Provides for, with respect to all taxpayers, among other things: (1) the repeal of the estate, gift, and generation-skipping taxes; and (2) the deduction of 100 percent of health insurance costs for the self-employed.
Provides for, with respect to farmers, among other things: (1) the limited exclusion of the gain from the sale of qualified farmland; and (2) a limited deduction for contributions to a Farm and Ranch Risk Management Account.
Provides for a study of the costs of regulations on farmers, ranchers, and foresters.
Reciprocal Trade Agreement Authorities Act of 2000 - Authorizes the President, whenever the President determines that one or more existing duties or other import restrictions of any foreign country or the United States are unduly burdening and restricting the foreign trade of the United States to enter into trade agreements with foreign countries (during a limited time period) which, among other things: (1) create more open, equitable, and reciprocal market access; (2) reduce or eliminate trade barriers that decrease market opportunities for U.S. exports; (3) expand market opportunities for U.S. exports; (4) obtain reciprocal tariff and non-tariff barrier elimination; and (5) free the transfer of funds relating to investments.
Agricultural Trade Freedom Act - Amends the Agricultural trade Act of 1978 to exempt, subject to specified exceptions, agricultural commodities made available as a result of commercial sales from a unilateral trade sanction imposed by the United States on another country.
[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 627 Introduced in House (IH)]
107th CONGRESS
1st Session
H. R. 627
To provide tax and regulatory relief for farmers and to improve the
competitiveness of American agricultural commodities and products in
global markets.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 14, 2001
Mr. Boehner (for himself, Mr. Cooksey, Mr. Pence, Mr. Johnson of
Illinois, Mr. Osborne, Mr. Nethercutt, Mr. Fletcher, Mr. LaHood, and
Mr. Hayes) introduced the following bill; which was referred to the
Committee on Ways and Means, and in addition to the Committees on
Agriculture, Rules, and Government Reform, for a period to be
subsequently determined by the Speaker, in each case for consideration
of such provisions as fall within the jurisdiction of the committee
concerned
_______________________________________________________________________
A BILL
To provide tax and regulatory relief for farmers and to improve the
competitiveness of American agricultural commodities and products in
global markets.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Rural America
Prosperity Act of 2001''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--TAX RELIEF FOR FARMERS
Subtitle A--General Tax Provisions
Sec. 101. Deduction for 100 percent of health insurance costs of self-
employed individuals.
Sec. 102. Exclusion of gain from sale of farmland.
Sec. 103. Income averaging for farmers not to increase alternative
minimum tax liability.
Sec. 104. Farm and ranch risk management accounts.
Subtitle B--Estate and Gift Tax Relief
Sec. 111. Repeal of estate, gift, and generation-skipping taxes.
Sec. 112. Termination of step up in basis at death.
Sec. 113. Carryover basis at death.
Sec. 114. Additional reductions of estate and gift tax rates.
Sec. 115. Unified credit against estate and gift taxes replaced with
unified exemption amount.
Sec. 116. Deemed allocation of GST exemption to lifetime transfers to
trusts; retroactive allocations.
Sec. 117. Severing of trusts.
Sec. 118. Modification of certain valuation rules.
Sec. 119. Relief provisions.
Sec. 120. Expansion of estate tax rule for conservation easements.
TITLE II--STUDY OF COSTS OF REGULATIONS ON FARMERS, RANCHERS, AND
FORESTERS
Sec. 201. Definitions.
Sec. 202. Comptroller General study of regulations.
Sec. 203. Response of Secretary of Agriculture.
TITLE III--EXTENSION OF TRADE AUTHORITIES PROCEDURES FOR RECIPROCAL
TRADE AGREEMENTS
Sec. 301. Short title.
Sec. 302. Trade negotiating objectives.
Sec. 303. Trade agreements authority.
Sec. 304. Consultations.
Sec. 305. Implementation of trade agreements.
Sec. 306. Treatment of certain trade agreements.
Sec. 307. Conforming amendments.
Sec. 308. Definitions.
TITLE IV--AGRICULTURAL TRADE FREEDOM
Sec. 401. Short title.
Sec. 402. Definitions.
Sec. 403. Agricultural commodities, livestock, and products exempt from
unilateral agricultural sanctions.
Sec. 404. Sale or barter of food assistance.
TITLE I--TAX RELIEF FOR FARMERS
Subtitle A--General Tax Provisions
SEC. 101. DEDUCTION FOR 100 PERCENT OF HEALTH INSURANCE COSTS OF SELF-
EMPLOYED INDIVIDUALS.
(a) In General.--Paragraph (1) of section 162(l) of the Internal
Revenue Code of 1986 (relating to special rules for health insurance
costs of self-employed individuals) is amended to read as follows:
``(1) Allowance of deduction.--In the case of an individual
who is an employee within the meaning of section 401(c)(1),
there shall be allowed as a deduction under this section an
amount equal to 100 percent of the amount paid during the
taxable year for insurance which constitutes medical care for
the taxpayer, his spouse, and dependents.''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2001.
SEC. 102. EXCLUSION OF GAIN FROM SALE OF FARMLAND.
(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 (relating to items specifically excluded
from gross income) is amended by inserting after section 121 the
following:
``SEC. 121A. EXCLUSION OF GAIN FROM SALE OF QUALIFIED FARM PROPERTY.
``(a) Exclusion.--In the case of a natural person, gross income
shall not include gain from the sale or exchange of qualified farm
property.
``(b) Limitation.--
``(1) In general.--The amount of gain excluded from gross
income under subsection (a) with respect to any taxable year
shall not exceed $500,000 ($250,000 in the case of a married
individual filing a separate return), reduced by the aggregate
amount of gain excluded under subsection (a) for all preceding
taxable years.
``(2) Special rule for joint returns.--The amount of the
exclusion under subsection (a) on a joint return for any
taxable year shall be allocated equally between the spouses for
purposes of applying the limitation under paragraph (1) for any
succeeding taxable year.
``(c) Qualified Farm Property.--For purposes of this section--
``(1) In general.--The term `qualified farm property' means
real property located in the United States if, during periods
aggregating 3 years or more of the 5-year period ending on the
date of the sale or exchange of such real property--
``(A) such real property was used by the taxpayer
or a member of the family of the taxpayer as a farm for
farming purposes, and
``(B) there was material participation by the
taxpayer (or such a member) in the operation of the
farm.
``(2) Other definitions.--The terms `member of the family',
`farm', and `farming purposes' have the respective meanings
given such terms by paragraphs (2), (4), and (5) of section
2032A(e).
``(3) Special rules.--Rules similar to the rules of
paragraphs (4) and (5) of section 2032A(b) and paragraphs (3)
and (6) of section 2032A(e) shall apply.
``(d) Other Rules.--For purposes of this section, rules similar to
the rules of subsection (e) and subsection (f) of section 121 shall
apply.''
(b) Conforming Amendment.--The table of sections for part III of
subchapter B of chapter 1 of the Internal Revenue Code of 1986 is
amended by inserting after the item relating to section 121 the
following:
``Sec. 121A. Exclusion of gain from sale
of qualified farm property.''
(c) Effective Date.--The amendments made by this section shall
apply to any sale or exchange after the date of the enactment of this
Act in taxable years ending after such date.
SEC. 103. INCOME AVERAGING FOR FARMERS NOT TO INCREASE ALTERNATIVE
MINIMUM TAX LIABILITY.
(a) In General.--Section 55(c) of the Internal Revenue Code of 1986
(defining regular tax) is amended by redesignating paragraph (2) as
paragraph (3) and by inserting after paragraph (1) the following:
``(2) Coordination with income averaging for farmers.--
Solely for purposes of this section, section 1301 (relating to
averaging of farm income) shall not apply in computing the
regular tax.''
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 1997.
SEC. 104. FARM AND RANCH RISK MANAGEMENT ACCOUNTS.
(a) In General.--Subpart C of part II of subchapter E of chapter 1
of the Internal Revenue Code of 1986 (relating to taxable year for
which deductions taken) is amended by inserting after section 468B the
following:
``SEC. 468C. FARM AND RANCH RISK MANAGEMENT ACCOUNTS.
``(a) Deduction Allowed.--In the case of an individual engaged in
an eligible farming business, there shall be allowed as a deduction for
any taxable year the amount paid in cash by the taxpayer during the
taxable year to a Farm and Ranch Risk Management Account (hereinafter
referred to as the `FARRM Account').
``(b) Limitation.--The amount which a taxpayer may pay into the
FARRM Account for any taxable year shall not exceed 20 percent of so
much of the taxable income of the taxpayer (determined without regard
to this section) which is attributable (determined in the manner
applicable under section 1301) to any eligible farming business.
``(c) Eligible Farming Business.--For purposes of this section, the
term `eligible farming business' means any farming business (as defined
in section 263A(e)(4)) which is not a passive activity (within the
meaning of section 469(c)) of the taxpayer.
``(d) FARRM Account.--For purposes of this section--
``(1) In general.--The term `FARRM Account' means a trust
created or organized in the United States for the exclusive
benefit of the taxpayer, but only if the written governing
instrument creating the trust meets the following requirements:
``(A) No contribution will be accepted for any
taxable year in excess of the amount allowed as a
deduction under subsection (a) for such year.
``(B) The trustee is a bank (as defined in section
408(n)) or another person who demonstrates to the
satisfaction of the Secretary that the manner in which
such person will administer the trust will be
consistent with the requirements of this section.
``(C) The assets of the trust consist entirely of
cash or of obligations which have adequate stated
interest (as defined in section 1274(c)(2)) and which
pay such interest not less often than annually.
``(D) All income of the trust is distributed
currently to the grantor.
``(E) The assets of the trust will not be
commingled with other property except in a common trust
fund or common investment fund.
``(2) Account taxed as grantor trust.--The grantor of a
FARRM Account shall be treated for purposes of this title as
the owner of such Account and shall be subject to tax thereon
in accordance with subpart E of part I of subchapter J of this
chapter (relating to grantors and others treated as substantial
owners).
``(e) Inclusion of Amounts Distributed.--
``(1) In general.--Except as provided in paragraph (2),
there shall be includible in the gross income of the taxpayer
for any taxable year--
``(A) any amount distributed from a FARRM Account
of the taxpayer during such taxable year, and
``(B) any deemed distribution under--
``(i) subsection (f)(1) (relating to
deposits not distributed within 5 years),
``(ii) subsection (f)(2) (relating to
cessation in eligible farming business), and
``(iii) subparagraph (A) or (B) of
subsection (f)(3) (relating to prohibited
transactions and pledging account as security).
``(2) Exceptions.--Paragraph (1)(A) shall not apply to--
``(A) any distribution to the extent attributable
to income of the Account, and
``(B) the distribution of any contribution paid
during a taxable year to a FARRM Account to the extent
that such contribution exceeds the limitation
applicable under subsection (b) if requirements similar
to the requirements of section 408(d)(4) are met.
For purposes of subparagraph (A), distributions shall be
treated as first attributable to income and then to other
amounts.
``(f) Special Rules.--
``(1) Tax on deposits in account which are not distributed
within 5 years.--
``(A) In general.--If, at the close of any taxable
year, there is a nonqualified balance in any FARRM
Account--
``(i) there shall be deemed distributed
from such Account during such taxable year an
amount equal to such balance, and
``(ii) the taxpayer's tax imposed by this
chapter for such taxable year shall be
increased by 10 percent of such deemed
distribution.
The preceding sentence shall not apply if an amount
equal to such nonqualified balance is distributed from
such Account to the taxpayer before the due date
(including extensions) for filing the return of tax imposed by this
chapter for such year (or, if earlier, the date the taxpayer files such
return for such year).
``(B) Nonqualified balance.--For purposes of
subparagraph (A), the term `nonqualified balance' means
any balance in the Account on the last day of the
taxable year which is attributable to amounts deposited
in such Account before the 4th preceding taxable year.
