24 each investment project it insures, reinsures, or fi-

25 nances, a development impact profile consisting of



39



1 data appropriate to measure the projected and ac-

2 tual effects of such project on development.

3 "(b) Small Business Development. ā€”

4 "(1) Broadened participation by small

5 BUSINESSES. ā€” The Corporation shall undertake, in

6 cooperation with appropriate agencies of the United

7 States Government as well as private entities and

8 others, to broaden the participation of United States

9 small business, cooperatives, and other small United

10 States investors in the development of small private

1 1 enterprise in eligible countries or areas.

12 u (2) Preferential consideration. ā€” Not-

13 withstanding the requirements of section 231(c)(1),

14 and on such terms and conditions as the Corpora-

15 tion may determine through loans, grants, or other

16 programs authorized by section 233, the Corporation

17 shall undertake, to the maximum degree possible

1 8 consistent with its purposes ā€”

19 "(A) to give preferential consideration in

20 its investment insurance, reinsurance, and

21 guarantee activities to investment projects spon-

22 sored by or involving United States small busi-

23 ness; and

24 "(B) to maintain the proportion of projects

25 sponsored by or significantly involving United



40



1 States small business at not less than 30 per-

2 cent of all projects insured, reinsured, or fi-

3 nanced by the Corporation. '

4 "(c) Environmental Considerations. ā€”

5 "(1) Environmental, health, or safety

6 HAZARD. ā€” The Corporation shall refuse to insure,
reinsure, or finance any investment in connection

8 with a project which the Corporation determines will

9 pose an unreasonable or major environmental,

10 health, or safety hazard, or will result in the signifi-

1 1 cant degradation of national parks or similar pro-

12 tected areas.

13 u (2) Resource sustainable develop-

14 MENT. ā€” The Corporation, in determining whether to

15 provide insurance, reinsurance, or financing for a

16 project, shall ensure that the project is consistent

17 with the provisions of section 117 (as so redesig-

18 nated by the Special Foreign Assistance Act of

19 1986), section 118, and section 119 of this Act re-

20 lating to the environment and natural resources of,

21 and tropical forests and endangered species in, de-

22 veloping countries, and consistent with the intent of

23 regulations issued pursuant to sections 118 and 119

24 of this Act.



41



1 "(3) Impact on environment and natural

2 RESOURCES. ā€” The requirements of section 117(c) of

3 this Act relating to environmental impact statements

4 and environmental assessments shall apply to any

5 investment which the Corporation insures, reinsures,

6 or finances under this title.

7 "(4) Notification of foreign govern-

8 MENTS. ā€” Before finally providing insurance, reinsur-

9 ance, or financing under this title for any environ-

10 mentally sensitive investment in connection with a

1 1 project in a country, the Corporation shall notify ap-

12 propriate government officials of that country of ā€”

13 "(A) all guidelines and other standards

14 adopted by the International Bank for Recon-

15 struction and Development and any other inter-

16 national organization that relate to the public

17 health or safety or the environment and are ap-

18 plicable to the project; and

19 "(B) to the maximum extent practicable,

20 any restriction, under any law of the United

21 States, that relates to public health or safety or

22 the environment and would apply to the project

23 if the project were undertaken in the United

24 States.



42



1 The notification under the preceding sentence shall

2 include a summary of the guidelines, standards, and

3 restrictions referred to in subparagraphs (A) and

4 (B), and may include any environmental impact

5 statement, assessment, review, or study prepared

6 with respect to the investment pursuant to para-

7 graph (3).

8 "(5) Consideration op comments re-

9 CEIVED. ā€” Before finally providing insurance, rein-

10 surance, or financing for any investment subject to

11 paragraph (4), the Corporation shall take into ac-

12 count any comments it receives on the project in-

1 3 volved.

14 "(d) Worker Rights. ā€”

15 "(1) Limitation on opic activities. ā€” The

16 Corporation may insure, reinsure, or finance a

17 project only if the country in which the project is to

18 be undertaken is taking steps to adopt and imple-

19 ment laws that extend internationally recognized

20 worker rights, as defined in section 502(a)(4) of the

21 Trade Act of 1974 (19 U.S.C, 2462(a)(4)), to work-

22 ers in that country (including any designated zone in

23 that country). The Corporation shall also include the

24 following language, in substantially the following

25 form, in all contracts which the Corporation enters



43



1 into with eligible investors to provide financial sup-

2 port under this title:

3 " 'The investor agrees not to take actions to

4 prevent employees of the foreign enterprise from

5 lawfully exercising their right of association and

6 their right to organize and bargain collectively. The

7 investor further agrees to observe applicable laws re-

8 lating to a minimum age for employment of children,

9 acceptable conditions of work with respect to mini-

10 mum wages, hours of work, and occupational health

1 1 and safety, and not to use forced labor. The investor

12 is not responsible under this paragraph for the ac-

13 tions of a foreign government.'.

