Trade Enforcement Act of 1987

Summary

Trade Enforcement Act of 1987 - Title I: Amendments to Trade Laws - Subtitle A: The Tariff Act of 1930 - Amends the Tariff Act of 1930 to prohibit the administering authority from deducting indirect selling expenses (as an offset of the exporters expenses) from foreign market value. Changes the method of determining the exporter's sale price for purposes of assessing antidumping duties. Requires the administering authority, with respect to antidumping duties, to determine, if the merchandise under investigation is exported from a State-controlled economy country, the foreign market value of such merchandise on the basis of the trade weighted average of the home market prices or prices sold to other countries of selected market economies at a comparable stage of development for which such information is available. Requires the International Trade Commission (ITC) to determine whether an antidumping or countervailing duty order should apply to a particular class or kind of imported merchandise. Sets forth factors the ITC should consider when making such determination. Declares that "downstream dumping" occurs when a product is routinely used as a significant part, component, assembly, or material in the manufacture of imported merchandise that is subject to an antidumping investigation, if such product is purchased at a price that: (1) is lower than the generally available price of such product in the country of manufacture; or (2) if the generally available price of the production in the country of manufacture is artificially depressed by reason of a subsidy or other sales at below foreign market value, is lower than the price at which such product would be generally available in such country but for such depression. Requires the administering authority to include the amount attributable to the downstream dumping in calculating the amount of any antidumping duty on such merchandise. Adds to the factors to be considered by the administering authority in imposing an antidumping duty on imported merchandise a determination by the ITC that an industry producing a product used in the manufacture of such merchandise has been materially injured or threatened with material injury, or the establishment of such an industry in the United States has been materially retarded. Redefines "interested party" to include manufacturers of the product that is used in the manufacture or production of a like product. Provides that all antidumping and countervailing duty investigations shall be governed by the Administrative Procedure Act. States that a "resource input subsidy" exists if: (1) (a) a product is provided or sold by a government-regulated entity for input use within such country at a domestic price that is lower than the fair market value of the input product and is not freely available to U.S. producers; and (b) a product would, if sold at the fair market value, constitute a significant portion of the total cost of the merchandise in or for which the input product is used; or (2) under specified circumstances, the right to remove such product is provided by that country's government. Sets forth the method of calculating the amount of a resource input subsidy. Requires injury determinations by the ITC to be made in all countervailing duty investigations relating to the existence of resource input subsidies. Includes in the definition of "subsidy" (for antidumping and countervailing duty purposes) any resource input subsidy. Revises the term "subsidy" to provide that a benefit shall be considered to constitute a subsidy, even if it is nominally or actually available to many or all enterprises or industries, if when actually conferred it accrues to specific recipients. Requires benefits that would constitute a countervailable subsidy to be treated as a subsidy if provided to an enterprise or industry, or group of enterprises or industries, in a state-controlled economy country. Sets forth the method for determining the amount of such subsidy. Prohibits the ITC, when making determinations as to material injury in antidumping and countervailing duty investigations, from considering the size of the dumping or countervailing margins found by the administering authority, or the ability of other foreign producers to enter the U.S. market. Changes the standard of judicial reviews under which a court holds determinations made in countervailing and antidumping duty proceedings to be unlawful from such determinations being unsupported by "substantial" evidence on the record to such determinations being unsupported by "a preponderance of the evidence" on the record. Makes unlawful the importation, or the sale within the United States after importation, of articles that: (1) infringe a valid and enforceable U.S. patent or copyright; or (2) are made under, or by means of, a patented process. Makes it unlawful to import or sell within the United States after importation articles that infringe a valid and enforceable U.S. trademark. Permits a person to bring an action in the Court of International Trade for review of any decision not to preclude the importation of merchandise which bears a trademark owned by such person. Subtitle B: Import Relief - Amends the Trade Act of 1974 to include a downward trend in investment, research, and development expenditures in an industry as factors to be considered by the ITC in making determinations with respect to whether articles are being imported in such increased quantities as to be a threat of serious injury to such industry. Sets forth other factors to be considered by the ITC when making such determinations. Requires the ITC, upon a finding that an imported article has caused a a serious injury or threat thereof to an industry, to prescribe appropriate relief that shall take effect within 30 days. Requires the ITC, upon completing its investigation, to submit a report to the President and the Congress. Sets forth factors that must be considered by the ITC in determining appropriate import relief. Requires the President to provide import relief according to the findings of the ITC. Repeals specified provisions of the Trade Act of 1974 relating to import relief by the President. Transfers authority to terminate such relief from the President to the ITC. Repeals a provision relating to the President providing for the administration of import restrictions imposed under the Trade Act of 1974. Deletes certain provisions relating to the advisement of the President by the ITC. Requires the President, upon receipt of a specified ITC report, to: (1) proclaim changes in tariff rates, tariff-rate quotas, and the imposition of quantitative restrictions as provided by the ITC; (2) in the case of quantitative restrictions, instruct the United