``(C) Ordering rule.--For purposes of this
paragraph, distributions from a FARRM Account (other
than distributions of current income) shall be treated
as made from deposits in the order in which such
deposits were made, beginning with the earliest
deposits.
``(2) Cessation in eligible business.--At the close of the
first disqualification period after a period for which the
taxpayer was engaged in an eligible farming business, there
shall be deemed distributed from the FARRM Account of the
taxpayer an amount equal to the balance in such Account (if
any) at the close of such disqualification period. For purposes
of the preceding sentence, the term `disqualification period'
means any period of 2 consecutive taxable years for which the
taxpayer is not engaged in an eligible farming business.
``(3) Certain rules to apply.--Rules similar to the
following rules shall apply for purposes of this section:
``(A) Section 220(f)(8) (relating to treatment on
death).
``(B) Section 408(e)(2) (relating to loss of
exemption of account where individual engages in
prohibited transaction).
``(C) Section 408(e)(4) (relating to effect of
pledging account as security).
``(D) Section 408(g) (relating to community
property laws).
``(E) Section 408(h) (relating to custodial
accounts).
``(4) Time when payments deemed made.--For purposes of this
section, a taxpayer shall be deemed to have made a payment to a
FARRM Account on the last day of a taxable year if such payment
is made on account of such taxable year and is made on or
before the due date (without regard to extensions) for filing
the return of tax for such taxable year.
``(5) Individual.--For purposes of this section, the term
`individual' shall not include an estate or trust.
``(6) Deduction not allowed for self-employment tax.--The
deduction allowable by reason of subsection (a) shall not be
taken into account in determining an individual's net earnings
from self-employment (within the meaning of section 1402(a))
for purposes of chapter 2.
``(g) Reports.--The trustee of a FARRM Account shall make such
reports regarding such Account to the Secretary and to the person for
whose benefit the Account is maintained with respect to contributions,
distributions, and such other matters as the Secretary may require
under regulations. The reports required by this subsection shall be
filed at such time and in such manner and furnished to such persons at
such time and in such manner as may be required by such regulations.''.
(b) Tax on Excess Contributions.--
(1) Subsection (a) of section 4973 of the Internal Revenue
Code of 1986 (relating to tax on excess contributions to
certain tax-favored accounts and annuities) is amended by
striking ``or'' at the end of paragraph (3), by redesignating
paragraph (4) as paragraph (5), and by inserting after
paragraph (3) the following:
``(4) a FARRM Account (within the meaning of section
468C(d)), or''.
(2) Section 4973 of such Code, is amended by adding at the
end the following:
``(g) Excess Contributions to FARRM Accounts.--For purposes of this
section, in the case of a FARRM Account (within the meaning of section
468C(d)), the term `excess contributions' means the amount by which the
amount contributed for the taxable year to the Account exceeds the
amount which may be contributed to the Account under section 468C(b)
for such taxable year. For purposes of this subsection, any
contribution which is distributed out of the FARRM Account in a
distribution to which section 468C(e)(2)(B) applies shall be treated as
an amount not contributed.''.
(3) The section heading for section 4973 of such Code is
amended to read as follows:
``SEC. 4973. EXCESS CONTRIBUTIONS TO CERTAIN ACCOUNTS, ANNUITIES,
ETC.''.
(4) The table of sections for chapter 43 of such Code is
amended by striking the item relating to section 4973 and
inserting the following:
``Sec. 4973. Excess contributions to
certain accounts, annuities,
etc.''.
(c) Tax on Prohibited Transactions.--
(1) Subsection (c) of section 4975 of the Internal Revenue
Code of 1986 (relating to tax on prohibited transactions) is
amended by adding at the end the following:
``(6) Special rule for farrm accounts.--A person for whose
benefit a FARRM Account (within the meaning of section 468C(d))
is established shall be exempt from the tax imposed by this
section with respect to any transaction concerning such account
(which would otherwise be taxable under this section) if, with
respect to such transaction, the account ceases to be a FARRM
Account by reason of the application of section 468C(f)(3)(A)
to such account.''.
(2) Paragraph (1) of section 4975(e) of such Code is
amended by redesignating subparagraphs (E) and (F) as
subparagraphs (F) and (G), respectively, and by inserting after
subparagraph (D) the following:
``(E) a FARRM Account described in section
468C(d),''.
(d) Failure To Provide Reports on FARRM Accounts.--Paragraph (2) of
section 6693(a) of the Internal Revenue Code of 1986 (relating to
failure to provide reports on certain tax-favored accounts or
annuities) is amended by redesignating subparagraphs (C) and (D) as
subparagraphs (D) and (E), respectively, and by inserting after
subparagraph (B) the following:
``(C) section 468C(g) (relating to FARRM
Accounts),''.
(e) Clerical Amendment.--The table of sections for subpart C of
part II of subchapter E of chapter 1 of the Internal Revenue Code of
1986 is amended by inserting after the item relating to section 468B
the following:
``Sec. 468C. Farm and Ranch Risk
Management Accounts.''.
(f) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2000.
Subtitle B--Estate and Gift Tax Relief
SEC. 111. REPEAL OF ESTATE, GIFT, AND GENERATION-SKIPPING TAXES.
(a) In General.--Subtitle B of the Internal Revenue Code of 1986 is
hereby repealed.
(b) Effective Date.--The repeal made by subsection (a) shall apply
to the estates of decedents dying, and gifts and generation-skipping
transfers made, after December 31, 2010.
SEC. 112. TERMINATION OF STEP UP IN BASIS AT DEATH.
(a) Termination of Application of Section 1014.--Section 1014 of
the Internal Revenue Code of 1986 (relating to basis of property
acquired from a decedent) is amended by adding at the end the
following:
``(f) Termination.--In the case of a decedent dying after December
31, 2010, this section shall not apply to property for which basis is
provided by section 1022.''.
(b) Conforming Amendment.--Subsection (a) of section 1016 of the
Internal Revenue Code of 1986 (relating to adjustments to basis) is
amended by striking ``and'' at the end of paragraph (26), by striking
the period at the end of paragraph (27) and inserting ``, and'', and by
adding at the end the following:
``(28) to the extent provided in section 1022 (relating to
basis for certain property acquired from a decedent dying after
December 31, 2010).''.
SEC. 113. CARRYOVER BASIS AT DEATH.
(a) General Rule.--Part II of subchapter O of chapter 1 of the
Internal Revenue Code of 1986 (relating to basis rules of general
application) is amended by inserting after section 1021 the following
new section:
``SEC. 1022. CARRYOVER BASIS FOR CERTAIN PROPERTY ACQUIRED FROM A
DECEDENT DYING AFTER DECEMBER 31, 2010.
``(a) Carryover Basis.--Except as otherwise provided in this
section, the basis of carryover basis property in the hands of a person
acquiring such property from a decedent shall be determined under
section 1015.
``(b) Carryover Basis Property Defined.--
``(1) In general.--For purposes of this section, the term
`carryover basis property' means any property--
``(A) which is acquired from or passed from a
decedent who died after December 31, 2010, and
``(B) which is not excluded pursuant to paragraph
(2).
The property taken into account under subparagraph (A) shall be
determined under section 1014(b) without regard to subparagraph
(A) of the last sentence of paragraph (9) thereof.
``(2) Certain property not carryover basis property.--The
term `carryover basis property' does not include--
``(A) any item of gross income in respect of a
decedent described in section 691,
``(B) property of the decedent to the extent that
the aggregate adjusted fair market value of such
property does not exceed $1,300,000, and
``(C) property which was acquired from the decedent
by the surviving spouse of the decedent (and which
would be carryover basis property without regard to
this subparagraph) but only if the value of such
property would have been deductible from the value of
the taxable estate of the decedent under section 2056,
as in effect on the day before the date of the
enactment of the Rural America Prosperity Act of 2001.
For purposes of this subsection, the term `adjusted fair market
value' means, with respect to any property, fair market value
reduced by any indebtedness secured by such property.
``(3) Limitation on exception for property acquired by
surviving spouse.--The adjusted fair market value of property
which is not carryover basis property by reason of paragraph
(2)(C) shall not exceed $3,000,000.
``(4) Allocation of excepted amounts.--The executor shall
allocate the limitations under paragraphs (2)(B) and (3).
``(5) Inflation adjustment of excepted amounts.--In the
case of decedents dying in a calendar year after 2011, the
dollar amounts in paragraphs (2)(B) and (3) shall each be
increased by an amount equal to the product of--
``(A) such dollar amount, and
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for such calendar year,
determined by substituting `2010' for `1992' in
subparagraph (B) thereof.
If any increase determined under the preceding sentence is not
a multiple of $10,000, such increase shall be rounded to the
nearest multiple of $10,000.
``(c) Regulations.--The Secretary shall prescribe such regulations
as may be necessary to carry out the purposes of this section.''.
(b) Miscellaneous Amendments Related to Carryover Basis.--
(1) Capital gain treatment for inherited art work or
similar property.--
(A) In general.--Subparagraph (C) of section
1221(a)(3) of the Internal Revenue Code of 1986
(defining capital asset) is amended by inserting ``(other than by
reason of section 1022)'' after ``is determined''.
(B) Coordination with section 170.--Paragraph (1)
of section 170(e) of such Code (relating to certain
contributions of ordinary income and capital gain
property) is amended by adding at the end the
following: ``For purposes of this paragraph, the
determination of whether property is a capital asset
shall be made without regard to the exception contained
in section 1221(a)(3)(C) for basis determined under
section 1022.''.
(2) Definition of executor.--Section 7701(a) of such Code
(relating to definitions) is amended by adding at the end the
following:
``(47) Executor.--The term `executor' means the executor or
administrator of the decedent, or, if there is no executor or
administrator appointed, qualified, and acting within the
United States, then any person in actual or constructive
possession of any property of the decedent.''.
(3) Clerical amendment.--The table of sections for part II
of subchapter O of chapter 1 of such Code is amended by adding
at the end the following new item:
``Sec. 1022. Carryover basis for certain
property acquired from a
decedent dying after December
31, 2010.''.
(c) Effective Date.--The amendments made by this section shall
apply to estates of decedents dying after December 31, 2010.
SEC. 114. ADDITIONAL REDUCTIONS OF ESTATE AND GIFT TAX RATES.
(a) Maximum Rate of Tax Reduced to 50 Percent.--
(1) In general.--The table contained in section 2001(c)(1)
of the Internal Revenue Code of 1986 is amended by striking the
two highest brackets and inserting the following:
``Over $2,500,000..............
$1,025,800, plus 50% of the
excess over
$2,500,000.''.
(2) Phase-in of reduced rate.--Subsection (c) of section
2001 of such Code is amended by adding at the end the following
new paragraph:
``(3) Phase-in of reduced rate.--In the case of decedents
dying, and gifts made, during 2002, the last item in the table
contained in paragraph (1) shall be applied by substituting
`53%' for `50%'.''.
(b) Repeal of Phaseout of Graduated Rates.--Subsection (c) of
section 2001 of the Internal Revenue Code of 1986 is amended by
striking paragraph (2) and redesignating paragraph (3), as added by
subsection (a), as paragraph (2).
(c) Additional Reductions of Rates of Tax.--Subsection (c) of
section 2001 of the Internal Revenue Code of 1986, as so amended, is
amended by adding at the end the following new paragraph:
``(3) Phasedown of tax.--In the case of estates of
decedents dying, and gifts made, during any calendar year after
2003 and before 2011--
``(A) In general.--Except as provided in
subparagraph (C), the tentative tax under this
subsection shall be determined by using a table
prescribed by the Secretary (in lieu of using the table
contained in paragraph (1)) which is the same as such
table; except that--
``(i) each of the rates of tax shall be
reduced by the number of percentage points
determined under subparagraph (B), and
``(ii) the amounts setting forth the tax
shall be adjusted to the extent necessary to
reflect the adjustments under clause (i).
