H.R. 166: Preventing Recurring Trade Evasion and Circumvention Act

113th Congress, 2013–2015. Text as of Jan 04, 2013 (Introduced).

Status & Summary | PDF | Source: GPO and Cato Institute Deepbills

I

113th CONGRESS

1st Session

H. R. 166

IN THE HOUSE OF REPRESENTATIVES

January 4, 2013

(for himself and Mr. Richmond) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To prevent the evasion of antidumping and countervailing duty orders, and for other purposes.

1.

Short title and table of contents

(a)

Short title

This Act may be cited as the Preventing Recurring Trade Evasion and Circumvention Act or PROTECT Act .

(b)

Table of contents

The table of contents for this Act is as follows:

Sec. 1. Short title and table of contents.

Sec. 2. Definitions.

Sec. 3. Application to Canada and Mexico.

Title I—Actions relating to enforcement of trade remedy laws

Sec. 101. Trade Remedy Law Enforcement Division.

Sec. 102. Collection of information on evasion of trade remedy laws.

Sec. 103. Access to information.

Sec. 104. Cooperation with foreign countries on preventing evasion of trade remedy laws.

Sec. 105. Trade negotiating objectives.

Title II—Other matters

Sec. 201. Allocation and training of personnel.

Sec. 202. Annual report on prevention of evasion of antidumping and countervailing duty orders.

Sec. 203. Addressing circumvention by new shippers.

2.

Definitions

In this Act:

(1)

Appropriate congressional committees

The term appropriate congressional committees means—

(A)

the Committee on Finance and the Committee on Appropriations of the Senate; and

(B)

the Committee on Ways and Means and the Committee on Appropriations of the House of Representatives.

(2)

Commissioner

The term Commissioner means the Commissioner responsible for U.S. Customs and Border Protection.

(3)

Covered merchandise

The term covered merchandise means merchandise that is subject to—

(A)

a countervailing duty order issued under section 706 of the Tariff Act of 1930; or

(B)

an antidumping duty order issued under section 736 of the Tariff Act of 1930.

(4)

Eligible small business

(A)

In general

The term eligible small business means any business concern which, in the Commissioner’s judgment, due to its small size, has neither adequate internal resources nor financial ability to obtain qualified outside assistance in preparing and submitting for consideration allegations of evasion.

(B)

Non-reviewability

Any agency decision regarding whether a business concern is an eligible small business for purposes of section 101(b)(3) is not reviewable by any other agency or by any court.

(5)

Enter; entry

The terms enter and entry refer to the entry, or withdrawal from warehouse for consumption, in the customs territory of the United States.

(6)

Evade; evasion

The terms evade and evasion refer to entering covered merchandise into the customs territory of the United States by means of any document or electronically transmitted data or information, written or oral statement, or act that is material and false, or any omission that is material, and that results in any cash deposit or other security or any amount of applicable antidumping or countervailing duties being reduced or not being applied with respect to the merchandise.

(7)

Secretary

The term Secretary means the Secretary of the Treasury.

(8)

Trade remedy laws

The term trade remedy laws means title VII of the Tariff Act of 1930.

3.

Application to 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 (19 U.S.C. 3438), this Act and the amendments made by this Act shall apply with respect to goods from Canada and Mexico.

I

Actions relating to enforcement of trade remedy laws

101.

Trade Remedy Law Enforcement Division

(a)

Establishment

(1)

In general

The Secretary of Homeland Security shall establish and maintain within the Office of International Trade of U.S. Customs and Border Protection, established under section 2(d) of the Act of March 3, 1927 (44 Stat. 1381, chapter 348; 19 U.S.C. 2072(d)), a Trade Remedy Law Enforcement Division.

(2)

Composition

The Trade Law Remedy Enforcement Division shall be composed of—

(A)

headquarters personnel led by a Director, who shall report to the Assistant Commissioner of the Office of International Trade; and

(B)

a National Targeting and Analysis Group dedicated to preventing and countering evasion.

(3)

Duties

The Trade Remedy Law Enforcement Division shall be dedicated—

(A)

to the development and administration of policies to prevent and counter evasion;

(B)

to direct enforcement and compliance assessment activities concerning evasion;

(C)

to the development and conduct of commercial risk assessment targeting with respect to cargo destined for the United States in accordance with subsection (c);

(D)

to issuing Trade Alerts described in subsection (d); and

(E)

to the development of policies for the application of single entry and continuous bonds for entries of covered merchandise to sufficiently protect the collection of antidumping and countervailing duties commensurate with the level of risk of noncollection.

