[Senate Report 108-117]
[From the U.S. Government Publishing Office]
Calendar No. 223
108th Congress Report
SENATE
1st Session 108-117
======================================================================
UNITED STATES-SINGAPORE FREE TRADE AGREEMENT IMPLEMENTATION ACT
_______
July 29 (legislative day, July 21), 2003.--Ordered to be printed
_______
Mr. Grassley, from the Committee on Finance, and on behalf of Mr.
Hatch, from the Committee on the Judiciary; filed the following
JOINT REPORT
together with
ADDITIONAL VIEWS
[To accompany S. 1417]
[Including cost estimate of the Congressional Budget Office]
The Committee on Finance, and the Committee on the
Judiciary, to which was jointly referred the bill (S. 1417) to
implement the United States-Singapore Free Trade Agreement,
having considered the same, reports thereon and recommends that
the bill do pass.
CONTENTS
Page
I. Reports and Other Materials of the Committees.....................2
Part I. Report of the Committee on Finance........................2
A. Summary of Congressional Consideration of the United
States-Chile Free Trade Agreement.................... 2
B. General Background.................................... 4
C. Overview of the United States-Singapore Free Trade
Agreement............................................ 7
D. General Description of the Bill....................... 24
Title I--Approval of, and General Provisions Relating
to, the Agreement................................ 24
Title II--Customs Provisions......................... 25
Title III--Relief From Imports....................... 27
Title IV--Temporary Entry of Business Persons........ 33
E. Congressional Action.................................. 33
F. Vote of the Committee in Reporting the Bill........... 35
G. Regulatory Impact and Other Matters................... 35
Part II. Report of the Committee on the Judiciary................35
A. Background............................................ 35
B. Implementing Legislation on Temporary Professional
Workers.............................................. 36
C. Judiciary Committee Action............................ 37
II. Budgetary Impact of the Bill.....................................39
III.Additional Views.................................................42
IV. Changes in Existing Law..........................................54
I. REPORTS AND OTHER MATTERS OF THE COMMITTEES
Part I. Report of the Committee on Finance
The Committee on Finance, to which was referred the bill
(S. 1416) to approve and implement the United States-Singapore
Free Trade Agreement, having considered the same, reports
favorably thereon and recommends that the bill do pass.
A. SUMMARY OF CONGRESSIONAL CONSIDERATION OF THE UNITED STATES-
SINGAPORE FREE TRADE AGREEMENT
1. Background
On November 16, 2000, President William J. Clinton and
Prime Minister Goh Chok Tong of Singapore agreed that in
December 2000, the two countries would begin negotiations on a
United States-Singapore Free Trade Agreement with the goal of
completing negotiations before the end of 2000. On August 6,
2002, President George W. Bush signed the Trade Act of 2002,
which provides expedited procedures for consideration of
legislation implementing trade agreements that meet objectives
under the Act. On October 1, 2002, President Bush notified
Congress of ongoing negotiations between the United States and
Singapore on a Free Trade Agreement. On January 29, 2003,
President Bush notified Congress of his intention to enter into
the United States-Singapore Free Trade Agreement. President
Bush and Prime Minister Goh signed the Agreement on May 6,
2003.
2. Trade Promotion Authority Procedures In General
The requirements for Congressional consideration of the
United States-Singapore Free Trade Agreement (the Agreement)
under expedited procedures (known as Trade Promotion Authority
(TPA) Procedures) are set forth in sections 2103 through 2106
of the Bipartisan Trade Promotion Authority Act (the Act) and
section 151 of the Trade Act of 1974.
Section 2103 of the Act authorizes the President, prior to
June 1, 2005 (or prior to June 1, 2007, if trade authority
procedures are extended under section 2103(c) of the Act), to
enter into reciprocal trade agreements with foreign countries
to reduce or eliminate tariff or nontariff barriers and other
trade-distorting measures. The purpose of section 2103
procedures is to provide the means to achieve U.S. negotiating
objectives set forth under section 2102 of the Act in
international trade negotiations.
3. Notification Prior to Negotiations
Under section 2104(a)(1) of the Act, the President must
provide written notice to the Congress at least 90 calendar
days before initiating negotiations. Section 2104(a)(2)
requires the President, before and after submission of the
notice, to consult regarding the negotiations with the relevant
Committees of Congress and the Congressional Oversight Group
established under section 2107 of the Act. Section 2106 of the
Act exempts Singapore from the pre-negotiation notification and
consultation requirements of section 2104(a) only. Section
2106(b)(2), however, requires the President, as soon as
feasible after the enactment of the Act, to notify Congress of,
and consult with Congress about, the negotiations. The Act was
enacted on August 6, 2002 as part of the Trade Act of 2002
(Pub. L. 107-210). On October 1, 2002, President George W. Bush
notified the Congress of the United States' ongoing
negotiations with Singapore on a free trade agreement.
4. Notification of Intent To Enter Into an Agreement
Under section 2105(a)(1)(A) of the Act, the President is
required, at least 90 days before entering into an agreement,
to notify Congress of his intent to enter into the agreement.
On January 29, 2003, President George W. Bush notified Congress
of his intention to enter into the United States-Singapore Free
Trade Agreement.
Section 2105(a)(1)(B) of the Act also requires the
President, within 60 days of signing an agreement, to submit to
Congress a preliminary list of existing laws that the President
considers would be required to bring the United States into
compliance with such agreement. On May 6, 2003, the President
signed the Agreement. On July 3, 2003, the President
transmitted to Congress a description of changes in existing
law required to comply with the Agreement.
5. Development of the Implementing Legislation
Under TPA Procedures, the Congress and the Administration
work together to produce the legislation to implement a free
trade agreement. The drafting occurs in informal meetings of
the Committees with jurisdiction over the laws that must be
amended to implement the agreement. At times, this process may
also include one or more House-Senate conference meetings. The
objective is to produce one bill to be transmitted by the House
and Senate Leadership to the President as the recommended
legislation to implement the trade agreement. The drafting is
done in close consultation with the Administration in an effort
to ensure that the legislation faithfully implements the
agreement and that the Administration's subsequent formal
submission is consistent with the legislation recommended by
the Congress.
In meetings in June and July 2003, the Senate Committee on
Finance and the House Committee on Ways and Means considered
and made recommendations for the implementing bill. Other
Committees of the Senate and House also considered provisions
of the implementing legislation within their respective
jurisdictions.
6. Formal Submission of the Agreement and Legislation
When the President formally submits a trade Agreement to
the Congress under section 2105 of the Act, the President must
include in the submission the final legal text of the
agreement, together with implementing legislation, a statement
of administrative action (describing regulatory and other
changes that are necessary or appropriate to implement the
agreement), a statement setting forth the reasons of the
President regarding how and to what extent the agreement makes
progress in achieving the applicable policies, purposes,
priorities, and objectives set forth in the Act, and a
statement setting forth the reasons of the President regarding
how the agreement serves the interests of U.S. commerce.
The implementing legislation is introduced in both Houses
of Congress on the day it is submitted by the President and is
referred to Committees with jurisdiction over its provisions.
President George W. Bush transmitted the final text of the
United States-Singapore Free Trade Agreement, along with
implementing legislation, a Statement of Administrative Action,
and other supporting information, as required under section
2105 of the Trade Act of 2002, to the Congress on July 15,
2003. The legislation was introduced that same day in both the
House and the Senate.
To qualify for TPA Procedures, the implementing bill itself
must contain provisions formally approving the agreement and
the statement of administrative action. Further, the
implementing bill must contain only those provisions necessary
or appropriate to implement the Agreement. The implementing
bill reported here--which approves the United States-Singapore
Free Trade Agreement and the Statement of Administrative Action
and contains provisions necessary or appropriate to implement
the Agreement into U.S. law-was referred to the Senate
Committee on Finance and the Senate Committee on the Judiciary.
7. Committee and Floor Consideration
When the requirements of the Act are satisfied,
implementing revenue bills, such as the United States-Singapore
Free Trade Agreement Implementation Act (Implementation Act),
are subject to the legislative procedures of section 151 of the
Trade Act of 1974. The following schedule for Congressional
consideration applies under these procedures:
(i) House Committees have up to 45 days in which to
report the bill; any Committee which does not do so in
that period will be automatically discharged from
further consideration.
(ii) A vote on final passage by the House must occur
on or before the 15th day after the Committees report
or are discharged.
(iii) Senate Committees must act within 15 days of
receiving the implementing revenue bill from the House
or within 45 days of Senate introduction of the
implementing bill, whichever is longer, or they will be
discharged automatically.
(iv) The full Senate then must vote within 15 days.
Thus, the Congress has a maximum of 90 days to complete
action on the bill, although the time period can be shortened.
Once the implementing bill has been formally submitted by
the President and introduced, no amendments to the bill are in
order in either House of Congress. Floor debate in each House
is limited to no more than 20 hours.
B. GENERAL BACKGROUND
1. United States-Singapore Trade
Singapore is the 12th largest trading partner of the United
States in terms of total trade. With a gross domestic product
(GDP) of about $88 billion, and per capita income of about
$20,900, Singapore has one of the highest per capita GDPs in
the world. It is a major trading country whose exports and
imports each generally exceed its GDP.
Some 1,600 U.S. companies and close to 20,000 American
citizens are located in Singapore. Many U.S. multinational
corporations use Singapore as a regional headquarters and base
to export around the world. The United States is Singapore's
largest foreign direct investor, while Singapore is the second
largest Asian investor in the United States after Japan. As of
2001, Singapore accounted for $26.7 billion in American direct
investment, or a little over 12 percent of total U.S. direct
investment in Asia and the Pacific.
Singapore is the largest trading partner of the United
States in Southeast Asia with two-way trade of $30.3 billion
and a U.S. bilateral merchandise trade surplus in 2002 of $0.6
billion (down from $0.9 billion in 2001), a reversal from the
deficit of $3.1 billion in 2000. The United States generally
runs a surplus in services trade with Singapore. Singapore is
the 11th largest export market for the United States with $14.7
billion in merchandise exports in 2002. It is the 16th largest
source for goods imported into the United States with $14.1
billion in 2002. The United States is Singapore's second
largest trading partner (after Malaysia, while Japan is third).
In bilateral trade by sectors, the United States runs surpluses
with Singapore in aircraft; electrical machinery; plastic;
mineral fuel; instruments; miscellaneous chemical products;
aluminum; dyes, paints, and putty; and iron and steel products.
The United States incurs deficits with Singapore in machinery;
organic chemicals; a special other category under Chapter 98 of
the HTS; knit apparel; special import reporting provisions
under Chapter 99 of the HTS; fish and seafood; woven apparel;
and books and newspapers.
2. Tariffs and Trade Agreements
Virtually all of Singapore's imports enter Singapore duty-
free. Only beer and certain alcoholic beverages are subject to
import tariffs. Singapore does, however, impose high excise
taxes on distilled spirits and wines, tobacco products, and
motor vehicles. The Government of Singapore also bans chewing
gum. These practices are addressed in the Agreement.
Singapore has implemented free trade agreements with New
Zealand (effective January 1, 2001) and with the European Free
Trade Area (effective January 1, 2003). The European Free Trade
Area encompasses Iceland, Norway, Switzerland, and
Liechtenstein. In January 2002, Singapore concluded a free
trade agreement with Japan that excludes agricultural products.
Singapore has also completed free trade negotiations with
Australia (agreement signed on February 17, 2003), and is in
negotiations with Mexico (since July 2000) and Canada (since
October 2001). On November 14, 2002, Singapore established a
study group to explore a free trade agreement with South Korea.
As a member of the Association of South East Asian Nations
(ASEAN), Singapore also is a participant in The Framework
Agreement on Comprehensive Economic Co-operation between ASEAN
and the Peoples Republic of China (signed November 4, 2002),
under which tariffs are to be reduced or eliminated by 2010.
U.S. EXPORTS TO SINGAPORE, 1997-2002
[In millions of dollars]
----------------------------------------------------------------------------------------------------------------
HTS category 1997 1998 1999 2000 2001 2002
----------------------------------------------------------------------------------------------------------------
84--Machinery................................. 4,936.9 4,298.2 4,569.0 5,373.2 4,631.2 4,159.0
85--Electrical machinery...................... 5,842.2 5,198.8 5,276.7 5,946.5 4,415.3 3,819.1
88--Aircraft, spacecraft...................... 1,630.6 1,833.6 1,547.1 840.4 3,544.3 2,828.2
90--Optical, medical equipment................ 1,014.6 895.4 1,016.3 1,364.8 1,020.2 1,124.7
27--Mineral fuels, oil, etc................... 193.9 109.7 282.1 311.4 475.3 615.3
39--Plastics.................................. 549.8 480.4 535.6 656.8 546.3 602.0
98--Special other............................. 489.7 502.7 511.1 554.4 550.7 499.3
29--Organic chemicals......................... 488.1 339.9 385.1 402.8 405.5 368.2
38--Misc. chemical products................... 326.7 252.8 293.5 358.2 285.4 316.2
76--Aluminum.................................. 168.4 154.1 142.4 71.8 28.6 118.0
32--Tanning, dyes, paints..................... 90.5 76.3 106.4 89.1 77.8 107.4
73--Iron/steel products....................... 107.4 118.8 110.9 114.2 104.2 107.3
87--Vehicles, not railway..................... 176.9 138.2 107.3 93.0 124.1 100.8
37--Photographic/cinematic.................... 87.9 75.6 94.7 105.2 87.3 97.2
28--Inorganic chemicals/rare earths........... 57.6 46.8 58.9 70.8 73.4 92.1
Other......................................... 1,566.1 1,152.3 1,209.3 1,463.8 1,322.0 1,266.6
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Total exports........................... 17,727.4 15,673.5 16,246.4 17,816.4 17,691.6 16,221.2
----------------------------------------------------------------------------------------------------------------
Note.--HTS = harmonized tariff schedule number.
Source: U.S. International Trade Commission Dataweb.
U.S. IMPORTS FROM SINGAPORE, 1997-2002
[In millions of dollars]
----------------------------------------------------------------------------------------------------------------
HTS category 1997 1998 1999 2000 2001 2002
----------------------------------------------------------------------------------------------------------------
84--Machinery................................. 13,545.9 12,453.0 11,516.0 10,366.1 8,198.0 7,977.9
85--Electrical machinery/equipment............ 3,504.0 2,995.7 3,209.0 4,762.1 2,955.5 2,389.6
98--Special other............................. 652.0 680.2 953.3 1,161.1 1,016.1 921.3
29--Organic chemicals......................... 688.1 333.6 582.9 634.9 821.2 806.6
90--Optical, medical instruments.............. 435.9 574.3 627.2 713.5 728.9 755.8
61--Knit apparel.............................. 232.2 249.6 256.3 264.9 233.6 233.8
27--Mineral fuels, oil, etc................... 116.3 106.7 139.6 318.6 188.4 157.9
30--Pharmaceutical products................... 3.6 6.7 6.6 5.9 4.9 152.0
49--Books, newspapers, manuscripts............ 124.3 122.9 120.4 120.4 125.0 121.9
99--Other special import provisions........... 82.8 94.1 109.6 116.0 93.9 87.8
39--Plastics.................................. 36.0 34.4 37.1 49.4 40.1 73.0
88--Aircraft, spacecraft...................... 63.7 68.8 56.4 58.7 72.9 61.6
62--Woven apparel............................. 55.0 56.6 69.3 89.7 64.8 52.2
3--Fish and seafood........................... 83.4 63.2 52.8 61.2 54.0 51.1
87--Vehicles, not railway..................... 46.4 47.4 74.1 52.2 33.3 33.6
Other......................................... 312.3 328.5 309.0 332.9 268.7 239.7
-----------------------------------------------------------------
Total imports........................... 19,981.8 18,215.7 18,119.6 19,107.6 14,899.4 14,115.8
----------------------------------------------------------------------------------------------------------------
Note.--HTS = harmonized tariff schedule number.
Source: U.S. International Trade Commission Dataweb.
3. International Trade Commission Study
In June 2003, the United States International Trade
Commission (ITC) released the results of its investigation
(Investigation No. TA-2104-6) into the probable economic
effects of a United States-Singapore Free Trade Agreement. The
ITC concluded that the economy-wide effects on U.S. trade,
production, and economic welfare, of the Agreement's tariff
reductions alone are likely to be small. The report explained
that this is not an unexpected finding given: the existing open
trade relationship; small trade and bilateral investment flows
relative to U.S. trade and investment worldwide; and the small
size of Singapore's economy relative to that of the United
States. The ITC finding, however, serves as an estimate of
confirmation, focusing largely on the implications of tariff
reduction, which may be quantified, unlike changes in many non-
tariff barriers.
