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Trade United States. Congress. House. Committee on Forei.

Oversight of the U.S. and Foreign Commercial Service : hearing and markup on H.R. 4950, Jobs through Trade Expansion Act of 1994 before the Subcommittee on Economic Policy, Trade and Environment of the Committee on Foreign Affairs, House of Representatives, One Hundred Third Congress, second session

. (page 5 of 6)


22 or officers as may be designated by the Board shall be

23 conclusively presumed to be issued in compliance with the

24 requirements of this Act.



58



1 "(j) Use op Local Currencies. — Direct loans or

2 investments made in order to preserve the value of funds

3 received in inconvertible foreign currency by the Corpora-

4 tion as a result of activities conducted pursuant to section

5 233(a) shall not be considered in determining whether the

6 Corporation has made or has outstanding loans, guaran-

7 tees, or investments to the extent of any limitation on obli-

8 gations and equity investment imposed by or pursuant to

9 this title. The provisions of section 504(b) of the Federal

10 Credit Reform Act of 1990 shall not apply to direct loan

1 1 obligations made with funds described in this subsection.

12 "(k) Prohibition on Noncompetitive Awarding

13 op Insurance Contracts on OPIC Supported Ex-

14 ports. —

15 "(1) Requirement for certification. — (A)

16 Except as provided in subparagraph (C), the inves-

17 tor on whose behalf insurance, reinsurance, guaran-

18 ties, or other financing is provided under this title

19 with respect to a project shall be required to certify

20 to the Corporation that any contract for the export

21 of goods as part of that project will include a clause

22 requiring that United States insurance companies

23 have a fair and open competitive opportunity to pro-

24 vide insurance against risk of loss of such support.



59

1 "(B) The investor shall be required, in every

2 practicable case, to so certify before the insurance,

3 reinsurance, guarantee, or other financing is pro-

4 vided. In any case in which such a certification is

5 not made in advance, the investor shall include in

6 the certification the reasons for the failure to make

7 a certification in advance.

8 "(C) Subparagraph <A) does not apply with re-

9 speet to an investor who does not, because of the na-

10 ture of the investment, have a controlling interest in

1 1 fact in the project in question.

12 "(2) Reports by the united states trade

13 representative. — The United States Trade Rep-

14 resentative shall review the actions of the Corpora-

15 tion under paragraph (1) and, after consultation

16 with representatives of United States insurance com-

17 panies, shall report to the Congress, with respect to

18 such actions, in the report required by section

19 181(b) of the Trade Act of 1974.

20 "(3) Definitions. — For purposes of this

2 1 subsection —

22 "(A) the term 'United States insurance

23 company' includes —

24 "(i) an individual, partnership, cor-

25 poration, holding company, or other legal



60

1 entity which is authorized, or in the case

2 of a holding company, subsidiaries of

3 which are authorized, by a State to engage

4 in the business of issuing insurance con-

5 tracts or reinsuring the risk underwritten

6 by insurance companies; and

7 "(ii) foreign operations, branches,

8 agencies, subsidiaries, affiliates, or joint

9 ventures of any entity described in clause

10 (i);

11 "(B) United States insurance companies

12 shall be considered to have had a 'fair and open

13 competitive opportunity to provide insurance' if

14 they—

15 "(i) have received notice of the oppor-

16 tunity to provide insurance; and

17 "(ii) have been evaluated on a non-

1 8 discriminatory basis; and

19 "(C) the term 'State' includes the District

20 of Columbia and any commonwealth, territory,

2 1 or possession of the United States.

22 "SEC. 238. GENERAL PROVISIONS AND POWERS.

23 "(a) Principal Office. — The Corporation shall

24 have its principal office in the District of Columbia and



61



1 shall be deemed, for purposes of venue in civil actions, to

2 be a resident of the District of Columbia.

3 "(b) Audits.—

4 "(1) In general. — The Corporation shall be

5 subject to the applicable provisions of chapter 91 of

6 title 31, United States Code, except as otherwise

7 provided in this title.

8 "(2) Independent audit. — An independent

9 certified public accountant shall perform a financial

10 and compliance audit of the financial statements of

11 the Corporation each year, in accordance with gen-

12 erally accepted Government auditing standards for a

13 financial and compliance audit, taking into consider-

14 ation any standards recommended by the Comptrol-

15 ler General. The independent certified public ac-

16 countant shall report the results of such audit to the

17 Board. The financial statements of the Corporation

18 shall be presented in accordance with generally ac-

19 cepted accounting principles. These financial state-

20 ments and the report of the accountant shall be in-

21 eluded in a report which contains, to the extent ap-

22 plicable, the information identified in section 9106

23 of title 31, United States Code. The Corporation

24 shall submit such report to the Congress not later

25 than 6V2 months after the end of the last fiscal vear



62



1 covered by the audit. The Comptroller General may

2 review the audit conducted by the accountant and

3 the report to the Congress in the manner and at

4 such times as the Comptroller General considers

5 necessary.