``(B) Percentage points of reduction.--
The number of
``For calendar year:
percentage points is:
2004................................... 1.0
2005................................... 2.0
2006................................... 3.0
2007................................... 4.0
2008................................... 5.5
2009................................... 7.5
2010................................... 9.5.
``(C) Coordination with income tax rates.--The
reductions under subparagraph (A)--
``(i) shall not reduce any rate under
paragraph (1) below the lowest rate in section
1(c), and
``(ii) shall not reduce the highest rate
under paragraph (1) below the highest rate in
section 1(c).
``(D) Coordination with credit for state death
taxes.--Rules similar to the rules of subparagraph (A)
shall apply to the table contained in section 2011(b)
except that the Secretary shall prescribe percentage
point reductions which maintain the proportionate
relationship (as in effect before any reduction under
this paragraph) between the credit under section 2011
and the tax rates under subsection (c).''.
(d) Effective Dates.--
(1) Subsections (a) and (b).--The amendments made by
subsections (a) and (b) shall apply to estates of decedents
dying, and gifts made, after December 31, 2001.
(2) Subsection (c).--The amendment made by subsection (c)
shall apply to estates of decedents dying, and gifts made,
after December 31, 2003.
SEC. 115. UNIFIED CREDIT AGAINST ESTATE AND GIFT TAXES REPLACED WITH
UNIFIED EXEMPTION AMOUNT.
(a) In General.--
(1) Estate tax.--Subsection (b) of section 2001 of the
Internal Revenue Code of 1986 (relating to computation of tax)
is amended to read as follows:
``(b) Computation of Tax.--
``(1) In general.--The tax imposed by this section shall be
the amount equal to the excess (if any) of--
``(A) the tentative tax determined under paragraph
(2), over
``(B) the aggregate amount of tax which would have
been payable under chapter 12 with respect to gifts
made by the decedent after December 31, 1976, if the
provisions of subsection
(c) (as in effect at the decedent's death) had been
applicable at the time of such gifts.
``(2) Tentative tax.--For purposes of paragraph (1), the
tentative tax determined under this paragraph is a tax computed
under subsection (c) on the excess of--
``(A) the sum of--
``(i) the amount of the taxable estate, and
``(ii) the amount of the adjusted taxable
gifts, over
``(B) the exemption amount for the calendar year in
which the decedent died.
``(3) Exemption amount.--For purposes of paragraph (2), the
term `exemption amount' means the amount determined in
accordance with the following table:
``In the case of
The exemption
calendar year:
amount is:
2002 and 2003........................ $700,000
2004................................. $850,000
2005................................. $950,000
2006 or thereafter................... $1,000,000.
``(4) Adjusted taxable gifts.--For purposes of paragraph
(2), the term `adjusted taxable gifts' means the total amount
of the taxable gifts (within the meaning of section 2503) made
by the decedent after December 31, 1976, other than gifts which
are includible in the gross estate of the decedent.''.
(2) Gift tax.--Subsection (a) of section 2502 of such Code
(relating to computation of tax) is amended to read as follows:
``(a) Computation of Tax.--
``(1) In general.--The tax imposed by section 2501 for each
calendar year shall be the amount equal to the excess (if any)
of--
``(A) the tentative tax determined under paragraph
(2), over
``(B) the tax paid under this section for all prior
calendar periods.
``(2) Tentative tax.--For purposes of paragraph (1), the
tentative tax determined under this paragraph for a calendar
year is a tax computed under section 2001(c) on the excess of--
``(A) the aggregate sum of the taxable gifts for
such calendar year and for each of the preceding
calendar periods, over
``(B) the exemption amount under section 2001(b)(3)
for such calendar year.''.
(b) Repeal of Unified Credits.--
(1) Section 2010 of the Internal Revenue Code of 1986
(relating to unified credit against estate tax) is hereby
repealed.
(2) Section 2505 of such Code (relating to unified credit
against gift tax) is hereby repealed.
(c) Conforming Amendments.--
(1)(A) Subsection (b) of section 2011 of the Internal
Revenue Code of 1986 is amended--
(i) by striking ``adjusted'' in the table; and
(ii) by striking the last sentence.
(B) Subsection (f) of section 2011 of such Code is amended
by striking ``, reduced by the amount of the unified credit
provided by section 2010''.
(2) Subsection (a) of section 2012 of such Code is amended
by striking ``and the unified credit provided by section
2010''.
(3) Subparagraph (A) of section 2013(c)(1) of such Code is
amended by striking ``2010,''.
(4) Paragraph (2) of section 2014(b) of such Code is
amended by striking ``2010, 2011,'' and inserting ``2011''.
(5) Clause (ii) of section 2056A(b)(12)(C) of such Code is
amended to read as follows:
``(ii) to treat any reduction in the tax
imposed by paragraph (1)(A) by reason of the
credit allowable under section 2010 (as in
effect on the day before the date of the
enactment of the Rural America Prosperity Act
of 2001) or the exemption amount allowable
under section 2001(b) with respect to the
decedent as a credit under section 2505 (as so
in effect) or exemption under section 2521 (as
the case may be) allowable to such surviving
spouse for purposes of determining the amount
of the exemption allowable under section 2521
with respect to taxable gifts made by the
surviving spouse during the year in which the
spouse becomes a citizen or any subsequent
year,''.
(6) Subsection (a) of section 2057 of such Code is amended
by striking paragraphs (2) and (3) and inserting the following
new paragraph:
``(2) Maximum deduction.--The deduction allowed by this
section shall not exceed the excess of $1,300,000 over the
exemption amount (as defined in section 2001(b)(3)).''.
(7)(A) Subsection (b) of section 2101 of such Code is
amended to read as follows:
``(b) Computation of Tax.--
``(1) In general.--The tax imposed by this section shall be
the amount equal to the excess (if any) of--
``(A) the tentative tax determined under paragraph
(2), over
``(B) a tentative tax computed under section
2001(c) on the amount of the adjusted taxable gifts.
``(2) Tentative tax.--For purposes of paragraph (1), the
tentative tax determined under this paragraph is a tax computed
under section 2001(c) on the excess of--
``(A) the sum of--
``(i) the amount of the taxable estate, and
``(ii) the amount of the adjusted taxable
gifts, over
``(B) the exemption amount for the calendar year in
which the decedent died.
``(3) Exemption amount.--
``(A) In general.--The term `exemption amount'
means $60,000.
``(B) Residents of possessions of the united
states.--In the case of a decedent who is considered to
be a nonresident not a citizen of the United States
under section 2209, the exemption amount under this
paragraph shall be the greater of--
``(i) $60,000, or
``(ii) that proportion of $175,000 which
the value of that part of the decedent's gross
estate which at the time of his death is
situated in the United States bears to the
value of his entire gross estate wherever
situated.
``(C) Special rules.--
``(i) Coordination with treaties.--To the
extent required under any treaty obligation of
the United States, the exemption amount allowed
under this paragraph shall be equal to the
amount which bears the same ratio to the
exemption amount under section 2001(b)(3) (for
the calendar year in which the decedent died)
as the value of the part of the decedent's
gross estate which at the time of his death is
situated in the United States bears to the
value of his entire gross estate wherever
situated. For purposes of the preceding
sentence, property shall not be treated as
situated in the United States if such property is exempt from the tax
imposed by this subchapter under any treaty obligation of the United
States.
``(ii) Coordination with gift tax exemption
and unified credit.--If an exemption has been
allowed under section 2521 (or a credit has
been allowed under section 2505 as in effect on
the day before the date of the enactment of the
Rural America Prosperity Act of 2001) with
respect to any gift made by the decedent, each
dollar amount contained in subparagraph (A) or
(B) or the exemption amount applicable under
clause (i) of this subparagraph (whichever
applies) shall be reduced by the exemption so
allowed under section 2521 (or, in the case of
such a credit, by the amount of the gift for
which the credit was so allowed).''.
(8) Section 2102 of such Code is amended by striking
subsection (c).
(9)(A) Subsection (a) of section 2107 of such Code is
amended by adding at the end the following new paragraph:
``(3) Limitation on exemption amount.--Subparagraphs (B)
and (C) of section 2101(b)(3) shall not apply in applying
section 2101 for purposes of this section.''.
(B) Subsection (c) of section 2107 of such Code is
amended--
(i) by striking paragraph (1) and by redesignating
paragraphs (2) and (3) as paragraphs (1) and (2),
respectively, and
(ii) by striking the second sentence of paragraph
(2) (as so redesignated).
(10) Paragraph (1) of section 6018(a) of such Code is
amended by striking ``the applicable exclusion amount in effect
under section 2010(c)'' and inserting ``the exemption amount
under section 2001(b)(3)''.
(11) Subparagraph (A) of section 6601(j)(2) of such Code is
amended to read as follows:
``(A) the amount of the tentative tax which would
be determined under the rate schedule set forth in
section 2001(c) if the amount with respect to which
such tentative tax is to be computed were $1,000,000,
or''.
(12) The table of sections for part II of subchapter A of
chapter 11 of such Code is amended by striking the item
relating to section 2010.
(13) The table of sections for subchapter A of chapter 12
of such Code is amended by striking the item relating to
section 2505.
(d) Effective Date.--The amendments made by this section--
(1) insofar as they relate to the tax imposed by chapter 11
of the Internal Revenue Code of 1986, shall apply to estates of
decedents dying after December 31, 2001, and
(2) insofar as they relate to the tax imposed by chapter 12
of such Code, shall apply to gifts made after December 31,
2001.
SEC. 116. DEEMED ALLOCATION OF GST EXEMPTION TO LIFETIME TRANSFERS TO
TRUSTS; RETROACTIVE ALLOCATIONS.
(a) In General.--Section 2632 of the Internal Revenue Code of 1986
(relating to special rules for allocation of GST exemption) is amended
by redesignating subsection (c) as subsection (e) and by inserting
after subsection (b) the following new subsections:
``(c) Deemed Allocation to Certain Lifetime Transfers to GST
Trusts.--
``(1) In general.--If any individual makes an indirect skip
during such individual's lifetime, any unused portion of such
individual's GST exemption shall be allocated to the property
transferred to the extent necessary to make the inclusion ratio
for such property zero. If the amount of the indirect skip
exceeds such unused portion, the entire unused portion shall be
allocated to the property transferred.
``(2) Unused portion.--For purposes of paragraph (1), the
unused portion of an individual's GST exemption is that portion
of such exemption which has not previously been--
``(A) allocated by such individual,
``(B) treated as allocated under subsection (b)
with respect to a direct skip occurring during or
before the calendar year in which the indirect skip is
made, or
``(C) treated as allocated under paragraph (1) with
respect to a prior indirect skip.
``(3) Definitions.--
``(A) Indirect skip.--For purposes of this
subsection, the term `indirect skip' means any transfer
of property (other than a direct skip) subject to the
tax imposed by chapter 12 made to a GST trust.
``(B) GST trust.--The term `GST trust' means a
trust that could have a generation-skipping transfer
with respect to the transferor unless--
``(i) the trust instrument provides that
more than 25 percent of the trust corpus must
be distributed to or may be withdrawn by one or
more individuals who are non-skip persons--
``(I) before the date that the
individual attains age 46,
``(II) on or before one or more
dates specified in the trust instrument
that will occur before the date that
such individual attains age 46, or
``(III) upon the occurrence of an
event that, in accordance with
regulations prescribed by the
Secretary, may reasonably be expected
to occur before the date that such
individual attains age 46;
``(ii) the trust instrument provides that
more than 25 percent of the trust corpus must
be distributed to or may be withdrawn by one or
more individuals who are non-skip persons and
who are living on the date of death of another person identified in the
instrument (by name or by class) who is more than 10 years older than
such individuals;
``(iii) the trust instrument provides that,
if one or more individuals who are non-skip
persons die on or before a date or event
described in clause (i) or (ii), more than 25
percent of the trust corpus either must be
distributed to the estate or estates of one or
more of such individuals or is subject to a
general power of appointment exercisable by one
or more of such individuals;
``(iv) the trust is a trust any portion of
which would be included in the gross estate of
a non-skip person (other than the transferor)
if such person died immediately after the
transfer;
``(v) the trust is a charitable lead
annuity trust (within the meaning of section
2642(e)(3)(A)) or a charitable remainder
annuity trust or a charitable remainder
unitrust (within the meaning of section
664(d)); or
``(vi) the trust is a trust with respect to
which a deduction was allowed under section
2522 for the amount of an interest in the form
of the right to receive annual payments of a
fixed percentage of the net fair market value
of the trust property (determined yearly) and
which is required to pay principal to a non-
skip person if such person is alive when the
yearly payments for which the deduction was
allowed terminate.
