TRADE AGREEMENTS ACT EXTENSION FRIDAY, JUNE 20, 1958 UNITED STATES SENATE, The committee met, pursuant to call, at 10:10 a. m., in room 312, Senate Office Building, Senator Harry Flood Byrd (chairman) presiding. Present: Senators Byrd (chairman), Kerr, Frear, Long, Anderson, Douglas, Williams, Flanders, Malone, Carlson, and Bennett. Also present: Elizabeth B. Springer, chief clerk. Stanley D. Metzger, Department of State. The CHAIRMAN. The meeting will come to order. The committee has under consideration H. R. 12591, extension of the reciprocal trade program. I submit for the record a copy of the bill as well as a brief analysis of the provisions therein. (The analysis and bill follow:) General authority.-Authority of the President to enter into trade agreements is extended from June 30, 1958 to June 30, 1963 (sec. 2). Tariff reductions.—Authority is granted to reduce tariffs by (i) reduction of rates existing on July 1, 1958 by 25 percent in stages of not more than 10 percent in any 12-month period; (ii) reduction by 2 percentage points (or its equivalent) as an alternative to (i) with no more than 1 percentage point reduction in any 12-month period; (iii) alternatively, a reduction to 50 percent ad valorem in no less than 3 annual stages, each limited to one-third of the total reduction (sec. 3 (a) (8)). Tariff increases.—Authorization to increase tariffs to a rate of 50 percent above the rate existing on July 1, 1934 (instead of 50 percent above the January 1, 1945 rate, as in the present act) (sec. 3 (c)). Escape-clause procedure. The present escape-clause procedure is retained with the following modifications in the procedure: (a) Escape-clause investigations and reports are to be completed by the Tariff Commission in 6 months (instead of the present 9 months) (sec. 5 (b)); (b) subpena powers granted to the Tariff Commission in escape-clause proceedings (sec. 9 (a)); (c) duty-free items bound in trade agrements may be transferred to the dutiable list and rates imposed up to 50 percent ad valorem (sec. 5 (c)); (d) organization or groups of employees are granted authority to file an application for escape-clause proceedings (sec. 5 (a)) (e) a Presidential disapproval of a Tariff Commission recommendation may be overridden by the adoption of a concurrent resolution by a two-thirds vote of both houses. Such a resolution would be a privileged matter in order to expedite congressional consideration (sec. 7). Peril-point procedure. The present peril-point authority is amended by (a) making an escape-clause investigation automatic whenever the Tariff Commission finds in a peril-point report that an increase in duty over existing levels is necessary to prevent injury (sec. 4 (b)); (b) peril-point investigations and reports are to be completed in 6 months (instead of the present 4) (sec. 4 (a)). National security amendment.—(a) The national security amendment is amended to specify certain of the factors which are to guide the ODM in considering whether imports are threatening to impair the national security (sec. 8 (c)); (b) ODM is to carry out an investigation upon application of an interested party or upon the motion of the head of any agency of Government, including the Director of the ODM (sec. 8 (b)); (c) the investigatory procedure of ODM is altered to provide 1 for a single investigation (sec. 8 (b)); (d) a report must be published on the disposition of each investigation (sec. 8 (d)); (e) ODM is to issue procedural regulations for the conduct of such investigations (sec. 8 (d)). Annual report. Included in the annual report on the operations of the trade agreements is to be a statement on progress made in removing restrictions maintained against United States exports by other countries (sec. 3 (d)). Negotiation procedure. It is the sense of the Congress that during the negotiations of a trade agreement, the President is to seek information and advice from representatives of American industry, agriculture, and labor (sec. 3 (f)). GATT.-Enactment of this legislation does not indicate approval or disapproval of the GATT (sec. 10). [H. R. 12591, 85th Cong., 2d sess.] AN ACT To extend the authority of the President to enter into trade agreements under section 350 of the Tariff Act of 1930, as amended, and for other purposes Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Trade Agreements Extension Act of 1958". SEC. 2. The period during which the President is authorized to enter into foreign trade agreements under section 350 of the Tariff Act of 1930, as amended (19 U. S. C., sec. 1351), is hereby extended from the close of June 30, 1958, until the close of June 30, 1963. SEC. 3. (a) Subsection (a) of section 350 of the Tariff Act of 1930, as amended (19 U. S. C., sec. 1351 (a)), is amended as follows: (1) Paragraph (2) (A) is amended by striking out "January 1, 1945" and by inserting in lieu thereof "July 1, 1934". (2) Pa agraph (2) (D) is amended by inserting “and before July 1, 1958," after "June 12, 1955,". (3) The last sentence of paragraph (2) (D) (ii) is amended by striking out "section 402 of this Act (as in effect" and inserting in lieu thereof "section 402 or 402a of this Act (as in effect, with respect to the article concerned,". (4) Paragraph (2) is amended by adding at the end thereof the following new subparagraph: "(E) In order to carry out a foreign trade agreement entered into by the President on