6 "(3) Audit by comptroller general. — In

7 lieu of the financial and compliance audit required

8 by paragraph (2), the Comptroller General shall, if

9 the Comptroller General considers it necessary or

10 upon the request of the Congress, audit the financial

11 statements of the Corporation in the manner pro-

12 vided in paragraph (2).

13 "(4) Availability op information. — All

14 books, accounts, financial records, reports, files,

15 workpapers, and property belonging to or in use by

16 the Corporation and the accountant who conducts

17 the audit under paragraph (2), which are necessary

18 for purposes of this subsection, shall be made avail-

19 able to the representatives of the General Account-

20 ing Office designated by the Comptroller General.

21 "(c) Powers. — To carry out the purposes of this

22 title, the Corporation is authorized —

23 "(1) to adopt and use a corporate seal, which

24 shall be judicially noticed;

25 "(2) to sue and be sued in its corporate name:



63



1 "(3) to adopt, amend, and repeal bylaws gov-

2 erning the conduct of its business and the perform-

3 ance of the powers and duties granted to or imposed

4 upon it by law;

5 "(4) to acquire, hold, or dispose of, upon such

6 terms and conditions as the Corporation may deter-

7 mine, any property, real, personal, or mixed, tan-

8 gible or intangible, or any interest therein;

9 "(5) to invest funds derived from fees and other

10 revenues in obligations of the United States and to

1 1 use the proceeds therefrom, including earnings and

1 2 profits, as it considers appropriate;

13 "(6) to indemnify directors, officers, employees,

14 and agents of the Corporation for liabilities and ex-

1 5 penses incurred in connection with their Corporation

1 6 activities;

17 "(7) to require bonds of officers, employees,

1 8 and agents and to pay the premiums for such bonds;

19 "(8) notwithstanding any other provision of

20 law, to represent itself or to contract for representa-

21 tion in all legal and arbitral proceedings;

22 "(9) to enter into limited-terms contracts with

23 nationals of the United States for personal services

24 to carry out activities in the United States and

25 abroad under section 233;



64



1 "(10) to purchase, discount, rediscount, sell,

2 and negotiate, with or without its endorsement or

3 guarantee, and guarantee notes, participation certifi-

4 cates, and other evidence of indebtedness (except

5 that the Corporation shall not issue its own securi-

6 ties, except participation certificates for the purpose
of carrying out section 231(c)(3), participation cer-

8 tificates in connection with transactions authorized

9 by section 233(b), or participation certificates as evi-

10 dence of indebtedness held by the Corporation in

1 1 connection with settlement of claims under section

12 237(h));

13 "(11) to make and carry out such contracts and

14 agreements as are necessary and advisable in the

15 conduct of its business;

16 "(12) to exercise any priority of the Govern-

17 ment of the United States in collecting debts from

18 the estates of bankrupt, insolvent, or decedent par-

19 ties;

20 "(13) to determine the character of and the ne-

21 cessity for its obligations and expenditures, and the

22 manner in which they shall be incurred, allowed, and

23 paid, subject to provisions of law specifically applica-

24 ble to Government corporations;



65



1 "(14) to collect or compromise any obligations

2 assigned to or held by the Corporation, including

3 any legal or equitable rights accruing to the Cor-

4 poration; and

5 "(15) to take such actions as may be necessary

6 or appropriate to carry out the powers of the Cor-

7 poration.

8 "(d) Exemption From State and Local Tax-

9 ation. — The Corporation (including its franchise, capital,

10 reserves, surplus, advances, intangible property, and in-

11 come) shall be exempt from all taxation at any time im-

1 2 posed by any State, the District of Columbia, or any coun-

13 ty, municipality, or local taxing authority.

