. <<NOTE: 19 USC 3805 note.>> PERIOD OF RELIEF.
(a) In General.--The import relief that the President is authorized
to provide under section 322, including any extensions thereof, may not,
in the aggregate, exceed 3 years.
(b) Extension.--If the initial period for any import relief provided
under this section is less than 3 years, the President may extend the
effective period of any import relief provided under this section,
subject to the limitation set forth in subsection (a), if the President
determines that--
(1) the import relief continues to be necessary to remedy or
prevent serious damage and to facilitate adjustment; and
(2) there is evidence that the industry is making a positive
adjustment to import competition.
SEC. 324. <<NOTE: 19 USC 3805 note.>> ARTICLES EXEMPT FROM RELIEF.
The President may not provide import relief under this subtitle with
respect to any article if import relief previously has been provided
under this subtitle with respect to that article.
[[Page 117 STAT. 939]]
SEC. 325. <<NOTE: 19 USC 3805 note.>> RATE AFTER TERMINATION OF IMPORT
RELIEF.
When import relief under this subtitle is terminated with respect to
an article, the rate of duty on that article shall be duty-free.
SEC. 326. <<NOTE: 19 USC 3805 note.>> TERMINATION OF RELIEF AUTHORITY.
No import relief may be provided under this subtitle with respect to
any article after the date that is 8 years after the date on which
duties on the article are eliminated pursuant to the Agreement.
SEC. 327. <<NOTE: 19 USC 3805 note.>> COMPENSATION AUTHORITY.
For purposes of section 123 of the Trade Act of 1974 (19 U.S.C.
2133), any import relief provided by the President under this subtitle
shall be treated as action taken under chapter 1 of title II of that
Act.
SEC. 328. <<NOTE: 19 USC 3805 note.>> BUSINESS CONFIDENTIAL INFORMATION.
The President may not release information which the President
considers to be confidential business information unless the party
submitting the confidential business information had notice, at the time
of submission, that such information would be released by the President,
or such party subsequently consents to the release of the information.
To the extent business confidential information is provided, a
nonconfidential version of the information shall also be provided, in
which the business confidential information is summarized or, if
necessary, deleted.
TITLE IV--TEMPORARY ENTRY OF BUSINESS PERSONS
SEC. 401. <<NOTE: 19 USC 3805 note.>> NONIMMIGRANT TRADERS AND
INVESTORS.
Upon a basis of reciprocity secured by the Agreement, an alien who
is a national of Chile (and any spouse or child (as defined in section
101(b)(1) of the Immigration and Nationality Act (8 U.S.C. 1101(b)(1)))
of such alien, if accompanying or following to join the alien) may, if
otherwise eligible for a visa and if otherwise admissible into the
United States under the Immigration and Nationality Act (8 U.S.C. 1101
et seq.), be considered to be classifiable as a nonimmigrant under
section 101(a)(15)(E) of such Act (8 U.S.C. 1101(a)(15)(E)) if entering
solely for a purpose specified in clause (i) or (ii) of such section
101(a)(15)(E). For purposes of this section, the term ``national'' has
the meaning given such term in article 14.9 of the Agreement.
SEC. 402. <<NOTE: 19 USC 3805 note.>> NONIMMIGRANT PROFESSIONALS; LABOR
ATTESTATIONS.
(a) Nonimmigrant Professionals.--
(1) Definitions.--Section 101(a)(15)(H)(i)(b) of the
Immigration and Nationality Act (8 U.S.C. 1101(a)(15)(H)(i)(b))
is amended by striking ``212(n)(1), or (c)'' and inserting
``212(n)(1), or (b1) who is entitled to enter the United States
under and in pursuance of the provisions of an agreement listed
in section 214(g)(8)(A), who is engaged in a specialty
occupation described in section 214(i)(3), and with respect to
whom the Secretary of Labor determines and certifies to the
Secretary of Homeland Security and the Secretary of State
[[Page 117 STAT. 940]]
that the intending employer has filed with the Secretary of
Labor an attestation under section 212(t)(1), or (c)''.