States Customs Service to allow imports of articles that possess a valid visa; (3) direct the United States Trade Representative (USTR) to undertake negotiations in the case of orderly marketing arrangements; (4) direct the Secretary of Labor and the Secretary of Commerce to review petitions for trade adjustment assistance on an expedited basis; and (5) perform such other actions as are necessary to put ITC determinations into effect. Requires the President, whenever he has taken action to increase or impose a duty or other import restriction, to treat as compensation the suspension of dutiable treatment on any U.S. product. Requires the ITC (currently, the President), upon the request of the President or the USTR, upon its own motion, or upon a petition filed by an interested person, to determine whether: (1) U.S. rights have been denied under a trade agreement; or (2) any foreign act, policy, or practice is inconsistent with, or otherwise denies U.S. trade benefits under, any trade agreement, or such act, policy, or practice is discriminatory and burdens or restricts U.S. commerce. Requires the ITC, upon an affirmative determination, to determine what action is appropriate to enforce U.S. rights or to obtain the elimination of the foreign act, policy, or practice. Permits the ITC to recommend, pursuant to such determination, action to: (1) suspend, withdraw, or prevent, or refrain from the proclamation of, benefits of trade agreement concessions under a trade agreement; and (2) impose duties or other import restrictions on the goods of, and fees or restrictions on the services of, a foreign country. Requires the President, upon receipt of an ITC determination, to perform all necessary actions to put the ITC recommendation into effect. Authorizes the President to commence negotiations to eliminate the unfair foreign trade practices. Transfers functions of the USTR to the ITC with respect to the enforcement of U.S. trade rights or relief from unfair foreign trade practices. Requires the ITC, whenever it makes a determination that a country has engaged in an unfair trade practice, to transmit notice of such determination to the President. Requires the President, in order to eliminate such unfair practice, to increase the import duties or impose import quotas on the import which was involved in such practice. Authorizes the President to negotiate an agreement with countries that are engaged in such unfair practice to terminate such practice within a specified period of time. Requires the President, if he has negotiated or proclaimed any modification in an existing duty, to transmit notification of such modification to the Congress. Prohibits such modification from becoming effective if a joint resolution disapproving it is enacted within a specified period. Authorizes any interested party to file with the United States Committee for Implementation of Textile Agreements (CITA) a petition to correct market disruption. Requires CITA, upon receiving a petition, to determine whether to commence an investigation to determine whether a product subject to such petition has been or is being imported in such quantities as to cause market disruption for that product. Requires CITA, if it determines to commence an investigation, to notify the USTR and the Congress. Provides for judicial review of CITA determinations by the United States Court of International Trade. Requires CITA, in order to correct the market disruption caused by such article, to impose quotas on the importation of such article unless and until the USTR has negotiated a bilateral agreement with the country from which such article is imported. Requires such agreement to provide for the issuance of export visas for the products covered by the agreement by any exporting country that is a party to such agreement. Requires the Customs Service to monitor all imports covered by the agreement and to deny entry to such imports that exceed the limits contained in such agreement. Subtitle C: National Trade Council - Establishes the National Trade Council in the Executive Office of the President to provide advice with respect to the integration of national and international policies relating to trade. Directs the Council to appoint: (1) a Food and Fibre Advisory Committee to provide advice regarding the production and distribution of food and food products in international trade; (2) a Business and Labor Advisory Committee to provide advice regarding methods to increase the productivity of the Nation's workforce; (3) a Research and Development Advisory Committee to provide advice regarding technological research and development; and (4) such other advisory committees as deemed necessary. Subtitle D: Private Right of Action - Amends the Clayton Act to include a specified antidumping provision among U.S. antitrust laws. Amends such antidumping provision of the Unfair Competition Act of 1916 to allow any person who is injured in her or his property or business by the sale or importation of an article made in a foreign country to bring a civil action against the manufacturer, exporter, or related importer of such article if: (1) the article is imported or sold in the United States at less than its foreign market or constructed value; and (2) such sale or importation causes or threatens material injury to U.S. industry or labor or prevents the establishment or modernization of U.S. industry. (Currently, the cause of such an action is predicated on the intent of the importer to injure or prevent the establishment of U.S. industry or to monopolize trade.) Restricts the court jurisdiction of such an action to the district court of the District of Columbia or the Court of International Trade. Entitles a prevailing plaintiff in such an action to appropriate equitable relief or, if such relief is inadequate, to compensatory damages, and legal expenses (currently, treble damages and legal expenses). Declares that the standard of proof in such an action is a preponderance of the evidence. Places the burden of proof for rebutting a prima facie case on the defendant. Includes within the meaning of prima facie case a finding by the ITC that dumping exists. Authorizes the court to: (1) issue subpoenas to be enforced in any judicial district; (2) enjoin importation of articles allegedly dumped pending the defendant's compliance with any court order; (3) review, in camera, confidential or privileged material; (4) accept material under seal; and (5) disclose such material. Requires expedited treatment of such actions. Sets a four-year statute of limitations for actions under this Act. Requires the foreign market value or constructed value of an article to include the amount of any subsidy provided to the manufacturer, producer, or exporter of the