14 "SEC. 239. ANNUAL REPORT; MAINTENANCE OF INFORMA-

15 TION.

16 "(a) Annual Report. —

17 "(1) Requirement. — After the end of each fis-

18 cal year, the Corporation shall submit to the Con-

19 gress a complete and detailed report of its oper-

20 ations during such fiscal year. Such report shall

21 include —

22 "(A) an assessment, based upon the devel-

23 opment impact profiles required by section

24 234(a), of the economic and social development

25 impact and benefits of the projects with respect



66



1 to which such profiles are prepared, and of the

2 extent to which the operations of the Corpora-

3 tion complement or are compatible with the de-

4 velopment assistance programs of the United

5 States and other donors; and

6 "(B) a description of any project for which

7 the Corporation —

8 "(i) refused pursuant to section

9 234(e) to provide insurance, reinsurance,

10 financing, or other financial support on ac-

1 1 count of violations of human rights; or

12 "(ii) notwithstanding such violations,

13 provided insurance, reinsurance, financing,

14 or financial support on the basis of a de-

15 termination that the exception under sec-

16 tion 116(a) applies, or the national secu-

1 7 rity so requires.

18 "(2) Projections op effects on employ-

19 ment. —

20 "(A) In general. — Each annual report

21 required by paragraph (1) shall contain projec-

22 tions of the effects on employment in the Unit-

23 ed States of all projects for which, during the

24 fiscal year covered by the report, the Corpora-

25 tion initially issued anv insurance or reinsur-



67

1 ance or provided financing. Each such report

2 shall include projections of —

3 "(i) the amount of United States ex-

4 ports to be generated by those projects,

5 both during the start-up phase and over a

6 period of years;

7 "(ii) the final destination of the prod-

8 ucts to be produced as a result of those

9 projects; and

10 "(iii) the impact such production will

1 1 have on the production of similar products

12 in the United States with regard to both

13 domestic sales and exports.

14 "(B) Basis for projections. — The pro-

15 jections required by this paragraph shall be

16 based on an analysis of each of the projects de-

17 scribed in subparagraph (A).

18 "(C) Manner op reporting effects on

19 EMPLOYMENT.— In reporting the projections on

20 employment required by this paragraph, the

21 Corporation shall specify, with respect to each

22 project —

23 "(i) any loss of jobs in the United

24 States caused by the project, whether or

25 not the project itself creates other jobs;



68



1 "(ii) any jobs created by the project;

2 and

3 "(iii) the country in which the project

4 is located, and the economic sector involved

5 in the project.

6 No proprietary information may be dis-

7 closed under this subparagraph.

8 "(3) Protection op Certain Informa-

9 TION. — Paragraph (2) does not require the inclusion

10 in any information which would not be required to

1 1 be made available to the public pursuant to section

12 552 of title 5, United States Code (relating to free-

13 dom of information).

14 "(b) Maintenance of Information. — The Cor-

1 5 poration shall maintain as part of its records —

16 "(1) all information collected in preparing the

17 report required by section 240A(c) of the Foreign

18 Assistance Act of 1961 (as in effect before the en-

19 actment of the Overseas Private Investment Cor-

20 poration Amendments Act of 1988), whether the in-

21 formation was collected by the Corporation itself or

22 by a contractor; and

23 "(2) a copy of the analysis of each project ana-

24 lyzed in preparing the projections required by sub-

25 section (a)(2) or the report required by section



69

1 240A(c) of the Foreign Assistance Act of 1961 (as

2 in effect before the enactment of the Overseas Pri-

3 vate Investment Corporation Amendments Act of

4 1988).

5 "SEC. 240. DEFINITIONS.

6 "As used in this title, the following terms have the

7 following meanings:

8 "(1) Board. — The term 'Board' means the

9 Board of Directors of the Corporation.

10 (2) CORPORATION. — The term 'Corporation'

1 1 means the Overseas Private Investment Corporation.

12 "(3) Eligible investor. — (A) The term 'eligi-

13 ble investor' means —

14 "(i) a United States citizen;

15 "(ii) a corporation, partnership, or other

16 association, including a nonprofit association,

17 which is created under the laws of the United

18 States, any State, the District of Columbia, or

19 any commonwealth, territory, or possession of

20 the United States, and which is substantially

21 beneficially owned by United States citizens;

22 and

23 "(ui) a foreign corporation, partnership, or

24 other association which is wholly owned by one

25 or more United States citizens or corporations,



70

1 partnerships, or other associations described in

2 clause (ii), except that the eligibility of any such

3 foreign corporation shall be determined without

4 regard to any shares held by other than United

5 States citizens or corporations, partnerships, or

6 other associations described in clause (ii) if, in

7 the aggregate, such shares equal less than 5

8 percent of the total issued and subscribed share

9 capital of such foreign corporation.

10 "(B) For purposes of this title —

11 "(i) in the case of insurance or a guaran-

12 tee for any loan investment, a final determina-

13 tion of whether a person is an eligible investor

14 may be made at the time the insurance or guar-

15 antee is issued; and

16 "(ii) in the case of insurance or a guaran-

17 tee for any other investment, an investor must

18 be an eligible investor at the time a claim arises

19 as well as the time the insurance or guarantee

20 is issued.