At the sectoral level, the report concluded that some
sectors of the U.S. economy likely would experience increased
import competition from Singapore, while other sectors likely
would experience increased export opportunities with respect to
Singapore. However, any such increase would be from a very
small base, given Singapore's small economy and small market
size, and thus have a minimal impact on production, prices, or
employment in the corresponding U.S. sector. By the year 2016,
the ITC estimated the effects to be greater for U.S. exports of
vegetables, fruits, and nuts; meats; and other processed foods.
For U.S. imports, the likely effects would be greater for
electronic equipment and other machinery and equipment.
C. OVERVIEW OF THE UNITED STATES-SINGAPORE FREE TRADE AGREEMENT
1. The Agreement
The Agreement comprises an integrated set of reciprocal
obligations that will eliminate barriers to trade between
Singapore and the United States in a manner that is consistent
with Article XXIV of the General Agreement on Tariffs and Trade
1994 (GATT 1994) and Article V of the General Agreement on
Trade in Services (GATS). It would enter into force after an
exchange of notes on or after January 1, 2004.
2. Chapters
Establishment of the Free Trade Area and Definitions.
Parties agree to the establishment of a free trade area and
affirm that they will interpret and apply the Agreement in
light of the objectives of the Agreement. Parties further agree
that existing bilateral rights and obligations will continue to
apply and that nothing in the Agreement is to be read as
altering any legal obligation under other international
agreements. Certain terms within the Agreement are defined,
including the territory of each Party to which the free trade
agreement will apply. For the United States, this includes the
customs territory of the United States, foreign trade zones
within the United States and Puerto Rico, and the undersea
international economic zone; insular possessions of the United
States and any area of outer space are not covered. For
Singapore, this includes all territory, land, sea or air, under
its sovereign control.
National Treatment and Market Access for Goods. The
Agreement sets forth the principal rules governing trade in
goods, requiring each Party to treat products from the other
Party in a non-discriminatory manner. It provides for the
phase-out of tariffs on ``originating goods'' (as defined by
the rules of origin) that are traded between the two Parties,
and requires the elimination of a wide variety of non-tariff
trade barriers that restrict or distort trade flows.
Upon the Agreement's entry into force, Singapore is to
apply zero tariffs immediately on all U.S. products. U.S.
tariffs on 92 percent of Singaporean goods are also to be
eliminated immediately, with remaining tariffs phased out over
periods of up to 10 years. In addition, U.S. merchandise
processing fees on imports of originating goods from Singapore
will be eliminated. The Agreement also provides that the
Parties may agree to speed up tariff phase-outs on a product-
by-product basis after the Agreement takes effect.
Certain products, including professional equipment, goods
for display or demonstration, and commercial samples, will be
granted duty-free temporary admission without the usual bonding
requirement applied to imports. Import and export restrictions,
fees, and formalities, such as export and import price
requirements, import licensing conditioned on performance
requirements, and voluntary export restraints inconsistent with
the GATT 1994, will be prohibited.
Singapore will harmonize its excise taxes on imports of
distilled spirits by 2005, allow imports of chewing gum with
therapeutic value, and eliminate its ban on imports of
satellite dishes. During the first 9 years that the Agreement
is in force, the United States will provide tariff preference
levels for specific and limited amounts of certain non-
originating apparel from Singapore. These tariff preference
levels (TPLs) will apply to a limited quantity of cotton and
man-made fiber goods cut and sewn in Singapore using fabric or
yarn imported from third countries. In the first year after the
TPL provisions take effect, TPL status will apply to 25 million
square meters of apparel. This quantity will be reduced each
year thereafter. The TPL program will terminate 9 years after
it first takes effect. The United States will phase out duties
on TPL imports in five equal annual increments once the TPL
program takes effect, with the U.S. duty rate reduced to zero
beginning on the first day of the fifth year.
Rules of Origin. Chapter 3 of the Agreement sets out duty
benefits that will apply to goods considered to be
``originating goods'' under the rules of origin set out in the
Agreement and in Annexes 3A, 3B and 3C. Chapter 3 of the
Agreement includes four alternative sets of criteria under
which a product will generally qualify as an originating good.
They are: (1) when a good is wholly obtained or produced in the
territory of one or both of the Parties; (2) when a good is
manufactured or assembled from non-originating materials that
undergo a specified change in tariff classification in one or
both Parties; (3) when a good falls under the ``integrated
sourcing initiative'' category of goods listed in Annex 3B; or
(4) the good meets any applicable ``regional value content''
requirement, or the good meets the de minimis rule and all
other applicable criteria of Chapter 3.
The Agreement also clarifies that simple combining or
packaging operations, or mere dilution with water or another
substance that does not change the characteristics of the good,
will not confer origin.
Under the de minimis rule, a good can receive originating
status if the value of non-originating materials does not
exceed 10 percent of the adjusted value of the good, and the
good otherwise meets the criteria of the Agreement. Chapter 3
of the Agreement also outlines the regional value content test
whereby a good can qualify for originating status if a
specified percentage of the value of the good is attributable
to originating materials. The Agreement provides two methods
for calculating that percentage: the ``build-down method''
based on the value of non-originating materials used, and the
``build-up method'' based on the value of originating materials
used. Under the Agreement, accessories, spare parts, and tools
delivered with a good will be considered part of the material
making up the good so long as these items are not separately
classified or invoiced and their quantities and values are
customary. The de minimis rule does not apply in calculating
regional value content.
The Agreement requires that the denial of preferential
treatment by a Party must be issued in writing and accompanied
by legal and factual findings. Each Party may require that an
importer retain, for up to 5 years, records necessary for
demonstrating that a good is originating. Further, a Party will
not penalize an importer where the importer promptly and
voluntarily corrects a claim and pays any duties owed within 1
year of submission of the claim. Chapter 3 of the Agreement
also contains provisions for the verification of the
originating status of goods.
The Agreement also contains textile and apparel rules of
origin. A textile or apparel product will generally qualify as
an originating good only if all processing (e.g., yarn-
spinning, fabric production, cutting, and assembly) takes place
in the territory of one or both of the Parties, or if there is
an applicable change in tariff classification as specified in
Annex 3A of the Agreement. A special 7 percent de minimis rule
applies to certain textile and apparel products. This special
de minimis rule does not apply to elastomeric yarns.
Parties to the Agreement shall work together to ensure the
effective and uniform application of the rules found in Chapter
3 of the Agreement. Modifications of Annexes 3A, 3B, and 3C
may, upon consultation, be considered. Either Party may convene
consultations in which the Parties will consider whether to
modify the textile and apparel rules of origin.
Customs Administration. The Agreement commits each Party to
observe certain transparency and rulemaking obligations for
customs administration. Each Party must promptly publish its
customs measures on the Internet or in print form and, where
possible, solicit public comments before amending customs
regulations. Parties will also provide written advance rulings,
on request, to its importers and to exporters of the other
Party regarding whether a product qualifies as an originating
good under the Agreement, as well as on other customs matters.
Each Party will guarantee importers access to both
administrative and judicial reviews of customs decisions.
The Agreement calls for the Parties to cooperate in
securing compliance with each other's customs measures related
to the Agreement and to import and export restrictions. Parties
will also release goods from customs promptly and apply
expedited procedures for clearing express shipments through
customs under security considerations. Specific provisions
calling for the Parties to share customs information where a
Party has a reasonable suspicion of unlawful activity in
connection with goods traded between the two countries are also
provided. Provisions for the clearance and handling of express
shipments are also included.
Textile and Apparel. The Agreement commits the Parties to
adopt or maintain certain administrative, judicial, and
enforcement measures, relating to trade in textile and apparel
goods, which include: anti-circumvention, monitoring,
cooperation and information sharing, enforcement,
confidentiality, consultations, and safeguard actions.
Parties are to prevent circumvention by undertaking
measures to enforce domestic laws related to circumvention of
textile and apparel import rules and to cooperate in the
enforcement of the other Party's laws related to circumvention.
Singapore will establish and maintain a number of monitoring
programs designed to enhance the enforcement of its laws
relating to trade in textile and apparel goods. Among others,
these include measures to: (1) monitor imports, exports, and
production of textile and apparel goods in free trade zones;
(2) institute a system of registration, inspection, record
keeping and reporting covering all enterprises that produce
textile or apparel goods claimed to be originating goods under
the Agreement or marked as ``products of Singapore,'' and all
enterprises that export such goods to the United States; and
(3) establish and maintain a program to ensure that goods en
route to the United States bear accurate country of origin
markings and that the documents accompanying the goods
accurately describe the goods.
Parties will share documents and information relevant to
circumvention of their rules governing textile and apparel
imports. They will investigate claims of circumvention and,
where appropriate, perform on-site verifications and take
enforcement action. If the United States discovers that an
enterprise in Singapore is engaged in intentional
circumvention, it may temporarily bar imports from the
enterprise. Further, either Party may convene bilateral
consultations on circumvention issues.
Textile and apparel provisions and pertinent provisions of
national treatment and market access for goods, as well as
rules of origin, will take effect after the Parties consult and
exchange written notices that legislation needed to implement
the provisions is in place.
Chapter 5 of the Agreement establishes a specific bilateral
safeguard mechanism for textiles and apparel goods. A Party may
take a safeguard action with respect to a textile or apparel
good benefiting from preferential tariff treatment under the
Agreement if that good is being imported in such increased
quantities and under such conditions that imports of the good
from the other Party constitute a substantial cause of serious
damage, or actual threat thereof, to a domestic industry. The
safeguard actions authorized in the Agreement consist of: a
suspension of the further reduction of any rate of duty
provided for under the Agreement on the good; or, an increase
in the rate of duty on the good, to a level not to exceed the
lesser of the normal trade relations/most-favored-nation (NTR/
MFN) applied rate of duty in effect at the time the action is
taken or the NTR/MFN applied rate of duty in effect on the date
of entry into force of the Agreement.
A safeguard action, including any extension of such action,
may not be maintained under Chapter 5 of the Agreement for more
than 4 years, and no safeguard action may be taken or
maintained beyond the period ending 10 years after the entry
into force of the terms of the Agreement relating to textile
and apparel goods under Article 5.10 of the Agreement. In
addition, no safeguard action may be taken by an importing
Party against a particular textile or apparel good of the other
Party more than once, and upon termination of a safeguard
action, the rate of duty on the good shall be the rate that
would have been in effect but for the safeguard action.
The Party taking a safeguard action must provide mutually
agreed-upon trade liberalizing compensation in the form of
concessions having substantially equivalent trade effects, or
equivalent value, compared to the additional duties resulting
from the emergency action. Such concessions shall be limited to
textile and apparel goods, unless the Parties agree otherwise.
If the Parties are unable to reach an agreement on
compensation, the exporting Party may take action with respect
to textile and apparel goods of the other Party that has trade
effects substantially equivalent to the trade effects of the
safeguard action taken under Chapter 5 of the Agreement.
However, the right to take such action shall not be exercised
for the first 24 months that the textile or apparel safeguard
action is in effect, provided that the safeguard action was
taken in response to an absolute increase in imports and such
action conforms to the provisions of Chapter 5 of the
Agreement.
Nothing in Chapter 5 of the Agreement shall be construed to
limit a Party's rights and obligations under Chapter 7
(Safeguards) of the Agreement, except that a bilateral
safeguard measure under Chapter 7 of the Agreement may not be
taken with respect to textile or apparel goods that have been
subject to a safeguard action under Chapter 5 of the Agreement.
Nothing in Chapter 7 of the Agreement shall be construed to
affect a Party's rights and obligations under Chapter 5 of the
Agreement. In addition, nothing in Chapter 5 of the Agreement
shall be construed to limit the ability of a Party to restrain
imports of textile and apparel goods in a manner consistent
with the WTO Agreement on Textiles and Clothing or the WTO
Agreement on Safeguards.
Technical Barriers to Trade. The Agreement enhances
existing WTO obligations by encouraging the Parties to exchange
information on technical barriers to trade (TBT) issues, hold
consultations to resolve issues, and use international
standards as a basis for technical regulations, standards, and
conformity assessment procedures. It encourages the Parties to
enhance their cooperation in the context of other agreements,
including taking steps toward the implementation of the first
two phases of the Asia Pacific Economic Cooperation (APEC)
Mutual Recognition Arrangement for Conformity Assessment of
Telecommunications Equipment. Each Party is to designate a TBT
coordinator to work with domestic firms and groups and the
other Party's TBT coordinator on enhancing bilateral
cooperation. A working group on medical products and their
regulation is established under annex 6A.
Safeguards. The Agreement establishes a bilateral safeguard
mechanism that allows a Party to impose a temporary safeguard
on an originating good of the other Party if, as a result of
the reduction or elimination of a customs duty pursuant to the
Agreement, that good is being imported in such increased
quantities and under such conditions as to constitute a
substantial cause of serious injury, or threat of serious
injury, to a domestic industry.
If serious injury to a domestic industry, or threat
thereof, is found under procedural and investigative
requirements pursuant to domestic law and in accordance with
the WTO Agreement on Safeguards, the importing Party may
suspend any further staged reductions in customs duties on the
good, or may increase the customs duty rate to a level not
greater than a specified normal trade relation/most-favored-
nation (NTR/MFN) rate. A bilateral safeguard measure can be
imposed for up to 4 years, including any extension of the
original measure; for safeguards applied for more than 1 year,
the Party must progressively liberalize the safeguard measure
at regular intervals. Upon termination of the safeguard
measure, the rate of customs duty on the originating good
reverts to the rate that would have been in effect but for the
measure.
The Agreement also permits the imposition of provisional
safeguard measures in critical circumstances where delay would
cause damage that would be difficult to repair, subject to a
preliminary determination that there is clear evidence that
imports of an originating good from the other Party have
increased as a result of the reduction or elimination of a
customs duty pursuant to the Agreement, and that such imports
constitute a substantial cause of serious injury, or threat of
serious injury, to a domestic industry. A provisional measure
may be imposed under such circumstances for up to 200 days,
during which time the Party must complete the safeguard
investigation.
The Party imposing a safeguard measure must provide
mutually agreed-upon trade liberalizing compensation in the
form of concessions having substantially equivalent trade
effects, or equivalent value, compared to the additional
customs duties resulting from the safeguard measure. If the
Parties are unable to reach an agreement on compensation, the
exporting Party may take substantially equivalent action with
respect to the originating goods of the other Party. Under
Chapter 7, a bilateral safeguard measure cannot be applied more
than once to an originating good, nor may a bilateral safeguard
be applied or maintained to an originating good that has been
subject to any other safeguard measure since the entry into
force of the Agreement. Chapter 7 permits the imposition of a
bilateral safeguard measure only during the 10 year transition
period identified in the Agreement, unless the Party against
whose originating good the measure is applied consents to the
measure.
Each Party retains its rights and obligations in accordance
with the WTO Agreement on Safeguards, and the Agreement does
not confer any additional rights or obligations on the Parties
with respect to actions taken in accordance with the WTO
Agreement on Safeguards, except that a Party imposing a global
safeguard measure may exclude imports of an originating good
from the other Party if such imports are not a substantial
cause of serious injury or threat of serious injury.
Cross-Border Trade in Services. Under the Agreement, cross-
border trade in services covering the supply of a service
either: (1) from the territory of one Party into the territory
of another; (2) in the territory of a Party by a person of that
Party to a person of the other Party; or (3) by a national of a
Party in the territory of another Party, shall be accorded
national treatment and normal trade relation/most-favored-
nation (NTR/MFN) treatment. The Agreement also includes a rule
prohibiting Parties from requiring firms to establish a local
presence before they can supply a service.
In addition, the Agreement seeks to remove market access
barriers by barring certain types of restrictions on the supply
of services (e.g., rules limiting the number of firms that may
offer a particular service or restricting or requiring specific
types of legal structures or joint ventures with local
companies in order to supply a service). The Agreement's market
access rules apply both to services supplied on a cross-border
basis and through a local investment.
The Agreement contains Annexes listing exemptions from
certain service provisions of the Agreement. Further, all
existing state and local laws and regulations are exempted from
the service obligations. Once a Party liberalizes a measure
that it has exempted, it must thereafter maintain the measure
at least at that level of openness.