(b)

Duties of Director

The duties of the Director of the Trade Remedy Law Enforcement Division shall include—

(1)

directing the trade enforcement and compliance assessment activities of U.S. Customs and Border Protection that concern evasion;

(2)

facilitating, promoting, and coordinating cooperation and the exchange of information between U.S. Customs and Border Protection, U.S. Immigration and Customs Enforcement, and other relevant agencies regarding evasion;

(3)

notifying on a timely basis the administering authority (as defined in section 771(1) of the Tariff Act of 1930 (19 U.S.C. 1677(1))) and the Commission (as defined in section 771(2) of the Tariff Act of 1930 (19 U.S.C. 1677(2))) of any finding, determination, civil action, or criminal action taken by U.S. Customs and Border Protection or other Federal agency regarding evasion; and

(4)

serving as the primary liaison between U.S. Customs and Border Protection and the public regarding United States Government activities concerning evasion, including—

(A)

receive and transmit to the appropriate U.S. Customs and Border Protection office allegations from parties of evasion;

(B)

upon request by the party or parties that submitted an allegation of evasion, provide information to such party or parties on the status of U.S. Customs and Border Protection’s consideration of the allegation and decision to pursue or not pursue any investigations or other actions, such as changes in policies, procedures, or resource allocation as a result of the allegation;

(C)

as needed, request from the party or parties that submitted an allegation of evasion any additional information that may be relevant for U.S. Customs and Border Protection determining whether to initiate an investigation or take any other action regarding the allegation;

(D)

notify on a timely basis the party or parties that submitted such an allegation of the results of any civil or criminal actions taken by U.S. Customs and Border Protection or other Federal agency regarding evasion as a direct or indirect result of the allegation;

(E)

upon request, provide technical assistance and advice to eligible small businesses to enable such businesses to prepare and submit allegations of evasion, except that the Director may deny assistance if the Director concludes that the allegation, if submitted, would not lead to the initiation of an investigation or any other action to address the allegation;

(F)

in cooperation with the public, the Advisory Committee on Commercial Operations of the United States Customs Service, the Trade Support Network and any other relevant parties and organizations, develop guidelines on the types and nature of information that may be provided in allegations of evasion; and

(G)

regularly consult with the public, the Advisory Committee on Commercial Operations of the United States Customs Service, the Trade Support Network, and any other relevant parties and organizations regarding the development and implementation of regulations, interpretations, and policies related to countering evasion.

(c)

Preventing and countering evasion of the trade remedy laws

In carrying out its duties with respect to preventing and countering evasion, the National Targeting and Analysis Group dedicated to preventing and countering evasion shall—

(1)

establish targeted risk assessment methodologies and standards—

(A)

for evaluating the risk that cargo destined for the United States may constitute evading covered merchandise; and

(B)

for issuing, as appropriate, Trade Alerts described in subsection (d); and

(2)

to the extent practicable and otherwise authorized by law, use information available from the Automated Commercial System, the Automated Commercial Environment computer system, the Automated Targeting System, the Automated Entry System, the International Trade Data System, and the Treasury Enforcement Communications System, and any successor systems, to administer the methodologies and standards established under paragraph (1).

(d)

Trade alerts

Based upon the application of the targeted risk assessment methodologies and standards established under subsection (c), the Director of the Trade Remedy Law Enforcement Division shall issue Trade Alerts or other such means of notification to directors of United States ports of entry directing further inspection, or physical examination or testing, of specific merchandise to ensure compliance with the trade remedy laws.

(e)

Definitions

In this section—

(1)

the term Advisory Committee on Commercial Operations of the United States Customs Service means the Advisory Committee established under section 9503(c) of the Omnibus Budget Reconciliation Act of 1987 (19 U.S.C. 2071 note); and

(2)

the term Trade Support Network means the network of private sector entities that provide input on the design and development of modernization projects of U.S. Customs and Border Protection.

(f)

Use of trade data for commercial enforcement purposes

Section 343(a)(3) of the Trade Act of 2002 (19 U.S.C. 2071 note) is amended—

(1)

by striking subparagraph (F); and

(2)

by redesignating subparagraphs (G) through (L) as subparagraphs (F) through (K), respectively.

102.