21 "(4) Expropriation. — The term 'expropria-

22 tion' includes any abrogation, repudiation, or impair-

23 ment by a foreign government of its own contract

24 with an investor with respect to a project, where

25 such abrogation, repudiation, or impairment is not



71



1 caused by the investor's own fault or misconduct,

2 and materially adversely affects the continued oper-

3 ation of the project.

4 "(5) Investment. — The term 'investment' in-

5 eludes any contribution or commitment of funds,

6 commodities, services, patents, processes, or tech-

7 niques, in the form of —

8 "(A) a loan or loans to an approved

9 project;

10 "(B) the purchase of a share of ownership

1 1 in any such project;

12 "(C) participation in royalties, earnings, or

13 profits of any such project; or

14 "(D) the furnishing of commodities or

15 services pursuant to a lease or other contract.

16 "(6) Noncredit ACTIVITIES. — The term

17 'noncredit activities' means all activities of the Cor-

18 poration other than its direct loan program under

19 section 233(b)(1) and its guarantee program under

20 section 233(b)(3).

21 "(7) Predecessor guarantee authority. —

22 The term 'predecessor guarantee authority' means

23 prior guarantee authorities (other than housing

24 guarantee authorities) repealed by the Foreign As-

25 sistance Act of 1969, sections 202(b) and 413(b) of



72

1 the Mutual Security Act of 1954, and section

2 111(b)(3) of the Economic Cooperation Act of 1948,

3 (exclusive of authority relating to informational

4 media guarantees).".

5 TITLE II -TRADE AND

6 DEVELOPMENT AGENCY

7 SEC. 201. TRADE AND DEVELOPMENT AGENCY.

8 (a) Purpose. — Section 661(a) of the Foreign Assist-

9 ance Act of 1961 (22 U.S.C. 2421(a)) is amended—

10 (1) in the first sentence, by inserting "inde-

1 1 pendent" before "agency"; and

12 (2) in the second sentence, by striking "develop-

13 ment projects" and all that follows and inserting

14 "developing and middle-income countries in ways

15 consistent with environmentally sound and broad-

16 based sustainable economic development.".

17 (b) Authority To Provide Assistance. — Section

18 661(b) of such Act (22 U.S.C. 2421(b)) is amended—

19 (1) in paragraph (1) —

20 (A) by striking ", including those in

21 which" and all that follows through "under part

22 I,": and

23 (B) by inserting "environmental assess-

24 ments," after "engineering design,":



73



1 (2) in the first sentence of the matter preceding

2 subparagraph (A) of paragraph (2), by inserting

3 "environmental assessments" after "to provide sup-

4 port for"; and

5 (3) in paragraph (3)(B)—

6 (A) by striking "Other agencies of the

7 United States Government" and inserting

8 "Other members of the Trade Promotion Co-

9 ordinating Committee"; and

10 (B) by inserting "Director of before "the

1 1 Trade and Development Agency".

12 (c) Director and Personnel. — Section 661(c)(1)

13 of such Act (22 U.S.C. 2421(c)(1)) is amended—

14 (1) by striking "There shall be" and inserting

15 "(A) There shall be"; and

16 (2) by adding at the end the following new sub-

17 paragraph:

18 "(B) The Director shall report directly to the

19 President.".

20 (d) Annual Report. — Section 661(d) of such Act

21 (22 U.S.C. 2421(d)) is amended by striking "President"

22 and inserting "Director of the Trade and Development

23 Agency".

24 (e) Funding.— Section 661(f)(1) of such Act (22

25 U.S.C. 2421(f)(1)) is amended—



74



1 (1) by striking "There are authorized" and in-

2 serting "(A) There are authorized";

3 (2) by striking "$55,000,000" and all that fol-

4 lows and inserting "$45,000,000 for fiscal year

5 1995, and $90,000,000 for fiscal year 1996."; and

6 (3) by adding at the end the following new sub-

7 paragraph:

8 "(B) Amounts appropriated pursuant to the au-

9 thorization of appropriations under subparagraph

10 (A) are authorized to remain available until ex-

1 1 pended.".

12 TITLE III -EXPORT PROMOTION

13 PROGRAMS WITHIN THE

14 INTERNATIONAL TRADE AD-

15 MINISTRATION

16 SEC. 301. EXPORT PROMOTION AUTHORIZATION.

17 Section 202 of the Export Administration Amend-

18 ments Act of 1985 (15 U.S.C. 4052) is amended to read

19 as follows:

20 "SEC. 202. AUTHORIZATION OF APPROPRIATIONS.