For purposes of this subparagraph, the value of
transferred property shall not be considered to be
includible in the gross estate of a non-skip person or
subject to a right of withdrawal by reason of such
person holding a right to withdraw so much of such
property as does not exceed the amount referred to in
section 2503(b) with respect to any transferor, and it
shall be assumed that powers of appointment held by
non-skip persons will not be exercised.
``(4) Automatic allocations to certain gst trusts.--For
purposes of this subsection, an indirect skip to which section
2642(f) applies shall be deemed to have been made only at the close of
the estate tax inclusion period. The fair market value of such transfer
shall be the fair market value of the trust property at the close of
the estate tax inclusion period.
``(5) Applicability and effect.--
``(A) In general.--An individual--
``(i) may elect to have this subsection not
apply to--
``(I) an indirect skip, or
``(II) any or all transfers made by
such individual to a particular trust,
and
``(ii) may elect to treat any trust as a
GST trust for purposes of this subsection with
respect to any or all transfers made by such
individual to such trust.
``(B) Elections.--
``(i) Elections with respect to indirect
skips.--An election under subparagraph
(A)(i)(I) shall be deemed to be timely if filed
on a timely filed gift tax return for the
calendar year in which the transfer was made or
deemed to have been made pursuant to paragraph
(4) or on such later date or dates as may be
prescribed by the Secretary.
``(ii) Other elections.--An election under
clause (i)(II) or (ii) of subparagraph (A) may
be made on a timely filed gift tax return for
the calendar year for which the election is to
become effective.
``(d) Retroactive Allocations.--
``(1) In general.--If--
``(A) a non-skip person has an interest or a future
interest in a trust to which any transfer has been
made,
``(B) such person--
``(i) is a lineal descendant of a
grandparent of the transferor or of a
grandparent of the transferor's spouse or
former spouse, and
``(ii) is assigned to a generation below
the generation assignment of the transferor,
and
``(C) such person predeceases the transferor,
then the transferor may make an allocation of any of such
transferor's unused GST exemption to any previous transfer or
transfers to the trust on a chronological basis.
``(2) Special rules.--If the allocation under paragraph (1)
by the transferor is made on a gift tax return filed on or
before the date prescribed by section 6075(b) for gifts made
within the calendar year within which the non-skip person's
death occurred--
``(A) the value of such transfer or transfers for
purposes of section 2642(a) shall be determined as if
such allocation had been made on a timely filed gift
tax return for each calendar year within which each
transfer was made,
``(B) such allocation shall be effective
immediately before such death, and
``(C) the amount of the transferor's unused GST
exemption available to be allocated shall be determined
immediately before such death.
``(3) Future interest.--For purposes of this subsection, a
person has a future interest in a trust if the trust may permit
income or corpus to be paid to such person on a date or dates
in the future.''.
(b) Conforming Amendment.--Paragraph (2) of section 2632(b) of the
Internal Revenue Code of 1986 is amended by striking ``with respect to
a direct skip'' and inserting ``or subsection (c)(1)''.
(c) Effective Dates.--
(1) Deemed allocation.--Section 2632(c) of the Internal
Revenue Code of 1986 (as added by subsection (a)), and the
amendment made by subsection (b), shall apply to transfers
subject to chapter 11 or 12 made after December 31, 2000, and
to estate tax inclusion periods ending after December 31, 2000.
(2) Retroactive allocations.--Section 2632(d) of the
Internal Revenue Code of 1986 (as added by subsection (a))
shall apply to deaths of non-skip persons occurring after
December 31, 2000.
SEC. 117. SEVERING OF TRUSTS.
(a) In General.--Subsection (a) of section 2642 of the Internal
Revenue Code of 1986 (relating to inclusion ratio) is amended by adding
at the end the following new paragraph:
``(3) Severing of trusts.--
``(A) In general.--If a trust is severed in a
qualified severance, the trusts resulting from such
severance shall be treated as separate trusts
thereafter for purposes of this chapter.
``(B) Qualified severance.--For purposes of
subparagraph (A)--
``(i) In general.--The term `qualified
severance' means the division of a single trust
and the creation (by any means available under
the governing instrument or under local law) of
two or more trusts if--
``(I) the single trust was divided
on a fractional basis, and
``(II) the terms of the new trusts,
in the aggregate, provide for the same
succession of interests of
beneficiaries as are provided in the
original trust.
``(ii) Trusts with inclusion ratio greater
than zero.--If a trust has an inclusion ratio
of greater than zero and less than 1, a
severance is a qualified severance only if the
single trust is divided into two trusts, one of
which receives a fractional share of the total
value of all trust assets equal to the
applicable fraction of the single trust
immediately before the severance. In such case,
the trust receiving such fractional share shall
have an inclusion ratio of zero and the other
trust shall have an inclusion ratio of 1.
``(iii) Regulations.--The term `qualified
severance' includes any other severance
permitted under regulations prescribed by the
Secretary.
``(C) Timing and manner of severances.--A severance
pursuant to this paragraph may be made at any time. The
Secretary shall prescribe by forms or regulations the
manner in which the qualified severance shall be
reported to the Secretary.''.
(b) Effective Date.--The amendment made by this section shall apply
to severances after December 31, 2000.
SEC. 118. MODIFICATION OF CERTAIN VALUATION RULES.
(a) Gifts for Which Gift Tax Return Filed or Deemed Allocation
Made.--Paragraph (1) of section 2642(b) of the Internal Revenue Code of
1986 (relating to valuation rules, etc.) is amended to read as follows:
``(1) Gifts for which gift tax return filed or deemed
allocation made.--If the allocation of the GST exemption to any
transfers of property is made on a gift tax return filed on or
before the date prescribed by section 6075(b) for such transfer
or is deemed to be made under section 2632 (b)(1) or (c)(1)--
``(A) the value of such property for purposes of
subsection (a) shall be its value as finally determined
for purposes of chapter 12 (within the meaning of
section 2001(f)(2)), or, in the case of an allocation
deemed to have been made at the close of an estate tax
inclusion period, its value at the time of the close of
the estate tax inclusion period, and
``(B) such allocation shall be effective on and
after the date of such transfer, or, in the case of an
allocation deemed to have been made at the close of an
estate tax inclusion period, on and after the close of
such estate tax inclusion period.''.
(b) Transfers at Death.--Subparagraph (A) of section 2642(b)(2) of
the Internal Revenue Code of 1986 is amended to read as follows:
``(A) Transfers at death.--If property is
transferred as a result of the death of the transferor,
the value of such property for purposes of subsection
(a) shall be its value as finally determined for
purposes of chapter 11; except that, if the
requirements prescribed by the Secretary respecting
allocation of post-death changes in value are not met,
the value of such property shall be determined as of
the time of the distribution concerned.''.
(c) Effective Date.--The amendments made by this section shall
apply to transfers subject to chapter 11 or 12 of the Internal Revenue
Code of 1986 made after December 31, 2000.
SEC. 119. RELIEF PROVISIONS.
(a) In General.--Section 2642 of the Internal Revenue Code of 1986
is amended by adding at the end the following new subsection:
``(g) Relief Provisions.--
``(1) Relief from late elections.--
``(A) In general.--The Secretary shall by
regulation prescribe such circumstances and procedures
under which extensions of time will be granted to
make--
``(i) an allocation of GST exemption
described in paragraph (1) or (2) of subsection
(b), and
``(ii) an election under subsection (b)(3)
or (c)(5) of section 2632.
Such regulations shall include procedures for
requesting comparable relief with respect to transfers
made before the date of the enactment of this paragraph.
``(B) Basis for determinations.--In determining
whether to grant relief under this paragraph, the
Secretary shall take into account all relevant
circumstances, including evidence of intent contained
in the trust instrument or instrument of transfer and
such other factors as the Secretary deems relevant. For
purposes of determining whether to grant relief under
this paragraph, the time for making the allocation (or
election) shall be treated as if not expressly
prescribed by statute.
``(2) Substantial compliance.--An allocation of GST
exemption under section 2632 that demonstrates an intent to
have the lowest possible inclusion ratio with respect to a
transfer or a trust shall be deemed to be an allocation of so
much of the transferor's unused GST exemption as produces the
lowest possible inclusion ratio. In determining whether there
has been substantial compliance, all relevant circumstances
shall be taken into account, including evidence of intent
contained in the trust instrument or instrument of transfer and
such other factors as the Secretary deems relevant.''.
(b) Effective Dates.--
(1) Relief from late elections.--Section 2642(g)(1) of the
Internal Revenue Code of 1986 (as added by subsection (a))
shall apply to requests pending on, or filed after, December
31, 2000.
(2) Substantial compliance.--Section 2642(g)(2) of such
Code (as so added) shall apply to transfers subject to chapter
11 or 12 of the Internal Revenue Code of 1986 made after
December 31, 2000. No implication is intended with respect to
the availability of relief from late elections or the
application of a rule of substantial compliance on or before
such date.
SEC. 120. EXPANSION OF ESTATE TAX RULE FOR CONSERVATION EASEMENTS.
(a) Where Land Is Located.--
(1) In general.--Clause (i) of section 2031(c)(8)(A) of the
Internal Revenue Code of 1986 (defining land subject to a
conservation easement) is amended--
(A) by striking ``25 miles'' both places it appears
and inserting ``50 miles''; and
(B) striking ``10 miles'' and inserting ``25
miles''.
(2) Effective date.--The amendments made by this subsection
shall apply to estates of decedents dying after December 31,
2000.
(b) Clarification of Date for Determining Value of Land and
Easement.--
(1) In general.--Section 2031(c)(2) of the Internal Revenue
Code of 1986 (defining applicable percentage) is amended by
adding at the end the following new sentence: ``The values
taken into account under the preceding sentence shall be such
values as of the date of the contribution referred to in
paragraph (8)(B).''.
(2) Effective date.--The amendment made by this subsection
shall apply to estates of decedents dying after December 31,
1997.
TITLE II--STUDY OF COSTS OF REGULATIONS ON FARMERS, RANCHERS, AND
FORESTERS
SEC. 201. DEFINITIONS.
In this title:
(1) Regulation.--
(A) In general.--The term ``regulation'' means the
whole or a part of an agency statement of general or
particular applicability and future effect designed to
implement, interpret, or prescribe law or policy.
(B) Exclusion.--The term ``regulation'' does not
include--
(i) the approval or prescription, on a
case-by-case or consolidated case basis, for
the future of rates, wages, corporations, or
financial structures or reorganizations
thereof, prices, facilities, appliances,
services or allowances therefor, or of
valuations, costs, or accounting, or practices
bearing on activities described in this clause;
or
(ii) the granting of an application for a
license, registration, or similar authority,
granting or recognizing an exemption, granting
a variance or petition for relief from a
regulatory requirement, or other action
relieving a restriction or taking any action
necessary to permit new or improved
applications of technology.
(2) License.--The term ``license'' means the whole or part
of an agency permit, certificate, approval, registration,
charter, membership, statutory exemption, or other form of
permission.
SEC. 202. COMPTROLLER GENERAL STUDY OF REGULATIONS.