14 "(2) Use of annual reports on workers

15 RIGHTS. ā€” The Corporation shall, in making its de-

16 terminations under paragraph (1), use the reports

17 submitted to the Congress pursuant to section

18 505(c) of the Trade Act of 1974 (19 U.S.C.

19 2465(c)).

20 "(3) Waiver.ā€” (A) Paragraph (1) shall not

21 prohibit the Corporation from providing any insur-

22 ance, reinsurance, or financing with respect to a

23 country if the President determines that such activi-

24 ties by the Corporation would be in the national eco-

25 nomic interests of the United States. Anv such de-



44



1 termination shall be reported in writing to the ap-

2 propriate congressional committees, together with

3 the reasons for the determination.

4 "(B) As used in subparagraph (A), the term

5 'appropriate congressional committees' means the

6 Committee on Foreign Affairs and the Committee on

7 Appropriations of the House of the Representatives

8 and the Committee on Foreign Relations and the

9 Committee on Appropriations of the Senate.

10 "(e) Human Rights. ā€”

11 "(1) In GENERAL. ā€” The Corporation shall take

12 into account in the conduct of its programs in a

13 country, in consultation with the Secretary of State,

14 all available information about observance of and re-

15 spect for human rights and fundamental freedoms in

16 such country and the effect the operation of such

17 programs will have on human rights and fundamen-

18 tal freedoms in such country.

19 "(2) Human rights violators. ā€” The provi-

20 sions of section 116 shall apply to any insurance, re-

21 insurance, or financing provided by the Corporation

22 for projects in a country, except that in addition to

23 the exception set forth in subsection (a) of such sec-

24 tion, the Corporation may support a project if the

25 national security interest so requires.



45



1 "(f) Harm to Employment in the United

2 States. ā€”

3 "(1) Replacement of united states pro-

4 DUCTION. ā€” (A) The Corporation shall refuse to in-

5 sure, reinsure, or finance an investment if the Cor-

6 poration determines that ā€”

7 "(i) such investment is likely to cause the

8 investor significantly to reduce the number of

9 the investor's employees in the United States

10 because the investor is replacing his or her

1 1 United States production with production from

1 2 such investment; and

13 "(ii) the production from such investment

14 involves substantially the same product for sub-

15 stantially the same market as the investor's

16 United States production.

17 "(B) If the Corporation determines that an in-

18 vestment is not likely to have the effects described

19 in subparagraph (A), the Corporation shall monitor

20 conformance with the representations made by the

21 investor on which the Corporation relied in making

22 that determination.

23 "(2) Export processing zones. ā€” The Cor-

24 poration shall refuse to insure, reinsure, or finance

25 an investment for the purpose of establishing or de-






46



1 veloping in a foreign country any export processing

2 zone or designated area in which the tax, tariff,

3 labor, environment, and safety laws of that country

4 do not apply, in part or in whole, to activities car-

5 ried out within that zone or area, unless such assist-

6 ance is not likely to cause a loss of jobs within the

7 United States as determined in consideration of the

8 restrictions contained in paragraph (1).

9 "(g) Performance Requirements. ā€” The Corpora-

10 tion shall refuse to insure, reinsure, or finance an invest-

1 1 ment which is subject to performance requirements which

1 2 would reduce substantially the positive trade benefits like-

1 3 ly to accrue to the United States from the investment.

14 "(h) Prohibited Trade Practices. ā€”

15 "(1) Payments to violators barred. ā€” No

16 payment may be made under any insurance or rein-

17 surance which is issued under this title on or after

18 April 24, 1978, for any loss occurring with respect

19 to a project, if the preponderant cause of such loss

20 was an act by the investor seeking such payment, by

21 a person possessing majority ownership and control

22 of the investor at the time of the act, or by any

23 agent of such investor or controlling person, and a

24 court of the United States has entered a final judg-

25 ment that such act constituted a violation of section



47



1 30A of the Securities Exchange Act of 1934 or sec-

2 tion 104 of the Foreign Corrupt Practices Act of

3 1977.