21 "There are authorized to be appropriated to the De-

22 partment of Commerce to carry out export promotion

23 programs —

24 "(1) $250,000,000 for fiscal year 1995: and

25 "(2) $275,000,000 for fiscal year 1996.".



75

i TITLE IV- PROMOTION OF UNIT-

2 ED STATES ENVIRONMENTAL

3 EXPORTS

4 SEC. 401. SHORT TITLE.

5 This title may be cited as the "Environmental Export

6 Promotion Act of 1994".

7 SEC. 402. PROMOTION OF ENVIRONMENTAL EXPORTS.

8 (a) Environmental Technologies Trade Advi-

9 sory Committee. — Section 2313 of the Export Enhance-

10 ment Act of 1988 (15 U.S.C. 4728) is amended—

11 (1) by striking subsection (d);

12 (2) by redesignating subsection (c) as sub-

13 section (e); and

14 (3) by inserting after subsection (b) the follow-

15 ing:

16 "(c) Environmental Technologies Trade Advt-

17 sory Committee. —

18 "(1) Establishment and purpose. — The

19 President shall establish the Environmental Tech-

20 nologies Trade Advisory Committee (hereafter in

21 this section referred to as the 'Committee'). The

22 purpose of the Committee shall be to provide advice

23 and guidance to the Working Group in the develop-

24 ment and administration of programs to expand



76



1 United States exports of environmental technologies,

2 goods, and services.

3 "(2) Membership. — The members of the Com-

4 mittee shall be drawn from representatives of —

5 "(A) environmental businesses, including

6 small businesses;

7 "(B) trade associations in the environ-

8 mental sector;

9 "(C) private sector organizations involved

10 in the promotion of environmental exports; and

11 "(D) other appropriate interested members

1 2 of the public.

13 "(d) Export Plans for Priority Countries. —

14 "(1) Priority country identification. —

15 The Working Group, in consultation with the Com-

16 mittee, shall annually assess which foreign countries

17 have markets with the greatest potential for the ex-

18 port of United States environmental technologies,

19 goods, and services. Of these countries the Working

20 Group shall select as priority countries 5 with the

21 greatest potential for the application of United

22 States Government export promotion resources relat-

23 ed to environmental exports.

24 "(2) EXPORT plans. — The Working Group, in

25 consultation with the Committee, shall annually ere-



77



1 ate a plan for each priority country selected under

2 paragraph (1), setting forth in detail ways to in-

3 crease United States environmental exports to such

4 country. Each such plan shall —

5 "(A) identify the primary public and pri-

6 vate sector opportunities for United States ex-

7 porters of environmental technologies, goods,

8 and sendees in the priority country;

9 "(B) analyze the financing and other re-

10 quirements for major projects in the priority

1 1 country which will use environmental tech-

12 nologies, goods, and services, and analyze

13 whether such projects are dependent upon fi-

14 nancial assistance from foreign countries or

15 multilateral institutions; and

16 "(C) list specific actions to be taken by the

17 member agencies of the Working Group to in-

18 crease United States exports to the priority

19 country.".

20 (b) Additional Mechanisms to Promote Envi-

21 ronmental Exports. — Section 2313 of the Export En-

22 hancement Act of 1988 is further amended by adding at

23 the end the following:



78



1 "(f) Environmental Technologies Specialists

2 in the United States and Foreign Commercial

3 Service. —

4 "(1) Assignment op environmental tech-

5 NOLOGIES SPECIALISTS. — The Secretary of Com-

6 merce shall assign a specialist in environmental tech-
nologies to the office of the United States and For-

8 eign Commercial Service in each of the 5 priority

9 countries selected under subsection (d)(1), and the

10 Secretary is authorized to assign such a specialist to

1 1 the office of the United States and Foreign Com-

12 mereial Sendee in any country that is a promising

13 market for United States exports of environmental

14 technologies, goods, and services. Such specialist

15 may be an employee of the Department, an employee

16 of any relevant United States Government depart-

17 ment or agency assigned on a temporary or limited

18 term basis to the Commerce Department, or a rep-

1 9 resentative of the private sector assigned to the De-

20 partment of Commerce.

21 "(2) Duties of envtronmental tech-

22 NOLOGIES SPECIALISTS. — Each specialist assigned

23 under paragraph (1) shall provide export promotion

24 assistance to United States environmental busi-

25 nesses, including, but not limited to —



79



1 "(A) identifying factors in the country to

2 which the specialist is assigned that affect the

3 United States share of the domestic market for

4 environmental technologies, goods, and services,

5 including market barriers, standards-setting ac-
1 2 3 4 5 6

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