(a) Data Review and Collection.--The Comptroller General of the
United States shall--
(1) conduct a review of existing Federal and non-Federal
studies and data regarding the cost to farmers, ranchers, and
foresters of complying with existing or proposed Federal
regulations directly affecting farmers, ranchers, and
foresters; and
(2) as necessary, obtain and analyze new data concerning
the costs to farmers, ranchers, and foresters of complying with
Federal regulations proposed as of June 30, 2000, directly
affecting farmers, ranchers, and foresters.
(b) Use of Data.--Using the studies and data reviewed and collected
under subsection (a), the Comptroller General shall--
(1) assess the overall costs to farmers, ranchers, and
foresters of complying with existing and proposed Federal
regulations directly affecting farmers, ranchers, and
foresters; and
(2) identify and recommend reasonable alternatives to those
regulations that will achieve the objectives of the regulations
at less cost to farmers, ranchers, and foresters.
(c) Submission of Results.--Not later than June 30, 2001, the
Comptroller General shall submit to the Secretary of Agriculture, the
Committee on Agriculture, Nutrition, and Forestry of the Senate, and
the Committee on Agriculture of the House of Representatives the
results of the assessment conducted under subsection (b)(1) and the
recommendations prepared under subsection (b)(2).
SEC. 203. RESPONSE OF SECRETARY OF AGRICULTURE.
Not later than September 30, 2001, the Secretary of Agriculture
shall submit to the Committee on Agriculture, Nutrition, and Forestry
of the Senate, and the Committee on Agriculture of the House of
Representatives a report responding to the recommendations of the
Comptroller General under section 202 regarding reasonable alternatives
that could achieve the objectives of Federal regulations at less cost
to farmers, ranchers, and foresters.
TITLE III--EXTENSION OF TRADE AUTHORITIES PROCEDURES FOR RECIPROCAL
TRADE AGREEMENTS
SEC. 301. SHORT TITLE.
This title may be cited as the ``Reciprocal Trade Agreement
Authorities Act of 2001''.
SEC. 302. TRADE NEGOTIATING OBJECTIVES.
(a) Overall Trade Negotiating Objectives.--The overall trade
negotiating objectives of the United States for agreements subject to
the provisions of section 303 are--
(1) to obtain more open, equitable, and reciprocal market
access;
(2) to obtain the reduction or elimination of barriers and
distortions that are directly related to trade and that
decrease market opportunities for United States exports or
otherwise distort United States trade;
(3) to further strengthen the system of international
trading disciplines and procedures, including dispute
settlement; and
(4) to foster economic growth, raise living standards, and
promote full employment in the United States and to enhance the
global economy.
(b) Principal Trade Negotiating Objectives.--
(1) Trade barriers and distortions.--The principal
negotiating objectives of the United States regarding trade
barriers and other trade distortions are--
(A) to expand competitive market opportunities for
United States exports and to obtain fairer and more
open conditions of trade by reducing or eliminating
tariff and nontariff barriers and policies and
practices of foreign governments directly related to
trade that decrease market opportunities for United
States exports or otherwise distort United States
trade; and
(B) to obtain reciprocal tariff and nontariff
barrier elimination agreements, with particular
attention to those tariff categories covered in section
111(b) of the Uruguay Round Agreements Act (19 U.S.C.
3521(b)).
(2) Trade in services.--The principal negotiating objective
of the United States regarding trade in services is to reduce
or eliminate barriers to international trade in services,
including regulatory and other barriers that deny national
treatment or unreasonably restrict the establishment or
operations of service suppliers.
(3) Foreign investment.--The principal negotiating
objective of the United States regarding foreign investment is
to reduce or eliminate artificial or trade-distorting barriers
to trade-related foreign investment by--
(A) reducing or eliminating exceptions to the
principle of national treatment;
(B) freeing the transfer of funds relating to
investments;
(C) reducing or eliminating performance
requirements and other unreasonable barriers to the
establishment and operation of investments;
(D) seeking to establish standards for
expropriation and compensation for expropriation,
consistent with United States legal principles and
practice; and
(E) providing meaningful procedures for resolving
investment disputes.
(4) Intellectual property.--The principal negotiating
objectives of the United States regarding trade-related
intellectual property are--
(A) to further promote adequate and effective
protection of intellectual property rights, including
through--
(i)(I) ensuring accelerated and full
implementation of the Agreement on Trade-
Related Aspects of Intellectual Property Rights
referred to in section 101(d)(15) of the
Uruguay Round Agreements Act (19 U.S.C.
3511(d)(15)), particularly with respect to
United States industries whose products are
subject to the lengthiest transition periods
for full compliance by developing countries
with that Agreement, and
(II) ensuring that the provisions of any
multilateral or bilateral trade agreement
entered into by the United States provide
protection at least as strong as the protection
afforded by chapter 17 of the North American
Free Trade Agreement and the annexes thereto;
(ii) providing strong protection for new
and emerging technologies and new methods of
transmitting and distributing products
embodying intellectual property;
(iii) preventing or eliminating
discrimination with respect to matters
affecting the availability, acquisition, scope,
maintenance, use, and enforcement of
intellectual property rights; and
(iv) providing strong enforcement of
intellectual property rights, including through
accessible, expeditious, and effective civil,
administrative, and criminal enforcement
mechanisms; and
(B) to secure fair, equitable, and
nondiscriminatory market access opportunities for
United States persons that rely upon intellectual
property protection.
(5) Transparency.--The principal negotiating objective of
the United States with respect to transparency is to obtain
broader application of the principle of transparency through--
(A) increased and more timely public access to
information regarding trade issues and the activities
of international trade institutions; and
(B) increased openness of dispute settlement
proceedings, including under the World Trade
Organization.
(6) Reciprocal trade in agriculture.--The principal
negotiating objective of the United States with respect to
agriculture is to obtain competitive opportunities for United
States exports in foreign markets substantially equivalent to
the competitive opportunities afforded foreign exports in
United States markets and to achieve fairer and more open
conditions of trade in bulk and value-added commodities by--
(A) reducing or eliminating, by a date certain,
tariffs or other charges that decrease market
opportunities for United States exports--
(i) giving priority to those products that
are subject to significantly higher tariffs or
subsidy regimes of major producing countries;
and
(ii) providing reasonable adjustment
periods for United States import-sensitive
products, in close consultation with the
Congress on such products before initiating
tariff reduction negotiations;
(B) reducing or eliminating subsidies that decrease
market opportunities for United States exports or
unfairly distort agriculture markets to the detriment
of the United States;
(C) developing, strengthening, and clarifying rules
and effective dispute settlement mechanisms to
eliminate practices that unfairly decrease United
States market access opportunities or distort
agricultural markets to the detriment of the United
States, including--
(i) unfair or trade-distorting activities
of export state trading enterprises and other
administrative mechanisms, with emphasis on
requiring price transparency in the operation
of export state trading enterprises and such
other mechanisms;
(ii) unjustified trade restrictions or
commercial requirements affecting new
technologies, including biotechnology;
(iii) unjustified sanitary or phytosanitary
restrictions, including those not based on
scientific principles in contravention of the
Uruguay Round Agreements;
(iv) other unjustified technical barriers
to trade; and
(v) restrictive rules in the administration
of tariff rate quotas;
(D) improving import relief mechanisms to recognize
the unique characteristics of perishable agriculture;
(E) taking into account whether a party to the
negotiations has failed to adhere to the provisions of
already existing trade agreements with the United
States or has circumvented obligations under those
agreements;
(F) taking into account whether a product is
subject to market distortions by reason of a failure of
a major producing country to adhere to the provisions
of already existing trade agreements with the United
States or by the circumvention by that country of its
obligations under those agreements; and
(G) otherwise ensuring that countries that accede
to the World Trade Organization have made meaningful
market liberalization commitments in agriculture.
(7) Labor, the environment, and other matters.--The
principal negotiating objective of the United States regarding
labor, the environment, and other matters is to address the
following aspects of foreign government policies and practices
regarding labor, the environment, and other matters that are
directly related to trade:
(A) To ensure that foreign labor, environmental,
health, or safety policies and practices do not
arbitrarily or unjustifiably discriminate or serve as
disguised barriers to trade.
(B) To ensure that foreign governments do not
derogate from or waive existing domestic environmental,
health, safety, or labor measures, including measures
that deter exploitative child labor, as an
encouragement to gain competitive advantage in
international trade or investment. Nothing in this
subparagraph is intended to address changes to a
country's laws that are consistent with sound
macroeconomic development.
(8) WTO extended negotiations.--The principal negotiating
objectives of the United States regarding trade in financial
services are those set forth in section 135(a) of the Uruguay
Round Agreements Act (19 U.S.C. 3555(a)), regarding trade in
civil aircraft are those set forth in section 135(c) of that
Act, and regarding rules of origin are the conclusion of an
agreement described in section 132 of that Act (19 U.S.C.
3552).
(c) International Economic Policy Objectives.--
(1) In general.--The President should take into account the
relationship between trade agreements and other important
priorities of the United States and seek to ensure that the
trade agreements entered into by the United States complement
and reinforce other policy goals. The United States priorities
in this area include--
(A) seeking to ensure that trade and environmental
policies are mutually supportive;
(B) seeking to protect and preserve the environment
and enhance the international means for doing so, while
optimizing the use of the world's resources;
(C) promoting respect for worker rights and the
rights of children and an understanding of the
relationship between trade and worker rights,
particularly by working with the International Labor
Organization to encourage the observance and
enforcement of core labor standards, including the
prohibition on exploitative child labor; and
(D) supplementing and strengthening standards for
protection of intellectual property under conventions
administered by international organizations other than
the World Trade Organization, expanding these
conventions to cover new and emerging technologies, and
eliminating discrimination and unreasonable exceptions
or preconditions to such protection.
(2) Applicability of trade authorities procedures.--Nothing
in this subsection shall be construed to authorize the use of
the trade authorities procedures described in section 303 to
modify United States law.
(d) Guidance for Negotiators.--
(1) Domestic objectives.--In pursuing the negotiating
objectives described in subsection (b), the negotiators on
behalf of the United States shall take into account United
States domestic objectives, including the protection of health
and safety, essential security, environmental, consumer, and
employment opportunity interests, and the law and regulations
related thereto.
(2) Consultations with congressional advisers and
enforcement of the trade laws.--In the course of negotiations
conducted under this title, the United States Trade
Representative shall--
(A) consult closely and on a timely basis with, and
keep fully apprised of the negotiations, the
congressional advisers on trade policy and negotiations
appointed under section 161 of the Trade Act of 1974;
and
(B) preserve the ability of the United States to
enforce rigorously its trade laws, including the
antidumping and countervailing duty laws, and avoid
agreements which lessen the effectiveness of domestic
and international disciplines on unfair trade,
especially dumping and subsidies, in order to ensure
that United States workers, agricultural producers, and
firms can compete fully on fair terms and enjoy the
benefits of reciprocal trade concessions.
(e) Adherence to Obligations Under Uruguay Round Agreements.--In
determining whether to enter into negotiations with a particular
country, the President shall take into account the extent to which that
country has implemented, or has accelerated the implementation of, its
obligations under the Uruguay Round Agreements.
SEC. 303. TRADE AGREEMENTS AUTHORITY.
(a) Agreements Regarding Tariff Barriers.--
(1) In general.--Whenever the President determines that one
or more existing duties or other import restrictions of any
foreign country or the United States are unduly burdening and
restricting the foreign trade of the United States and that the
purposes, policies, and objectives of this title will be
promoted thereby, the President--
(A) may enter into trade agreements with foreign
countries before--
(i) October 1, 2003, or
(ii) October 1, 2007, if trade authorities
procedures are extended under subsection (c),
and
(B) may, subject to paragraphs (2) and (3),
proclaim--
(i) such modification or continuance of any
existing duty,
(ii) such continuance of existing duty-free
or excise treatment, or
(iii) such additional duties,
as the President determines to be required or
appropriate to carry out any such trade agreement. The
President shall notify the Congress of the President's
intention to enter into an agreement under this
subsection.