4 "(2) Regulations. ā€” The Corporation shall

5 have in effect regulations setting forth appropriate

6 conditions under which any person who has been fi-
nally determined by a court of the United States to

8 have violated section 30A of the Securities Exchange

9 Act of 1934 or section 104 of the Foreign Corrupt

10 Practices Act of 1977 shall be suspended, for a pe-

1 1 riod of not more than 5 years, from eligibility to re-

12 ceive any insurance, reinsurance, financing, or other

1 3 financial support authorized by this title, if that vio-

14 lation related to a project insured, reinsured, fi-

15 nanced, or otherwise supported by the Corporation

16 under this title.

17 "(i) Fraud or Misrepresentation. ā€” No payment

1 8 may be made under any guarantee, insurance, or reinsur-

19 ance issued under this. title for any loss arising out of

20 fraud or misrepresentation for which the party seeking

2 1 payment is responsible.

22 "(j) Penalties for Fraud. ā€” Whoever knowingly

23 makes any false statement or report, or willfully

24 overvalues any land, property, or security, for the purpose

25 of influencing in any way the action of the Corporation



48



1 with respect to any insurance, reinsurance, guarantee,

2 loan, equity investment, or other activity of the Corpora-

3 tion under section 233 or any change or extension of any

4 such insurance, reinsurance, guarantee, loan, equity in-

5 vestment, or activity, by renewal, deferment of action or

6 otherwise, or the acceptance, release, or substitution of se-

7 curity therefor, shall be fined not more than $1,000,000

8 or imprisoned not more than 30 years, or both.

9 "(k) Public Hearings. ā€” The Board shall hold at

10 least 1 public hearing each year in order to afford an op-

11 portunity for any person to present views as to whether

1 2 the Corporation is carrying out its activities in accordance

13 with section 231 and this section or whether any invest-

14 ment in a particular country should have been or should

15 be extended insurance, reinsurance, or financing under

16 this title.

17 "SEC. 235. ISSUING AUTHORITY, DIRECT INVESTMENT AU-

1 8 THORITY, EQUITY FUND, AND RESERVES.

19 "(a) Issuing Authority. ā€”

20 "(1) Insurance. ā€” The maximum contingent li-

21 ability outstanding at any one time pursuant to in-

22 surance issued under section 233(a) shall not exceed

23 in the aggregate $15,000,000,000.

24 "(2) Financing. ā€” (A) The maximum contin-

25 gent liability outstanding at any one time pursuant



49



1 to financing issued under section 233(b) shall not

2 exceed in the aggregate $14,500,000,000.

3 "(B) Subject to spending authority provided in

4 appropriations Acts pursuant to section 504(b) of

5 the Federal Credit Reform Act of 1990, the Cor-

6 poration is authorized to transfer such suras as are

7 necessary from its noncredit activities to pay for the

8 subsidy cost of a program level for the direct loan

9 and guarantee programs under sections 233(b)(1)

10 and (b)(3)ā€”

1 1 "(i) $3,000,000,000 for fiscal year 1995;

12 "(ii) $4,000,000,000 for fiscal year 1996;

13 and

14 "(iii) $5,000,000,000 for fiscal year 1997.

15 "(3) Termination op authority. ā€” The au-

16 thority of sections 233(a) and (b)(3) shall continue

17 until September 30, 1997.

18 "(b) Creation of Fund for Acquisition of Eq-

19 UITY. ā€” The Corporation is authorized to maintain a re-

20 volving fund to be available solely for the purposes speci-

21 fied in section 233(b)(2) and to make transfers to the fund

22 of a total of $45,000,000 (less amounts transferred to the

23 fund before the effective date of this title) from its

24 noncredit activities. The Corporation shall apply to the

25 fund all amounts received by the Corporation as income



50



1 on securities acquired under section 233(b)(2) using funds

2 made available under this section, and from the proceeds

3 on the disposition of such securities. Purchases of, invest-

4 ments in, and other acquisitions of equity from the fund

5 are authorized for any fiscal year only to the extent or

6 in such amounts as are provided in advance in appropria-

7 tions Acts or are transferred to the Corporation pursuant

8 to section 632(a).

9 "(c) Insurance Reserves. ā€”

10 "(1) Maintenance and purposes. ā€” The Cor-

1 1 poration shall maintain insurance reserves. Such re-

12 serves shall be available for the discharge of liabil-

13 ities, as provided in subsection (d), until such time

14 as all such liabilities have been discharged or have

15 expired or until all such reserves have been expended

1 6 in accordance with the provisions of this section.

