HR 639 IH
112th CONGRESS
1st Session
H. R. 639
To amend title VII of the Tariff Act of 1930 to clarify that
countervailing duties may be imposed to address subsidies
relating to a fundamentally undervalued currency of any foreign
country.
IN THE HOUSE OF REPRESENTATIVES
February 10, 2011
Mr. LEVIN (for himself, Mr. ACKERMAN, Mr. ALTMIRE, Mr. AUSTRIA,
Mr. BECERRA, Ms. BERKLEY, Mr. BISHOP of Georgia, Mr. BISHOP of
Utah, Mr. BLUMENAUER, Mr. BOSWELL, Mr. BRALEY of Iowa, Mr.
BURTON of Indiana, Mr. CARSON of Indiana, Mr. CICILLINE, Mr.
CLARKE of Michigan, Mr. COBLE, Mr. COHEN, Mr. CONNOLLY of
Virginia, Mr. CONYERS, Mr. COSTELLO, Mr. COURTNEY, Mr. CRAVAACK,
Mr. CRITZ, Mr. DAVIS of Illinois, Mr. DEFAZIO, Ms. DELAURO, Mr.
DINGELL, Mr. DONNELLY of Indiana, Mr. DOYLE, Mr. ELLISON, Mr.
FILNER, Mr. FRANK of Massachusetts, Mr. GARAMENDI, Mr. GENE
GREEN of Texas, Mr. GRIJALVA, Mr. HIGGINS, Mr. HINCHEY, Mr.
HOLDEN, Mr. HOLT, Mr. HUNTER, Mr. JOHNSON of Georgia, Mr. JONES,
Ms. KAPTUR, Mr. KILDEE, Mr. KISSELL, Mr. KUCINICH, Mr. LARSON of
Connecticut, Mr. LATOURETTE, Mr. LEWIS of Georgia, Mr. LIPINSKI,
Mr. LOEBSACK, Mr. MANZULLO, Mr. MCHENRY, Ms. MCCOLLUM, Mr.
MCCOTTER, Mr. MCDERMOTT, Mr. MCGOVERN, Mr. MCKINLEY, Mr.
MICHAUD, Mrs. MILLER of Michigan, Mr. GEORGE MILLER of
California, Mr. MURPHY of Connecticut, Mr. MURPHY of
Pennsylvania, Mrs. MYRICK, Mr. NEAL, Ms. NORTON, Mr. PALLONE,
Mr. PASCRELL, Mr. PETERS, Mr. PETRI, Ms. PINGREE of Maine, Mr.
PLATTS, Mr. ROGERS of Kentucky, Mr. ROGERS of Alabama, Mr.
ROHRABACHER, Ms. ROYBAL-ALLARD, Mr. RUSH, Mr. RYAN of Ohio, Ms.
LINDA T. SANCHEZ of California, Mr. SENSENBRENNER, Ms.
SCHAKOWSKY, Mr. SHULER, Mr. SHUSTER, Ms. SLAUGHTER, Mr.
STUTZMAN, Mr. STARK, Ms. SUTTON, Mr. THOMPSON of California, Mr.
TIERNEY, Mr. TONKO, Mr. TOWNS, Mr. TURNER, Mr. VISCLOSKY, Mr.
WELCH, Mr. WOLF, and Ms. WOOLSEY) introduced the following bill;
which was referred to the Committee on Ways and Means
A BILL
To amend title VII of the Tariff Act of 1930 to clarify that
countervailing duties may be imposed to address subsidies
relating to a fundamentally undervalued currency of any foreign
country.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `Currency Reform for Fair Trade
Act'.
SEC. 2. CLARIFICATION REGARDING DEFINITION OF COUNTERVAILABLE
SUBSIDY.
(a) Benefit Conferred- Section 771(5)(E) of the Tariff Act of
1930 (19 U.S.C. 1677(5)(E)) is amended--
(1) in clause (iii), by striking `and' at the end;
(2) in clause (iv), by striking the period at the end and
inserting `, and'; and
(3) by inserting after clause (iv) the following new clause:
`(v) in the case in which the currency of a country in which the
subject merchandise is produced is exchanged for foreign
currency obtained from export transactions, and the currency of
such country is a fundamentally undervalued currency, as defined
in paragraph (37), the difference between the amount of the
currency of such country provided and the amount of the currency
of such country that would have been provided if the real
effective exchange rate of the currency of such country were not
undervalued, as determined pursuant to paragraph (38).'.