(2) Limitations.--No proclamation may be made under
paragraph (1) that--
(A) reduces any rate of duty (other than a rate of
duty that does not exceed 5 percent ad valorem on the
date of the enactment of this Act) to a rate of duty
which is less than 50 percent of the rate of such duty
that applies on such date of enactment;
(B) reduces the rate of duty on an article to take
effect on a date that is more than 10 years after the
first reduction that is proclaimed to carry out a trade
agreement with respect to such article; or
(C) increases any rate of duty above the rate that
applied on January 1, 2001.
(3) Aggregate reduction; exemption from staging.--
(A) Aggregate reduction.--Except as provided in
subparagraph (B), the aggregate reduction in the rate
of duty on any article which is in effect on any day
pursuant to a trade agreement entered into under
paragraph (1) shall not exceed the aggregate reduction
which would have been in effect on such day if--
(i) a reduction of 3 percent ad valorem or
a reduction of one-tenth of the total
reduction, whichever is greater, had taken
effect on the effective date of the first
reduction proclaimed under paragraph (1) to
carry out such agreement with respect to such
article; and
(ii) a reduction equal to the amount
applicable under clause (i) had taken effect at
1-year intervals after the effective date of
such first reduction.
(B) Exemption from staging.--No staging is required
under subparagraph (A) with respect to a duty reduction
that is proclaimed under paragraph (1) for an article
of a kind that is not produced in the United States.
The United States International Trade Commission shall
advise the President of the identity of articles that
may be exempted from staging under this subparagraph.
(4) Rounding.--If the President determines that such action
will simplify the computation of reductions under paragraph
(3), the President may round an annual reduction by an amount
equal to the lesser of--
(A) the difference between the reduction without
regard to this paragraph and the next lower whole
number; or
(B) one-half of 1 percent ad valorem.
(5) Other limitations.--A rate of duty reduction that may
not be proclaimed by reason of paragraph (2) may take effect
only if a provision authorizing such reduction is included
within an implementing bill provided for under section 305 and
that bill is enacted into law.
(6) Other tariff modifications.--Notwithstanding paragraphs
(1)(B) and (2) through (5), and subject to the consultation and
layover requirements of section 115 of the Uruguay Round
Agreements Act, the President may proclaim the modification of
any duty or staged rate reduction of any duty set forth in
Schedule XX, as defined in section 2(5) of that Act, if the
United States agrees to such modification or staged rate
reduction in a negotiation for the reciprocal elimination or
harmonization of duties under the auspices of the World Trade
Organization or as part of an interim agreement leading to the
formation of a regional free-trade area.
(7) Authority under uruguay round agreements act not
affected.--Nothing in this subsection shall limit the authority
provided to the President under section 111(b) of the Uruguay
Round Agreements Act (19 U.S.C. 3521(b)).
(b) Agreements Regarding Tariff and Nontariff Barriers.--
(1) In general.--(A) Whenever the President determines
that--
(i) one or more existing duties or any other import
restriction of any foreign country or the United States
or any other barrier to, or other distortion of,
international trade unduly burdens or restricts the
foreign trade of the United States or adversely affects
the United States economy, or
(ii) the imposition of any such barrier or
distortion is likely to result in such a burden,
restriction, or effect,
and that the purposes, policies, and objectives of this title
will be promoted thereby, the President may enter into a trade
agreement described in subparagraph (B) during the period
described in subparagraph (C).
(B) The President may enter into a trade agreement under
subparagraph (A) with foreign countries providing for--
(i) the reduction or elimination of a duty,
restriction, barrier, or other distortion described in
subparagraph (A), or
(ii) the prohibition of, or limitation on the
imposition of, such barrier or other distortion.
(C) The President may enter into a trade agreement under
this paragraph before--
(i) October 1, 2003, or
(ii) October 1, 2007, if trade authorities
procedures are extended under subsection (c).
(2) Conditions.--A trade agreement may be entered into
under this subsection only if such agreement makes progress in
meeting the applicable objectives described in section 302 and
the President satisfies the conditions set forth in section
304.
(3) Bills qualifying for trade authorities procedures.--The
provisions of section 151 of the Trade Act of 1974 (in this
title referred to as ``trade authorities procedures'') apply to
a bill of either House of Congress consisting only of--
(A) a provision approving a trade agreement entered
into under this subsection and approving the statement
of administrative action, if any, proposed to implement
such trade agreement,
(B) provisions directly related to the principal
trade negotiating objectives set forth in section
302(b) achieved in such trade agreement, if those
provisions are necessary for the operation or
implementation of United States rights or obligations
under such trade agreement,
(C) provisions that define and clarify, or
provisions that are related to, the operation or effect
of the provisions of the trade agreement,
(D) provisions to provide adjustment assistance to
workers and firms adversely affected by trade, and
(E) provisions necessary for purposes of complying
with section 252 of the Balanced Budget and Emergency
Deficit Control Act of 1985 in implementing the trade
agreement,
to the same extent as such section 151 applies to implementing
bills under that section. A bill to which this subparagraph
applies shall hereafter in this title be referred to as an
``implementing bill''.
(c) Extension Disapproval Process for Congressional Trade
Authorities Procedures.--
(1) In general.--Except as provided in section 305(b)--
(A) the trade authorities procedures apply to
implementing bills submitted with respect to trade
agreements entered into under subsection (b) before
October 1, 2003; and
(B) the trade authorities procedures shall be
extended to implementing bills submitted with respect
to trade agreements entered into under subsection (b)
after September 30, 2003, and before October 1, 2007,
if (and only if)--
(i) the President requests such extension
under paragraph (2); and
(ii) neither House of the Congress adopts
an extension disapproval resolution under
paragraph (5) before October 1, 2003.
(2) Report to congress by the president.--If the President
is of the opinion that the trade authorities procedures should
be extended to implementing bills described in paragraph
(1)(B), the President shall submit to the Congress, not later
than July 1, 2003, a written report that contains a request for
such extension, together with--
(A) a description of all trade agreements that have
been negotiated under subsection (b) and the
anticipated schedule for submitting such agreements to
the Congress for approval;
(B) a description of the progress that has been
made in negotiations to achieve the purposes, policies,
and objectives of this title, and a statement that such
progress justifies the continuation of negotiations;
and
(C) a statement of the reasons why the extension is
needed to complete the negotiations.
(3) Report to congress by the advisory committee.--The
President shall promptly inform the Advisory Committee for
Trade Policy and Negotiations established under section 135 of
the Trade Act of 1974 (19 U.S.C. 2155) of the President's
decision to submit a report to the Congress under paragraph
(2). The Advisory Committee shall submit to the Congress as
soon as practicable, but not later than August 1, 2003, a
written report that contains--
(A) its views regarding the progress that has been
made in negotiations to achieve the purposes, policies,
and objectives of this title; and
(B) a statement of its views, and the reasons
therefor, regarding whether the extension requested
under paragraph (2) should be approved or disapproved.
(4) Reports may be classified.--The reports submitted to
the Congress under paragraphs (2) and (3), or any portion of
such reports, may be classified to the extent the President
determines appropriate.
(5) Extension disapproval resolutions.--(A) For purposes of
paragraph (1), the term ``extension disapproval resolution''
means a resolution of either House of the Congress, the sole
matter after the resolving clause of which is as follows:
``That the ____ disapproves the request of the President for
the extension, under section 303(c)(1)(B)(i) of the Reciprocal
Trade Agreement Authorities Act of 2001, of the provisions of
section 151 of the Trade Act of 1974 to any implementing bill
submitted with respect to any trade agreement entered into
under section 303(b) of the Reciprocal Trade Agreement
Authorities Act of 2001 after September 30, 2003.'', with the
blank space being filled with the name of the resolving House
of the Congress.
(B) Extension disapproval resolutions--
(i) may be introduced in either House of the
Congress by any member of such House; and
(ii) shall be referred, in the House of
Representatives, to the Committee on Ways and Means
and, in addition, to the Committee on Rules.
(C) The provisions of sections 152(d) and (e) of the Trade
Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating to the floor
consideration of certain resolutions in the House and Senate)
apply to extension disapproval resolutions.
(D) It is not in order for--
(i) the Senate to consider any extension
disapproval resolution not reported by the Committee on
Finance;
(ii) the House of Representatives to consider any
extension disapproval resolution not reported by the
Committee on Ways and Means and, in addition, by the
Committee on Rules; or
(iii) either House of the Congress to consider an
extension disapproval resolution after September 30,
2003.
SEC. 304. CONSULTATIONS.
(a) Notice and Consultation Before Negotiation.--
(1) In general.--The President, with respect to any
agreement that is subject to the provisions of section 303(b),
shall--
(A) provide, at least 90 calendar days before
initiating negotiations, written notice to the Congress
of the President's intention to enter into the
negotiations and set forth therein the date the
President intends to initiate such negotiations, the
specific United States objectives for the negotiations,
and whether the President intends to seek an agreement,
or changes to an existing agreement; and
(B) before and after submission of the notice,
consult regarding the negotiations with the Committee
on Finance of the Senate and the Committee on Ways and
Means of the House of Representatives and such other committees of the
House and Senate as the President deems appropriate.
(2) Consultations regarding negotiations on certain
objectives.--
(A) Consultation.--In addition to the requirements
set forth in paragraph (1), before initiating
negotiations with respect to a trade agreement subject
to section 303(b) where the subject matter of such
negotiations is directly related to the principal trade
negotiating objectives set forth in section 302(b)(1)
or section 302(b)(7), the President shall consult with
the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the
Senate and with the appropriate advisory groups
established under section 135 of the Trade Act of 1974
with respect to such negotiations.
(B) Scope.--The consultations described in
subparagraph (A) shall concern the manner in which the
negotiation will address the objective of reducing or
eliminating a specific tariff or nontariff barrier or
foreign government policy or practice directly related
to trade that decreases market opportunities for United
States exports or otherwise distorts United States
trade.
(3) Negotiations regarding agriculture.--Before initiating
negotiations the subject matter of which is directly related to
the subject matter under section 302(b)(6)(A) with any country,
the President shall assess whether United States tariffs on
agriculture products that were bound under the Uruguay Round
Agreements are lower than the tariffs bound by that country. In
addition, the President shall consider whether the tariff
levels bound and applied throughout the world with respect to
imports from the United States are higher than United States
tariffs and whether the negotiation provides an opportunity to
address any such disparity. The President shall consult with
the Committee on Ways and Means and the Committee on
Agriculture of the House of Representatives and the Committee
on Finance and the Committee on Agriculture, Nutrition, and
Forestry of the Senate concerning the results of the
assessment, whether it is appropriate for the United States to
agree to further tariff reductions based on the conclusions
reached in the assessment, and how all applicable negotiating
objectives will be met.
(b) Consultation With Congress Before Agreements Entered Into.--
(1) Consultation.--Before entering into any trade agreement
under section 303(b), the President shall consult with--
(A) the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the
Senate; and
(B) each other committee of the House and the
Senate, and each joint committee of the Congress, which
has jurisdiction over legislation involving subject
matters which would be affected by the trade agreement.
(2) Scope.--The consultation described in paragraph (1)
shall include consultation with respect to--
(A) the nature of the agreement;
(B) how and to what extent the agreement will
achieve the applicable purposes, policies, and
objectives of this title; and
(C) the implementation of the agreement under
section 305, including the general effect of the
agreement on existing laws.
(c) Advisory Committee Reports.--The report required under section
135(e)(1) of the Trade Act of 1974 regarding any trade agreement
entered into under section 303(a) or (b) of this Act shall be provided
to the President, the Congress, and the United States Trade
Representative not later than 30 days after the date on which the
President notifies the Congress under section 303(a)(1) or 305(a)(1)(A)
of the President's intention to enter into the agreement.
SEC. 305. IMPLEMENTATION OF TRADE AGREEMENTS.