17 "(2) Funding. ā€” The insurance reserves shall

18 consist of ā€”

19 "(A) any funds in the insurance reserves of

20 the Corporation on September 30, 1994;

21 "(B) amounts transferred to the reserves

22 pursuant to this Act; and

23 "(C) such sums as are appropriated pursu-

24 ant to subsection (e) of this section for such

25 purposes.



51

1 "(d) Order op Payments To Discharge Liabil-

2 ITEES. ā€” Any payment made to discharge liabilities under

3 investment insurance or reinsurance issued under section

4 233, or to discharge liabilities under predecessor guaran-

5 tee authority, shall be paid first out of the insurance re-

6 serves, as long as such reserves remain available, and

7 thereafter out of funds made available pursuant to sub-

8 section (e) of this section. Any payments made to dis-

9 charge liabilities under guarantees issued under section

10 233(b)(3) shall be paid in accordance with the Federal

1 1 Credit Reform Act of 1990.

12 "(e) Authorization of Appropriations. ā€”

13 "(1) Authorization. ā€” Subject to paragraph

14 (2), there are authorized to be appropriated to the

1 5 Corporation such amounts as may be necessary from

16 time to time to replenish or increase the insurance

17 reserves, to discharge the liabilities under insurance

18 or reinsurance issued by the Corporation, to dis-

19 charge liabilities under predecessor guarantee au-

20 thority, or to discharge obligations of the Corpora-

21 tion purchased by the Secretary of the Treasury

22 pursuant to subsection (f).

23 "(2) Limitation on appropriations. ā€” No ap-

24 propriation shall be made under paragraph (1) to

25 augment the insurance reserves until the amount of



52

1 funds in the insurance reserves is less than

2 $25,000,000. Any appropriations to augment the in-

3 surance reserves shall then only be made either pur-

4 suant to specific authorization enacted after the date

5 of enactment of the Overseas Private Investment

6 Corporation Amendments Act of 1974, or to satisfy
the full faith and credit provision of section 237(c).

8 "(f) Issuance of Obligations. ā€” In order to dis-

9 charge liabilities under investment insurance or reinsur-

10 ance, the Corporation is authorized to issue from time to

1 1 time for purchase by the Secretary of the Treasury its

12 notes, debentures, bonds, or other obligations. The aggre-

13 gate amount of such obligations outstanding at any one

14 time may not exceed $100,000,000. Any such obligation

15 shall be repaid to the Treasury within 1 year after the

16 date of issue of such obligation. Any such obligation shall

1 7 bear interest at a rate determined by the Secretary of the

18 Treasury, taking into consideration the current average

1 9 market yield on outstanding marketable obligations of the

20 United States of comparable maturities during the month

2 1 preceding the issuance of any obligation authorized by this

22 subsection. The Secretary of the Treasury shall purchase

23 any obligation of the Corporation issued under this sub-

24 section, and for such purchase the Secretary may use as

25 a public debt transaction the proceeds of the sale of any



53

1 securities issued under chapter 31 of title 31, United

2 States Code. The purpose for which securities may be is-

3 sued under chapter 31 of title 31, United States Code,

4 shall include any such purchase.

5 "SEC. 236. INCOME AND REVENUES.

6 "In order to carry out the purposes of the Corpora-

7 tion, all revenues earned by the Corporation from its

8 noncredit activities and amounts transferred to the Cor-

9 poration shall be held by the Corporation and shall be

10 available to carry out its purposes, including without

1 1 limitation ā€”

12 "(1) payment of all credit and noncredit ex-

1 3 penses of the Corporation;

14 "(2) transfers and additions to the insurance

15 reserves maintained under section 235(c), and such

16 other funds or reserves as the Corporation may es-

17 tablish, at such time and in such amounts as the

1 8 Board may determine; and

19 "(3) payment of dividends, on capital stock,

20 which shall consist of and be paid from net earnings

21 of the Corporation after payments, transfers, and

22 additions under paragraphs (1) and (2).



54



1 "SEC. 237. GENERAL PROVISIONS RELATING TO INSUR-

2 ANCE AND FINANCING PROGRAM.

3 "(a) Agreements With Countries. ā€” Insurance,

4 guarantees, and reinsurance issued under this title shall

5 cover investment made in connection with projects in any

6 eligible country or area with the government of which the

7 President of the United States has agreed to institute a

8 program for such insurance, guarantees, or reinsurance.