The Agreement includes provisions on transparency and
domestic regulation that apply to the development and
application of regulations governing services and rules on
domestic regulation that govern the operation of approval and
licensing systems for service suppliers. The Agreement also
excludes any service supplied in the exercise of governmental
authority (a service that is provided on a non-commercial and
non-competitive basis). The Agreement does not generally apply
to government subsidies, although Singapore has undertaken a
commitment relating to cross-subsidization of certain express
delivery services.
Telecommunications. The Agreement provides for non-
discriminatory access to public telecommunications networks for
the service suppliers of each nation. Telecommunication network
users are guaranteed reasonable and non-discriminatory access
and transparent and effective enforcement by telecommunications
regulators.
In addition, the Agreement requires each Party to regulate
its dominant telecommunications suppliers in ways that will
ensure a level playing field for new entrants from the other
Party. Phone companies are to obtain the right to interconnect
with networks in a timely fashion and on terms, conditions, and
cost-oriented rates that are transparent and reasonable. Firms
seeking to build a physical network are to be granted non-
discriminatory access to buildings that contain telephone
switches and submarine cable heads. Firms are to be able to
lease elements of telecommunication networks on non-
discriminatory terms and to re-sell telecommunication services
to build their customer bases.
The Agreement opens rulemaking procedures within
telecommunication regulatory authorities and requires
publication of inter-connection agreements and service rates.
The Agreement also requires Parties to make deregulation
commitments tied to the emergence of competition in a
telecommunication services area. The Agreement specifies that
companies will compete on the basis of technology and
innovation, not on government-mandated standards.
In a letter from Singapore's Trade Minister signed along
with the Agreement, Singapore has committed to establish a plan
to divest its majority interest in Singapore's two leading
telecommunications firms.
Financial Services. Chapter 10 of the Agreement applies to
measures adopted or maintained by a Party relating to:
financial institutions of the other Party; investors of the
other Party, and investments of such investors, in financial
institutions within the Party's territory; and, cross-border
trade in financial services. Chapter 10 of the Agreement does
not apply to measures adopted or maintained by a Party relating
to: activities or services forming part of a public retirement
plan or statutory system of social security; or, activities or
services conducted for the account or with the guarantee or
using the financial resources of the Party, including its
public entities. The foregoing exceptions to the application of
Chapter 10 of the Agreement do not apply if a Party allows any
of the foregoing activities or services to be conducted by its
financial institutions in competition with a public entity or a
financial institution.
Under the Agreement, each Party will accord national
treatment and normal trade relation/most-favored-nation (NTR/
MFN) treatment to investors of the other Party and will provide
market access for financial institutions without limitations
on, inter alia, the number of financial institutions, the total
value of financial service transactions or assets, the total
number of financial service operations or the total quantity of
financial services output, or the number of natural persons
that may be employed in a particular financial service sector.
A Party shall not adopt or maintain measures that restrict or
require specific types of legal entity or joint venture through
which a financial institution may supply a service.
Under the terms of the Agreement, a Party may not require
financial institutions of the other Party to hire individuals
of a particular nationality as senior managerial or other
essential personnel, nor may a Party require more than a simple
majority of the board of directors to be nationals or residents
of the Party. Provisions are made for nonconforming measures
maintained by a Party, and Chapter 10 of the Agreement
enumerates certain exceptions to the application of: Chapter
10; Chapter 9 (Telecommunications); Chapter 14 (Electronic
Commerce); Chapter 15 (Investment); and Articles 8.2.2 and 8.10
of Chapter 8 (Cross-Border Trade in Services).
The Parties recognize the importance of transparency and
agree that transparent regulations and policies shall be
published in advance of general application. Parties shall also
maintain or establish mechanisms to respond to inquiries from
interested persons. The Agreement establishes a Financial
Services Committee under Article 10.16 to promote objective and
transparent regulatory processes in each Party. A Party may
request consultations with the other Party regarding any matter
arising under the Agreement. As modified by Article 10.18 of
the Agreement (Dispute Settlement), Article 20.4 applies to the
settlement of disputes between the Parties arising under
Chapter 10 of the Agreement.
If an investor of a Party submits a claim under Section C
of Chapter 15 of the Agreement (Investor-State Dispute
Settlement) against the other Party and the respondent invokes
Article 10.10 (Exceptions), on the request of the respondent,
the tribunal shall refer the matter to the Financial Services
Committee for a decision. The tribunal may not proceed pending
receipt of a decision or report under Chapter 10 of the
Agreement.
Annex 10A specifies the application of Chapter 10 of the
Agreement to insurance and insurance-related services, and
banking and other financial services (excluding insurance), in
the United States and Singapore. Annex 10B of the Agreement
contains Introductory Notes for the Schedules of the United
States and Singapore to Annex 10B, while Annex 10C of the
Agreement lists specific commitments of the United States and
Singapore relating to financial services. Annex 10D of the
Agreement details additional information with respect to the
Financial Services Committee established pursuant to article
10.16 of the Agreement.
Temporary Entry. Chapter 11 of the Agreement sets forth
general principles and obligations with respect to providing
for the temporary entry of business persons. These provisions
are more fully addressed in Part II., Report of the Committee
on the Judiciary.
Competition Policy. The Agreement requires each Party to
adopt or maintain laws prohibiting anti-competitive business
conduct and an agency to enforce them. In particular, Singapore
has committed to enact general antitrust legislation by January
2005. Each Party will take appropriate enforcement action to
address anti-competitive business conduct. The Agreement also
affirms that each Party's antitrust enforcement policy is not
to discriminate on the basis of nationality.
Basic procedural rights for firms facing antitrust
enforcement actions are provided, requiring each Party to
provide such firms with the right to be heard and to present
evidence before imposing a sanction or remedy, and ensuring
that any sanctions or remedies are subject to review by a court
or independent tribunal.
Parties must ensure that private or government-owned
entities that are granted the sole right to provide or purchase
a good or service conduct themselves in a manner consistent
with commercial considerations; that they do not discriminate
against the other Party's goods or service suppliers, and that
they do not use their monopoly position to engage in anti-
competitive practices in markets outside their monopoly
mandate. The Agreement further requires that Singapore ensure
that its government enterprises act in accordance with
commercial considerations, provide non-discriminatory treatment
to U.S. goods and services suppliers, and refrain from entering
into anti-competitive agreements among competitors or engaging
in exclusionary practices that reduce competition to the
detriment of consumers.
Singapore shall also publish an annual report detailing its
ownership and control of larger government enterprises, and
will provide the same information for enterprises of any size
upon U.S. request. Singapore will not exercise influence over
its government enterprises except in a manner consistent with
the Agreement, and will continue to reduce its aggregate
ownership and other interests in these enterprises. The United
States will ensure that its government enterprises accord non-
discriminatory treatment in their sales of goods and services
to Singaporean companies.
Parties to the Agreement are to cooperate on competition
law and policy developments and further transparency by
providing for the exchange of publicly available information on
antitrust enforcement and on designated monopolies and
government enterprises. The Parties may also request
consultations to discuss specific issues. Where pertinent in
such consultations, Singapore will provide information
regarding the steps it plans to take or has taken to address
anti-competitive conduct by a government enterprise.
Provisions requiring the Parties to adopt and enforce
antitrust laws are not subject to the Agreement's dispute
settlement procedures. However, rules addressing conduct by
designated monopolies and government enterprises can be
enforced through the Agreement's dispute settlement mechanism.
Government Procurement. The Agreement establishes
obligations regarding government purchases that extend beyond
those that the Parties have undertaken under the WTO Agreement
on Government Procurement (GPA). These include such areas as
thresholds, scope and coverage, and procedures for withdrawing
entities from coverage when a government's control or influence
over them has been eliminated. The Agreement also commits
Parties to cooperate in the ongoing review of the GPA, on
procurement matters in APEC, and in WTO negotiations regarding
transparency in government procurement.
The provisions on government procurement within the
Agreement cover purchases abovecertain dollar thresholds by
government departments and entities that each Party has listed in its
relevant Schedules to the GPA. The Agreement applies to central or
Federal Government procurement of goods and services valued at $56,190
or more and construction services valued at $6,481,000 or more. The
Agreement's provisions also apply to certain purchases by U.S. State
governments listed in the GPA Schedule of the United States, namely,
the procurement of goods and services valued at $460,000 or more and
construction services of $6,481,000 or more. For government enterprises
subject to the Parties' commitments under the GPA, the Chapter's
thresholds are set at either $250,000 or $518,000 for goods and
services, and $6,481,000 for construction services.
The Agreement incorporates the GPA's basic rule of national
treatment and bars discrimination against locally established
suppliers on the basis of foreign affiliation or ownership. The
Agreement also includes GPA rules designed to ensure
transparency in procurement procedures. Each Party must publish
laws, regulations and other measures governing procurement,
along with any changes to those measures. Further, procuring
entities must publish notices of procurement opportunities in
advance.
The Agreement incorporates GPA rules for setting deadlines
on tendering and requires procuring entities to give suppliers
information needed to prepare tenders, including the criteria
that procuring entities will use to evaluate tenders. The
Agreement also requires that procuring entities publish
information on awards, including the names of suppliers, a
description of the goods or services procured, and the value of
the contract.
Electronic Commerce. The Agreement includes provisions on
electronic commerce which establish explicit guarantees that
the principle of non-discrimination applies to products
delivered electronically. It further establishes a binding
prohibition on customs duties charged on digital products
delivered electronically, such as legitimate downloads of
music, videos, software or text.
The Agreement makes binding a number of commitments that
are now only voluntary or temporary commitments under the WTO.
It affirms that any commitments made related to services in the
Agreement also extend to the electronic delivery of such
services, such as financial services delivered over the
Internet. Parties have agreed to the non-discriminatory
treatment of digital products and the permanent duty-free
status of products delivered electronically.
Investment. The Agreement provides national treatment
protections for investors. Among the rights afforded to
investors (consistent with those found in U.S. law) are due
process protections and the right to receive fair market value
for property in the event of an expropriation. The Agreement
prohibits and removes certain performance-related requirements
or restrictions on investors, such as limitations on the number
of locations or the requirement that an investor export a given
level of goods and services as a condition for the investment.
The Agreement ties investor protections to standards
developed under customary international law. It further
obligates Parties to provide investors with treatment in
accordance with ``customary international law'' rather than in
accordance with ``international law'' (as was done in NAFTA).
The Agreement includes an investor-State mechanism under
which investors aggrieved by government actions that are in
breach of obligations under the Agreement have the right to
take the dispute directly to an international arbitration
tribunal for resolution. Submissions to dispute panels and
panel hearings are to be open to the public, and interested
parties are to have the opportunity to submit their views.
Intellectual Property Rights. The Agreement provides for
the protection of copyrights, patents, trademarks and trade
secrets. It enhances enforcement of intellectual property
rights and requires that non-discrimination obligations apply
to all types of intellectual property. The Agreement will
require Singapore to ratify or accede to several agreements on
intellectual property rights, including the International
Convention for the Protection of New Varieties of Plants, the
Trademark Law Treaty, the Brussels Convention Relating to the
Distribution of Programme-Carrying Satellite Signals, and the
Patent Cooperation Treaty. The Agreement also includes full
national treatment commitments, with no exceptions for digital
products. It also requires each Party to publish its laws,
regulations, procedures, and decisions concerning the
protection or enforcement of intellectual property rights.
The Agreement imposes rules with respect to the
registration of collective, certification, and sound marks, as
well as geographical indications and scent marks. It also
imposes rules for domain name management that require a dispute
resolution procedure to prevent trademark cyber-piracy. The
Agreement streamlines the trademark filing process by allowing
applicants to use their own national patent/trademark offices
for filing trademark applications.
The Agreement further ensures that only authors, composers,
and other copyright owners, have the right to make their works
available online. Copyright owners maintain rights to temporary
copies of their works on computers. Copyrighted works and
phonograms are protected for extended terms, consistent with
U.S. standards and international trends. The Agreement also
contains anti-circumvention provisions aimed at preventing the
tampering with technologies (such as embedded codes on discs)
that are designed to prevent piracy and unauthorized
distribution over the Internet. The Agreement also ensures that
governments use only legitimate computer software.
Under the Agreement, protection for encrypted program-
carrying satellite signals extends to the signals themselves as
well as the programming. Parties have agreed to criminalize
unauthorized reception and re-distribution of satellite
signals. The Agreement also contains limited liability for
internet service providers.
The Agreement provides for a patent term to be extended to
compensate for up-front administrative or regulatory delays in
granting the original patent. The grounds for revoking a patent
are limited to the same grounds required to originally refuse a
patent. The Agreement also provides protection for patents
covering biotech plants and animals. In addition, the Agreement
provides for protection against imports of pharmaceutical
products without a patent-holder's consent by allowing lawsuits
when contracts are breached.
Under the Agreement, test data and trade secrets submitted
to a government for the purpose of product approval are to be
protected against disclosure for a period of 5 years for
pharmaceuticals and 10 years for agricultural chemicals. The
Agreement also closes potential loopholes to these provisions
and is designed to ensure that government marketing-approval
agencies will not grant approval to patent-violating products.
Under the Agreement, there are criminal penalties for
companies that make pirated copies from legitimate products.
Intellectual property right laws are to be enforced against
traded goods, including transshipments, to deter violators from
using U.S. or Singaporean ports or free-trade zones to traffic
in pirated products. The Agreement mandates both statutory and
actual damages for intellectual property rights violations and
provides that monetary damages be awarded even if actual
economic harm (retail value, profits made by violators) cannot
be determined. The Agreement also restricts the use of
compulsory licenses to copy patented drugs and sets up new
barriers to the import of patented drugs sold at lower prices
in third countries.
Labor. The Parties reaffirm their obligations as members of
the International Labor Organization (ILO) and under the 1998
ILO Declaration on Fundamental Principles and Rights at Work
and its Follow-up (ILO Declaration). The Agreement provides
that each Party must strive to ensure that its domestic labor
laws recognize and protect the fundamental labor principles
spelled out in the ILO Declaration and listed in Chapter 17 of
the Agreement. Each Party also commits not to weaken
protections under domestic labor laws in order to encourage
bilateral trade or investment. The Agreement defines labor laws
to mean those statutes or regulations directly related to: the
right of association; the right to organize and bargain
collectively; a prohibition of forced or compulsory labor; a
minimum age for the employment of children and elimination of
the worst forms of child labor; and, acceptable conditions of
work with respect to minimum wages, hours of work, and
occupational safety and health.
The Agreement recognizes the right of each Party to
establish its own domestic labor standards, and to adopt or
modify its labor laws. The Agreement provides that each Party
shall not fail to effectively enforce its labor laws, through a
sustained or recurring course of action or inaction, in a
manner affecting trade between the Parties. The Agreement
recognizes that each Party retains the right to exercise
discretion with respect to investigatory, prosecutorial,
regulatory, and compliance matters and to make decisions
regarding the allocation of resources to enforcement with
respect to other labor matters determined to have higher
priorities. Each Party is obliged to provide fair, equitable,
and transparent proceedings for the enforcement of labor laws,
and each Party guarantees that Parties to such proceedings may
seek remedies to ensure the enforcement of their rights under
domestic labor laws.
The Agreement authorizes the Joint Committee established
under Chapter 20 of the Agreement to create a Subcommittee on
Labor Affairs to provide a forum for consultation on the
Agreement and its implementation. Meetings of the Subcommittee
shall include a public session, unless the Parties otherwise
agree. The Agreement also establishes a United States-Singapore
Labor Cooperation Mechanism to: promote respect for ILO labor
principles and other common commitments; establish priorities
for cooperative activities on labor matters; develop specific
cooperative activities; exchange information; and, develop
recommendations for consideration by the Joint Committee.
A Party can request consultations with the other Party
regarding any matter arising under Chapter 17 of the Agreement.
If the Parties fail to resolve the matter through
consultations, either Party may then request that the
Subcommittee on Labor Affairs be convened to address the
matter. Dispute settlement procedures are available only when a
Party asserts under Article 17.2.1(a) that the other Party has
failed to effectively enforce its labor laws, through a
sustained or recurring course of action or inaction, in a
manner affecting trade between the Parties. In that instance,
the complaining Party may request dispute settlement
proceedings under Chapter 20 of the Agreement, after an initial
60-day consultation period, by referring the matter to the
Joint Committee.