(a) In General.--
(1) Notification and submission.--Any agreement entered
into under section 303(b) shall enter into force with respect
to the United States if (and only if)--
(A) the President, at least 90 calendar days before
the day on which the President enters into the trade
agreement, notifies the House of Representatives and
the Senate of the President's intention to enter into
the agreement, and promptly thereafter publishes notice
of such intention in the Federal Register;
(B) within 60 days after entering into the
agreement, the President submits to the Congress a
description of those changes to existing laws that the
President considers would be required in order to bring
the United States into compliance with the agreement;
(C) after entering into the agreement, the
President submits a copy of the final legal text of the
agreement, together with--
(i) a draft of an implementing bill
described in section 303(b)(3);
(ii) a statement of any administrative
action proposed to implement the trade
agreement; and
(iii) the supporting information described
in paragraph (2); and
(D) the implementing bill is enacted into law.
(2) Supporting information.--The supporting information
required under paragraph (1)(C)(iii) consists of--
(A) an explanation as to how the implementing bill
and proposed administrative action will change or
affect existing law; and
(B) a statement--
(i) asserting that the agreement makes
progress in achieving the applicable purposes,
policies, and objectives of this title;
(ii) setting forth the reasons of the
President regarding--
(I) how and to what extent the
agreement makes progress in achieving
the applicable purposes, policies, and
objectives referred to in clause (i);
(II) whether and how the agreement
changes provisions of an agreement
previously negotiated;
(III) how the agreement serves the
interests of United States commerce;
and
(IV) how the implementing bill
meets the standards set forth in
section 303(b)(3).
(3) Reciprocal benefits.--In order to ensure that a foreign
country that is not a party to a trade agreement entered into
under section 303(b) does not receive benefits under the
agreement unless the country is also subject to the obligations
under the agreement, the implementing bill submitted with
respect to the agreement shall provide that the benefits and
obligations under the agreement apply only to the parties to
the agreement, if such application is consistent with the terms
of the agreement. The implementing bill may also provide that
the benefits and obligations under the agreement do not apply
uniformly to all parties to the agreement, if such application
is consistent with the terms of the agreement.
(b) Limitations on Trade Authorities Procedures.--
(1) For lack of consultations.--
(A) In general.--The trade authorities procedures
shall not apply to any implementing bill submitted with
respect to a trade agreement entered into under section
303(b) if during the 60-day period beginning on the
date that one House of Congress agrees to a procedural
disapproval resolution for lack of notice or
consultations with respect to that trade agreement, the
other House separately agrees to a procedural
disapproval resolution with respect to that agreement.
(B) Procedural disapproval resolution.--For
purposes of this paragraph, the term ``procedural
disapproval resolution'' means a resolution of either
House of Congress, the sole matter after the resolving
clause of which is as follows: ``That the President has
failed or refused to notify or consult (as the case may
be) with Congress in accordance with section 304 or 305
of the Reciprocal Trade Agreement Authorities Act of
2001 on negotiations with respect to, or entering into,
a trade agreement to which section 303(b) of that Act
applies and, therefore, the provisions of section 151
of the Trade Act of 1974 shall not apply to any
implementing bill submitted with respect to that trade
agreement.''.
(2) Procedures for considering resolutions.--(A) Procedural
disapproval resolutions--
(i) in the House of Representatives--
(I) shall be introduced by the chairman or
ranking minority member of the Committee on
Ways and Means or the chairman or ranking
minority member of the Committee on Rules;
(II) shall be referred to the Committee on
Ways and Means and, in addition, to the
Committee on Rules; and
(III) may not be amended by either
Committee; and
(ii) in the Senate shall be original resolutions of
the Committee on Finance.
(B) The provisions of section 152(d) and (e) of the Trade
Act of 1974 (19 U.S.C. 2192(d) and (e)) (relating to the floor
consideration of certain resolutions in the House and Senate)
apply to procedural disapproval resolutions.
(C) It is not in order for the House of Representatives to
consider any procedural disapproval resolution not reported by
the Committee on Ways and Means and, in addition, by the
Committee on Rules.
(c) Rules of House of Representatives and Senate.--Subsection (b)
of this section and section 103(c) are enacted by the Congress--
(1) as an exercise of the rulemaking power of the House of
Representatives and the Senate, respectively, and as such are
deemed a part of the rules of each House, respectively, and
such procedures supersede other rules only to the extent that
they are inconsistent with such other rules; and
(2) with the full recognition of the constitutional right
of either House to change the rules (so far as relating to the
procedures of that House) at any time, in the same manner, and
to the same extent as any other rule of that House.
SEC. 306. TREATMENT OF CERTAIN TRADE AGREEMENTS.
(a) Certain Agreements.--Notwithstanding section 303(b)(2), if an
agreement to which section 303(b) applies--
(1) is entered into under the auspices of the World Trade
Organization regarding trade in information technology
products,
(2) is entered into under the auspices of the World Trade
Organization regarding extended negotiations on financial
services as described in section 135(a) of the Uruguay Round
Agreements Act (19 U.S.C. 3555(a)),
(3) is entered into under the auspices of the World Trade
Organization regarding the rules of origin work program
described in Article 9 of the Agreement on Rules of Origin
referred to in section 101(d)(10) of the Uruguay Round
Agreements Act (19 U.S.C. 3511(d)(10)), or
(4) is entered into with Chile,
and results from negotiations that were commenced before the date of
the enactment of this Act, subsection (b) shall apply.
(b) Treatment of Agreements.--In the case of any agreement to which
subsection (a) applies--
(1) the applicability of the trade authorities procedures
to implementing bills shall be determined without regard to the
requirements of section 304(a), and any procedural disapproval
resolution under section 305(b)(1)(B) shall not be in order on
the basis of a failure or refusal to comply with the provisions
of section 304(a); and
(2) the President shall consult regarding the negotiations
described in subsection (a) with the committees described in
section 304(a)(1)(B) as soon as feasible after the enactment of
this Act.
SEC. 307. CONFORMING AMENDMENTS.
(a) In General.--Title I of the Trade Act of 1974 (19 U.S.C. 2111
et seq.) is amended as follows:
(1) Implementing bill.--
(A) Section 151(b)(1) (19 U.S.C. 2191(b)(1)) is
amended by striking ``section 1103(a)(1) of the Omnibus
Trade and Competitiveness Act of 1988, or section 282
of the Uruguay Round Agreements Act'' and inserting
``section 282 of the Uruguay Round Agreements Act, or
section 305(a)(1) of the Reciprocal Trade Agreement
Authorities Act of 2001''.
(B) Section 151(c)(1) (19 U.S.C. 2191(c)(1)) is
amended by striking ``or section 282 of the Uruguay
Round Agreements Act'' and inserting ``, section 282 of
the Uruguay Round Agreements Act, or section 305(a)(1)
of the Reciprocal Trade Agreement Authorities Act of
2001''.
(2) Advice from international trade commission.--Section
131 (19 U.S.C. 2151) is amended--
(A) in subsection (a)--
(i) in paragraph (1), by striking ``section
123 of this Act or section 1102 (a) or (c) of
the Omnibus Trade and Competitiveness Act of
1988,'' and inserting ``section 123 of this Act
or section 303(a) or (b) of the Reciprocal
Trade Agreement Authorities Act of 2001,''; and
(ii) in paragraph (2), by striking
``section 1102 (b) or (c) of the Omnibus Trade
and Competitiveness Act of 1988'' and inserting
``section 303(b) of the Reciprocal Trade
Agreement Authorities Act of 2001'';
(B) in subsection (b), by striking ``section
1102(a)(3)(A)'' and inserting ``section 303(a)(3)(A) of
the Reciprocal Trade Agreement Authorities Act of
2001'' before the end period; and
(C) in subsection (c), by striking ``section 1102
of the Omnibus Trade and Competitiveness Act of 1988,''
and inserting ``section 303 of the Reciprocal Trade
Agreement Authorities Act of 2001,''.
(3) Hearings and advice.--Sections 132, 133(a), and 134(a)
(19 U.S.C. 2152, 2153(a), and 2154(a)) are each amended by
striking ``section 1102 of the Omnibus Trade and
Competitiveness Act of 1988,'' each place it appears and
inserting ``section 303 of the Reciprocal Trade Agreement
Authorities Act of 2001,''.
(4) Prerequisites for offers.--Section 134(b) (19 U.S.C.
2154(b)) is amended by striking ``section 1102 of the Omnibus
Trade and Competitiveness Act of 1988'' and inserting ``section
303 of the Reciprocal Trade Agreement Authorities Act of
2001''.
(5) Advice from private and public sectors.--Section 135
(19 U.S.C. 2155) is amended--
(A) in subsection (a)(1)(A), by striking ``section
1102 of the Omnibus Trade and Competitiveness Act of
1988'' and inserting ``section 303 of the Reciprocal
Trade Agreement Authorities Act of 2001'';
(B) in subsection (e)(1)--
(i) by striking ``section 1102 of the
Omnibus Trade and Competitiveness Act of 1988''
each place it appears and inserting ``section
303 of the Reciprocal Trade Agreement
Authorities Act of 2001''; and
(ii) by striking ``section 1103(a)(1)(A) of
such Act of 1988'' and inserting ``section
305(a)(1)(A) of the Reciprocal Trade Agreement
Authorities Act of 2001''; and
(C) in subsection (e)(2), by striking ``section
1101 of the Omnibus Trade and Competitiveness Act of
1988'' and inserting ``section 302 of the Reciprocal
Trade Agreement Authorities Act of 2001''.
(6) Transmission of agreements to congress.--Section 162(a)
(19 U.S.C. 2212(a)) is amended by striking ``or under section
1102 of the Omnibus Trade and Competitiveness Act of 1988'' and
inserting ``or under section 303 of the Reciprocal Trade
Agreement Authorities Act of 2001''.
(b) Application of Certain Provisions.--For purposes of applying
sections 125, 126, and 127 of the Trade Act of 1974 (19 U.S.C. 2135,
2136(a), and 2137)--
(1) any trade agreement entered into under section 303
shall be treated as an agreement entered into under section 101
or 102, as appropriate, of the Trade Act of 1974 (19 U.S.C.
2111 or 2112); and
(2) any proclamation or Executive order issued pursuant to
a trade agreement entered into under section 303 shall be
treated as a proclamation or Executive order issued pursuant to
a trade agreement entered into under section 102 of the Trade
Act of 1974.
SEC. 308. DEFINITIONS.
In this title:
(1) United states person.--The term ``United States
person'' means--
(A) a United States citizen;
(B) a partnership, corporation, or other legal
entity organized under the laws of the United States;
and
(C) a partnership, corporation, or other legal
entity that is organized under the laws of a foreign
country and is controlled by entities described in
subparagraph (B) or United States citizens, or both.
(2) Uruguay round agreements.--The term ``Uruguay Round
Agreements'' has the meaning given that term in section 2(7) of
the Uruguay Round Agreements Act (19 U.S.C. 3501(7)).
(3) World trade organization.--The term ``World Trade
Organization'' means the organization established pursuant to
the WTO Agreement.
(4) WTO agreement.--The term ``WTO Agreement'' means the
Agreement Establishing the World Trade Organization entered
into on April 15, 1994.
TITLE IV--AGRICULTURAL TRADE FREEDOM
SEC. 401. SHORT TITLE.
This title may be cited as the ``Agricultural Trade Freedom Act''.
SEC. 402. DEFINITIONS.
In this title, the terms ``agricultural commodity'' and ``United
States agricultural commodity'' have the meanings given the terms in
section 102 of the Agricultural Trade Act of 1978 (7 U.S.C. 5602).
SEC. 403. AGRICULTURAL COMMODITIES, LIVESTOCK, AND PRODUCTS EXEMPT FROM
UNILATERAL AGRICULTURAL SANCTIONS.