Collection of information on evasion of trade remedy laws

(a)

Authority To collect information

To determine whether covered merchandise is being entered into the customs territory of the United States through evasion, the Secretary, acting through the Commissioner

(1)

shall exercise all existing authorities to collect information needed to make the determination; and

(2)

may collect such additional information as is necessary to make the determination through such methods as the Commissioner considers appropriate, including by issuing questionnaires with respect to the entry or entries at issue to—

(A)

a person who filed an allegation with respect to the covered merchandise;

(B)

a person who is alleged to have entered the covered merchandise into the customs territory of the United States through evasion; or

(C)

any other person who is determined to have information relevant to the allegation of entry of covered merchandise into the customs territory of the United States through evasion.

(b)

Adverse inference

(1)

In general

If the Secretary finds that a person who filed an allegation, a person alleged to have entered covered merchandise into the customs territory of the United States through evasion, or a foreign producer or exporter of covered merchandise that is alleged to have entered into the customs territory of the United States through evasion, has failed to cooperate by not acting to the best of the person’s ability to comply with a request for information, the Secretary may, in making a determination whether an entry or entries of covered merchandise may constitute merchandise that is entered into the customs territory of the United States through evasion, use an inference that is adverse to the interests of that person in selecting from among the facts otherwise available to determine whether evasion has occurred.

(2)

Adverse inference described

An adverse inference used under paragraph (1) may include reliance on information derived from—

(A)

the allegation of evasion of the trade remedy laws, if any, submitted to U.S. Customs and Border Protection;

(B)

a determination by the Commissioner in another investigation, proceeding, or other action regarding evasion of the unfair trade laws; or

(C)

any other available information.

103.

Access to information

(a)

In general

Section 777(b)(1)(A)(ii) of the Trade Act of 1930 (19 U.S.C. 1677f(b)(1)(A)(ii)) is amended by inserting negligence, gross negligence, or after regarding.

(b)

Additional information

Notwithstanding any other provision of law, the Secretary is authorized to provide to the Secretary of Commerce or the U.S. International Trade Commission any information that is necessary to enable the Secretary of Commerce or the U.S. International Trade Commission to assist the Secretary to identify, through risk assessment targeting or otherwise, covered merchandise that is entered into the customs territory of the United States through evasion.

104.

Cooperation with foreign countries on preventing evasion of trade remedy laws

(a)

Bilateral agreements

(1)

In general

The Secretary shall seek to negotiate and enter into bilateral agreements with the customs authorities or other appropriate authorities of foreign countries for purposes of cooperation on preventing evasion of the trade remedy laws of the United States and the trade remedy laws of the other country.

(2)

Provisions and authorities

The Secretary shall seek to include in each such bilateral agreement the following provisions and authorities:

(A)

On the request of the importing party, the exporting party shall provide, consistent with its laws, regulations, and procedures, production, trade, and transit documents and other information necessary to determine whether an entry or entries exported from the exporting party are subject to the importing party’s trade remedy laws.

(B)

On the written request of the importing party, the exporting party shall conduct a verification for purposes of enabling the importing party to make a determination described in subparagraph (A).

(C)

The exporting party may allow the importing party to participate in a verification described in subparagraph (B), including through a site visit.

(D)

If the exporting party does not allow participation of the importing party in a verification described in subparagraph (B), the importing party may take this fact into consideration in its trade enforcement and compliance assessment activities regarding the compliance of the exporting countries’ exports with the importing countries’ trade remedy laws.

(b)

Consideration

The Commissioner is authorized to take into consideration whether a country is a signatory to a bilateral agreement described in subsection (a) and the extent to which the country is cooperating under the bilateral agreement for purposes of trade enforcement and compliance assessment activities of U.S. Customs and Border Protection that concern evasion by such country’s exports.

(c)

Report

Not later than December 31 of each year beginning after the date of the enactment of this Act, the Secretary shall submit to the appropriate congressional committees a report summarizing—

(1)

the status of any ongoing negotiations of bilateral agreements described in subsection (a), including the identities of the countries involved in such negotiations;

(2)

the terms of any completed bilateral agreements described in subsection (a); and

(3)

bilateral cooperation and other activities conducted pursuant to or enabled by any completed bilateral agreements described in subsection (a).

105.

Trade negotiating objectives

The principal negotiating objectives of the United States shall include obtaining the objectives of the bilateral agreements described under section 104(a) for any trade agreements under negotiation as of the date of the enactment of this Act or future trade agreement negotiations.

