Fair Currency Practices Act of 2005

Fair Currency Practices Act of 2005 - Amends the Exchange Rates and International Economic Policy Coordination Act of 1988 with respect to bilateral negotiations with countries considered to manipulate the rate of exchange between their currency and the U.S. dollar for purposes of preventing effective balance of payments adjustments or gaining unfair competitive advantage in international trade.

Modifies the preconditions for the initiation of negotiations by the Secretary of the Treasury to make them alternative rather than joint. (Requires the Secretary to consider that such manipulation is occurring with respect to countries that possess material global current account surpluses or (currently, and) significant bilateral trade surpluses with the United States.)

Declares that a country shall be considered to be manipulating the rate of exchange between its currency and the U.S. dollar if there is a protracted large-scale intervention in one direction in the exchange markets.

Authorizes the Secretary to find that a country is manipulating the rate of exchange based on any other factor or combination of factors.

Requires the Secretary to examine and report to Congress on the trade surplus of the People's Republic of China (PRC), particularly on: (1) why the trade surplus with the United States and other countries reported by the PRC differs from the trade surplus reported by the other countries; and (2) quantification of such differences.

[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 984 Introduced in Senate (IS)]







109th CONGRESS
  1st Session
                                 S. 984

     To amend the Exchange Rates and International Economic Policy 
Coordination Act of 1988 to clarify the definition of manipulation with 
              respect to currency, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 10, 2005

   Ms. Snowe introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
     To amend the Exchange Rates and International Economic Policy 
Coordination Act of 1988 to clarify the definition of manipulation with 
              respect to currency, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Currency Practices Act of 
2005''.

SEC. 2. AMENDMENTS RELATING TO INTERNATIONAL FINANCIAL POLICY.

    (a) Bilateral Negotiations.--Section 3004(b) of the Exchange Rates 
and International Economic Policy Coordination Act of 1988 (22 U.S.C. 
5304(b)) is amended in the second sentence by striking ``and (2)'' and 
inserting ``or (2)''.
    (b) Definition of Manipulation.--Section 3006 of the Exchange Rates 
and International Economic Policy Coordination Act of 1988 (22 U.S.C. 
5306) is amended by adding at the end the following:
            ``(3) Manipulation of rate of exchange.--For purposes of 
        this Act, a country shall be considered to be manipulating the 
        rate of exchange between its currency and the United States 
        dollar if there is a protracted large-scale intervention in one 
        direction in the exchange markets. The Secretary may find that 
        a country is manipulating the rate of exchange based on any 
        other factor or combination of factors.''.
    (c) Report.--Not later than 90 days after the date of enactment of 
this Act, the Secretary of the Treasury shall undertake an examination, 
and submit a report to Congress, regarding the trade surplus of the 
People's Republic of China. The Secretary shall examine why the trade 
surplus with the United States and other countries reported by the 
People's Republic of China differs from the trade surplus reported by 
the other countries. The report shall also quantify the differences 
between the trade surplus reported by the United States and other 
countries and what is reported by the People's Republic of China.
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