EXPLANATION OF H. J. RES. 101
DISAPPROVING THE EXTENSION OF THE WAIVER AUTHORITY
 CONTAINED IN SECTION 402(c) OF THE TRADE ACT OF 1974
WITH RESPECT TO VIETNAM

Present law

Vietnam's trade status is subject to the "Jackson-Vanik" provisions in Title IV of the Trade Act of 1974 (the Act). This provision of law governs the extension of normal trade relations (NTR), including NTR tariff treatment, and access to U.S. Government credits, or credit or investment guarantees, to nonmarket economy countries ineligible for NTR treatment as of the enactment of the Act. A country subject to the provision may gain coverage by U.S. trade financing programs by complying with the freedom of emigration provisions under the Act, or by receiving a waiver of such requirements by the President.

The Act authorizes the President to waive the freedom of emigration requirements with respect to a particular country if he determines that a waiver will substantially promote the freedom of emigration provisions, and if he has received assurances that the emigration practices of the country will lead substantially to the achievement of those objectives. This waiver gives U.S. exporters doing business in Vietnam access to U.S. Government credits, or credit or investment guarantees, such as those administered by the Overseas Private Investment Corporation, the Export-Import Bank, and the U.S. Department of Agriculture, provided Vietnam meets the eligibility criteria.

The extension of NTR tariff treatment also requires the conclusion and approval by Congress of a bilateral commercial agreement with the United States providing for reciprocal nondiscriminatory treatment. The U.S.-Vietnam Bilateral Trade Agreement (BTA) entered into force on December 10, 2001.

The President's waiver expires at midnight on July 2 of each year and may be extended on an annual basis. On June 3, 2002, the President issued a 12-month renewal of the waiver for Vietnam for the period July 3, 2002 through July 2, 2003. If both chambers of Congress do not pass a resolution of disapproval within the 60 calendar days following the expiration of the existing waiver authority (i.e., September 1, 2001), the President's waiver is automatically renewed through July 2, 2003. If a resolution of disapproval is enacted, it becomes effective 60 days after enactment.

Procedures

• If the President determines that a waiver extension will substantially promote the freedom of emigration objectives in the Act, he must submit to Congress a recommendation for a 12-month extension no later than 30 days prior to the waiver's expiration (i.e., June 3).

• A Jackson-Vanik waiver continues in effect unless disapproved by Congress within 60 calendar days after the expiration of the existing waiver (i.e., September 1).

• Disapproval takes the form of a joint resolution disapproving extension of the Presidential waiver. The text of the disapproval resolution is set forth in the Act and must be voted on in that form. It is not amendable except to add or subtract country names.

• House Action: The Committee on Ways and Means must report a resolution of disapproval (either favorably or unfavorably) within 30 calendar days after its introduction or be subject to discharge after that period. On the floor, a motion to proceed to the consideration of the resolution is highly privileged and is not debatable. Amendments to the motion are not in order, except to change country names. Floor debate is limited to 20 hours.

• Senate Action: The Finance Committee must report a resolution of disapproval within 30 calendar days after its introduction. Floor procedures are identical to the House.

• If the Senate resolution was introduced before receipt of the House resolution, the House resolution will be placed on the calendar when received.

• If the Senate passes a resolution before receiving an identical House resolution, it will be held at the desk. The House resolution will be deemed passed as soon as it is received.

• If the Senate and House resolutions are not identical, the Senate will vote on its version and request a conference.

• If the President vetoes the joint resolution, Congress may still disapprove the waiver if each House votes to override the veto on or before the later of: the last day of the 60-day period (September 1); or the last day of a 15-day period beginning on the date Congress receives the veto message.

Explanation of resolution

House Joint Resolution 101 states that Congress does not approve the extension of the authority contained in section 402(c) of the Trade Act of 1974, recommended by the President to Congress on June 3, 2002, with respect to Vietnam.