9 "(b) Protection of Interests of the Corpora-

10 TION. ā€” The Corporation shall determine that suitable ar-

1 1 rangements exist for protecting the interest of the Cor-

1 2 poration in connection with any insurance, reinsurance, or

13 guarantee issued under this title, including arrangements

14 concerning ownership, use, and disposition of the cur-

1 5 rency, credits, assets, or investments on account of which

16 payment under such insurance, guarantee, or reinsurance

17 is to be made, and any right, title, claim, or cause of action

1 8 existing in connection therewith.

19 "(c) Full Faith and Credit Pledged. ā€” All guar-

20 antees issued under predecessor guarantee authority, and

21 all insurance, reinsurance, and guarantees issued under

22 this title shall constitute obligations, in accordance with

23 the terms of such insurance, reinsurance, or guarantees,

24 of the United States of America, and the full faith and

25 credit of the United States of America is hereby pledged

26 for the full payment and performance of such obligations.



55

1 "(d) Pees. ā€” Fees may be charged for providing in-

2 surance, reinsurance, financing, and other services under

3 this title in amounts to be determined by the Corporation.

4 Fees paid for project-specific transaction costs and other

5 transaction costs, including project-related travel and ex-

6 penses for legal representation, associated with sendees

7 provided to specific investors or potential investors pursu-

8 ant to section 233, including financing, insurance, reinsur-

9 ance, missions, seminars, conferences, and other pre-in-

vestment services, shall be available for obligation for the

1 purposes for which they were collected notwithstanding

2 any other provision of law. Transaction costs relating to

3 investment financing commitments entered into pursuant

4 to section 233(b) shall be considered cash flows from the

5 Government resulting from financing commitments and

6 shall be paid out of the appropriate financing account es-

7 tablished pursuant to section 505(b) of the Federal Credit

8 Reform Act of 1990.

9 "(e) Insurance, Financing, and Reinsurance

20 Limited to 20 Years. ā€” No insurance, reinsurance, or

21 guarantee of any equity investment under this title shall

22 extend beyond 20 years from the date on which such in-

23 surance, reinsurance, or guarantee is issued.

24 "(f) Amount of Compensation Paid on

25 Claims. ā€” Compensation for any insurance, reinsurance,



56

1 or guarantee issued under this title shall not exceed the

2 dollar value, as of the date of the investment, of the invest-

3 ment made in the project with the approval of the Cor-

4 poration plus interest, earnings, or profits actually ac-

5 crued on such investment to the extent provided by such

6 insurance, reinsurance, or guarantee, except that the Cor-

7 poration may provide that ā€”

8 "(1) appropriate adjustments in the insured

9 dollar value be made to reflect the replacement cost

10 of project assets;

11 "(2) compensation for a claim of loss under in-

12 surance of an equity investment may be computed

13 on the basis of the net book value attributable to

14 such equity investment on the date of loss; and

15 "(3) compensation for loss due to business

16 interruption may be computed on a basis to be de-

17 termined by the Corporation which reflects amounts

18 lost.

19 Notwithstanding the preceding sentence, the Corporation

20 shall limit the amount of direct insurance and reinsurance

21 issued under section 233 so that risk of loss as to at least

22 10 percent of the total investment of the insured and its

23 affiliates in the project is borne by the insured and such

24 affiliates. This limitation shall not apply to direct insur-



57

1 ance or reinsurance of loans by banks or other financial

2 institutions to unrelated parties.

3 "(g) Limitation With Respect to Foreign

4 Credit Institutions. ā€” Insurance, guarantees, or rein-

5 surance of a loan or equity investment of an eligible inves-

6 tor in a foreign bank, finance company, or other credit

7 institution shall extend only to such loan or equity invest-

8 ment and not to any individual loan or equity investment

9 made by such foreign bank, finance company, or other

10 credit institution.

11 "(h) Settlement and Arbitration of Claims. ā€”

12 Claims arising as a result of insurance, reinsurance, or

13 guarantee operations under this title may be settled, and

14 disputes arising as a result thereof may be arbitrated with

1 5 the consent of the parties, on such terms and conditions

16 as the Corporation may determine. Payment made pursu-

17 ant to any such settlement, or as a result of an arbitration

18 award, shall be final and conclusive notwithstanding any

1 9 other provision of law.

20 "(i) Contracts Presumed To Comply With

21 Act. ā€” Each guarantee contract executed by such officer