or after July 1, 1958, decreasing any rate of duty below the lowest of the rates provided for in paragraph (4) (A) of this subsection." (5) Paragraph (3) (A) is amended (A) by striking out "of subparagraphs (B) and (C) of this paragraph," and by inserting in lieu thereof "of subparagraphs (B) and (C) of this paragraph and of subparagraph (B) of paragraph (4) of this subsection,", and (B) by striking out "suspension under paragraph (4)" and by inserting in lieu thereof "suspension under paragraph (5)”. (6) Paragraph (3) (D) is amended by striking out "paragraph (2) (C) or (D)" and by inserting in lieu thereof "paragraph (2) (C) or (D) or paragraph (4) (A) or (B)". (7) Paragraphs (4) and (5) are renumbered as paragraphs (5) and (6), respectively. (8) Subsection (a) is amended by inserting after paragraph (3) the following new paragraph: "(4) (A) No proclamation pursuant to paragraph (1) (B) of this subsection shall be made, in order to carry out a foreign trade agreement entered into by the President on or after July 1, 1958, decreasing any rate of duty below the lowest of the following rates: "(i) The rate which would result from decreasing the rate existing on July 1, 1958, by 25 per centum of such rate. "(ii) Subject to paragraph (2) (B) of this subsection, the rate 2 per centum ad valorem below the rate existing on July 1, 1958. "(iii) The rate 50 per centum ad valorem or, in the case of any article subject to a specific rate of duty or to a combination of rates including a specific rate, any rate (or combination of rates), however stated, the ad valorem equivalent of which has been determined as 50 per centum ad valorem. The provisions of clauses (ii) and (iii) of this subparagraph and of subparagraph (B) (ii) of this paragraph shall, in the case of any article subject to a combination of ad valorem rates of duty, apply to the aggregate of such rates; and, in the case of any article subject to a specific rate of duty or to a combination of rates including a specific rate, such provisions shall apply on the basis of the ad valorem equivalent of such rate or rates, during a representative period (whether or not such period includes July 1, 1958), determined in the same manner as the ad valorem equivalent of rates not stated wholly in ad valorem terms is determined for the purpose of paragraph (2) (D) (ii) of this subsection. (B) (i) In the case of any decrease in duty to which clause (i) of subparagraph g. (A) of this paragraph applies, such decrease shall become initially effective in not more than five annual stages, and no amount of decrease becoming initially effective at one time shall exceed 10 per centum of the rate of duty existing on val July 1, 1958, or, in any case in which the rate has been increased since that date, exceed such 10 per centum or one-third of the total amount of the decrease under the foreign trade agreement, whichever is the greater. "(ii) In the case of any decrease in duty to which clause (ii) of subparagraph (A) of this paragraph applies, such decrease shall become initially effective in not more than five annual stages, and no amount of decrease becoming initially effective at one time shall exceed 1 per centum ad valorem or, in any case in which the rate has been increased since July 1, 1958, exceed such 1 per centum or one-third of the total amount of the decrease under the foreign trade agreement, whichever is the greater. "(iii) In the case of any decrease in duty to which clause (iii) of subparagraph (A) of this paragraph applies, such decrease shall become initially effective in not more than five annual stages, and no amount of decrease becoming initially effective at one time shall exceed one-third of the total amount of the decrease under the foreign trade agreement. "(C) In the case of any decrease in duty to which subparagraph (A) of this paragraph applies, no part of a decrease after the first part shall become initially effective (i) until the immediately previous part shall have been in effect for a period or periods aggregating not less than one year, nor (ii) after the first part shall have been in effect for a period or periods aggregating more than four years. If any part of a decrease has become effective, then any time thereafter during which such part of the decrease is not in effect by reason of legislation of the United States or action thereunder shall be excluded in determining when the four-year period expires." (b) Subsection (b) of section 350 of the Tariff Act of 1930, as amended (19 U. S. C., sec. 1351 (b)), is amended (1) by striking out "exclusive" in the first sentence, and (2) by amending paragraph (2) to read as follows: "(2) In order to carry out a foreign trade agreement entered into by the President on or after June 12, 1955, below the applicable alternative specified in subsection (a) (2) (C) or (D) or (4) (A) (subject to the applicable provisions of subsection (a) (3) (B), (C), and (D) and (4) (B) and (C)), each such alternative to be read for the purposes of this paragraph as relating to the rate of duty applicable to products of Cuba. With respect to products of Cuba, the limitation of subsection (a) (2) (D) (ii) or (4) (A) (iii) may be exceeded to such extent as may be required to maintain an absolute margin of preference to which such products are entitled " (c) Paragraph (2) (A) of subsection (c) of section 350 of the Tariff Act of 1930, as