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I 107TH CONGRESS 2D SESSION H. R. 4179 To amend the Harmonized Tariff Schedule of the United States with respect to the production incentive certificate program for watch and jewelry producers in possessions of the United States, including the Virgin Is- lands, Guam, and American Samoa. IN THE HOUSE OF REPRESENTATIVES APRIL 11, 2002 Mrs. CHRISTENSEN (for herself, Mrs. JOHNSON of Connecticut, and Mr. MCNULTY) introduced the following bill; which was referred to the Com- mittee on Ways and Means A BILL To amend the Harmonized Tariff Schedule of the United States with respect to the production incentive certificate program for watch and jewelry producers in possessions of the United States, including the Virgin Islands, Guam, and American Samoa. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. AMENDMENTS TO UNITED STATES INSULAR 3 POSSESSION PROGRAM. 4 (a) PRODUCTION CERTIFICATES.—Additional U.S. 5 Note 5(h) to chapter 91 of the Harmonized Tariff Sched- 6 ule of the United States is amended— 7 2 •HR 4179 IH (1) by amending subparagraphs (i) and (ii) to 1 read as follows: 2 ‘‘(i) In the case of each of calendar years 2002 through 3 2015, the Secretaries jointly, shall— 4 ‘‘(A) verify— 5 ‘‘(1) the wages paid in the preceding calendar 6 year by each producer (including the value 7 of usual and customary fringe benefits)— 8 ‘‘(I) to permanent residents of the insular 9 possessions; and 10 ‘‘(II) to workers providing training in the 11 insular possessions in the production 12 or manufacture of watch movements 13 and watches or engaging in such other 14 activities in the insular possessions re- 15 lating to such production or manufac- 16 ture as are approved by the Secre- 17 taries; and 18 ‘‘(2) the total quantity and value of watches 19 produced in the insular possessions by that 20 producer and imported into the customs 21 territory of the United States; and 22 ‘‘(B) issue to each producer (not later than 60 days 23 after the end of the preceding calendar year) a 24 certificate for the applicable amount. 25 3 •HR 4179 IH ‘‘(ii) For purposes of subparagraph (i), except as provided 1 in subparagraphs (iii) and (iv), the term ‘applicable 2 amount’ means an amount equal to the sum of— 3 ‘‘(A) 90 percent of the producer’s creditable wages 4 (including the value of any usual and customary 5 fringe benefits) on the assembly during the pre- 6 ceding calendar year of the first 300,000 units; 7 plus 8 ‘‘(B) the applicable graduated declining percentage 9 (determined each year by the Secretaries) of the 10 producer’s creditable wages (including the value 11 of any usual and customary fringe benefits) on 12 the assembly during the preceding calendar 13 year of units in excess of 300,000 but not in ex- 14 cess of 750,000; plus 15 ‘‘(C) the difference between the duties that would 16 have been due on the producer’s watches (ex- 17 cluding digital watches) imported into the cus- 18 toms territory of the United States during the 19 preceding calendar year if the watches had been 20 subject to duty at the rates set forth in column 21 1 under this chapter that were in effect on Jan- 22 uary 1, 2001, and the duties that would have 23 been due on the watches if the watches had 24 been subject to duty at the rates set forth in 25 4 •HR 4179 IH column 1 under this chapter that were in effect 1 for such preceding calendar year.’’; and 2 (2) by amending subparagraph (v) to read as 3 follows: 4 ‘‘(v)(A) Any certificate issued under subparagraph (i) 5 shall entitle the certificate holder to secure a refund 6 of duties equal to the face value of the certificate on 7 watches, watch movements, and articles of jewelry 8 provided for in heading 7113 that are imported into 9 the customs territory of the United States by the cer- 10 tificate holder. Such refunds shall be made under reg- 11 ulations issued by the Treasury Department. Not 12 more than 5 percent of such refunds may be retained 13 as a reimbursement to the Customs Service for the 14 administrative costs of making the refunds. If the 15 Secretary of the Treasury determines that there is 16 an insufficient level of duties from watch and watch- 17 related tariffs, the Secretary may authorize refunds 18 of duties collected on jewelry under chapter 71 or any 19 other duties that the Secretary determines are appro- 20 priate. 21 ‘‘(B) At the election of the certificate holder and upon 22 making the certification described in this clause, the 23 Secretary of the Treasury shall pay directly to the 24 5 •HR 4179 IH certificate holder the face value of the certificate, less 1 the value of— 2 ‘‘(1) any duty refund previously claimed by the hold- 3 er under the certificate, and 4 ‘‘(2) a discount of not more than 2 percent of the 5 face value of the certificate, 6 as determined by the Secretary of the Treasury. 7 ‘‘(C) Direct payments under clause (B) shall be made 8 under regulations issued by the Secretary of the 9 Treasury. Such regulations shall assure that a certifi- 10 cate holder is required to provide only the minimum 11 documentation necessary to support an application 12 for direct payment. A certificate holder shall not be 13 eligible for direct payment under clause (B) unless 14 the certificate holder certifies to the Secretaries that 15 the funds received will be reinvested or utilized to 16 support and continue employment in the Virgin Is- 17 lands. 18 ‘‘(D) The Secretary of the Treasury is authorized to make 19 the payments provided for in clause (B) from duties 20 collected on watches, watch movements, and parts 21 therefor. If such duties are insufficient, the Secretary 22 of the Treasury is authorized to make the payments 23 from duties collected on jewelry under chapter 71 or 24 6 •HR 4179 IH any other duties that the Secretary determines are 1 appropriate.’’. 2 (b) JEWELRY.—Additional U.S. Note 3 to chapter 71 3 of the Harmonized Tariff Schedule of the United States 4 is amended— 5 (1) by redesignating paragraphs (b), (c), (d), 6 and (e) as paragraphs (c), (d), (e), and (f), respec- 7 tively; 8 (2) by inserting after paragraph (a) the fol- 9 lowing new paragraph: 10 ‘‘(b) The 750,000 unit limitation in additional U.S. Note 11 5(h)(ii)(B) to chapter 91 shall not apply to articles 12 of jewelry subject to this note.’’; and 13 (3) by striking paragraph (f), as so redesig- 14 nated, and inserting the following: 15 ‘‘(f) Notwithstanding any other provision of law, any arti- 16 cle of jewelry provided for in heading 7113 that is 17 assembled in the Virgin Islands, Guam, or American 18 Samoa by a jewelry manufacturer or jewelry assem- 19 bler that commenced jewelry manufacturing or jew- 20 elry assembly operations in the Virgin Islands, Guam, 21 or American Samoa after August 9, 2001, shall be 22 treated as a product of the Virgin Islands, Guam, or 23 American Samoa for purposes of this note and Gen- 24 eral Note 3(a)(iv) of this Schedule if such article is 25 7 •HR 4179 IH entered no later than 18 months after such jewelry 1 manufacturer or jewelry assembler commenced jew- 2 elry manufacturing or jewelry assembly operations in 3 the Virgin Islands, Guam, or American Samoa.’’. 4 SEC. 2. EFFECTIVE DATE. 5 The amendments made by this Act shall apply with 6 respect to goods imported into the customs territory of 7 the United States on or after January 1, 2002. 8 Æ