§4421 — Title 19 Customs Duties | U.S. Code

Summary

Requires the Secretary of the Treasury to send Congress a report about each major U.S. trading partner’s economic and currency policies within 180 days after February 24, 2016, and at least every 180 days after that. Each report must show each country’s trade balance with the U.S., its current account as a percent of GDP, how that percent changed over the prior three years, and its foreign exchange reserves compared to short-term debt and to GDP. Countries that have a large U.S. trade surplus, a material current account surplus, and repeated one-sided intervention in currency markets get a deeper review. That deeper review must cover recent currency market moves (including interventions), trends and any undervaluation in the real effective exchange rate, changes in capital controls or trade limits, and reserve buildup. The Treasury had to explain publicly within 90 days after February 24, 2016, how it decides which countries meet those tests. After a deeper review, the President, through the Treasury Secretary, must start stronger talks with the country to push for policy fixes, say U.S. concerns, warn that the President can act, and try to make a specific plan. The Secretary can skip those talks if doing them would hurt the U.S. economy more than help or would harm national security, but must report the reasons to Congress. If one year after talks begin the Treasury finds the country still did not fix the problems, the President must use one or more penalties: bar new financing from the U.S. International Development Finance Corporation for projects there; ban federal purchases of goods or services from that country (consistent with international obligations and after checking costs); ask the U.S. IMF director to push for more surveillance and consultations; and tell the U.S. Trade Representative to consider the country’s failure in trade talks. The President may waive penalties for economic or security reasons but must report to Congress. The law also defines the named congressional committees, what “country” covers, what a “real effective exchange rate” is, and that “Secretary” means the Treasury Secretary.

Title 19, §4421

Customs Duties — Source: USLM XML via OLRC

(a)(1)Not later than 180 days after February 24, 2016, and not less frequently than once every 180 days thereafter, the Secretary shall submit to the appropriate committees of Congress a report on the macroeconomic and currency exchange rate policies of each country that is a major trading partner of the United States.

(2)(A)Each report submitted under paragraph (1) shall contain—

(i)for each country that is a major trading partner of the United States—

(I)that country’s bilateral trade balance with the United States;

(II)that country’s current account balance as a percentage of its gross domestic product;

(III)the change in that country’s current account balance as a percentage of its gross domestic product during the 3-year period preceding the submission of the report;

(IV)that country’s foreign exchange reserves as a percentage of its short-term debt; and

(V)that country’s foreign exchange reserves as a percentage of its gross domestic product; and

(ii)an enhanced analysis of macroeconomic and exchange rate policies for each country that is a major trading partner of the United States that has—

(I)a significant bilateral trade surplus with the United States;

(II)a material current account surplus; and

(III)engaged in persistent one-sided intervention in the foreign exchange market.

(B)Each enhanced analysis under subparagraph (A)(ii) shall include, for each country with respect to which an analysis is made under that subparagraph—

(i)a description of developments in the currency markets of that country, including, to the greatest extent feasible, developments with respect to currency interventions;

(ii)a description of trends in the real effective exchange rate of the currency of that country and in the degree of undervaluation of that currency;

(iii)an analysis of changes in the capital controls and trade restrictions of that country; and

(iv)patterns in the reserve accumulation of that country.

(3)Not later than 90 days after February 24, 2016, the Secretary shall publicly describe the factors used to assess under paragraph (2)(A)(ii) whether a country has a significant bilateral trade surplus with the United States, has a material current account surplus, and has engaged in persistent one-sided intervention in the foreign exchange market.

(b)(1)The President, through the Secretary, shall commence enhanced bilateral engagement with each country for which an enhanced analysis of macroeconomic and currency exchange rate policies is included in the report submitted under subsection (a), in order to, as appropriate—

(A)urge implementation of policies to address the causes of the undervaluation of its currency, its significant bilateral trade surplus with the United States, and its material current account surplus, including undervaluation and surpluses relating to exchange rate management;

(B)express the concern of the United States with respect to the adverse trade and economic effects of that undervaluation and those surpluses;

(C)advise that country of the ability of the President to take action under subsection (c); and/or

(D)develop a plan with specific actions to address that undervaluation and those surpluses.

