text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``United States-Japan Trade Equalizing 
  Act of 1993''.
  
                     TITLE I--FINDINGS AND DEFINITIONS
  
  SEC. 101. FINDINGS, PURPOSE, AND DISCLAIMERS.
  
      (a) Findings.--The Congress makes the following findings:
              (1) The United States trade deficit with Japan has 
          increased substantially over the past decade. In 1991, the 
          United States trade deficit with Japan was $43,400,000,000. The 
          trade deficit increased by 14 percent in 1 year, to over 
          $49,400,000,000 by the end of 1992.
              (2) The traditional domestic motor vehicle and motor 
          vehicle parts sector directly employs more than 1 million 
          workers and indirectly employs several million more. The 
          workers are skilled, hard working, productive, capable, and 
          proud of their work. The workers and their employers have 
          achieved great improvements in quality, performance, fuel 
          economy, safety, and design of domestic motor vehicles.
              (3) The domestic motor vehicle and motor vehicle parts 
          sector directly and indirectly accounts for about 12 percent of 
          our gross national product and generates more than 
          $200,000,000,000 a year in revenue.
              (4) The domestic motor vehicle and motor vehicle parts 
          sector is a major consumer of steel, glass, textiles, rubber, 
          aluminum, machine tools, chemicals, electronics, and other 
          important products.
              (5) Recognizing the competitive pressures facing the motor 
          vehicle industry, Japan has operated under a voluntary export 
          restraint arrangement since 1981 that has not been recognized 
          or enforced by the United States Government.
              (6) Since 1986 the United States Government has engaged, 
          with little result, in a negotiating process with the 
          Government of Japan to obtain fair access to the markets of 
          that nation for United States producers of motor vehicle parts 
          and manufacturers of motor vehicles.
              (7) Despite these negotiating efforts, in 1992 the United 
          States posted a $49,400,000,000 trade deficit with Japan of 
          which over $30,000,000,000 was accounted for by the automotive 
          sector deficit ($9,800,000,000 of which was attributable to 
          motor vehicle parts), and there is little evidence that the 
          Japanese Government is seriously trying to eliminate such 
          deficits which are detrimental to the United States economy and 
          jobs.
              (8) In addition to transplant assembly facilities in the 
          United States that are owned or controlled by Japanese persons, 
          motor vehicles and motor vehicle parts are being imported from 
          Japan into the United States in such increased quantities and 
          under such conditions as to cause, or threaten to cause, 
          serious injury to domestic manufacturers of like or directly 
          competitive products and to the domestic workers producing such 
          products.
              (9) In the last 5 years, transplant assembly facilities in 
          the United States that are owned or controlled by persons from 
          Japan have not shifted significantly their procurement to 
          traditional United States producers of motor vehicle parts, as 
          illustrated by the fact that--
                      (A) the United States automotive parts trade 
                  deficit with Japan grew between 1985 and 1990 at an 
                  annual average rate of 17 percent and totaled 
                  $9,800,000,000 in 1992; and
                      (B) only 12.5 percent of the customs value of 
                  vehicles manufactured in such transplant facilities in 
                  the United States is based on parts produced by 
                  traditional United States motor vehicle parts 
                  producers, while 35.1 percent of such value is based on 
                  imports from Japan and 32.4 percent of such value is 
                  based on purchases from Japanese-affiliated parts 
                  producers located in the United States.
              (10) The pattern of procurement described in paragraph (9) 
          has contributed significantly to the overall United States 
          merchandise trade deficit with Japan.
              (11) The continuation of current procurement practices by 
          automobile companies owned or controlled by persons from Japan 
          and the increased production of vehicles by transplant 
          facilities in the United States is projected to result in a 110 
          percent (or $21,990,000,000) increase in the United States 
          motor vehicle parts trade deficit by 1994.
              (12) Aftermarket parts are likely to account for 50 percent 
          of the motor vehicle parts trade deficit with Japan by 1994 
          because transplant facilities are not purchasing sufficient 
          quantities of original equipment from United States suppliers.
              (13) Traditional United States motor vehicle parts 
          manufacturers are particularly underrepresented in the 
          production of motor vehicles produced by transplant facilities 
          in the United States in the following 3 major, high value-added 
          vehicle systems:
                      (A) Engines.
                      (B) Transmissions.
                      (C) Body structures.
              (14) In the 1991 National Trade Estimates Report, the 
          United States Trade Representative listed ``close and durable 
          relationships'' between Japanese motor vehicle makers and 
          suppliers as a barrier to United States motor vehicle parts 
          sales in Japan.
              (15) The market share of Japanese motor vehicle 
          manufacturers in the European Community is currently 10 percent 
          while their market share in the United States is about 35 
          percent.
              (16) The European Community has negotiated an understanding 
          with the Government of Japan limiting the market share of motor 
          vehicles produced by Japanese motor vehicle manufacturing 
          companies both in Japan and in the European Community to less 
          than 16 percent until the year 2000.
              (17) The home market for motor vehicles and motor vehicle 
          parts in Japan remains largely closed to all foreign 
          manufacturers whose combined market share equals no more than 3 
          percent.
              (18) Japan's nontariff market barriers include onerous 
          inspection and certification systems that discriminate against 
          foreign-made motor vehicles and motor vehicle parts, a tax 
          system that discriminates against foreign-made products, closed 
          distribution systems and dealer networks, and government-
          tolerated ``Keiretsu'' relationships involving motor vehicle 
          and motor vehicle parts manufacturers and dealers. At the same 
          time, Japanese firms enjoy open markets in the United States 
          with no limitations or discrimination.
      (b) Purpose.--The purpose of this Act is to decrease the 
  merchandise trade deficit of the United States with Japan by providing 
  for a staged merchandise trade deficit reduction over a 5-year period.
      (c) Congressional Disclaimers.--It is the intent of Congress that 
  this Act shall not be deemed to modify or amend the terms or conditions 
  of any international treaty, convention, or agreement that may be 
  applicable to motor vehicles and motor vehicle parts and to which the 
  United States, on the date of the enactment of this Act, is a party, 
  including, but not limited to, the terms or conditions of any such 
  treaty, convention, or agreement which provide for the resolution of 
  conflicts between the parties thereto. Nothing in this Act shall be 
  construed (1) to confer jurisdiction upon any court of the United 
  States to consider and resolve such conflicts, or (2) to alter or amend 
  any law existing on the date of the enactment of this Act which may 
  confer such jurisdiction in such courts.
  