Subtitle B of title IV of the Agricultural Trade Act of 1978 (7
U.S.C. 5661 et seq.) is amended by adding at the end the following:
``SEC. 418. AGRICULTURAL COMMODITIES, LIVESTOCK, AND PRODUCTS EXEMPT
FROM UNILATERAL AGRICULTURAL SANCTIONS.
``(a) Definitions.--In this section:
``(1) Current sanction.--The term `current sanction' means
a unilateral agricultural sanction that is in effect on the
date of enactment of the Agricultural Trade Freedom Act.
``(2) New sanction.--The term `new sanction' means a
unilateral agricultural sanction that becomes effective after
the date of enactment of that Act.
``(3) Unilateral agricultural sanction.--The term
`unilateral agricultural sanction' means any prohibition,
restriction, or condition that is imposed on the export of an
agricultural commodity to a foreign country or foreign entity
and that is imposed by the United States for reasons of the
national interest, except in a case in which the United States
imposes the measure pursuant to a multilateral regime and the
other members of that regime have agreed to impose
substantially equivalent measures.
``(b) Exemption.--
``(1) In general.--Subject to paragraphs (2) and (3) and
notwithstanding any other provision of law, agricultural
commodities made available as a result of commercial sales
shall be exempt from a unilateral agricultural sanction imposed
by the United States on another country.
``(2) Exclusions.--Paragraph (1) shall not apply to
agricultural commodities made available as a result of programs
carried out under--
``(A) the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1691 et seq.);
``(B) section 416 of the Agricultural Act of 1949
(7 U.S.C. 1431);
``(C) the Food for Progress Act of 1985 (7 U.S.C.
1736o);
``(D) the Agricultural Trade Act of 1978 (7 U.S.C.
5601 et seq.); or
``(E) section 153 of the Food Security Act of 1985
(15 U.S.C. 713a-14).
``(3) Determination by president.--The President may
include agricultural commodities made available as a result of
the activities described in paragraph (1) in the unilateral
agricultural sanction imposed on a foreign country or foreign
entity if--
``(A) a declaration of war by Congress is in effect
with respect to the foreign country or foreign entity;
or
``(B)(i) the President determines that inclusion of
the agricultural commodities is in the national
interest;
``(ii) the President submits the report required
under subsection (d); and
``(iii) Congress has not approved a joint
resolution stating the disapproval of Congress of the
report submitted under subsection (d).
``(4) Effect on agricultural trade.--Nothing in this
subsection requires the imposition of a unilateral agricultural
sanction with respect to an agricultural commodity, whether
exported in connection with a commercial sale or a program
described in paragraph (2).
``(c) Current Sanctions.--
``(1) In general.--Subject to paragraph (2), the exemption
under subsection (b)(1) shall apply to a current sanction.
``(2) Presidential review.--Not later than 90 days after
the date of enactment of the Agricultural Trade Freedom Act,
the President shall review each current sanction to determine
whether the exemption under subsection (b)(1) should apply to
the current sanction.
``(3) Application.--The exemption under subsection (b)(1)
shall apply to a current sanction beginning on the date that is
180 days after the date of enactment of the Agricultural Trade
Freedom Act unless the President determines that the exemption
should not apply to the current sanction for reasons of the
national interest.
``(d) Report.--
``(1) In general.--If the President determines under
subsection (b)(3)(B)(i) or (c)(3) that the exemption should not
apply to a unilateral agricultural sanction, the President
shall submit a report to Congress not later than 15 days after
the date of the determination.
``(2) Contents of report.--The report shall contain--
``(A) an explanation of--
``(i) the economic activity that is
proposed to be prohibited, restricted, or
conditioned by the unilateral agricultural
sanction; and
``(ii) the national interest for which the
exemption should not apply to the unilateral
agricultural sanction; and
``(B) an assessment by the Secretary--
``(i) regarding export sales--
``(I) in the case of a current
sanction, whether markets in the
sanctioned country or countries present
a substantial trade opportunity for
export sales of a United States
agricultural commodity; or
``(II) in the case of a new
sanction, the extent to which any
country or countries to be sanctioned
or likely to be sanctioned are markets
that accounted for, during the
preceding calendar year, more than 3
percent of export sales of a United
States agricultural commodity;
``(ii) regarding the effect on United
States agricultural commodities--
``(I) in the case of a current
sanction, the potential for export
sales of United States agricultural
commodities in the sanctioned country
or countries; and
``(II) in the case of a new
sanction, the likelihood that exports
of United States agricultural
commodities will be affected by the new
sanction or by retaliation by any
country to be sanctioned or likely to
be sanctioned, including a description
of specific United States agricultural
commodities that are most likely to be
affected;
``(iii) regarding the income of
agricultural producers--
``(I) in the case of a current
sanction, the potential for increasing
the income of producers of the United
States agricultural commodities
involved; and
``(II) in the case of a new
sanction, the likely effect on incomes
of producers of the agricultural
commodities involved;
``(iv) regarding displacement of United
States suppliers--
``(I) in the case of a current
sanction, the potential for increased
competition for United States suppliers
of the agricultural commodity in
countries that are not subject to the
current sanction because of uncertainty
about the reliability of the United
States suppliers; and
``(II) in the case of a new
sanction, the extent to which the new
sanction would permit foreign suppliers
to replace United States suppliers; and
``(v) regarding the reputation of United
States agricultural producers as reliable
suppliers--
``(I) in the case of a current
sanction, whether removing the sanction
would improve the reputation of United
States producers as reliable suppliers
of agricultural commodities in general,
and of specific agricultural
commodities identified by the
Secretary; and
``(II) in the case of a new
sanction, the likely effect of the
proposed sanction on the reputation of
United States producers as reliable
suppliers of agricultural commodities
in general, and of specific
agricultural commodities identified by
the Secretary.
``(e) Congressional Priority Procedures.--
``(1) Joint resolution.--In this subsection, the term
`joint resolution' means only a joint resolution introduced
within 10 session days of Congress after the date on which the
report of the President under subsection (d) is received by
Congress, the matter after the resolving clause of which is as
follows: `That Congress disapproves the report of the President
pursuant to section 418(d) of the Agricultural Trade Act of
1978, transmitted on ______________.', with the blank completed
with the appropriate date.
``(2) Referral of report.--The report described in
subsection (d) shall be referred to the appropriate committee
or committees of the House of Representatives and to the
appropriate committee or committees of the Senate.
``(3) Referral of joint resolution.--
``(A) In general.--A joint resolution shall be
referred to the committees in each House of Congress
with jurisdiction.
``(B) Reporting date.--A joint resolution referred
to in subparagraph (A) may not be reported before the
eighth session day of Congress after the introduction
of the joint resolution.
``(4) Discharge of committee.--If the committee to which is
referred a joint resolution has not reported the joint
resolution (or an identical joint resolution) at the end of 30
session days of Congress after the date of introduction of the
joint resolution--
``(A) the committee shall be discharged from
further consideration of the joint resolution; and
``(B) the joint resolution shall be placed on the
appropriate calendar of the House concerned.
``(5) Floor consideration.--
``(A) Motion to proceed.--
``(i) In general.--When the committee to
which a joint resolution is referred has
reported, or when a committee is discharged
under paragraph (4) from further consideration
of, a joint resolution--
``(I) it shall be at any time
thereafter in order (even though a
previous motion to the same effect has
been disagreed to) for any member of
the House concerned to move to proceed
to the consideration of the joint
resolution; and
``(II) all points of order against
the joint resolution (and against
consideration of the joint resolution)
are waived.
``(ii) Privilege.--The motion to proceed to
the consideration of the joint resolution--
``(I) shall be highly privileged in
the House of Representatives and
privileged in the Senate; and
``(II) shall not be debatable.
``(iii) Amendments and motions not in
order.--The motion to proceed to the
consideration of the joint resolution shall not
be subject to--
``(I) amendment;
``(II) a motion to postpone; or
``(III) a motion to proceed to the
consideration of other business.
``(iv) Motion to reconsider not in order.--
A motion to reconsider the vote by which the
motion is agreed to or disagreed to shall not
be in order.
``(v) Business until disposition.--If a
motion to proceed to the consideration of the
joint resolution is agreed to, the joint
resolution shall remain the unfinished business
of the House concerned until disposed of.
``(B) Limitations on debate.--
``(i) In general.--Debate on the joint
resolution, and on all debatable motions and
appeals in connection with the joint
resolution, shall be limited to not more than
10 hours, which shall be divided equally
between those favoring and those opposing the
joint resolution.
``(ii) Further debate limitations.--A
motion to limit debate shall be in order and
shall not be debatable.
``(iii) Amendments and motions not in
order.--An amendment to, a motion to postpone,
a motion to proceed to the consideration of
other business, a motion to recommit the joint
resolution, or a motion to reconsider the vote
by which the joint resolution is agreed to or
disagreed to shall not be in order.
``(C) Vote on final passage.--Immediately following
the conclusion of the debate on a joint resolution, and
a single quorum call at the conclusion of the debate if
requested in accordance with the rules of the House
concerned, the vote on final passage of the joint
resolution shall occur.
``(D) Rulings of the chair on procedure.--An appeal
from a decision of the Chair relating to the
application of the rules of the Senate or House of
Representatives, as the case may be, to the procedure
relating to a joint resolution shall be decided without
debate.
``(6) Coordination with action by other house.--If, before
the passage by 1 House of a joint resolution of that House,
that House receives from the other House a joint resolution,
the following procedures shall apply:
``(A) No committee referral.--The joint resolution
of the other House shall not be referred to a
committee.
``(B) Floor procedure.--With respect to a joint
resolution of the House receiving the joint
resolution--
``(i) the procedure in that House shall be
the same as if no joint resolution had been
received from the other House; but
``(ii) the vote on final passage shall be
on the joint resolution of the other House.
``(C) Disposition of joint resolutions of receiving
house.--On disposition of the joint resolution received
from the other House, it shall no longer be in order to
consider the joint resolution originated in the
receiving House.
``(7) Procedures after action by both the house and
senate.--If a House receives a joint resolution from the other
House after the receiving House has disposed of a joint
resolution originated in that House, the action of the
receiving House with regard to the disposition of the joint
resolution originated in that House shall be deemed to be the
action of the receiving House with regard to the joint
resolution originated in the other House.
``(8) Rulemaking power.--This subsection is enacted by
Congress--
``(A) as an exercise of the rulemaking power of the
Senate and House of Representatives, respectively, and
as such this subsection--
``(i) is deemed to be a part of the rules
of each House, respectively, but applicable
only with respect to the procedure to be
followed in that House in the case of a joint
resolution; and
``(ii) supersedes other rules only to the
extent that this subsection is inconsistent
with those rules; and
``(B) with full recognition of the constitutional
right of either House to change the rules (so far as
the rules relate to the procedure of that House) at any
time, in the same manner and to the same extent as in
the case of any other rule of that House.''.
SEC. 404. SALE OR BARTER OF FOOD ASSISTANCE.
It is the sense of Congress that the amendments to section 203 of
the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C.
1723) made by section 208 of the Federal Agriculture Improvement and
Reform Act of 1996 (Public Law 104-127; 110 Stat. 954) were intended to
allow the sale or barter of United States agricultural commodities in
connection with United States food assistance only within the recipient
country or countries adjacent to the recipient country, unless--
(1) the sale or barter within the recipient country or
adjacent countries is not practicable; and
(2) the sale or barter within countries other than the
recipient country or adjacent countries will not disrupt
commercial markets for the agricultural commodity involved.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Ways and Means, and in addition to the Committees on Agriculture, Rules, and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Ways and Means, and in addition to the Committees on Agriculture, Rules, and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Ways and Means, and in addition to the Committees on Agriculture, Rules, and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Ways and Means, and in addition to the Committees on Agriculture, Rules, and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Ways and Means, and in addition to the Committees on Agriculture, Rules, and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Subcommittee on Government Efficiency, Financial Management and Intergovernmental Relations.
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Executive Comment Requested from USDA.
See H.R.1836.