(2)(A)The Secretary may waive the requirement under paragraph (1) to commence enhanced bilateral engagement with a country if the Secretary determines that commencing enhanced bilateral engagement with the country—

(i)would have an adverse impact on the United States economy greater than the benefits of such action; or

(ii)would cause serious harm to the national security of the United States.

(B)The Secretary shall promptly certify to Congress a determination under subparagraph (A) and promptly submit to Congress a report that describes in detail the reasons for the Secretary’s determination under subparagraph (A).

(c)(1)If, on or after the date that is one year after the commencement of enhanced bilateral engagement by the President, through the Secretary, with respect to a country under subsection (b)(1), the Secretary determines that the country has failed to adopt appropriate policies to correct the undervaluation and surpluses described in subsection (b)(1)(A) with respect to that country, the President shall take one or more of the following actions:

(A)Prohibit the United States International Development Finance Corporation from approving any new financing (including any insurance, reinsurance, or guarantee) with respect to a project located in that country on and after such date.

(B)Except as provided in paragraph (3), and pursuant to paragraph (4), prohibit the Federal Government from procuring, or entering into any contract for the procurement of, goods or services from that country on and after such date.

(C)Instruct the United States Executive Director of the International Monetary Fund to call for additional rigorous surveillance of the macroeconomic and exchange rate policies of that country and, as appropriate, formal consultations on findings of currency manipulation.

(D)Instruct the United States Trade Representative to take into account, in consultation with the Secretary, in assessing whether to enter into a bilateral or regional trade agreement with that country or to initiate or participate in negotiations with respect to a bilateral or regional trade agreement with that country, the extent to which that country has failed to adopt appropriate policies to correct the undervaluation and surpluses described in subsection (b)(1)(A).

(2)(A)The President may waive the requirement under paragraph (1) to take remedial action if the President determines that taking remedial action under paragraph (1) would—

(i)have an adverse impact on the United States economy greater than the benefits of taking remedial action; or

(ii)would cause serious harm to the national security of the United States.

(B)The President shall promptly certify to Congress a determination under subparagraph (A) and promptly submit to Congress a report that describes in detail the reasons for the President’s determination under subparagraph (A).

(3)The President may not apply a prohibition under paragraph (1)(B) in a manner that is inconsistent with United States obligations under international agreements.

(4)(A)Before applying a prohibition under paragraph (1)(B), the President shall consult with the Director of the Office of Management and Budget to determine whether such prohibition would subject the taxpayers of the United States to unreasonable cost.

(B)The President shall consult with the appropriate committees of Congress with respect to any action the President takes under paragraph (1)(B), including whether the President has consulted as required under subparagraph (A).

(d)In this section:

(1)The term “appropriate committees of Congress” means—

(A)the Committee on Banking, Housing, and Urban Affairs and the Committee on Finance of the Senate; and

(B)the Committee on Financial Services and the Committee on Ways and Means of the House of Representatives.

(2)The term “country” means a foreign country, dependent territory, or possession of a foreign country, and may include an association of 2 or more foreign countries, dependent territories, or possessions of countries into a customs union outside the United States.

(3)The term “real effective exchange rate” means a weighted average of bilateral exchange rates, expressed in price-adjusted terms.

(4)The term “Secretary” means the Secretary of the Treasury.

Notes & Related Subsidiaries

Editorial Notes

Amendments

2018—Subsec. (c)(1)(A). Pub. L. 115–254 substituted “United States International Development Finance Corporation” for “Overseas Private Investment Corporation”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2018 AmendmentAmendment by Pub. L. 115–254 effective at the end of the transition period, as defined in section 9681 of Title 22, Foreign Relations and Intercourse, see section 1470(w) of Pub. L. 115–254, set out as a note under section 905 of Title 2, The Congress.