If a panel determines that a Party has not conformed with
its obligations under Article 17.2.1(a) and the Parties are
unable to reach agreement on a resolution, the complaining
Party may request that the panel reconvene to impose an annual
monetary assessment on the other Party not to exceed $15
million, adjusted for inflation pursuant to Annex 20A of the
Agreement. Any assessments will be paid into a fund established
by the Joint Committee and utilized for labor initiatives.
Suspension of tariff benefits of an equivalent dollar value may
result from a Party's failure to pay the monetary assessment.
Environment. Chapter 18 of the Agreement recognizes the
right of each Party to establish its own levels of domestic
environmental protection and environmental development policies
and priorities, and to adopt or modify its environmental laws.
Each Party is obliged to provide fair, open, and equitable
proceedings for the enforcement of its environmental laws, as
well as appropriate and effective remedies for violation of its
environmental laws.
Under the Agreement, a Party shall not fail to effectively
enforce its environmental laws, through a sustained or
recurring course of action or inaction, in a manner affecting
trade between the Parties. The Agreement recognizes that each
Party retains the right to exercise discretion with respect to
investigatory, prosecutorial, regulatory, and compliance
matters and to make decisions regarding the allocation of
resources to enforcement with respect to other environmental
matters determined to have higher priorities.
The Parties commit to ensure that domestic laws provide for
high levels of environmental protection, and to strive to
continue to improve those laws. Each Party also recognizes that
it is inappropriate to encourage trade or investment by
weakening or reducing the protections afforded in domestic
environmental laws. Thus, each Party under the Agreement shall
strive to ensure that it does not waive or otherwise derogate
from, or offer to waive or derogate from, such laws in a manner
that weakens or reduces protections afforded in those laws as
an encouragement for trade with the other Party.
Chapter 18 of the Agreement defines environmental laws as
any statutes or regulations of a Party, or provisions thereof,
the primary purpose of which is the protection of the
environment or the prevention of a danger to human, animal, or
plant life or health, through: the prevention, abatement, or
control of the release or emission of pollutants or
environmental contaminants; the control of environmentally
hazardous or toxic chemicals, substances, materials, and
wastes; or, the protection or conservation of wild flora and
fauna, including endangered species, their habitat, and
specially protected natural areas. The Agreement excludes from
the definition of environmental laws any statute or regulation,
or provision thereof, directly related to worker safety or
health.
Chapter 18 calls for the establishment of a Subcommittee of
the Joint Committee established under Chapter 20 of the
Agreement to provide a forum for consultation on the Agreement
and its implementation. Meetings of the Subcommittee shall
normally include a session where members of the Subcommittee
have an opportunity to meet with the public to discuss matters
related to Chapter 18 of the Agreement. Separately, each Party
commits to ensure the opportunity for public participation in
the discussion of matters related to Chapter 18 of the
Agreement. The Parties also commit to pursue cooperative
environmental activities, and to strengthen environmental
performance, under a Memorandum of Intent on Cooperation in
Environmental Matters to be entered into between the Government
of Singapore and the United States, and in other fora.
A Party can request consultations with the other Party
regarding any matter arising under Chapter 18 of the Agreement.
If the Parties fail to resolve the matter through
consultations, either Party may then request that the
Subcommittee of the Joint Committee be convened to address the
matter. Dispute settlement procedures are available only when a
Party asserts under Article 18.2.1(a) that the other Party has
failed to effectively enforce its environmental laws, through a
sustained or recurring course of action or inaction, in a
manner affecting trade between the Parties. In that instance,
the complaining Party may request dispute settlement
proceedings under Chapter 20 of the Agreement, after an initial
60-day consultation period, by referring the matter to the
Joint Committee.
If a panel determines that a Party has not conformed with
its obligations under Article 18.2.1(a) and the Parties are
unable to reach agreement on a resolution, the complaining
Party may request that the panel reconvene to impose an annual
monetary assessment on the other Party not to exceed $15
million, adjusted for inflation pursuant to Annex 20A of the
Agreement. Any assessments will be paid into a fund established
by the Joint Committee and utilized for environmental
initiatives. Suspension of tariff benefits of an equivalent
dollar value may result from a Party's failure to pay the
monetary assessment.
The Parties recognize the importance of multilateral
environmental agreements (MEAs) and agree to consult on the
extent to which the outcome of ongoing WTO negotiations,
regarding the relationship between WTO rules and trade
obligations specified in MEAs, applies to the Agreement. The
Parties also agree to encourage businesses to voluntarily
incorporate sound principles of corporate stewardship into
their internal policies.
Transparency. The Agreement provides for the promulgation
of measures that ensure transparency and fairness in the
adoption and application of administrative action covered by
the Agreement. Parties agree, to the fullest extent possible:
to the advanced publishing of laws, regulations, procedures,
and administrative rulings that they propose to adopt; that on
the request of the other Party, a Party shall promptly respond
and provide information pertaining to any actual or proposed
measure; that administrative proceedings are to be conducted in
a consistently impartial and reasonable manner; and, that each
Party shall maintain judicial and/or administrative tribunals
or procedures for the purpose of the prompt review and possible
correction of final administrative actions regarding matters
covered by the Agreement.
Administrative and Dispute Settlement. Chapter 20 of the
Agreement establishes a dispute settlement mechanism that is
generally applicable to disputes between the Parties regarding
claims that a measure of a Party is inconsistent with the
Agreement or that a Party has otherwise failed to carry out its
obligations under the Agreement, or claims that a measure of
one Party causes nullification or impairment of benefits to the
other Party arising under: Chapter 2 (National Treatment and
Market Access for Goods); Chapter 3 (Rules of Origin); Chapter
8 (Cross Border Trade in Services); or Chapter 16 (Intellectual
Property Rights). For disputes arising under Chapter 17 (Labor)
or Chapter 18 (Environment), dispute settlement procedures
under Chapter 20 of the Agreement may be invoked only with
respect to a Party's obligation to not fail to effectively
enforce its labor or environmental laws, as the case may be,
through a sustained or recurring course of action or inaction,
in a manner affecting trade between the Parties.
A Party must first make a written request for consultations
and deliver the request to other Party. If the Parties fail to
resolve the matter within 60 days of delivery of the request,
either Party may refer the matter to the Joint Committee
established under Chapter 20 of the Agreement. If the Joint
Committee fails to resolve the dispute within 60 days, the
complaining Party may refer the matter to a dispute settlement
panel. By the date of entry into force of the Agreement, the
Parties are obliged to establish a contingent list of five
individuals who can each serve as a panelist or chair of a
panel. Procedures for panel selection are set forth in the
Agreement. The Agreement commits the Parties to establish rules
of procedure for panels; these rules shall include the right to
at least one public hearing before the panel, subject to the
protection of confidential information.
A panel is to present its initial report within 150 days
after the chair is appointed. The initial report shall contain
findings of fact and a determination as to whether: the measure
at issue is inconsistent with the obligations of the Agreement;
a Party has otherwise failed to carryout its obligations under
the Agreement; or, the measure at issue causes a nullification or
impairment of benefits to the other Party as specified in the
Agreement. The initial report shall also contain any other
determination requested by both Parties with regard to the dispute.
After Party comment, the panel is to issue a final report to the
Parties within 45 days of the initial report, unless the Parties agree
otherwise. Public release of the final report is to occur within 15
days thereafter, subject to the protection of confidential information.
Upon receiving the final report, the Parties are to agree on a
resolution of the dispute and, in instances of non-conformance with
obligations under the Agreement or nullification or impairment of
benefits as defined under the Agreement, such resolution, wherever
possible, should be the elimination of the nonconformity or the
nullification or impairment.
If the panel has found non-conformance with obligations
under the Agreement or nullification or impairment of benefits
as defined under the Agreement, and the Parties cannot resolve
their dispute generally within 45 days of receiving the panel's
final report, the Parties must enter into compensation
negotiations. If the Parties cannot agree on compensation
within 30 days, or the Parties agree on compensation or some
other resolution of the dispute and the complaining Party
believes that the other Party has failed to observe the terms
of such resolution, the complaining Party may propose a
suspension of trade benefits of equivalent effect. In general,
the complaining Party may begin suspending trade benefits 30
days after providing notice of its intent to do so. If the
other Party believes that either the proposed suspension of
benefits is manifestly excessive, or that it has eliminated the
nonconformity or nullification or impairment identified by the
panel and therefore suspension of benefits is not warranted,
the Party may request that the panel be reconvened in order to
consider the matter. In that instance, the complaining Party
may not begin suspending benefits until 30 days after receiving
the determination of the reconvened panel; if the panel
determines that the proposed level of benefits to be suspended
is manifestly excessive, it shall determine the level of
benefits it considers to be of equivalent effect.
The complaining Party may not suspend benefits if the
reconvened panel determines that the other Party has eliminated
the nonconformity or nullification or impairment. Similarly,
the complaining Party may not suspend benefits if the other
Party chooses to pay an annual monetary assessment; if the
Parties cannot agree on an amount of monetary assessment, the
amount will be set at a level equal to 50 percent of the level
determined by the reconvened panel or, if the panel has not
reconvened, 50 percent of the amount proposed by the
complaining Party. Unless the Joint Committee decides
otherwise, a monetary assessment is to be paid to the
complaining Party. Where circumstances warrant, the Joint
Committee may decide that a monetary assessment shall be paid
into a fund established by the Joint Committee and expended at
the direction of the Joint Committee for appropriate
initiatives to facilitate trade between the Parties. Suspension
of the full amount of benefits previously identified pursuant
to the Agreement may result from a Party's failure to pay a
monetary assessment.
Where a dispute involves Article 17.2.1(a) (Application and
Enforcement of Labor Laws) or Article 18.2.1(a) (Application
and Enforcement of Environmental Laws), however, and the
Parties either: are unable to reach agreement on a resolution
within 45 days of receiving the panel's final report; or, the
Parties agree on a resolution of the dispute and the
complaining Party considers that the other Party has failed to
observe the terms of such resolution, the complaining Party may
at any time thereafter request that the panel be reconvened to
impose an annual monetary assessment on the other Party. The
panel is to take certain enumerated factors into account in
setting the level of monetary assessment; the amount of the
assessment shall not exceed $15 million annually, adjusted for
inflation pursuant to Annex 20A of the Agreement. The amount is
to be paid into a fund established by the Joint Committee and
is to be expended at the direction of the Joint Committee for
appropriate labor or environmental initiatives, as the case may
be, in the territory of the Party complained against. If the
assessment is not paid, the complaining Party may take other
appropriate steps to collect the assessment, including
suspending tariff benefits under the Agreement.
The Agreement also establishes a compliance review
procedure available in all disputes, under which the Party
complained against may request that the panel determine whether
a previously identified nonconformity or nullification or
impairment has been eliminated. The panel must report within 90
days and, if it decides that the Party is in compliance, the
complaining Party must promptly reinstate any benefits that it
has suspended and the other Party will no longer be required to
pay any monetary assessment.
Not later than 5 years after the Agreement enters into
force, the Joint Committee is required to review the operation
and effectiveness of the provisions in Chapter 20 of the
Agreement that address non-implementation of the final report
(i.e. the provisions allowing for suspension of benefits or
imposition of monetary assessments). In the event five
proceedings initiated under Chapter 20 of the Agreement result
in either the suspension of benefits or the imposition of
monetary assessments, the Joint Committee shall complete its
review within 6 months of the fifth such occurrence, if sooner
than 5 years after the Agreement enters into force.
General and Final Provisions. Chapter 21 of the Agreement
sets out general provisions that apply to large portions of the
Agreement. It incorporates general provisions on issues such as
balance of payments, general exceptions, essential security,
taxation, disclosure of information, and corruption, including
mechanisms for accession to the Agreement and entry into force
of the Agreement, and a provision on the legal significance of
Annexes.
Chapter 21 of the Agreement further provides that the
Agreement will not affect either Party's rights or obligations
under any tax convention and sets out circumstances under which
tax measures are subject to the Agreement's national treatment
obligation for goods, the national treatment and normal trade
relation/most-favored-nation (NTR/MFN) obligations for
services, prohibitions on performance requirements, and
expropriation rules.
The Agreement also provides that a Party may withhold
information from the other Party where disclosure will impede
law enforcement, would be contrary to the public interest, or
would prejudice the legitimate commercial interests of a public
or private enterprise.
Parties further affirm their commitment to the adoption,
cooperation on, maintenance, and enforcement of, effective
anti-corruption measures, including deterrent penalties against
bribery and corruption in international business transactions.
Included in Chapter 21 of the Agreement are terms of
accession which allow other countries to accede to the
Agreement, subject to terms and conditions agreed upon between
such countries and the Parties, in accordance with applicable
legal procedures of each Party and the full consent of each
Party.
Chapter 21 of the Agreement also provides that the Annexes
are part of the Agreement and that the Parties may amend the
Agreement subject to applicable domestic procedures. This
Chapter also provides that the Agreement will enter into force
60 days after the exchange of written notifications and can be
terminated 6 months after a Party provides written notice of
its intention to withdraw from the Agreement.
D. GENERAL DESCRIPTION OF THE BILL
TITLE I. APPROVAL OF, AND GENERAL PROVISIONS RELATING TO, THE AGREEMENT
Sec. 101. Approval and Entry Into Force of the Agreement
This section provides Congressional approval for the
Agreement and its accompanying Statement of Administrative
Action. Section 101 also authorizes the President to exchange
notes with Singapore to provide for entry into force of the
Agreement on or after January 1, 2004. The exchange of notes is
conditioned on a determination by the President that Singapore
has taken measures necessary to comply with those of its
obligations that take effect at the time the Agreement enters
into force.
Sec. 102. Relationship of the Agreement to United States and State Law
This section establishes the relationship between the
Agreement and U.S. law. It clarifies that no provision of the
Agreement will be given effect under domestic law if
inconsistent with Federal law; this would include provisions of
Federal law enacted or amended by the Act.
Section 102 also provides that no State law may be declared
invalid on the ground that the law is inconsistent with the
Agreement, except in an action brought by the United States for
the purpose of declaring such law invalid. This section
precludes any private right of action or remedy against the
Federal Government, or a State government, based on the
provisions of the Agreement.
Sec. 103. Consultation and Layover Provisions for, and Effective Date
of, Proclaimed Actions
This section sets forth consultation and layover steps that
must precede the President's implementation of any tariff
modification by proclamation. Under the consultation and
layover provisions, the President must obtain the advice of the
relevant private sector advisory committees and the U.S.
International Trade Commission (ITC) on a proposed action. The
President must submit a report to the Senate Committee on
Finance and the House Committee on Ways and Means setting forth
the action proposed, the reasons therefore, and the advice of
the private sector advisors and the ITC. The Act sets aside a
60 day period following the date of transmittal of the report
for the Committees to consult with the President on the action.
Sec. 104. Implementing Actions in Anticipation of Entry Into Force and
Initial Regulations
This section provides the authority for new or amended
regulations to be issued, and for the President to proclaim
actions implementing the provisions of the Agreement, on the
date the Agreement enters into force. This section also
requires that, whenever possible, all Federal regulations
required or authorized under the Implementation Act are to be
developed and promulgated within 1 year of the Agreement's
entry into force.
Sec. 105. Administration of Dispute Settlement Proceedings
This section authorizes the President to establish or
designate within the Department of Commerce an office
responsible for providing administrative assistance to dispute
settlement panels established under Chapter 20 of the
Agreement. This section also authorizes the appropriation of
funds to support this office.
Sec. 106. Arbitration of Certain Claims
This section authorizes the United States to use binding
arbitration to resolve claims covered by two provisions of the
Agreement that concern government contracts. This section also
provides that contracts executed by an agency of the United
States on or after the 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. Effective Dates; Effect of Termination
This section provides the dates that certain provisions of
the Act will go into effect. This section also provides that
the provisions of the Implementation Act will no longer be in
effect on the date on which the Agreement ceases to be in
force.
TITLE II. CUSTOMS PROVISIONS
Sec. 201. Tariff Modifications
This section authorizes the President to implement by
proclamation the continuation, modification or elimination of
tariffs as the President determines to be necessary or
appropriate to carry out the terms of the Agreement.
Section 201(b) authorizes the President, subject to the
consultation and layover provisions of section 103(a) of the
bill, to: modify or continue any duty; modify the staging of
duty elimination pursuant to an agreement with Singapore under
Article 2.2.3 of the Agreement; keep in place duty-free or
excise treatment; or, impose any duty by proclamation whenever
the President determines it to be necessary or appropriate to
maintain the general level of reciprocal and mutually
advantageous concessions with respect to Singapore provided by
the Agreement.