(2) Admission of nonimmigrants.--Section 214 of the
Immigration and Nationality Act (8 U.S.C. 1184) is amended--
(A) in subsection (i)--
(i) in paragraph (1), by striking ``For
purposes'' and inserting ``Except as provided in
paragraph (3), for purposes''; and
(ii) by adding at the end the following:
``(3) For purposes of section 101(a)(15)(H)(i)(b1), the term
`specialty occupation' means an occupation that requires--
``(A) theoretical and practical application of a body of
specialized knowledge; and
``(B) attainment of a bachelor's or higher degree in the
specific specialty (or its equivalent) as a minimum for entry
into the occupation in the United States.''; and
(B) in subsection (g), by adding at the end the
following:
``(8)(A) The agreement referred to in section 101(a)(15)(H)(i)(b1)
is the United States-Chile Free Trade Agreement.
``(B)(i) <<NOTE: Aliens.>> The Secretary of Homeland Security shall
establish annual numerical limitations on approvals of initial
applications by aliens for admission under section 101(a)(15)(H)(i)(b1).
``(ii) The annual numerical limitations described in clause (i)
shall not exceed 1,400 for nationals of Chile for any fiscal year. For
purposes of this clause, the term `national' has the meaning given such
term in article 14.9 of the United States-Chile Free Trade Agreement.
``(iii) The annual numerical limitations described in clause (i)
shall only apply to principal aliens and not to the spouses or children
of such aliens.
``(iv) The annual numerical limitation described in paragraph (1)(A)
is reduced by the amount of the annual numerical limitations established
under clause (i). However, if a numerical limitation established under
clause (i) has not been exhausted at the end of a given fiscal year, the
Secretary of Homeland Security shall adjust upwards the numerical
limitation in paragraph (1)(A) for that fiscal year by the amount
remaining in the numerical limitation under clause (i). Visas under
section 101(a)(15)(H)(i)(b) may be issued pursuant to such adjustment
within the first 45 days of the next fiscal year to aliens who had
applied for such visas during the fiscal year for which the adjustment
was made.
``(C) The period of authorized admission as a nonimmigrant under
section 101(a)(15)(H)(i)(b1) shall be 1 year, and may be extended, but
only in 1-year increments. After every second extension, the next
following extension shall not be granted unless the Secretary of Labor
had determined and certified to the Secretary of Homeland Security and
the Secretary of State that the intending employer has filed with the
Secretary of Labor an attestation under section 212(t)(1) for the
purpose of permitting the nonimmigrant to obtain such extension.
``(D) The numerical limitation described in paragraph (1)(A) for a
fiscal year shall be reduced by one for each alien granted an extension
under subparagraph (C) during such year who has obtained 5 or more
consecutive prior extensions.''.
(b) Labor Attestations.--Section 212 of the Immigration and
Nationality Act (8 U.S.C. 1182) is amended--
[[Page 117 STAT. 941]]
(1) by redesignating the subsection (p) added by section
1505(f) of Public Law 106-386 (114 Stat. 1526) as subsection
(s); and
(2) by adding at the end the following:
``(t)(1) No alien may be admitted or provided status as a
nonimmigrant under section 101(a)(15)(H)(i)(b1) in an occupational
classification unless the employer has filed with the Secretary of Labor
an attestation stating the following:
``(A) The employer--
``(i) is offering and will offer during the period
of authorized employment to aliens admitted or provided
status under section 101(a)(15)(H)(i)(b1) wages that are
at least--
``(I) the actual wage level paid by the
employer to all other individuals with similar
experience and qualifications for the specific
employment in question; or
``(II) the prevailing wage level for the
occupational classification in the area of
employment,
whichever is greater, based on the best information
available as of the time of filing the attestation; and
``(ii) will provide working conditions for such a
nonimmigrant that will not adversely affect the working
conditions of workers similarly employed.
``(B) There is not a strike or lockout in the course of a
labor dispute in the occupational classification at the place of
employment.
``(C) The employer, at the time of filing the attestation--
``(i) has provided notice of the filing under this
paragraph to the bargaining representative (if any) of
the employer's employees in the occupational
classification and area for which aliens are sought; or
``(ii) if there is no such bargaining
representative, has provided notice of filing in the
occupational classification through such methods as
physical posting in conspicuous locations at the place
of employment or electronic notification to employees in
the occupational classification for which nonimmigrants
under section 101(a)(15)(H)(i)(b1) are sought.
``(D) A specification of the number of workers sought, the
occupational classification in which the workers will be
employed, and wage rate and conditions under which they will be
employed.
``(2)(A) <<NOTE: Public inspection. Deadline.>> The employer shall
make available for public examination, within one working day after the
date on which an attestation under this subsection is filed, at the
employer's principal place of business or worksite, a copy of each such
attestation (and such accompanying documents as are necessary).