Executive Documents

Ex. Ord. No. 13733. Delegation of Certain Authorities and Assignment of Certain Functions Under the Trade Facilitation and Trade

Enforcement

Act of 2015 Ex. Ord. No. 13733, July 22, 2016, 81 F.R. 49515, provided: By the authority vested in me as President by the Constitution and the laws of the United States of America, including the Trade Facilitation and Trade

Enforcement

Act of 2015 (the “Act”) (Public Law 114–125) and section 301 of title 3, United States Code, I hereby order as follows: section 1. Authorities and Functions under the Act. (a) The functions of the President under section 2313A(b) of the Export Enhancement Act of 1988, as added by section 504 of the Act, are assigned to the Secretary of Commerce. In carrying out its functions, the State and Federal Export Promotion Coordination Working Group established by the Secretary of Commerce under this section shall also coordinate with local and municipal governments representing regionally diverse areas. (b) The functions of the President under section 909(d) of the Act are assigned to the Secretary of State, in consultation with other relevant Federal agencies. (c) The functions of the President under section 915(d) of the Act are assigned to the Administrator of the United States Agency for International Development, in consultation with the Secretary of State and the United States Trade Representative (U.S. Trade Representative). (d) The functions of the President under section 915(e) of the Act are assigned to the U.S. Trade Representative, in consultation with the Secretary of State. Sec. 2. Engagement on Currency Exchange Rate and Economic Policies. (a) Prior to undertaking an enhanced analysis of a country pursuant to section 701(a)(2)(A)(ii) of the Act, the Secretary of the Treasury shall seek the views of the U.S. Trade Representative on changes in trade restrictions in that country. (b) In exercising the functions under section 701(b)(2)(A) of the Act, the Secretary of the Treasury shall consult with the Secretary of State in making any determination that commencing enhanced bilateral engagement with a country would cause serious harm to the national security of the United States. (c) If the Secretary of the Treasury determines, pursuant to section 701(c)(1) of the Act, that a country has failed to adopt appropriate policies to correct the undervaluation and surpluses described in section 701(b)(1)(A) of the Act with respect to that country, the Assistant to the President for Economic Policy, in consultation with the Secretary of the Treasury, the U.S. Trade Representative, the Secretary of State, and the Secretary of Commerce, shall make a recommendation to the President regarding which of the actions set forth in section 701(c)(1)(A) through (D) of the Act the President should take, or whether the President should waive, pursuant to section 701(c)(2) of the Act, the requirement to take remedial action. Sec. 3. General Provisions. (a) In exercising authority delegated by or performing functions assigned in this order, the Secretaries of State, the Treasury, and Commerce and the U.S. Trade Representative and their delegees: (i) shall ensure that all actions taken by them are consistent with the President’s constitutional authority to (A) conduct the foreign affairs of the United States, including the commencement, conduct, and termination of negotiations with foreign countries and international organizations; (B) withhold information the disclosure of which could impair the foreign relations, the national security, the deliberative processes of the Executive, or the performance of the Executive’s constitutional duties; (C) recommend for congressional consideration such measures as the President may judge necessary or expedient; and (D) supervise the executive branch; and (ii) may redelegate authority delegated by this order and may further assign functions assigned by this order to officers of any other department or agency within the executive branch to the extent permitted by law, including section 301 of title 3, United States Code, and such redelegation or further assignment shall be published in the Federal Register. (b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations. (c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person. Barack Obama.

§4421 Enhancement of engagement on currency exchange rate and economic policies with certain major trading partners of the United States

Summary

Title 19, §4421

Notes & Related Subsidiaries

Editorial Notes

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Executive Documents

Enforcement

Enforcement

Citations & Metadata