Sec. 202. Rules of Origin
This section implements the general rules of origin set
forth in Chapter 3 of the Agreement. Under the general rules,
there are four basic ways for a good imported from Singapore to
qualify as an originating good, and therefore be eligible for
preferential tariff treatment when the good is imported into
the United States.
First, a good is an originating good if it is wholly
obtained or produced entirely in the territory of Singapore,
the United States, or both. Second, the general rules of origin
provide that a good is an originating good if those materials
used to produce the good that are not themselves originating
goods are transformed in such a way as to cause their tariff
classification to change or meet other requirements, as
specified in Annex 3A of the Agreement.
Third, Article 3.2 provides that a good listed in Annex 3B
of the Agreement is considered to be an originating good if it
is imported into the territory of the United States from the
territory of Singapore. The goods listed in Annex 3B are
information technology goods and certain other goods for which
the current normal trade relation/most-favored-nation (NTR/MFN)
duty rate of the United States is zero. Thus, imports of these
goods into the United States would receive duty-free treatment
regardless of origin. The Agreement provides that a product
listed in Annex 3B (the Integrated Sourcing Initiative or ISI
product list) is an originating good only if it is shipped from
one Agreement Party to the other. If a product is shipped from
a non-Agreement party to Singapore, but is not then shipped
between Singapore and the United States, the product does not
meet the criteria for treatment as an originating good under
the Agreement. The ISI provisions of the Agreement do not
affect the applicability of normal rules of origin, except in
the limited situation of shipments between Singapore and the
United States.
Finally, the remainder of section 202 sets forth specific
rules for determining whether a good qualifies as an
originating good under the Agreement. Section 202(b) provides
that a good is not disqualified as an originating good if it
contains de minimis quantities of non-originating materials
that do not undergo a tariff transformation. Section 202(d)
implements provisions in Annex 3A of the Agreement that require
certain goods to have at least a specified percentage of
regional value content to qualify as originating goods. Section
202(d) prescribes alternative methods for calculating regional
value content. Other provisions in section 202 address the
valuation of materials and the determination of originating or
non-originating status for fungible goods and materials.
This section also authorizes the President to modify
certain of the Agreement's specific rules of origin by
proclamation, subject to the consultation and layover
provisions of section 103 of the Implementation Act. Section
202 expressly limits the President's authority to modify
specific rules of origin pertaining to textile and apparel
goods and precludes the modification by proclamation of
provisions of Annex 3B of the Agreement (the Integrated
Sourcing Initiative or ISI product list).
Sec. 203. Customs User Fees
This section amends Section 13031(b) of the Consolidated
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c) to
provide for the immediate elimination of the merchandise
processing fee for goods qualifying for preferential treatment
under the terms of the United States-Singapore Free Trade
Agreement. Processing of goods under the Agreement will be
financed by money from the General Fund of the Treasury.
Sec. 204. Disclosure of Incorrect Information
This section provides that the United States may not impose
a penalty on an importer who makes an invalid claim for
preferential tariff treatment under the Agreement if, after
discovering that the claim is invalid, the importer promptly
and voluntarily corrects the claim and pays any duty owing.
Sec. 205. Enforcement Relating to Trade in Textile and Apparel Goods
This section authorizes the President to apply anti-
circumvention provisions concerning textile and apparel goods.
In particular, this section authorizes the President to bar
textile and apparel goods from an exporter or producer that has
engaged in intentional circumvention or refused permission for
U.S. officials to conduct a verification visit at its
facilities in Singapore. Section 205 also authorizes the
President to take action against circumvention that has not
been addressed through bilateral cooperation by denying
preferential tariff treatment for the goods subject to the
circumvention and for other textile and apparel goods produced
by the enterprise that has been found to have engaged in the
circumvention.
Sec. 206. Regulations
This section requires the Secretary of the Treasury to
prescribe regulations necessary to carry out the tariff-related
provisions of the Agreement, including the rules of origin
provisions.
TITLE III. RELIEF FROM IMPORTS
Sec. 301. Definitions
This section defines the terms ``Commission'' and
``Singaporean Article'' for purposes of the bilateral safeguard
provision contained in Chapter 7 of the United States-Singapore
Free Trade Agreement. The term ``Commission'' is defined as the
United States International Trade Commission, and the term
``Singaporean Article'' is defined as an article that qualifies
as an originating good under section 202(a) of the United
States-Singapore Free Trade Agreement Implementation Act. This
section also defines the term ``Singaporean Textile or Apparel
Article'' for purposes of the textile and apparel safeguard
provision contained in Chapter 5 of the United States-Singapore
Free Trade Agreement. The term ``Singaporean Textile or Apparel
Article'' is defined as an article 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. Sec. 3511(d)(4)), and that satisfies the definition of a
Singaporean article as provided for in this section.
Subtitle A. Relief From Imports Benefiting From the Agreement
Sec. 311. Commencing of Action for Relief
This section requires the filing of a petition with the
Commission by an entity that is representative of an industry
in order to commence a bilateral safeguard investigation.
Section 311(a) permits a petitioning entity to request
provisional relief as if the petition had been filed under
section 202(a) of the Trade Act of 1974 (19 U.S.C.
Sec. 2252(a)). Any request for provisional relief based upon an
allegation of ``critical circumstances'' shall include such
allegation in the petition.
Section 311(b) provides that, upon the filing of a
petition, the Commission shall promptly initiate an
investigation to determine whether, as a result of the
reduction or elimination of a duty provided for under the
United States-Singapore Free Trade Agreement, a Singaporean
article is being imported into the United States in such
increased quantities, and under such conditions, that imports
of the Singaporean article constitute a substantial cause of
serious injury, or threat of serious injury, to the domestic
industry producing an article that is like, or directly
competitive with, the imported article.
Section 311(c) applies to any bilateral safeguard initiated
under the Agreement certain provisions, both substantive and
procedural, contained in section 202 of the Trade Act of 1974
(19 U.S.C. Sec. 2252) that apply to global safeguard
investigations. These provisions include, inter alia, the
requirement that the Commission publish notice of the
commencement of an investigation; the requirement that the
Commission hold a public hearing at which interested parties
and consumers have the right to be present, to present
evidence, and to respond to the presentations of other parties
and consumers; the factors to be taken into account by the
Commission in making its determinations; and, authorization for
the Commission to promulgate regulations to provide access to
confidential business information under protective order to
authorized representatives of interested parties in an
investigation.
Section 311(d) precludes the initiation of an investigation
with respect to any Singaporean article to which import relief
has already been provided under either: this bilateral
safeguard provision; the textile and apparel safeguard
provision set forth in subtitle B of title III of the United
States-Singapore Free Trade Agreement Implementation Act; the
global safeguard provision set forth in Chapter 1 of title II
of the Trade Act of 1974 (19 U.S.C. Sec. 2251 et seq.); article
6 of the Agreement on Textiles and Clothing referred to in
section 101(d)(4) of the Uruguay Round Agreements Act (19
U.S.C. Sec. 3511(d)(4)); or, article 5 of the Agreement on
Agriculture referred to in section 101(d)(2) of the Uruguay
Round Agreements Act (19 U.S.C. Sec. 3511(d)(2)).
Sec. 312. Commission Action on Petition
This section establishes deadlines for Commission
determinations following the initiation of a bilateral
safeguard investigation. Section 312(b) applies certain
statutory provisions that address a divided vote by the
Commission in a global safeguard investigation under section
202 of the Trade Act of 1974 (19 U.S.C. Sec. 2252), to
Commission determinations under this section. If the Commission
renders an affirmative injury determination, or a determination
that the President may consider to be an affirmative
determination in the event of a divided vote by the Commission,
section 312(c) requires that the Commission also find and
recommend to the President the amount of import relief that is
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.
Section 312(d) specifies the information to be included by the
Commission in a report to the President regarding its
determination. Upon submitting the requisite report to the
President, section 312(e) requires the Commission to promptly
make public such report, except for confidential information
contained in the report.
Sec. 313. Provision of Relief
This section directs the President, not later than 30 days
after receiving the report from the Commission, to provide
relief from imports of the article subject to an affirmative
determination by the Commission, or a determination that the
President considers to be an affirmative determination in the
event of a divided vote by the Commission, to the extent that
the President determines necessary to remedy or prevent the
injury and to facilitate the efforts of the domestic industry
to make a positive adjustment to import competition. Under
section 313(b), the President is not required to provide import
relief if the President determines that the provision of the
import relief will not provide greater economic and social
benefits than costs.
Section 313(c) specifies the nature of the import relief
that the President may impose, to include: the suspension of
any further reduction in duty provided under Annex 2B of the
United States-Singapore Free Trade Agreement; and, an increase
in the rate of duty imposed on such article to a level that
does not exceed the lesser of (1) the normal trade relation/
most-favored-nation (NTR/MFN) duty rate imposed on like
articles at the time the import relief is provided, or (2) the
NTR/MFN duty rate imposed on like articles on the day before
the date on which the United States-Singapore Free Trade
Agreement enters into force. In the case of a duty applied on a
seasonal basis to an article, the President may increase the
rate of duty imposed on such article to a level that does not
exceed the lesser of (1) the NTR/MFN duty rate imposed on like
articles for the immediately preceding corresponding season, or
(2) the NTR/MFN duty rate imposed on like articles on the day
before the date on which the United States-Singapore Free Trade
Agreement enters into force. Section 313(c) also requires that
if the period for which import relief is provided exceeds 1
year, the President shall provide for the progressive
liberalization (described in article 7.28 of the United States-
Singapore Free Trade Agreement) of such relief at regular
intervals during the period of its application.
Section 313(d) provides that the initial period for import
relief in a bilateral safeguard action shall not exceed 2
years. The President is authorized to extend the effective
period of such relief under section 313(d) if the President
determines that import relief continues to be necessary to
remedy or prevent serious injury and to facilitate adjustment
to import competition, and that there is evidence that the
domestic industry is making a positive adjustment to import
competition. Before the President can extend the period of
import relief, the President must first receive a report from
the Commission under section 313(d)(2)(B) containing an
affirmative determination, or a determination that the
President may consider to be an affirmative determination in
the event of a divided vote by the Commission, that import
relief continues to be necessary to remedy or prevent serious
injury and that the domestic industry is making a positive
adjustment to import competition. Section 313(d) also provides
that the total period for import relief in a bilateral
safeguard action, including any extension of such import
relief, shall not exceed 4 years.
Section 313(e) provides that upon termination of import
relief under the bilateral safeguard provision, the rate of
duty to be applied is the rate of duty that would have been in
effect on that date with respect to the article, but for the
provision of such import relief.
Section 313(f) provides that no import relief may be
provided under the bilateral safeguard provision on any article
that has been subject to relief, after entry into force of the
United States-Singapore Free Trade Agreement, under either:
this bilateral safeguard provision; the textile and apparel
safeguard provision set forth in subtitle B of title III of the
United States-Singapore Free Trade Agreement Implementation
Act; the global safeguard provision set forth in Chapter 1 of
title II of the Trade Act of 1974 (19 U.S.C. Sec. 2251 et
seq.); article 6 of the Agreement on Textiles and Clothing
referred to in section 101(d)(4) of the Uruguay Round
Agreements Act (19 U.S.C. Sec. 3511(d)(4)); or, article 5 of
the Agreement on Agriculture referred to in section 101(d)(2)
of the Uruguay Round Agreements Act (19 U.S.C.
Sec. 3511(d)(2)). This section is necessary to implement
article 7.2.7 of the United States-Singapore Free Trade
Agreement, in the event that an article subject to import
relief under the bilateral safeguard subsequently becomes
subject to import relief under one of these other provisions.
Sec. 314. Termination of Relief Authority
This section provides that the President's authority to
impose import relief under the bilateral safeguard provision
ends after the date that is 10 years after the date on which
the United States-Singapore Free Trade Agreement enters into
force. Section 314(b) contains an exception to this general
rule. The President may provide import relief under the
bilateral safeguard provision after the date that is 10 years
after the date on which the United States-Singapore Free Trade
Agreement enters into force if the President determines that
the Government of Singapore has consented to the imposition of
such import relief.
Sec. 315. Compensation Authority
This section authorizes the President, under section 123 of
the Trade Act of 1974 (19 U.S.C. Sec. 2133), to grant Singapore
new concessions as compensation for the imposition of import
relief in a bilateral safeguard investigation, in order to
maintain the general level of reciprocal concessions.
Sec. 316. Confidential Business Information
This section applies the same procedures for the treatment
and release of confidential business information by the
Commission in a global safeguard investigation under Chapter 1
of title II of the Trade Act of 1974 (19 U.S.C. Sec. 2251 et
seq.) to bilateral safeguard investigations under this
provision.
Subtitle B. Textile and Apparel Safeguard Measures
Sec. 321. Commencement of Action for Relief
This section requires the filing of a request with the
President by an interested party in order to commence action
for relief under the textile and apparel safeguard provision.
Upon the filing of a request, the President shall review the
request to determine, from the information presented in the
request, whether to commence consideration of the request.
Section 321(b) provides that, if the President determines that
the request 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. Determination and Provision of Relief
This section provides that following the President's
commencement of consideration of the request, the President
shall determine whether, as a result of the elimination of a
duty under the United States-Singapore Free Trade Agreement, a
Singaporean textile or apparel article is being imported into
the United States in such increased quantities and under such
conditions that imports of the article constitute a substantial
cause of serious damage, or actual threat thereof, to a
domestic industry producing an article that is like, or
directly competitive with, the imported article.
Section 322(a) identifies certain economic factors that the
President shall examine in making a determination, including
changes in the domestic industry's output, productivity,
capacity utilization, inventories, market share, exports,
wages, employment, domestic prices, profits, and investment,
none of which is necessarily decisive. Section 322(a) also
provides that the President shall not consider changes in
technology or consumer preference as factors supporting a
determination of serious damage or actual threat thereof.
Section 322(b) authorizes the President, in the event of an
affirmative determination of serious damage or actual threat
thereof, to provide import relief to the extent that the
President determines necessary to remedy or prevent the serious
damage and to facilitate adjustment by the domestic industry to
import competition. Section 322(b) also specifies the nature of
the import relief that the President may impose, to consist of:
the suspension of any further reduction in duty provided under
Annex 2B of the United States-Singapore Free Trade Agreement;
or, an increase in the rate of duty imposed on such article to
a level that does not exceed the lesser of (1) the normal trade
relation/most-favored-nation (NTR/MFN) duty rate imposed on
like articles at the time the import relief is provided, or (2)
the NTR/MFN duty rate imposed on like articles on the day
before the date on which the United States-Singapore Free Trade
Agreement enters into force.
Sec. 323. Period of Relief
This section provides that the initial period for import
relief in a textile and apparel safeguard action shall not
exceed 2 years. The President is authorized to extend the
effective period of such relief under section 323(b) if the
President determines that import relief continues to be
necessary to remedy or prevent serious damage and to facilitate
adjustment to import competition, and that there is evidence
that the domestic industry is making a positive adjustment to
import competition. Section 323(b) also provides that the total
period for import relief in a textile and apparel safeguard
action, including any extension of such import relief, may not
exceed 4 years.
Sec. 324. Articles Exempt From Relief
This section precludes the President from providing import
relief under the textile and apparel safeguard provision with
respect to any article to which import relief has already been
provided under the textile and apparel safeguard provision.
Sec. 325. Rate After Termination of Import Relief
This section provides that the duty rate applicable to a
textile or apparel article after termination of the import
relief shall be the duty rate that would have been in effect on
that date but for the provision of such import relief.
Sec. 326. Termination of Relief Authority
This section provides that the President's authority to
provide relief under the textile and apparel safeguard
provision terminates after the date that is 10 years after the
date on which the provisions of the United States-Singapore
Free Trade Agreement relating to trade in textile and apparel
goods take effect pursuant to article 5.10 of the United
States-Singapore Free Trade Agreement.
Sec. 327. Compensation Authority
This section authorizes the President, under section 123 of
the Trade Act of 1974 (19 U.S.C. Sec. 2133), to grant Singapore
new concessions as compensation for the imposition of import
relief in a textile and apparel safeguard proceeding, in order
to maintain the general level of reciprocal concessions.
Sec. 328. Business Confidential Information
This section precludes the President from releasing
information that 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. This section also provides that, 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.