``(B)(i) <<NOTE: Records.>> The Secretary of Labor shall compile, on
a current basis, a list (by employer and by occupational classification)
of the attestations filed under this subsection. Such list shall
include, with respect to each attestation, the wage rate, number of
aliens sought, period of intended employment, and date of need.
``(ii) <<NOTE: Public inspection.>> The Secretary of Labor shall
make such list available for public examination in Washington, D.C.
[[Page 117 STAT. 942]]
``(C) The Secretary of Labor shall review an attestation filed under
this subsection only for completeness and obvious inaccuracies. Unless
the Secretary of Labor finds that an attestation is incomplete or
obviously inaccurate, the Secretary of Labor shall provide the
certification described in section 101(a)(15)(H)(i)(b1) within 7 days of
the date of the filing of the attestation.
``(3)(A) The Secretary of Labor shall establish a process for the
receipt, investigation, and disposition of complaints respecting the
failure of an employer to meet a condition specified in an attestation
submitted under this subsection or misrepresentation by the employer of
material facts in such an attestation. Complaints may be filed by any
aggrieved person or organization (including bargaining representatives).
No investigation or hearing shall be conducted on a complaint concerning
such a failure or misrepresentation unless the complaint was filed not
later than 12 months after the date of the failure or misrepresentation,
respectively. The Secretary of Labor shall conduct an investigation
under this paragraph if there is reasonable cause to believe that such a
failure or misrepresentation has occurred.
``(B) <<NOTE: Deadlines.>> Under the process described in
subparagraph (A), the Secretary of Labor shall provide, within 30 days
after the date a complaint is filed, for a determination as to whether
or not a reasonable basis exists to make a finding described in
subparagraph (C). <<NOTE: Notice.>> If the Secretary of Labor determines
that such a reasonable basis exists, the Secretary of Labor shall
provide for notice of such determination to the interested parties and
an opportunity for a hearing on the complaint, in accordance with
section 556 of title 5, United States Code, within 60 days after the
date of the determination. If such a hearing is requested, the Secretary
of Labor shall make a finding concerning the matter by not later than 60
days after the date of the hearing. In the case of similar complaints
respecting the same applicant, the Secretary of Labor may consolidate
the hearings under this subparagraph on such complaints.
``(C)(i) If the Secretary of Labor finds, after notice and
opportunity for a hearing, a failure to meet a condition of paragraph
(1)(B), a substantial failure to meet a condition of paragraph (1)(C) or
(1)(D), or a misrepresentation of material fact in an attestation--
``(I) <<NOTE: Notification.>> the Secretary of Labor shall
notify the Secretary of State and the Secretary of Homeland
Security of such finding and may, in addition, impose such other
administrative remedies (including civil monetary penalties in
an amount not to exceed $1,000 per violation) as the Secretary
of Labor determines to be appropriate; and
``(II) the Secretary of State or the Secretary of Homeland
Security, as appropriate, shall not approve petitions or
applications filed with respect to that employer under section
204, 214(c), or 101(a)(15)(H)(i)(b1) during a period of at least
1 year for aliens to be employed by the employer.
``(ii) If the Secretary of Labor finds, after notice and opportunity
for a hearing, a willful failure to meet a condition of paragraph (1), a
willful misrepresentation of material fact in an attestation, or a
violation of clause (iv)--
``(I) <<NOTE: Notification.>> the Secretary of Labor shall
notify the Secretary of State and the Secretary of Homeland
Security of such finding and may, in addition, impose such other
administrative remedies (including civil monetary penalties in
an amount not
[[Page 117 STAT. 943]]
to exceed $5,000 per violation) as the Secretary of Labor
determines to be appropriate; and
``(II) the Secretary of State or the Secretary of Homeland
Security, as appropriate, shall not approve petitions or
applications filed with respect to that employer under section
204, 214(c), or 101(a)(15)(H)(i)(b1) during a period of at least
2 years for aliens to be employed by the employer.