II

Other matters

201.

Allocation and training of personnel

The Commissioner shall, to the maximum extent possible, ensure that U.S. Customs and Border Protection

(1)

employs sufficient personnel who have expertise in, and responsibility for, preventing and investigating the entry of covered merchandise into the customs territory of the United States through evasion;

(2)

on the basis of risk assessment metrics, assigns sufficient personnel with primary responsibility for preventing the entry of covered merchandise into the customs territory of the United States through evasion to the ports of entry in the United States at which the Commissioner determines potential evasion presents the most substantial threats to the revenue of the United States; and

(3)

provides adequate training to relevant personnel to increase expertise and effectiveness in the prevention and investigation of entries of covered merchandise into the customs territory of the United States through evasion.

202.

Annual report on prevention of evasion of antidumping and countervailing duty orders

(a)

In general

Not later than February 28 of each year, beginning in 2013, the Commissioner, in consultation with the Secretary of Commerce and the Assistant Secretary for U.S. Immigration and Customs Enforcement, shall submit to the appropriate congressional committees a report on the efforts being taken to prevent and investigate evasion.

(b)

Contents

Each report required under subsection (a) shall include—

(1)

for the calendar year preceding the submission of the report—

(A)

a summary of the efforts of U.S. Customs and Border Protection to prevent and investigate evasion;

(B)

the number of allegations of evasion received and the number of allegations of evasion resulting in investigations by U.S. Customs and Border Protection or any other agency;

(C)

a summary of the completed investigations of evasion, including the number and nature of the investigations initiated, conducted, or completed, as well as their resolution;

(D)

with respect to investigations that lead to issuance of a penalty notice, the penalty amounts;

(E)

the amounts of antidumping and countervailing duties collected as a result of any investigations or other actions by U.S. Customs and Border Protection or any other agency;

(F)

a description of the allocation of personnel and other resources of U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement to prevent and investigation evasion, including any assessments conducted regarding the allocation of such personnel and resources; and

(G)

a description of training conducted to increase expertise and effectiveness in the prevention and investigation of evasion; and

(2)

a description of U.S. Customs and Border Protection processes and procedures to prevent and investigate evasion, including—

(A)

the specific guidelines, policies, and practices used by U.S. Customs and Border Protection to ensure that allegations of evasion are promptly evaluated and acted upon in a timely manner;

(B)

an evaluation of the efficacy of such existing guidelines, policies, and practices;

(C)

identification of any changes since the last report that have materially improved or reduced the effectiveness of U.S. Customs and Border Protection to prevent and investigate evasion;

(D)

a description of the development and implementation of policies for the application of single entry and continuous bonds for entries of covered merchandise to sufficiently protect the collection of antidumping and countervailing duties commensurate with the level of risk on noncollection;

(E)

the processes and procedures for increased cooperation and information sharing with the Department of Commerce, U.S. Immigration and Customs Enforcement, and any other relevant Federal agencies to prevent and investigate evasion; and

(F)

identification of any recommended policy changes of other Federal agencies or legislative changes to improve the effectiveness of U.S. Customs and Border Protection to prevent and investigate evasion.

203.

Addressing circumvention by new shippers

Section 751(a)(2)(B) of the Tariff Act of 1930 (19 U.S.C. 1675(a)(2)(B)) is amended—

(1)

by striking clause (iii);

(2)

by redesignating clause (iv) as clause (iii); and

(3)

inserting after clause (iii), as redesignated by paragraph (2) of this section, the following:

(iv)

Any weighted average dumping margin or individual countervailing duty rate determined for an exporter or producer in a review conducted under clause (i) shall be based solely on the bona fide United States sales of an exporter or producer, as the case may be, made during the period covered by the review. In determining whether the United States sales of an exporter or producer made during the period covered by the review were bona fide, the administering authority shall consider, depending on the circumstances surrounding such sales—

(I)

the prices of such sales;

(II)

whether such sales were made in commercial quantities;

(III)

the timing of such sales;

(IV)

the expenses arising from such sales;

(V)

whether the subject merchandise involved in such sales were resold in the United States at a profit;

(VI)

whether such sales were made on an arms-length basis; and

(VII)

any other factor the administering authority determines to be relevant as to whether such sales are, or are not, likely to be typical of those the exporter or producer will make after completion of the review.

.