Subtitle C. Cases Under Title II of the Trade Act of 1974
Sec. 331. Findings and Action on Goods From Singapore
This section authorizes the President, when imposing global
safeguard relief under Chapter 1 of title II of the Trade Act
of 1974 (19 U.S.C. Sec. 2251 et seq.), to exercise the
discretion to exclude imports from Singapore that would
otherwise be subject to the global safeguard relief, if certain
conditions are met. Section 331(a) requires the Commission to
find and report to the President whether imports of the article
from Singapore are a substantial cause of serious injury or
threat thereof. Section 331(b) requires the President, in
determining the nature and extent of action to be taken under
Chapter 1 of title II of the Trade Act of 1974 (19 U.S.C.
Sec. 2251 et seq.), to also determine whether imports from
Singapore are a substantial cause of the serious injury or
threat thereof found by the Commission. If the President
determines that imports from Singapore are not a substantial
cause of the serious injury or threat thereof found by the
Commission, the President may exclude imports from Singapore
from any global safeguard relief action taken by the President.
TITLE IV. TEMPORARY ENTRY OF BUSINESS PERSONS
Sections 401 and 402 implement Chapter 11 of the Agreement
with respect to providing for the temporary entry of business
persons. These provisions are more fully addressed in Part II.,
Report of the Committee on the Judiciary.
E. CONGRESSIONAL ACTION
On November 16, 2000, President William J. Clinton and
Prime Minister Goh Chok Tong of Singapore agreed that in
December 2000 the two countries would begin negotiations on a
United States-Singapore Free Trade Agreement. On October 1,
2002, President George W. Bush notified the Congress of ongoing
negotiations between the United States and Singapore on a free
trade agreement. On January 29, 2003, President Bush notified
Congress of his intention to enter into the United States-
Singapore Free Trade Agreement. President Bush and Prime
Minister Goh signed the Agreement on May 6, 2003. The
Administration published the Agreement on May 7, 2003, and
informally submitted draft implementing legislation to the
108th Congress in June 2003.
On June 10, 2003, the House Ways and Means Committee,
Subcommittee on Trade, held a hearing on the implementation of
the bilateral Free Trade Agreements with Singapore and Chile.
The Subcommittee received testimony from the Hon. Earl
Blumenauer (Representative in Congress from the State of
Oregon); the Hon. Pete Sessions (Representative in Congress
from the State of Texas); the Hon. Judy Biggert (Representative
in Congress from the State of Illinois); the Hon. Peter F.
Allgeier (Deputy United States Trade Representative); E. Leon
Trammell (founder and chief executive officer, Tramco,
Incorporated, on behalf of the U.S. Chamber of Commerce); Jeff
Jacobs (president, Global Business Development, QUALCOMM,
Incorporated); Keith Gottfried (senior vice president and
general counsel, Borland Software Corporation, on behalf of the
Business Software Alliance); Bob Haines (manager, International
Relations, Exxon Mobil Corporation, and co-chair, U.S.-
Singapore Free Trade Agreement Business Coalition); Joseph
Papovich (senior vice president, international, Recording
Industry Association of America, on behalf of the Entertainment
Industry Coalition for Free Trade); David Spence (managing
director, regulatory and industry affairs, Legal Department,
Federal Express, and chairman, Trade Committee, Air Courier
Conference of America); Gawain Kripke (senior policy advisor,
Oxfam America); Thea M. Lee (chief international economist,
American Federation of Labor and Congress of Industrial
Organizations); John Audley (senior associate and director,
Project on Trade, Equity, and Development, Carnegie Endowment
for International Peace).
On June 17, 2003, the Senate Committee on Finance held a
public hearing on the implementation of the bilateral Free
Trade Agreements with Singapore and Chile. The Committee
received testimony from the Hon. Christopher S. Bond (Senator
from the State of Missouri); the Hon. Peter Allgeier (Deputy
United States Trade Representative); Norman Sorensen
(president, Principal International Incorporated, on behalf of
the Coalition of Service Industries); James Jarrett (vice
president for worldwide government affairs, Intel Corporation,
on behalf of the Business Software Alliance and the High Tech
Trade Coalition); Jeffrey Shafer (managing director, Citigroup,
on behalf of the U.S.-Singapore Free Trade Agreement Business
Coalition); Sandra Polaski (senior associate, Carnegie
Endowment for International Peace); Larry Liebenow (president
and chief executive officer, Quaker Fabric Corporation, and
chairman of the executive committee of the U.S. Chamber of
Commerce); Jon Caspers (Pleasant Valley Pork Corporation, and
president of the National Pork Producers Council); Keith Schott
(Bar Four F Ranch Incorporated, and treasurer, Montana Grain
Growers Association); David Johnson (executive vice president
and general counsel, Warner Music Group, on behalf of the
Entertainment Industry Coalition for Free Trade); and Paul
Joffe (senior director for international affairs, National
Wildlife Federation).
On July 10, 2003, the Senate Committee on Finance conducted
an informal consideration of the implementing language
submitted by the Administration. In addition, the House Ways
and Means Committee and the House Judiciary Committee conducted
their informal considerations of the implementing language on
July 10, 2003, respectively. On July 14, 2003, the Senate
Judiciary Committee notified an informal consideration of the
Administration's implementing language.
On July 15, 2003, the Administration formally transmitted
to Congress the implementing legislation for the United States-
Singapore Free Trade Agreement. On July 15, 2003, Senator
Charles E. Grassley introduced legislation in the Senate
(S.1417), with Senator Max Baucus and Senator Bill Frist as
cosponsors, to implement the Agreement. Congressman Tom DeLay,
with Congressman Charles Rangel as a cosponsor, as respective
designees for the Speaker of the House and the Minority Leader
of the House and by request, introduced the identical
legislation in the House (H.R. 2739), on July 15, 2003.
On July 14, 2003, the Senate Judiciary Committee held a
public hearing on draft implementing legislation for the
proposed United States-Singapore Free Trade Agreement. The
Committee received testimony from Regina Vargo (Assistant
United States Trade Representative for the Americas), and Ralph
Ives (Assistant United States Trade Representative for
Southeast Asia, Pacific, and APEC Affairs). The House Judiciary
Committee favorably voted out the measure on July 16, 2003, by
voice vote.
On July 17, 2003, the Senate Committee on Finance
unanimously reported out S.1417, a bill to implement the United
States-Singapore Free Trade Agreement, by a vote of 21-0. The
House Ways and Means Committee also favorably reported out H.R.
2739 on July 17, 2003, by a vote of 32-5. On the same day, the
Senate Judiciary Committee also favorably reported out the
measure by a vote of 11-4.
F. VOTE OF THE COMMITTEE IN REPORTING THE BILL
In compliance with section 133 of the Legislative
Reorganization Act of 1946, the Committee states that S.1417
was ordered favorably reported, without amendment, by a
unanimous recorded vote with a quorum present on July 17, 2003.
g. regulatory impact and other matters
In compliance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee states that the
bill will not significantly regulate any individuals or
businesses, will not affect the personal privacy of
individuals, and will result in no significant additional
paperwork.
The following information is provided in accordance with
section 423 of the Unfunded Mandates Reform Act of 1995 (Pub.
L. No. 104-04). The committee has reviewed the provisions of S.
1417 as approved by the Committee on July 17, 2003. In
accordance with the requirement of Pub. L. No. 104-04, the
Committee has determined that the bill contains no
intergovernmental mandates, as defined in the UMRA, and would
not affect the budgets of State, local, or tribal governments.
Part II. Report of the Committee on the Judiciary
A. BACKGROUND
As provided in Article 11.1 et seq. and Annex 11A, the
United States-Singapore Free Trade Agreement (FTA) creates
separate categories of entry for citizens of each country to
engage in a wide range of business and investment activities on
a temporary basis. The FTA addresses four specific categories
of temporary nonimmigrant admissions currently governed by U.S.
immigration law. They are: business visitors, treaty traders
and investors, intra-company transfers, and professional
workers. These categories parallel the visa categories commonly
referred to by the letter and numeral that denotes their
subsection in Sec. 101(a)(15) of the Immigration and
Nationality Act: B-1 visitors, E treaty traders and investors,
L-1 intra-company transferees, and H-1B professional workers.
B-1 nonimmigrants are visitors for business purposes and
are required to be seeking admission for activities other than
purely employment or hire. The difference between a business
visitor and a temporary worker depends also on the source of
the alien's salary. To be classified as a visitor for business,
an alien must receive his or her salary from abroad and must
not receive any remuneration from a U.S. source other than an
expense allowance and reimbursement for other expenses
incidental to temporary stay.
Foreign nationals who are treaty traders enter on the E-1
visa, while those who are treaty investors use the E-2 visa.
Treaty trader is defined as one who seeks temporary admission
to the United States solely to carry on substantial trade,
including trade in services or trade in technology, principally
between the United States and the foreign state of which he/she
is a national. Treaty investor is defined as one who seeks
temporary admission to the United States solely to develop and
direct the operations of an enterprise in which he/she has
invested, or of an enterprise in which he/she is actively in
the process of investing a substantial amount of capital.
Intracompany transferees who work for an international firm
or corporation in executive and managerial positions or have
specialized product knowledge are admitted on L-1 visas. The
prospective L-1 nonimmigrant must demonstrate that he or she
meets the qualifications for the particular job as well as the
visa category. The alien must have been employed by the firm
for at least 6 months in the preceding 3 years in the capacity
for which the transfer is sought.
Foreign nationals seeking H-1B visas for professional
specialty workers go through a 2-step admissions process. Using
a streamlined form of the Labor Condition Application (LCA)
known as labor attestation, employers wishing to bring in an H-
1B professional foreign worker first must attest in an
application to the U.S. Department of Labor (DOL) that the
employer will pay the nonimmigrant the greater of the actual
wages paid other employees in the same job or the prevailing
wages for that occupation; the employer will provide working
conditions for the nonimmigrant that do not cause the working
conditions of the other employees to be adversely affected;
and, there is no strike or lockout. Firms categorized as H-1B
dependent (generally if at least 15% of the workforce are H-1B
workers) must also attest that they have attempted to recruit
U.S. workers and that they have not laid off U.S. workers 90
days prior to or after hiring any H-1B nonimmigrants. The
prospective H-1B nonimmigrants then must demonstrate that they
have the requisite education and work experience for the posted
positions as well as a baccalaureate degree (or equivalent
experience) necessary to be considered a professional specialty
worker. The admission of H-1B nonimmigrants is numerically
limited, with a statutory cap of 65,000 that is temporarily
increased to 195,000 through FY2003.
B. IMPLEMENTING LEGISLATION ON TEMPORARY PROFESSIONAL WORKERS
The USTR's legislation that would implement the Singapore
agreement was introduced July 15, 2003, as S. 1417. Title IV of
this bill would amend several sections of the Immigration and
Nationality Act. Foremost, the bills would amend
Sec. 101(a)(15)(H) of INA to carve out a portion of the H-1B
visas--to be designated the H-1B-1 visa--for professional
workers entering through the FTAs. In many ways the proposed
FTA professional worker visa requirements parallel the H-1B
visa requirements, notably having similar educational
requirements. Although the implementing language, for the
purpose of consistency with the actual FTA, requires
``specialized knowledge'' instead of ``highly specialized
knowledge'' as stated in the current H-1B statute, the
Administration's Statement of Administrative Action (SAA)
clearly instructs that specialized knowledge and highly
specialized knowledge are to be treated similarly. The bill
also amends Sec. 212 of INA to add a labor attestation
requirement for employers bringing in potential FTA
professional workers that is similar to the H-1B labor
attestation statutory requirements. The additional attestation
requirements for ``H-1B dependent employers'' currently
specified in Sec. 212 are not included in the labor attestation
requirements for employers of the proposed FTA professional
workers. The Administration omitted some of the requirements
that are due to ``sunset'' at the end of FY 2003 because it did
not know whether the provisions will continue after the current
fiscal year, and did not wish to impose harsher conditions on
trade partners than the United States currently imposes on
other nations. However, nothing in the implementing language
precludes application of future restrictions on these FTA visas
so long as the restrictions do not conflict with the underlying
terms of the FTA.
S. 1417 contains numerical limits of 5,400 new entries
under the proposed FTA professional worker visa from Singapore.
The bill does not limit the number of times that an alien may
renew the FTA professional worker visa on an annual basis,
unlike H-1B workers who are limited to a total of 6 years.
However, the bar on immigrant intent under INA Sec. 214(b)
applies here, whereas such ban does not apply to H-1B visa
holders. This means that a holder of the FTA visa must show
that he or she intends to return to Singapore and has
maintained substantial ties to Singapore. Otherwise, the United
States government may deny the renewal request. H-1B visa
holders may intend to remain permanently in the United States.
There is also a numerical limitation on the entry of
professional workers. The legislation limits the number of
Singaporean professional workers coming into the United States
to 5,400 annually. Further, the Secretary of Homeland Security
may set a cap lower than the 5,400 limitfor any given year.
Each FTA professional worker visa granted is charged against the total
H-1B cap, whether it remains at 195,000, goes down to 65,000, or if a
new cap is set after the current law sunsets. Moreover, after the fifth
year, a number is charged against the overall H1-B cap for each year
that the FTA professional worker visa is extended.
There is little debate on the investor (E) and business
visitor (B-1) visa provisions of the FTA. Some members of the
Committee have criticized that the intra-company transferee (L-
1) provisions of the FTA do not permit labor certification or
numerical limitations to be placed on these visas. However,
neither the FTA nor S. 1417 precludes imposition of conditions
that would be intended to thwart fraud or to punish fraudulent
use of this visa category.
C. JUDICIARY COMMITTEE ACTION
On July 14, 2003, the Judiciary Committee held a hearing on
the temporary entry provisions of the FTAs with Singapore and
Chile. The USTR provided two witnesses, Ralph Ives and Regina
Vargo, who were the lead negotiators with Singapore and Chile,
respectively.
At the hearing, members of this Committee expressed serious
concerns about the propriety of using trade agreements as the
vehicle to enter into immigration agreements with foreign
countries. The concerns were shared by Republican as well as
Democrat senators.
On July 15, 2003, the Administration transmitted the entire
implementing language for the two trade agreements, including
the provisions for temporary entry of professional workers,
business visitors, intra-company transferees, and investors.
On July 17, 2003, at an Executive Business Meeting of the
Judiciary Committee, the members discussed the temporary entry
provisions of both trade agreements. There was a bipartisan
sentiment that the trade agreements were not the appropriate
vehicle to negotiate immigration provisions. Despite the
general displeasure, the Committee voted in favor of the
temporary entry provisions.
The Committee voted in the following manner for both the
Singapore and the Chile agreements:
YES NO PASS
Mr. Hatch Mr. Sessions Mr. Leahy
Mr. Grassley Mr. Kohl Mr. Biden
Mr. Specter Mrs. Feinstein Mr. Durbin
Mr. Kyl Mr. Feingold Mr. Edwards
Mr. DeWine
Mr. Graham
Mr. Craig
Mr. Cornyn
Mr. Chambliss
Mr. Kennedy
Mr. Schumer
II. BUDGETARY IMPACT OF THE BILL
CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
S. 1417--A bill to implement the United States-Singapore Free Trade
Agreement
Summary: S. 1417 would approve the free trade agreement
(FTA) between the government of the United States and the
government of Singapore that was entered into on May 6, 2003.
It would provide for tariff reductions and other changes in law
related to implementation of the agreement, such as provisions
dealing with dispute settlement, rules of origin, and safeguard
measures for textile and apparel industries. The bill also
would allow the temporary entry of certain business persons
into the United States.
The Congressional Budget Office estimates that enacting the
bill would reduce revenues by $55 million in 2004, by $410
million over the 2004-2008 period, and by about $1 billion over
the 2004-2013 period, net of income and payroll tax offsets.
The bill would not have a significant effect on direct spending
or spending subject to appropriation. CBO has determined that
S. 1417 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would not affect the budgets of state, local, or tribal
governments.
Estimated Cost to the Federal Government: The estimated
budgetary impact of S. 1417 is shown in the following table.
----------------------------------------------------------------------------------------------------------------
By Fiscal Year, in Millions of Dollars--
--------------------------------------------
2004 2005 2006 2007 2008
----------------------------------------------------------------------------------------------------------------
CHANGES IN REVENUES \1\
Estimated revenues................................................. -55 -80 -86 -92 -98
----------------------------------------------------------------------------------------------------------------
\1\ S. 1417 also would affect direct spending and discretionary spending, but the amounts of those changes would
be less than $500,000 a year.