``(iii) If the Secretary of Labor finds, after notice and
opportunity for a hearing, a willful failure to meet a condition of
paragraph (1) or a willful misrepresentation of material fact in an
attestation, in the course of which failure or misrepresentation the
employer displaced a United States worker employed by the employer
within the period beginning 90 days before and ending 90 days after the
date of filing of any visa petition or application supported by the
attestation--
``(I) <<NOTE: Notification.>> the Secretary of Labor shall
notify the Secretary of State and the Secretary of Homeland
Security of such finding and may, in addition, impose such other
administrative remedies (including civil monetary penalties in
an amount not to exceed $35,000 per violation) as the Secretary
of Labor determines to be appropriate; and
``(II) the Secretary of State or the Secretary of Homeland
Security, as appropriate, shall not approve petitions or
applications filed with respect to that employer under section
204, 214(c), or 101(a)(15)(H)(i)(b1) during a period of at least
3 years for aliens to be employed by the employer.
``(iv) It is a violation of this clause for an employer who has
filed an attestation under this subsection to intimidate, threaten,
restrain, coerce, blacklist, discharge, or in any other manner
discriminate against an employee (which term, for purposes of this
clause, includes a former employee and an applicant for employment)
because the employee has disclosed information to the employer, or to
any other person, that the employee reasonably believes evidences a
violation of this subsection, or any rule or regulation pertaining to
this subsection, or because the employee cooperates or seeks to
cooperate in an investigation or other proceeding concerning the
employer's compliance with the requirements of this subsection or any
rule or regulation pertaining to this subsection.
``(v) The Secretary of Labor and the Secretary of Homeland Security
shall devise a process under which a nonimmigrant under section
101(a)(15)(H)(i)(b1) who files a complaint regarding a violation of
clause (iv) and is otherwise eligible to remain and work in the United
States may be allowed to seek other appropriate employment in the United
States for a period not to exceed the maximum period of stay authorized
for such nonimmigrant classification.
``(vi)(I) It is a violation of this clause for an employer who has
filed an attestation under this subsection to require a nonimmigrant
under section 101(a)(15)(H)(i)(b1) to pay a penalty for ceasing
employment with the employer prior to a date agreed to by the
nonimmigrant and the employer. The Secretary of Labor shall determine
whether a required payment is a penalty (and not liquidated damages)
pursuant to relevant State law.
``(II) If the Secretary of Labor finds, after notice and opportunity
for a hearing, that an employer has committed a violation of this
clause, the Secretary of Labor may impose a civil monetary penalty
[[Page 117 STAT. 944]]
of $1,000 for each such violation and issue an administrative order
requiring the return to the nonimmigrant of any amount paid in violation
of this clause, or, if the nonimmigrant cannot be located, requiring
payment of any such amount to the general fund of the Treasury.
``(vii)(I) It is a failure to meet a condition of paragraph (1)(A)
for an employer who has filed an attestation under this subsection and
who places a nonimmigrant under section 101(a)(15)(H)(i)(b1) designated
as a full-time employee in the attestation, after the nonimmigrant has
entered into employment with the employer, in nonproductive status due
to a decision by the employer (based on factors such as lack of work),
or due to the nonimmigrant's lack of a permit or license, to fail to pay
the nonimmigrant full-time wages in accordance with paragraph (1)(A) for
all such nonproductive time.
``(II) It is a failure to meet a condition of paragraph (1)(A) for
an employer who has filed an attestation under this subsection and who
places a nonimmigrant under section 101(a)(15)(H)(i)(b1) designated as a
part-time employee in the attestation, after the nonimmigrant has
entered into employment with the employer, in nonproductive status under
circumstances described in subclause (I), to fail to pay such a
nonimmigrant for such hours as are designated on the attestation
consistent with the rate of pay identified on the attestation.
``(III) <<NOTE: Applicability.>> In the case of a nonimmigrant under
section 101(a)(15)(H)(i)(b1) who has not yet entered into employment
with an employer who has had approved an attestation under this
subsection with respect to the nonimmigrant, the provisions of
subclauses (I) and (II) shall apply to the employer beginning 30 days
after the date the nonimmigrant first is admitted into the United
States, or 60 days after the date the nonimmigrant becomes eligible to
work for the employer in the case of a nonimmigrant who is present in
the United States on the date of the approval of the attestation filed
with the Secretary of Labor.
``(IV) This clause does not apply to a failure to pay wages to a
nonimmigrant under section 101(a)(15)(H)(i)(b1) for nonproductive time
due to non-work-related factors, such as the voluntary request of the
nonimmigrant for an absence or circumstances rendering the nonimmigrant
unable to work.