amended (19 U. S. C., sec. 1351 (c) (2) (A)), is amended by striking out "'existing on January 1, 1945' and 'existing on January 1, 1955' " and by inserting in lieu thereof "existing on July 1, 1934', 'existing on January 1, 1945', 'existing on January 1, 1955', and 'existing on July 1, 1958' ". (d) Paragraph (1) of subsection (e) of section 350 of the Tariff Act of 1930, as amended (19 U. S. C., sec. 1351 (e) (1)), is amended by inserting after "(including the incorporation therein of escape clauses)," the following: "the results of action taken to obtain removal of foreign trade restrictions (including discriminatory restrictions) against United States exports, remaining restrictions, and the measures available to seek their removal in accordance with the objectives of this section,". (e) Section 350 of the Tariff Act of 1930, as amended (19 U. S. C., sec. 1351), is amended by adding at the end thereof the following new subsection: "(f) It is hereby declared to be the sense of the Congress that the President, during the course of negotiating any foreign trade agreement under this section, should seek information and advice with respect to such agreement from representatives of industry, agriculture, and labor." SEC. 4. (a) The third sentence of subsection (a) of section 3 of the Trade Agreements Extension Act of 1951, as amended (19 U. S. C., sec. 1360 (a)), is amended by striking out "120 days" and inserting in lieu thereof "six months". The last sentence of such subsection is amended by striking out "120-day” and inserting in lieu thereof "six-month”. (b) Subsection (b) of section 3 of the Trade Agreements Extension Act of 1951, as amended (19 U. S. C., sec. 1360 (b)), is amended by adding at the end thereof the following new sentence: "If in the course of any such investigation the Commission shall find with respect to any article on the list upon which a tariff concession has been granted that an increase in duty or additional import restriction is required to avoid serious injury to the domestic industry producing like or directly competitive articles, the Commission shall promptly institute an investgation with respect to that article pursuant to section 7 of this Act." SEC. 5. (a) The first paragraph of subsection (a) of section 7 of the Trade Agreements Extension Act of 1951, as amended (19 U. S. C., sec. 1364 (a)), is amended by striking out "any interested party" and inserting in lieu thereof "any interested party (including any organization or group of employees)". (b) (1) The first paragraph of section 7 (a) of such Act is amended by striking out "nine months" and inserting in lieu thereof "six months". (2) The amendment made by paragraph (1) shall apply only with respect to applications made after the date of the enactment of this Act. (c) Section 7 of the Trade Agreements Extension Act of 1951, as amended (19 U. S. C., sec. 1364), is amended by adding at the end thereof the following new subsection: "(f) In carrying out the provisions of this section the President may, notwithstanding section 350 (a) (2) of the Tariff Act of 1930, as amended, impose a duty not in excess of 50 per centum ad valorem on any article not otherwise subject to duty." SEC. 6. Subsection (c) of section 7 of the Trade Agreements Extension Act of 1951, as amended (19 U. S. C., sec. 1364 (c)), is amended by inserting "(1)" after "(c)" at the beginning thereof, and by adding at the end thereof the following: "(2) The action so found and reported by the Commission to be necessary shall take effect (as provided in the first sentence of paragraph (1) or in paragraph (3), as the case may be)-- "(A) if approved by the President, or "(B) if disapproved by the President in whole or in part, upon the adoption by both Houses of the Congress (within the 60-day period following the date on which the report referred to in the second sentence of paragraph (1) is submitted to such committees), by the yeas and nays by a two-thirds vote of each House, of a concurrent resolution stating in effect that the Senate and House of Representatives approve the action so found and reported by the Commission to be necessary. For the purposes of subparagraph (B), in the computation of the 60-day period there shall be excluded the days on which either House is not in session because of an adjournment of more than 3 days to a day certain or an adjournment of the Congress sine die. "(3) In any case in which the contingency set forth in paragraph (2) (B) occurs, the President shall (within 15 days after the adoption of such resolution) take such action as may be necessary to make the adjustments, impose the quotas or make such other modifications as were found and reported by the Commission to be necessary." SEC. 7. (a) The following subsections of this section are enacted by the Congress: (1) As an exercise of the rulemaking power of the Senate and the House of Representatives, respectively, and as such they shall be considered as part of the rules of each House, respectively, but applicable only with respect to the procedure to be followed in such House in the case of resolutions (as defined in subsection (b)); and such rules shall supersede other rules only to the extent that they are inconsistent therewith; and (2) With full recognition of the constitutional right of either House to change such rules (so far as relating to the procedure in such House) at any