Basis of Estimate
Revenues
Under the United States-Singapore agreement, all tariffs on
U.S. imports from Singapore would be phased out over time. The
tariffs would be phased out for individual products at varying
rates according to one of several different timetables ranging
from immediate elimination to partial elimination over 10
years. According to the U.S. International Trade Commission,
the U.S. collected $88 million in customs duties in 2002 on
about $14.1 billion of imports from Singapore. Of the imports,
only $1.3 billion faced non-zero tariff rates. These dutiable
imports from Singapore consist mostly of certain electrical
machinery, knitted or crocheted apparel, mineral fuels and
oils, surgical and precision instruments, and certain nuclear
reactor components. Based on these data, CBO estimates that
phasing out tariff rates as outlined in the U.S.-Singapore
agreement would reduce revenues by $55 million in 2004, by $410
million over the 2004-2008 period, and by about $1 billion over
the 2004-2013 period, net of income and payroll tax offsets.
This estimate includes the effects of increased imports
from Singapore that would result form the reduced prices of
imported products in the United States, reflecting the lower
tariff rates. It is likely that some of the increase in U.S.
imports from Singapore would displace imports from other
countries. In the absence of specific data on the extent of
this substitution effect, CBO assumes that an amount equal to
one-half of the increase in U.S. imports form Singapore would
display imports form other countries.
Based on current law, S. 1417 would not provide for the
assessment of civil monetary penalties on employers for
violations of the labor attestation process with respect to
certain workers form Singapore. However, if S. 1416, a bill to
implement the United States-Chile FTA, were to be enacted prior
to this bill, S.1417 would allow the Secretary of Labor to
assess such penalties. CBO expects that any additional revenues
collected as a result would amount to less than $500,000 in any
year.
Direct Spending
Title IV of S. 1417 would permit certain traders and
investors form Singapore, and their spouses and children, to
enter the United States as nonimmigrants. The Bureau of
Citizenship and Immigration Service (BCIS) would charge fee of
about $100 to provide nonimmigant visas, so CBO estimates that
the agency could collect several million dollars annually in
offsetting receipts ( a credit against direct spending). The
agency is authorizedto spend such fees without further
appropriation, so the net impact on BCIS spending would not be
significant.
However, if S. 1416 (a bill to implement the United States-
Chile FTA) were to be enacted prior to this bill, title IV
would establish a new nonimmigrant category for certain
professional workers from Singapore. The legislation would
limit the number of annual entries under this category to
5,400, plus spouses and children. The BCIS would charge fees of
about $100 to provide nonimmigrant visas, so CBO estimates that
the agency would collect less than $3 million annually in
offsetting receipts. Again, the agency is authorized to spend
such fees without further appropriation, so the net impact on
BCIS spending would not be significant.
Under current law, the Department of State also collects
$100 application fee for nonimmigrant visas. These collections
are spent on border security and consular functions. CBO
estimates that the net budgetary impact would be less than
$500,000 a year.
Spending Subject to Appropriation
Title I of S. 1417 would authorize the appropriation the
necessary funds for the Department of Commerce to pay the
United States' share of the costs of the dispute settlement
procedures established by the agreement. Based on information
from the agency, CBO estimates that implementing this provision
would cost $100,000 in 2004,and $250,000 in each of the
following years, subject to the availability of appropriated
funds.
Title II would require the International Trade Commission
(ITC) to investigate claims of injury to domestic industries as
a result of the FTA. The ITC would have 120 days to determine
whether a domestic industry has been injured, and if so, would
recommend the necessary amount of import relief. The ITC would
also submit a report on its determination to the President.
According to the ITC, similar FTAs have resulted in only a
handful of cases each year, at an average cost of about
$200,000 per investigation. Based on this information, CBO
estimates the bill would have no significant effect on spending
subject to appropriation.
Summary of Effect on Revenues and Direct Spending: The
overall effects of S. 1417 on revenues and direct spending are
shown in the following table.
--------------------------------------------------------------------------------------------------------------------------------------------------------
By Fiscal Year, In Millions of Dollars--
--------------------------------------------------------------------------------------------
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
--------------------------------------------------------------------------------------------------------------------------------------------------------
Changes in receipts........................................ 0 -55 -80 -86 -92 -98 -104 -110 -117 -124 -132
Changes in outlays......................................... * * * * * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note.--* = less than $500.000.
Source: the Congressional Budget Office.
Intergovernment and Private-Sector Impact: The bill
contains no intergovernmental or private-sector mandates as
defined in UMRA and would not affect the budgets of state,
local, or tribal governments.
Estimate Prepared by: Federal Revenues: Annabelle Bartsch.
Federal Spending: Dispute Settlements--Melissa Zimmerman;
Immigration--Mark Grabowicz, Christi Hawley-Sadoti, and Sunita
D'Monte. Impact on State, Local, and Tribal Governments:
Melissa Merrell. Impact on the Private Sector: Paige Piper/
Bach.
Estimate Approved by: G. Thomas Woodward, Assistant
Director for Tax Analysis; and Peter H. Fontaine, Deputy
Assistant Director for Budget Analysis.
III. ADDITIONAL VIEWS
ADDITIONAL VIEWS OF SENATORS FEINSTEIN AND LEAHY
Article 11.1 et seq. and Annex 11A of the United States-
Singapore Free Trade Agreement (FTA) contains provisions
governing the temporary entry of foreign nationals from
Singapore. Specifically, the agreement would require the United
States to grant temporary entry to business persons under
categories that parallel four nonimmigrant visa categories: the
B-1 business visitor visa, E-1 treaty trader or investor visa,
the L-1 intra-company transfer visa, and the H-1b professional
visa. With the exception of the H-1b visa equivalent, the trade
agreement does not impose numerical limits on the number of
nonimmigrant visas that may be issued in a given year. In fact,
the trade agreement expressly prohibits numerical limits on the
visa categories. In addition, neither party to the agreement
would be permitted to impose labor certification tests or other
similar conditions of entry upon foreign nationals of
Singapore.
On July 15, 2003, despite concerns expressed by members of
Congress over the immigration provisions, the President
transmitted to Congress legislation to implement the U.S.-
Singapore agreement. The legislation was subsequently
introduced in the Senate as S. 1417. Title IV of the
legislation establishes a new H-1B(1) category for the
temporary entry of foreign professionals from Singapore.
BINDING IMMIGRATION POLICY SHOULD NOT BE ENACTED IN TRADE AGREEMENTS
Trade agreements are not the appropriate vehicle for
broadening or constraining immigration policy. Such agreements
are meant to have a permanent impact. They cannot be amended or
modified by subsequent legislation, should Congress choose for
other compelling reasons to alter those provisions. The end
result would be a patchwork of inconsistent immigration laws
that may not serve not national interest.
The authority to establish immigration laws and policies
has historically rested with Congress. Article I, section 8,
clause 4 of the Constitution provides that Congress shall have
power to ``establish an uniform Rule of Naturalization.'' The
Supreme Court has long interpreted this provision of the
Constitution to grant Congress plenary power over immigration
policy.
As the Court found in Galvan v. Press, 347 U.S. 522, 531
(1954), ``that the formulation of policies [pertaining to the
entry of aliens and their right to remain here] is entrusted
exclusively to Congress has become about as firmly imbedded in
the legislative and judicial tissues of our body politic as any
aspect of our government.'' And, as the Court found in
Kleindienst v. Mandel, 408 U.S. 753, 766 (quoting Bountilier v.
INS, 387 U.S. 118, 123 (1967)), ``[t]he Court without exception
has sustained Congress' `plenary power to make rules for the
admission of aliens and to exclude those who possess those
characteristics which Congress has forbidden.'''
The practice of trading immigration visas for business
opportunities restricts the ability of Congress to legislate
and the Executive Branch to administer U.S. immigration law and
protect the interests of American and immigrant workers.
Moreover, such agreements usually involvenegotiating legally
binding provisions that limit the ability of policymakers to correct
abuses or deficiencies in our immigration system.
Because the Office of the United States Trade
Representative has agreed to binding commitments on the
movement of people, congressional measures to correct abuses in
a given visa program could be deemed inconsistent with the
U.S.'s obligations under the agreement, and thus, subject to
penalty. Without express authority from Congress, the U.S.
Trade Representative should not be permitted to negotiate new
visa categories and impose new obligations on our temporary
entry system in the trade agreements.
THE UNITED STATES TRADE REPRESENTATIVE HAS NOT DEMONSTRATED A NEED FOR
ADDITIONAL TEMPORARY ENTRY PROVISIONS
Our current immigration laws accommodate the entry of
foreign workers, providing employers access to a broad range of
temporary professionals. Each year, hundreds of thousands of
visas are issued to temporary workers and their family members.
The growth in the number of foreign professionals admitted for
temporary stays reflects global economic trends.
Not only has the U.S. Trade Representative not demonstrated
a need for negotiating the temporary entry provisions, the
Office did not provide any evidence that current immigration
law would be a barrier to meeting the U.S. obligation to
further trade in goods and services. In fact, current law is
sufficient to accommodate these obligations as evidenced by the
millions of temporary workers that enter the United States each
year.
The principal nonimmigrant visa categories under which
temporary business professionals enter are the B-1 visa for
business visitors, the E visa for traders and investors
entering under bilateral treaties, the H-1b for professionals
working in specialty occupations and the L visa for
intracompany transfers. These categories parallel the
categories of temporary admissions under the U.S.-Singapore
Free Trade Agreement.
In Fiscal year 2002, 4,376,935 foreign nationals entered
under the B-1 temporary business visitor visa; 171,368 entered
under the E treaty-trader visa; another 313,699 entered under
the L intracompany transfer visa; and an additional 370,490
entered the U.S. under the H-1b professional visa. In all, the
United States admitted a total of 5,232,492 foreign nationals
under the current temporary visa categories.
While the Free Trade Agreement with Singapore specifically
expresses the desire to facilitate the temporary entry of
persons fitting these categories, only the E visa category
would need to be modified in order to meet the obligations of
the U.S. and Singapore. Thus, with the possible exception of
the E visa, no evidence has been presented to substantiate the
need to include the temporary entry provisions in the trade
agreement.
Members of the Judiciary Committee asked why the U.S. Trade
Representative believed it necessary to include immigration
provisions in a fast-tracked agreement. The Office of the
United States Trade Representative offered the following
response: ``The international mobility of business persons,
whether in their personal capacity or as employees providing
services, hasbecome an increasingly important component of
competitive markets for suppliers and consumers alike.''
The assertion that there is a direct link between the
temporary entry of ``professionals'' and increased market
access for corporations involved in foreign direct investment
or trade in services, as the U.S. Trade Representative claims,
is questionable. Companies that use the new professional visa
programs would not have to be involved in international trade
and investment in any way. They can be domestic companies,
providing goods or services to domestic consumers. The only
global feature about these companies is their workforce.
Bringing in additional professionals outside of our traditional
H-1b framework has little to do with eliminating barriers to
services trade and foreign direct investment, and thus cannot
be justified as a logical extension of the limited authority
granted to the U.S. Trade Representative by the Trade Promotion
Authority Act.
FREE TRADE VISAS SHOULD NOT BE INDEFINITELY RENEWABLE
Under the trade agreement, the visas for temporary business
persons entering under all the categories in the agreement are
indefinitely renewable. This, in effect, transforms what on
paper is a temporary entry visa program into a permanent visa
program.
While the trade agreement requires temporary professionals
who enter under its term count against the overall cap imposed
on H-1b visas, each visa holder would be permitted to remain in
the United States for an indefinite period of time. Thus,
employers could renew their employees' visas each and every
year under the agreements, with no limits, while also bringing
in new entrants to fill up the annual numerical limits for new
visas. This effectively would prevent Congress from limiting
the duration of such visas when it is in the national interest
to do so.
INSUFFICIENT PROTECTIONS FOR WORKERS--BOTH DOMESTIC AND FOREIGN
TEMPORARY
Today 15.3 million people are unemployed, underemployed, or
have given up looking for work. Of that number, 9.4 million are
considered officially unemployed. These unemployment figures
are the highest in almost a decade. The average person has been
out of work nearly 20 weeks, one of the longest periods since
1948.
While employers are generally good actors, the provisions
as drafted in the trade agreement would increase the number of
temporary foreign workers exposed to exploitation and leave
more to face an uncertain future. By making the visas
indefinitely extendable these workers will remain in limbo with
year-to-year extensions of their stay.
Despite these concerns, the U.S. Trade Representative has
seen fit to push through a free trade agreement with
immigration provisions that significantly weaken the worker
protections under current immigration law. The provisions would
expand the types of occupation currently covered under H-1B to
include: management consultants, disaster relief claims
adjusters, physical therapists, and agricultural managers--
professions that do not require a bachelor's degree. (U.S.-
Singapore Free Trade Agreement, Appendix 11A.2, p. 131.) Nor
would employers be required to demonstrate a shortage of
workers in these professions before hiring foreign nationals
under the agreement.Essentially, these provisions would open
the door to the inclusion of new occupations in the trade agreement
that are not currently included in the H-1b program. The definition of
``specialty occupation'' in the H-1b program is specifically designed
to ensure that employers do not abuse the H-1b program to undercut
American workers in occupations where there is no skill shortage. The
H-1b program defines a ``specialty occupation'' as one that requires
the application of a ``body of highly specialized knowledge.'' The free
trade agreement with Singapore and implementing legislation, on the
other hand, broadens the definition of ``specialty occupation'' to
include any job that requires the application ``of a body of
specialized knowledge.'' Thus, the agreement omits the important
qualifier that the intending foreign professional's knowledge be highly
specialized, thus lowering the standard for admission. This is
unacceptable.
Moreover, unlike the provisions in the agreement, current
law requires ``H-1b dependent'' employers seeking temporary
workers to attest that they are actively trying to recruit U.S.
workers for the positions filled by the foreign workers. They
must also attest that they have not laid off U.S. workers 90
days prior to or after hiring H-1b nonimmigrants. These
additional requirements are not included in the agreement with
Singapore.
Neither the free trade agreement nor the implementing
legislation require the employer to attest and the Department
of Labor to certify that the employer has not laid off a U.S.
worker either 90 days before or after hiring the foreign worker
before the foreign national is permitted to enter the U.S. A
labor certification would require the Department of Labor to
undertake an investigation to verify that the employer's
attestation is accurate and truthful before permitting the
entry of the foreign national. Labor certifications are
expressly prohibited under the trade agreement. Under the
implementing provisions, the Labor Department may review
attestations only for completeness and obvious inaccuracies and
must provide the certification within seven days.
Neither the trade agreement nor the implementing language
provide the Department of Labor the authority to initiate
investigations or conduct spot checks at work sites to uncover
instances of U.S. worker displacement and other labor
violations pertaining to the entry of foreign workers. This is
particularly troublesome, given that in the last two fiscal
years, the Department of Labor investigated 166 businesses with
H-1b violations. As a result of those investigations, H-1b
employers were required to pay more than $5 million in back pay
awards to 678 H-1b workers. This suggests a compelling need to
exercise greater oversight over employers reliant upon foreign
labor.
NO LIMITATIONS ON OTHER VISA CATEGORIES
While the Administration has included a cap of 5,400 on the
foreign professional visa category, there are other categories
under which an unlimited number of foreign nationals from
Singapore could enter: the B-1 visitor visa; the E-treaty/
investor visas; and L-1 intracompany visas (which have recently
been the subject of investigations). None of these categories
are numerically limited under the agreement, and once enacted,
Congress may not subsequently impose caps on these categories
for nationals entering pursuant to this agreement.
Moreover, the agreement expressly prohibits the imposition
of labor certification tests or other similar conditions on
temporary entries under the B-1, E-1 and L-1 visa categories.
While Congress could certainly correct some aspects of the law
implementing the trade agreements, it would be limited in what
it could do by the underlying trade agreement itself.
For example, if Congress decided to better protect U.S.
businesses and workers by amending the laws governing the L-1
visa category to require a labor certification or a numerical
limit before a foreign worker from Singapore could enter the
U.S., it would not be able to do so. Both are plausible options
for dealing with perceived abuses in the visa category. The
trade agreement with Singapore states: ``Neither party may:
(a) As a condition for temporary entry under
paragraph 1, require labor certifications, or other
procedures of similar effect; or
(b) Impose or maintain any numerical restriction
relating to temporary entry under paragraph 1.'' [U.S.-
Singapore Free Trade Agreement, Chapter 11, Annex 11A,
section 3, p. 125.]