``(V) This clause shall not be construed as prohibiting an employer
that is a school or other educational institution from applying to a
nonimmigrant under section 101(a)(15)(H)(i)(b1) an established salary
practice of the employer, under which the employer pays to nonimmigrants
under section 101(a)(15)(H)(i)(b1) and United States workers in the same
occupational classification an annual salary in disbursements over fewer
than 12 months, if--
``(aa) the nonimmigrant agrees to the compressed annual
salary payments prior to the commencement of the employment; and
``(bb) the application of the salary practice to the
nonimmigrant does not otherwise cause the nonimmigrant to
violate any condition of the nonimmigrant's authorization under
this Act to remain in the United States.
``(VI) This clause shall not be construed as superseding clause
(viii).
[[Page 117 STAT. 945]]
``(viii) It is a failure to meet a condition of paragraph (1)(A) for
an employer who has filed an attestation under this subsection to fail
to offer to a nonimmigrant under section 101(a)(15)(H)(i)(b1), during
the nonimmigrant's period of authorized employment, benefits and
eligibility for benefits (including the opportunity to participate in
health, life, disability, and other insurance plans; the opportunity to
participate in retirement and savings plans; and cash bonuses and non-
cash compensation, such as stock options (whether or not based on
performance)) on the same basis, and in accordance with the same
criteria, as the employer offers to United States workers.
``(D) If the Secretary of Labor finds, after notice and opportunity
for a hearing, that an employer has not paid wages at the wage level
specified in the attestation and required under paragraph (1), the
Secretary of Labor shall order the employer to provide for payment of
such amounts of back pay as may be required to comply with the
requirements of paragraph (1), whether or not a penalty under
subparagraph (C) has been imposed.
``(E) The Secretary of Labor may, on a case-by-case basis, subject
an employer to random investigations for a period of up to 5 years,
beginning on the date on which the employer is found by the Secretary of
Labor to have committed a willful failure to meet a condition of
paragraph (1) or to have made a willful misrepresentation of material
fact in an attestation. The authority of the Secretary of Labor under
this subparagraph shall not be construed to be subject to, or limited
by, the requirements of subparagraph (A).
``(F) Nothing in this subsection shall be construed as superseding
or preempting any other enforcement-related authority under this Act
(such as the authorities under section 274B), or any other Act.
``(4) For purposes of this subsection:
``(A) The term `area of employment' means the area within
normal commuting distance of the worksite or physical location
where the work of the nonimmigrant under section
101(a)(15)(H)(i)(b1) is or will be performed. If such worksite
or location is within a Metropolitan Statistical Area, any place
within such area is deemed to be within the area of employment.
``(B) In the case of an attestation with respect to one or
more nonimmigrants under section 101(a)(15)(H)(i)(b1) by an
employer, the employer is considered to `displace' a United
States worker from a job if the employer lays off the worker
from a job that is essentially the equivalent of the job for
which the nonimmigrant or nonimmigrants is or are sought. A job
shall not be considered to be essentially equivalent of another
job unless it involves essentially the same responsibilities,
was held by a United States worker with substantially equivalent
qualifications and experience, and is located in the same area
of employment as the other job.
``(C)(i) The term `lays off', with respect to a worker--
``(I) means to cause the worker's loss of
employment, other than through a discharge for
inadequate performance, violation of workplace rules,
cause, voluntary departure, voluntary retirement, or the
expiration of a grant or contract; but
[[Page 117 STAT. 946]]
``(II) does not include any situation in which the
worker is offered, as an alternative to such loss of
employment, a similar employment opportunity with the
same employer at equivalent or higher compensation and
benefits than the position from which the employee was
discharged, regardless of whether or not the employee
accepts the offer.
``(ii) Nothing in this subparagraph is intended to limit an
employee's rights under a collective bargaining agreement or
other employment contract.
``(D) The term `United States worker' means an employee
who--
``(i) is a citizen or national of the United States;
or
``(ii) is an alien who is lawfully admitted for
permanent residence, is admitted as a refugee under
section 207 of this title, is granted asylum under
section 208, or is an immigrant otherwise authorized, by
this Act or by the Secretary of Homeland Security, to be
employed.''.
(c) Special Rule for Computation of Prevailing Wage.--Section
212(p)(1) of the Immigration and Nationality Act (8 U.S.C. 1182(p)(1))
is amended by striking ``(n)(1)(A)(i)(II) and (a)(5)(A)'' and inserting
``(a)(5)(A), (n)(1)(A)(i)(II), and (t)(1)(A)(i)(II)''.
