Currency Reform for Fair Trade Act - Amends the Tariff Act of 1930 to include as a "countervailable subsidy" requiring action under a countervailing duty or antidumping duty proceeding the benefit conferred on merchandise imported into the United States from foreign countries with fundamentally undervalued currency.
Defines "benefit conferred," in cases where the currency of a foreign country is exchanged for foreign currency (i.e., U.S. dollars) obtained from export transactions, as the difference between: (1) the amount of currency provided by a foreign country in which the subject merchandise is produced, and (2) the amount of currency such country would have provided if the real effective exchange rate of its currency were not fundamentally undervalued.
Declares that the fact that such a subsidy is also provided in circumstances not involving export shall not, for that reason alone, mean it cannot be considered export contingent and actionable under a countervailing duty and antidumping duty proceeding.
Requires the administering authority to determine that the currency of a foreign country is fundamentally undervalued if for an 18-month period: (1) the government of the country engages in protracted, large-scale intervention in one or more foreign exchange markets; (2) the country's real effective exchange rate is undervalued by at least 5%; (3) the country has experienced significant and persistent global current account surpluses; and (4) the country's government has foreign asset reserves exceeding the amount necessary to repay all its debt obligations falling due within the coming 12 months, 20% percent of the country's money supply, and the value of the country's imports during the previous 4 months.
Requires the use, for calculating a country's "real effective exchange rate undervaluation," of certain guidelines of the Consultative Group on Exchange Rate Issues of the International Monetary Fund (IMF) or, if those guidelines are not available, generally accepted economic and econometric techniques and methodologies. Requires the use, also, of inflation-adjusted, trade-weighted exchange rates.
Applies the amendments made by this Act to goods from Canada and Mexico.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1276 Introduced in House (IH)]
113th CONGRESS
1st Session
H. R. 1276
To amend title VII of the Tariff Act of 1930 to clarify that
countervailing duties may be imposed to address subsidies relating to a
fundamentally undervalued currency of any foreign country.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 20, 2013
Mr. Levin (for himself, Mr. Brooks of Alabama, Mrs. Capito, Mr. Coble,
Mr. Conyers, Mr. Cooper, Mr. Cummings, Mr. DeFazio, Mr. Dingell, Mr.
Enyart, Mr. Griffith of Virginia, Mr. Grijalva, Mr. Harper, Mr.
Higgins, Mr. Ellison, Mr. Foster, Mr. Johnson of Ohio, Mr. Jones, Ms.
Kaptur, Mr. Lipinski, Mr. Lynch, Mr. McHenry, Mr. McKinley, Mr. Meehan,
Mr. Michaud, Mr. George Miller of California, Mr. Murphy of
Pennsylvania, Mr. Owens, Mr. Pocan, Mr. Rangel, Mr. Ryan of Ohio, Ms.
Schwartz, Ms. Shea-Porter, Ms. Slaughter, Mr. Thompson of Pennsylvania,
Mr. Turner, Mr. Visclosky, Mr. Welch, and Mr. Young of Alaska)
introduced the following bill; which was referred to the Committee on
Ways and Means
_______________________________________________________________________
A BILL
To amend title VII of the Tariff Act of 1930 to clarify that
countervailing duties may be imposed to address subsidies relating to a
fundamentally undervalued currency of any foreign country.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Currency Reform for Fair Trade
Act''.
SEC. 2. CLARIFICATION REGARDING DEFINITION OF COUNTERVAILABLE SUBSIDY.
(a) Benefit Conferred.--Section 771(5)(E) of the Tariff Act of 1930
(19 U.S.C. 1677(5)(E)) is amended--
(1) in clause (iii), by striking ``and'' at the end;
(2) in clause (iv), by striking the period at the end and
inserting ``, and''; and
(3) by inserting after clause (iv) the following new
clause:
``(v) in the case in which the currency of
a country in which the subject merchandise is
produced is exchanged for foreign currency
obtained from export transactions, and the
currency of such country is a fundamentally
undervalued currency, as defined in paragraph
(37), the difference between the amount of the
currency of such country provided and the
amount of the currency of such country that
would have been provided if the real effective
exchange rate of the currency of such country
were not undervalued, as determined pursuant to
paragraph (38).''.