time, in the same manner and to the same extent as in the case of any other rule of such House. (b) As used in this section, the term "resolution" means only a concurrent resolution of the two Houses of Congress, the matter after the resolving clause of which is as follows: "That the Senate and House of Representatives approve the action "(1) found and reported by the United States Tariff Commission to be necessary to prevent or remedy serious injury to the respective domestic industry, in its report to the President dated 19 on its escapeclause investigation_numbered under the provisions of section 7 of the Trade Agreements Extension Act of 1951, as amended (19 U. S. C., sec. 1364), and "(2) disapproved by the President in whole or in part in his report (dated 19) pursuant to the second sentence of paragraph (1) of section 7 (c) of such Act.", -the blank spaces therein being appropriately filled; and does not include a concurrent resolution which specifies more than one such investigation. (c) A resolution with respect to an investigation shall be referred to the Committee on Finance of the Senate or to the Committee on Ways and Means of the House of Representatives by the President of the Senate or the Speaker of the House of Representatives, as the case may be. (d) (1) If the committee to which has been referred a resolution with respect to an investigation has not reported it before the expiration of ten calendar days after its introduction (or, in the case of a resolution received from the other House, ten calendar days after its receipt), it shall then (but not before) be in order to move either to discharge the committee from further consideration of such resolution, or to discharge the committee from further consideration of any other resolution with respect to such investigation which has been referred to the committee. (2) Such motion may be made only by a person favoring the resolution, shall be highly privileged (except that it may not be made after the committee has reported a resolution with respect to the same investigation), and debate thereon shall be limited to not to exceed one hour, to be equally divided between those favoring and those opposing the resolution. No amendment to such motion shall be in order, and it shall not be in order to move to reconsider the vote by which such motion is agreed to or disagreed to. (3) If the motion to discharge is agreed to or disagreed to, such motion may not be renewed, nor may another motion to discharge the committee be made with respect to any other resolution with respect to the same investigation. (e) (1) When the committee has reported, or has been discharged from further consideration of, a resolution with respect to an investigation it shall at any time thereafter be in order (even though a previous motion to the same effect has been disagreed to) to move to proceed to the consideration of such resolution. Such motion shall be highly privileged and shall not be debatable. No amendment to such motion shall be in order and it shall not be in order to move to reconsider the vote by which such motion is agreed to or disagreed to. (2) Debate on the resolution shall be limited to not to exceed ten hours, which shall be equally divided between those favoring and those opposing the resolution. A motion further to limit debate shall not be debatable. No amendment to, or motion to recommit, the resolution shall be in order, and it shall not be in order to move to reconsider the vote by which the resolution is agreed to or disagreed to. (f) (1) All motions to postpone, made with respect to the discharge from committee, or the consideration of, a resolution with respect to an investigation, and all motions to proceed to the consideration of other business, shall be decided without debate. (2) All appeals from the decisions of the Chair relating to the application of the rules of the Senate or the House of Representatives, as the case may be, to the procedure relating to a resolution with respect to an investigation shall be decided without debate. (g) If, prior to the passage by one House of a resolution of that House with respect to an investigation, such House receives from the other House a resolution with respect to the same investigation, then (1) If no resolution of the first House with respect to such investigation has been referred to committee, no other resolution with respect to the same investigation may be reported or (despite the provisions of subsection (d) (1)) be made the subject of a motion to discharge. (2) If a resolution of the first House with respect to such investigation has been referred to committee (A) the procedure with respect to that or other resolutions of such House with respect to such investigation which have been referred to committee shall be the same as if no resolution from the other House with respect to such investigation had been received; but (B) on any vote on final passage of a resolution of the first House with respect to such investigation the resolution from the other House with respect to such investigation shall be automatically substituted for the resolution of the first House. SEC. 8. (a) Section 2 of the Act entitled "An Act to extend the authority of the President to enter into trade agreements under section 350 of the Tariff Act of 1930, as amended", approved July 1, 1954, as amended by section 7 of the Trade |