article. Expresses the sense of the Congress that this Act is consistent with the General Agreement on Tariffs and Trade. Allows any person who is injured in his or her business or property by the fraudulent, grossly negligent, or negligent entry or introduction of merchandise into U.S. commerce to bring a civil action in the district court of the District of Columbia or the Court of International Trade, without respect to the amount in controversy. Entitles a person prevailing in such an action to appropriate equitable relief or, if such relief is inadequate, compensatory damages, and legal expenses. Permits the United States to intervene in an action under this Act as a matter of right. Subjects any court order under this Act to nullification by the President pursuant to authority under the International Emergency Economic Powers Act. Subtitle E: Scofflaw Penalties - Directs the Secretary to prohibit for three years any multiple customs law offender from: (1) introducing or attempting to introduce foreign goods into U.S. commerce; and (2) engaging or attempting to engage any other person to introduce, on such offender's behalf, foreign goods into U.S. commerce. Provides for identifying such multiple offenders. Sets the penalty for violations of such prohibition. Title II: Export Enhancement - Amends the Export Administration Act of 1979 to require the Secretary of Commerce to submit every two years to the President a report describing the product and technologies with respect to which applications for export licenses have been denied by reason of absence of foreign availability, together with the reasons for such denial. Decreases the time period within which the Secretary of Commerce must issue or deny an application for such license. Permits a person whose application has been denied to bring an action in the United States Court of International Trade for review of such denial. Title III: Encouragement of Investment and Research and Development - Amends the Internal Revenue Code (IRC) with respect to the business related credit for research activities. Revises the credit to provide for a possible 18 percent research and development credit, computed to permit credit in the following amounts: (1) six percent of a taxpayer's qualified research expenses; (2) six percent of a corporation's basic research payments to an educational institution or tax-exempt scientific research organization or grant organization; and (3) six percent of sums spent by a taxpayer to apply the results of research to specific products or technologies. Excludes from credit calculations any payments for research conducted outside of the United States and research in the social sciences, arts, or humanities. Disallows the basic research payment component of the credit to S corporations, personal holding companies, and service organizations. Makes permanent the income tax credit for qualified research expenditures by repealing the provisions that would terminate the credit for expenses incurred or paid after 1988. Establishes a tax credit against the income tax liability of a nonsubsidiary corporation or partnership with gross revenues of less than $1,000,000. Permits a credit of six percent of amounts spent for the purchase or lease of property for the purpose of putting into production products or utilizing processes developed by the taxpayer as a result of research and development outlays. Title IV: Securities Laws - Amends the IRC to disallow an income tax deduction for interest paid for funds to finance the purchase of stock of a corporation if the taxpayer, either before or after the purchase, owns or controls more than ten percent of the corporation's outstanding stock. Title V: Deficit Reduction - Amends the IRC to create a new excise tax, a value added tax. Fixes the rate for this tax at ten percent of the amount charged the purchaser by the seller of the taxable property or services. Requires a two-thirds' majority vote of both the House of Representatives and the Senate in order to consider any bill or resolution increasing this rate. Sets forth rules to govern consideration of such a bill or resolution. Imposes the value added tax on the following activities in the United States by a person engaging in a business or in a commercial-type transaction: (1) the sale of property; (2) the performance of services; and (3) the importing of property. Defines terms relevant to the value added tax and prescribes situs rules. Sets out rules to govern the taxable amount in cases of exchanges, imports, and sales of used goods. Exempts from the tax: (1) food; (2) housing; (3) medical care; (4) certain wholesale sales by farmers or fishermen; (5) mass transportation services in urban areas; (6) exports; (7) interest; (8) sales to governmental entities; (9) services or goods provided by a governmental entity in connection with educational activities; and (1) transactions engaged in by eligible tax-exempt charitable organizations (501(c)(3) organizations). Permits as a credit against the value added tax the aggregate amount of tax paid by sellers to the taxpayer of property and services that the taxpayer uses in the business to which the transaction relates. Sets forth administrative provisions to govern the value added tax, placing liability for the tax on the person selling the relevant property or services. Permits a de minimis exemption from the tax for persons having aggregate taxable transactions of $20,000 or less for a year. Establishes special rules for: (1) gifts of business property or services; (2) dispositions of nonbusiness real property; and (3) insurance contracts. Amends the Tariff Act of 1930 to add as factors in calculating the transaction value and computed value of imported merchandise the cost of: (1) transporting such merchandise to the United States; and (2) insuring such merchandise prior to importation into the United States. Revises the definition of "price actually paid or payable" to include (currently, excludes) the payment of costs for insurance and transportation of imported merchandise. Requires the Secretary of the Treasury to establish the Deficit and Debt Reduction Trust Fund and to deposit revenues from the value-added tax in such Fund.

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Timeline

1. 31 March 1987

   Introduced

   Read twice and referred to the Committee on Finance.

   Source: IntroReferral

2. 31 March 1987

   Introduced

   Introduced in Senate

   Source: IntroReferral

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Documents

1 official file

• Introduced in Senate

  summary · EN · 31 March 1987

  Open at official source

Sponsors

• Sen. Hollings, Ernest F. [D-SC] · D · Sponsor
• · ssfi00 · Standing

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