(d) Fee.--
(1) In general.--Section 214(c) of the Immigration and
Nationality Act (8 U.S.C. 1184(c)) is amended by adding at the
end the following:
``(11)(A) <<NOTE: Fees.>> Subject to subparagraph (B), the Secretary
of Homeland Security or the Secretary of State, as appropriate, shall
impose a fee on an employer who has filed an attestation described in
section 212(t)--
``(i) in order that an alien may be initially granted
nonimmigrant status described in section 101(a)(15)(H)(i)(b1);
or
``(ii) in order to satisfy the requirement of the second
sentence of subsection (g)(8)(C) for an alien having such status
to obtain certain extensions of stay.
``(B) The amount of the fee shall be the same as the amount imposed
by the Secretary of Homeland Security under paragraph (9), except that
if such paragraph does not authorize such Secretary to impose any fee,
no fee shall be imposed under this paragraph.
``(C) Fees collected under this paragraph shall be deposited in the
Treasury in accordance with section 286(s).''.
(2) Use of fee.--Section 286(s)(1) of the Immigration and
Nationality Act (8 U.S.C. 1356(s)(1)) is amended by striking
``section 214(c)(9).'' and inserting ``paragraphs (9) and (11)
of section 214(c).''.
SEC. 403. <<NOTE: 19 USC 3805 note.>> LABOR DISPUTES.
Section 214(j) of the Immigration and Nationality Act (8 U.S.C.
1184(j)) is amended--
(1) by striking ``(j)'' and inserting ``(j)(1)'';
(2) by striking ``this subsection'' each place such term
appears and inserting ``this paragraph''; and
(3) by adding at the end the following:
``(2) <<NOTE: Regulations.>> Notwithstanding any other provision of
this Act except section 212(t)(1), and subject to regulations
promulgated by the Secretary of Homeland Security, an alien who seeks to
enter the United States under and pursuant to the provisions of an
agreement
[[Page 117 STAT. 947]]
listed in subsection (g)(8)(A), and the spouse and children of such an
alien if accompanying or following to join the alien, may be denied
admission as a nonimmigrant under subparagraph (E), (L), or (H)(i)(b1)
of section 101(a)(15) if there is in progress a labor dispute in the
occupational classification at the place or intended place of
employment, unless such alien establishes, pursuant to regulations
promulgated by the Secretary of Homeland Security after consultation
with the Secretary of Labor, that the alien's entry will not affect
adversely the settlement of the labor dispute or the employment of any
person who is involved in the labor dispute. <<NOTE: Notice.>> Notice of
a determination under this paragraph shall be given as may be required
by such agreement.''.
SEC. 404. <<NOTE: 19 USC 3805 note.>> CONFORMING AMENDMENTS.
Section 214 of the Immigration and Nationality Act (8 U.S.C. 1184)
is amended--
(1) in subsection (b), by striking ``(other than a
nonimmigrant described in subparagraph (H)(i), (L), or (V) of
section 101(a)(15))'' and inserting ``(other than a nonimmigrant
described in subparagraph (L) or (V) of section 101(a)(15), and
other than a nonimmigrant described in any provision of section
101(a)(15)(H)(i) except subclause (b1) of such section)'';
(2) in subsection (c)(1), by striking ``section
101(a)(15)(H), (L), (O), or (P)(i)'' and inserting
``subparagraph (H), (L), (O), or (P)(i) of section 101(a)(15)
(excluding nonimmigrants under section 101(a)(15)(H)(i)(b1))'';
and
(3) in subsection (h), by striking ``(H)(i)'' and inserting
``(H)(i)(b) or (c)''.
Approved September 3, 2003.
LEGISLATIVE HISTORY--H.R. 2738 (S. 1416):
---------------------------------------------------------------------------
HOUSE REPORTS: No. 108-224, Pt. 1 (Comm. on Ways and Means) and Pt. 2
(Comm. on the Judiciary).
SENATE REPORTS: No. 108-116 accompanying S. 1416 (jointly from Comm. on
Finance and Comm. on the Judiciary).
CONGRESSIONAL RECORD, Vol. 149 (2003):
July 24, considered and passed House.
July 31, considered and passed Senate.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 39 (2003):
Sept. 3, Presidential remarks.
<all>