(b) Export Subsidy- Section 771(5A)(B) of the Tariff Act of 1930
(19 U.S.C. 1677(5A)(B)) is amended by adding at the end the
following new sentence: `In the case of a subsidy relating to a
fundamentally undervalued currency, the fact that the subsidy
may also be provided in circumstances not involving export shall
not, for that reason alone, mean that the subsidy cannot be
considered contingent upon export performance.'.
(c) Definition of Fundamentally Undervalued Currency- Section
771 of the Tariff Act of 1930 (19 U.S.C. 1677) is amended by
adding at the end the following new paragraph:
`(37) FUNDAMENTALLY UNDERVALUED CURRENCY- The administering
authority shall determine that the currency of a country in
which the subject merchandise is produced is a `fundamentally
undervalued currency' if--
`(A) the government of the country (including any public entity
within the territory of the country) engages in protracted,
large-scale intervention in one or more foreign exchange markets
during part or all of the 18-month period that represents the
most recent 18 months for which the information required under
paragraph (38) is reasonably available, but that does not
include any period of time later than the final month in the
period of investigation or the period of review, as applicable;
`(B) the real effective exchange rate of the currency is
undervalued by at least 5 percent, on average and as calculated
under paragraph (38), relative to the equilibrium real effective
exchange rate for the country's currency during the 18-month
period;
`(C) during the 18-month period, the country has experienced
significant and persistent global current account surpluses; and
`(D) during the 18-month period, the foreign asset reserves held
by the government of the country exceed--
`(i) the amount necessary to repay all debt obligations of the
government falling due within the coming 12 months;
`(ii) 20 percent of the country's money supply, using standard
measures of M2; and
`(iii) the value of the country's imports during the previous 4
months.'.
(d) Definition of Real Effective Exchange Rate Undervaluation-
Section 771 of the Tariff Act of 1930 (19 U.S.C. 1677), as
amended by subsection (c) of this section, is further amended by
adding at the end the following new paragraph:
`(38) REAL EFFECTIVE EXCHANGE RATE UNDERVALUATION- The
calculation of real effective exchange rate undervaluation, for
purposes of paragraph (5)(E)(v) and paragraph (37), shall--
`(A)(i) rely upon, and where appropriate be the simple average
of, the results yielded from application of the approaches
described in the guidelines of the International Monetary Fund's
Consultative Group on Exchange Rate Issues; or
`(ii) if the guidelines of the International Monetary Fund's
Consultative Group on Exchange Rate Issues are not available, be
based on generally accepted economic and econometric techniques
and methodologies to measure the level of undervaluation;
`(B) rely upon data that are publicly available, reliable, and
compiled and maintained by the International Monetary Fund or,
if the International Monetary Fund cannot provide the data, by
other international organizations or by national governments;
and
`(C) use inflation-adjusted, trade-weighted exchange rates.'.
SEC. 3. REPORT ON IMPLEMENTATION OF ACT.
(a) In General- Not later than 9 months after the date of the
enactment of this Act, the Comptroller General of the United
States shall submit to Congress a report on the implementation
of the amendments made by this Act.
(b) Matters To Be Included- The report required by subsection
(a) shall include a description of the extent to which United
States industries that have been materially injured by reason of
imports of subject merchandise produced in foreign countries
with fundamentally undervalued currencies have received relief
under title VII of the Tariff Act of 1930 (19 U.S.C. 1671 et
seq.), as amended by this Act.
SEC. 4. APPLICATION TO GOODS FROM CANADA AND MEXICO.
Pursuant to article 1902 of the North American Free Trade
Agreement and section 408 of the North American Free Trade
Agreement Implementation Act of 1993 (19 U.S.C. 3438), the
amendments made by section 2 of this Act shall apply to goods
from Canada and Mexico.
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