These provisions under the trade agreements would
significantly limit Congress' authority to: (a) establish more
stringent labor protections when warranted; and (b) limit the
number of visas that could be issued to nationals of Singapore,
should it deem that it is in the national interest.
The negotiation of temporary entry provisions demands
Congressional oversight and input and public scrutiny,
especially during a time when national security issues are of
such paramount concern to us all. Congress should not
relinquish its traditional authority over immigration power to
any administration, to other countries or to a panel of
international arbiters.
Behind the abstraction, the theories, and the statistics of
the Free Trade Agreement and its implementing provisions, there
is one inescapable factor: the real faces of the working men
and women of this country, and what will happen to them. For
this reason, we dissent from the Committee's majority views on
the temporary entry provisions of the U.S.-Singapore Free Trade
Agreement.
Dianne Feinstein.
Patrick J. Leahy.
ADDITIONAL VIEWS OF SENATOR KENNEDY
I voted in favor of the temporary entry provisions of the
Singapore and Chile Free Trade Agreements, but I have serious
concerns about the inclusion of immigration provisions in trade
agreements.
The implementing legislation submitted to the Committee
reflects a substantial improvement over the provisions
originally shown to the Committee. Many of us had major
concerns about the lack of worker protections in these
agreements, but in the several days before S. 1416 and S. 1417
were transmitted to Congress, bipartisan members of the House
and Senate Judiciary Committees succeeded in making
improvements in this legislation to strengthen these
protections.
The Constitution clearly gives Congress authority over
immigration issues and trade agreements should not change
immigration law without House and Senate approval. The Trade
Promotion Authority process used to implement free trade
agreements requires consultations with Congress, but not the
approval of Congress, amendments to implementing legislation
are prohibited after the legislation is transmitted to
Congress.
Although the number of workers who come to the United
States from Chile and Singapore under these agreements will be
relatively low, the Administration intends to negotiate similar
agreements with Morocco, Central American nations, South
Africa, Australia and other countries. These agreements with
Singapore and Chile should not be allowed to become a precedent
for the Administration to bypass Congress on immigration
issues.
Trade agreements are not an acceptable venue for changing
immigration law unless appropriate approval by Congress has
been obtained to make such changes.
Edward M. Kennedy.
ADDITIONAL VIEWS OF SENATOR KYL
I voted for the entry provisions of the U.S.-Chile and
U.S.-Singapore Free Trade Agreements because I understand the
importance of passing the legislation to implement these
underlying trade agreements. They would both be jeopardized if
forced to be renegotiated. I would like to point out, however,
that I am troubled that the U.S. Trade Representative
negotiated the immigration provisions, and proposed substantive
changes to immigration law, without any real input from the
Congress.
Broadly speaking, I am concerned that such U.S. immigration
law was changed not just by an executive branch of the United
States, but by other countries. It is also troubling that such
changes were negotiated by the United States Trade
Representative (USTR), and not by the U.S. Congress, even
though Congress is solely responsible for regulating the
nation's immigration policy, including the admission of foreign
nationals. Finally, as we prepare to reauthorize the INA's
expiring H1-B law, changes to the H1-B law included in these
agreements could serve as an unwelcome precedent for future
congressional negotiations on the H1-B visa policy.
I would note on the positive side, that within the
immigration requirements included in the treaties with Child
and Singapore, numerous improvements to the implementing
legislation have been made. The agreements allow for the entry
of 5,400 Singapore nationals and 1,400 Chile nationals to enter
the United States under the H1-B visa. The fact that the
proposed visa carve-outs are included in the existing H1-B
category, and that the Chile and Singapore numbers must be
included in the overall H1-B limit, are welcome improvements
over the original legislation's draft. In the original
implementing legislation draft, a separate visa category (an
H1-B(1)) was created that would have prevented any future
changes in our H1-B laws from affecting the proposed new visa
for Chile and Singapore nationals. It is also good that any
future improvements to the H1-B law will also be applicable to
these visas. I am also pleased that the legislation requires
that H1-B visas granted to Chile and Singapore nationals be
included in the nation's overall H1-B cap.
Other improvements from the original draft include a ban on
dual intent, in that a potential employee must be able to prove
that he intends to return home. Current H1-B visa holders do
not have to prove that they ever intend to return home. Another
improvement is the requirement that an attestation be completed
by the sponsoring employer that he sought out available U.S.
workers before offering the job to the person from Chile or
Singapore, just as current H1-B laws require. Moreover, an
additional attestation must be completed after the worker has
been working here for three years, which strengthens current
law. The legislation, unlike the original draft, also requires
that, as does current H1-B law, a fee to be paid by the
sponsoring employer. Other labor assurances were also included
in the final bill.
I am concerned, however, that the implementing legislation
still strays from our current H1-B law in numerous ways. First,
under current H1-B policy, workers can only adjust status twice
and then must adjust status or depart. Workers from Chile and
Singapore, however, will adjust annually--and, they can adjust
annually forever. Admittedly, such workers will be required to
prove that they intend to eventually return to home country but
a worker could conceivably prove that every year for the next
25 years. Such workers who seek renewal will also not be
included in the H1-B cap until the fifth year they apply for a
renewal of their visa.
There is also no requirement in the implementing
legislation that H1-B-dependent employers (15 percent or more
H1-B workers) in the United States undergo additional
attestation requirements before being allowed to bring in
Chilean or Singaporian workers. Current H1-B law requires that
H1-B-dependent employers show that they are ``actively trying
to recruit U.S. workers and that they have not laid off workers
in the last 90 days'' but there is no such requirement included
for H1-B-dependent employers in the U.S.
Immigration law is complicated, not only from a legal
perspective, but from a social and economic perspective. The
implementing legislation was improved a good deal before it was
sent to us. But, changes to the immigration policies
established by Congress should not have been a part of the
underlying trade negotiations. I would hope that the USTR would
commit that any future trade agreements negotiated and
completed under its watch include minimal, and acceptable to
Congress, changes to our immigration laws. In order to move
these agreements forward and hopefully complete action on them
before the August recess, I have voted them out of committee. I
would urge, again, that in future trade negotiations that we
concentrate on the issue of trade and leave changes to
immigration law to the Congress to work on for the good of the
country. Thank you.
Jon Kyl.
ADDITIONAL VIEWS OF SENATOR SESSIONS
The legislation that we have before us is deeply troubling.
The U.S. Trade Representative, by implementing new immigration
provisions in treaty negotiations, has usurped the role of the
legislative branch without any consent from this Congress.
The inclusion of immigration provisions in the Free Trade
Agreements with Chile and Singapore interferes with Congress'
plenary power to regulate the nation's immigration policy. This
power belongs to Congress alone and includes both the temporary
and permanent admissions of foreign nationals into the United
States.
Article I, section 8, clause 4 of the Constitution provides
that Congress shall have power to ``establish a uniform Rule of
Naturalization.'' The Supreme Court has long interpreted this
provision of the Constitution to grant Congress plenary power
over immigration policy. As the Court found in Galvan v. Press,
347 U.S. 522, 531 (1954), ``the formulation of policies
[pertaining to the entry of aliens and their right to remain
here] is entrusted exclusively to Congress has become about as
firmly imbedded in the legislative and judicial tissues of our
body politic as any aspect of our government.'' And, as the
Court held in Kleindienst v. Mandel, 408 U.S. 753, 766 (1972)
(quoting Boutilier v. INS, 386 U.S. 123 (1967)), ``[t]he Court
without exception has sustained Congress' plenary power to make
rules for the admission of aliens and to exclude those who
possess those characteristics which Congress has forbidden.''
As a Senator of this Committee, which has jurisdiction over
immigration policy, it is my duty to preserve the plenary power
of Congress to make immigration policy--I am dedicated to
opposing any erosions of that power.
At the hearing on Monday, the witness for the U.S. Trade
Representative, Mrs.Regina Vargo, was asked what legal
authority the USTR was relying on as a basis for including immigration
law negotiations in trade treaties. The USTR witness responded by
differentiating between temporary and permanent entries into the United
States, stating that because the Chile and Singapore Free Trade
Agreements only contained provisions regarding temporary entries of
foreign persons, the USTR was acting within the bounds of its
negotiating authority. This is not the case.
By negotiating and including immigration law provisions in
a binding bi-lateral treaty that Congress does not have the
power to amend, the USTR has established a dangerous precedent
that will not be tolerated in future trade agreements.
It would have been especially appropriate for the USTR to
ensure that employers who repeatedly use the visa programs
established under the trade agreements abide by all laws
governing the entry of the foreign workers.
The legislation before us today makes the H-1B requirements
under the Chile and Singapore agreements weaker than the
requirements for other H-1B workers and may restrict Congress'
ability to reform the L-1 visa program. Specifically, the
legislation--
Permits the admission of up to 5,400
professionals from Singapore and up to 1,400
professionals from Chile each year;
Permits the almost unlimited renewal of
these visas each year, which could have the effect of
turning a temporary entry visa program into a permanent
visa program; and
Permits the entry of dependent spouses and
children to join these professionals without their
entry into the U.S. being subject to a numerical cap.
If the U.S. Trade Representative continues to negotiate
treaty terms such as the ones before us today, I will be unable
to support them.
I am concerned with the current unemployment rate among
U.S. workers and I am dedicated to preserving their jobs. The
abuse surrounding some immigration visas is contributing to a
record level of unemployment for U.S. high-tech workers.
I welcome, when appropriate, foreign industries within our
borders, and, when appropriate, I fully support foreign workers
coming here to work. I believe the only way to protect the job
market for American workers is to preserve Congress' plenary
power to make laws that affect the ability of foreign workers
to displace American workers from their jobs.
Any provision of a future trade agreement that restricts
the ability of this Congress to protect U.S. jobs will not be
looked upon favorably.
I have great respect and appreciation for both Chile and
Singapore. They are great allies of this country and I want,
very much, to support the Free Trade Agreements that have been
negotiated with them. In this single instance, however, my
support of the trade provisions of the underlying treaty
agreements should not be read as support of the immigration
policies included therein or included in the implementing
legislation.
We have seen some improvement from the provisions included
in the initial draft, and I thought the administration had
heard our message loud and clear. The answers to written follow
up questions, however, do not indicate that the message was
clear enough. My support for the trade agreements should not be
questioned, but the assertion that the USTR now has the
authority to effectively legislate in the area of immigration
was detrimental to my support of the immigration provisions
included herein. I deeply desire to support Chile and Singapore
and had fully planned on voting for the Free Trade Agreements
at every turn. However, in light of the answers that we
received this morning from the USTR--answers to the written
questions submitted by Senators Feinstein, Kennedy and Graham
after Monday's hearing--I cannot support the committee vote
concerning the immigration provisions.
I continue to rely fully on the verbal guarantees we have
received that this process will not happen again in treaty
negotiations. I look forward to working with colleagues from
each nation, but in particular, the businessmen and women who
are engaged in the expansion of trade between our respective
business communities. In Alabama we are indeed fortunate that
several company's from Singapore found opportunities which they
developed into thriving businesses. One such business is
located in my home town of Mobile, Alabama. Mobile Aerospace
Engineering (MAE) is Singapore owned, but more importantly it
is a vibrant business employing over 1,000 local workers. MAE
is a community leader not just in the number of its employees,
but in its community outlook and community involvement. My
visits have revealed that Singapore is indeed a valued economic
partner and trusted ally.
I believe the Governments of Singapore and Chile clearly
understand the message my colleagues and I communicated to the
USTR. Our commitment to trade is not diminished; our message
however is quite clear.
Jeff Sessions.
ADDITIONAL VIEWS OF SENATOR CHAMBLISS
[Excerpted from page 36 of the transcript of the hearing
held on July 14, 2003, by the Committee on the Judiciary
regarding the temporary entry provisions of the Free Trade
Agreements with Chile and Singapore.]
Senator Chambliss. Mr. Chairman, as Chairman of the
Immigration Subcommittee, Senator Kennedy and I have a hearing
set next week to discuss H1-B and L1 visa programs. There is
the potential that after that hearing and subsequent thereto
and other hearings or whatever, we may be talking about
reducing the numbers available under those programs, for
various reasons.
I think for USTR to come in and to, in effect, legislate
immigration policy, as Senator Feinstein has said, is wrong. I
am going to vote for it to get it out of Committee. I am not
committed to voting for it on the floor.
It may be that we need USTR to go back--if they are
planning on, as this article indicates, bringing this type of
legislation forward in every agreement they negotiate under
Fast Track, then we have got a problem. And I think it needs to
be addressed now with the first agreements, and USTR needs to
know that this Subcommittee has jurisdiction over immigration
and we intend to assert it.
Saxby Chambliss.
IV. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
Pursuant to the requirements of paragraph 12 of Rule XXVI of
the Standing Rules of the Senate, changes in existing law made
by the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
SECTION 13031 OF THE CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF
1985
SEC. 13031. FEES FOR CERTAIN CUSTOMS SERVICES.
(a) * * *
(b) Limitations on Fees.--(1) * * *
* * * * * * *
(13) 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-Singapore 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.
* * * * * * *
----------
SECTION 592 OF THE TARIFF ACT OF 1930
SEC. 592. PENALTIES FOR FRAUD, GROSS NEGLIGENCE, AND NEGLIGENCE.
(a) * * *
* * * * * * *
(c) Maximum Penalties.--
(1) * * *
* * * * * * *
(7) Prior disclosure regarding claims under the
united states-singapore free trade agreement.--
(A) 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-Singapore Free Trade Agreement
Implementation Act if the importer, in
accordance with regulations issued by the
Secretary of the Treasury, voluntarily and
promptly makes a corrected declaration and pays
any duties owing.
(B) In the regulations referred to in
subparagraph (A), the Secretary of the Treasury
is authorized to prescribe time periods for
making a corrected declaration and paying
duties owing under subparagraph (A), if such
periods are not shorter than 1 year following
the date on which the importer makes the
incorrect claim that a good qualifies as an
originating good.
* * * * * * *
----------
SECTION 202 OF THE TRADE ACT OF 1974
SEC. 202. INVESTIGATIONS, DETERMINATIONS, AND RECOMMENDATIONS BY
COMMISSION.
(a) Petitions and Adjustment Plans.--
(1) * * *
* * * * * * *
(8) The procedures concerning the release of
confidential business information set forth in section
332(g) of the Tariff Act of 1930 shall apply with
respect to information received by the Commission in
the course of investigations conducted under this
chapter, part 1 of title III of the North American Free
Trade Agreement Implementation Act, [and] title II of
the United States-Jordan Free Trade Area Implementation
Act, and title III of the United States-Singapore Free
Trade Agreement Implementation Act. The Commission may
request that parties providing confidential business
information furnish nonconfidential summaries thereof
or, if such parties indicate that the information in
the submission cannot be summarized, the reasons why a
summary cannot be provided. If the Commission finds
that a request for confidentiality is not warranted and
if the party concerned is either unwilling to make the
information public or to authorize its disclosure in
generalized or summarized form, the Commission may
disregard the submission.
* * * * * * *
SECTION 214 OF THE IMMIGRATION AND NATIONALITY ACT
admission of nonimmigrants
Sec. 214. (a) * * *
(g)(1) * * *
* * * * * * *
[The purported changes made to paragraph (8) of section 214(g) by this
bill are shown below. Section 402(a)(2)(B) of H.R. 2738 inserts at the
end of subsection (g) a new paragraph (8), which is presumed to take
effect prior to the execution of these amendments.]
[(8)(A) The agreement referred to in section
101(a)(15)(H)(i)(b1) is the United States-Chile Free Trade
Agreement.]
(8)(A) The agreements referred to in section
101(a)(15)(H)(i)(b1) are--
(i) the United States-Chile Free Trade Agreement; and
(ii) the United States-Singapore Free Trade
Agreement.
(B)(i) * * *
[(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.]
(ii) The annual numerical limitations described in clause (i)
shall not exceed--
(I) 1,400 for nationals of Chile (as defined in
article 14.9 of the United States-Chile Free Trade
Agreement) for any fiscal year; and
(II) 5,400 for nationals of Singapore (as defined in
Annex 1A of the United States-Singapore Free Trade
Agreement) for any fiscal year.
* * * * * * *