(b) Export Subsidy.--Section 771(5A)(B) of the Tariff Act of 1930
(19 U.S.C. 1677(5A)(B)) is amended by adding at the end the following
new sentence: ``In the case of a subsidy relating to a fundamentally
undervalued currency, the fact that the subsidy may also be provided in
circumstances not involving export shall not, for that reason alone,
mean that the subsidy cannot be considered contingent upon export
performance.''.
(c) Definition of Fundamentally Undervalued Currency.--Section 771
of the Tariff Act of 1930 (19 U.S.C. 1677) is amended by adding at the
end the following new paragraph:
``(37) Fundamentally undervalued currency.--The
administering authority shall determine that the currency of a
country in which the subject merchandise is produced is a
`fundamentally undervalued currency' if--
``(A) the government of the country (including any
public entity within the territory of the country)
engages in protracted, large-scale intervention in one
or more foreign exchange markets during part or all of
the 18-month period that represents the most recent 18
months for which the information required under
paragraph (38) is reasonably available, but that does
not include any period of time later than the final
month in the period of investigation or the period of
review, as applicable;
``(B) the real effective exchange rate of the
currency is undervalued by at least 5 percent, on
average and as calculated under paragraph (38),
relative to the equilibrium real effective exchange
rate for the country's currency during the 18-month
period;
``(C) during the 18-month period, the country has
experienced significant and persistent global current
account surpluses; and
``(D) during the 18-month period, the foreign asset
reserves held by the government of the country exceed--
``(i) the amount necessary to repay all
debt obligations of the government falling due
within the coming 12 months;
``(ii) 20 percent of the country's money
supply, using standard measures of M2; and
``(iii) the value of the country's imports
during the previous 4 months.''.
(d) Definition of Real Effective Exchange Rate Undervaluation.--
Section 771 of the Tariff Act of 1930 (19 U.S.C. 1677), as amended by
subsection (c) of this section, is further amended by adding at the end
the following new paragraph:
``(38) Real effective exchange rate undervaluation.--The
calculation of real effective exchange rate undervaluation, for
purposes of paragraph (5)(E)(v) and paragraph (37), shall--
``(A)(i) rely upon, and where appropriate be the
simple average of, the results yielded from application
of the approaches described in the guidelines of the
International Monetary Fund's Consultative Group on
Exchange Rate Issues; or
``(ii) if the guidelines of the International
Monetary Fund's Consultative Group on Exchange Rate
Issues are not available, be based on generally
accepted economic and econometric techniques and
methodologies to measure the level of undervaluation;
``(B) rely upon data that are publicly available,
reliable, and compiled and maintained by the
International Monetary Fund or, if the International
Monetary Fund cannot provide the data, by other
international organizations or by national governments;
and
``(C) use inflation-adjusted, trade-weighted
exchange rates.''.
SEC. 3. REPORT ON IMPLEMENTATION OF ACT.
(a) In General.--Not later than 9 months after the date of the
enactment of this Act, the Comptroller General of the United States
shall submit to Congress a report on the implementation of the
amendments made by this Act.
(b) Matters To Be Included.--The report required by subsection (a)
shall include a description of the extent to which United States
industries that have been materially injured by reason of imports of
subject merchandise produced in foreign countries with fundamentally
undervalued currencies have received relief under title VII of the
Tariff Act of 1930 (19 U.S.C. 1671 et seq.), as amended by this Act.
SEC. 4. APPLICATION TO GOODS FROM CANADA AND MEXICO.
Pursuant to article 1902 of the North American Free Trade Agreement
and section 408 of the North American Free Trade Agreement
Implementation Act of 1993 (19 U.S.C. 3438), the amendments made by
section 2 of this Act shall apply to goods from Canada and Mexico.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
Referred to the Subcommittee on Trade.
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