  SEC. 102. DEFINITIONS.
  
      For purposes of this Act:
              (1) Motor vehicle and motor vehicle parts.--
                      (A) The term ``motor vehicle'' means any article of 
                  a kind described in heading 8703 or 8704 of the 
                  Harmonized Tariff Schedule of the United States.
                      (B) The term ``motor vehicle parts'' means any 
                  article of a kind described in the following provisions 
                  of the Harmonized Tariff Schedule of the United States 
                  if suitable for use in the manufacture or repair of 
                  motor vehicles:
                              (i) Subheadings 8407.31.00 through 
                          8407.34.20 (relating to spark-ignition 
                          reciprocating or rotary internal combustion 
                          piston engines).
                              (ii) Subheading 8408.20 (relating to the 
                          compression-ignition internal combustion 
                          engines).
                              (iii) Subheading 8409 (relating to parts 
                          suitable for use solely or principally with 
                          engines described in clauses (i) and (ii)).
                              (iv) Subheading 8483 (relating to 
                          transmission shafts and related parts).
                              (v) Subheadings 8706.00.10 and 8706.00.15 
                          (relating to chassis fitted with engines).
                              (vi) Heading 8707 (relating to motor 
                          vehicle bodies).
                              (vii) Heading 8708 (relating to bumpers, 
                          brakes and servo brakes, gear boxes, drive 
                          axles, nondriving axles, road wheels, 
                          suspension shock absorbers, radiators, mufflers 
                          and exhaust pipes, clutches, steering wheels, 
                          steering columns, steering boxes, and other 
                          parts and accessories of motor vehicles).
                  The Secretary shall by regulation include as motor 
                  vehicle parts such other articles (described by 
                  classification under such Harmonized Tariff Schedule) 
                  that the Secretary considers appropriate for the 
                  purposes of this Act.
                      (C)(i) The term ``Japanese motor vehicle'' means a 
                  motor vehicle which is the product of Japan.
                      (ii) The term ``Japanese motor vehicle part'' means 
                  a motor vehicle part which is the product of Japan.
              (2) Entered.--The term ``entered'' means entered, or 
          withdrawn from warehouse for consumption, in the customs 
          territory of the United States.
              (3) Import restriction implementation period.--The term 
          ``import restriction implementation period'' means a calendar 
          year which--
                      (A) occurs after 1994 and before calendar year 
                  2001, and
                      (B) follows a calendar year with respect to which 
                  the Secretary finds, under section 201(b), that the 
                  trade deficit reduction target was not met.
              (4) Interstate sale.--The term ``interstate sale'' means 
          sale or distribution in the interstate commerce of the United 
          States.
              (5) Baseline deficit.--(A) The term ``baseline deficit'' 
          means the average monthly merchandise trade deficit, as 
          computed by the Secretary, of the United States with Japan 
          during calendar year 1993.
              (B) In computing merchandise trade deficits under this 
          section, the value of bilateral trade between the United States 
          and Japan in--
                      (i) crude petroleum; and
                      (ii) nonmonetary gold;
          shall not be included.
              (6) Secretary.--The term ``Secretary'' means the Secretary 
          of Commerce.
              (7) Trade representative.--The term ``Trade 
          Representative'' means the United States Trade Representative.
  
               TITLE II--MERCHANDISE TRADE DEFICIT REDUCTION
  
  SEC. 201. STAGED TRADE DEFICIT REDUCTION.
  
      (a) Trade Deficit Reduction Targets.--
              (1) In general.--The trade deficit reduction target for 
          each of the calendar years listed below is an average monthly 
          merchandise trade deficit of the United States with Japan 
          during such year that does not exceed an amount that equals the 
          applicable percentage of the baseline deficit that appears 
          opposite such year:
  
  Calendar year                       Applicable percentage of baseline 
                                              deficit
      1994..........................................           80 percent
      1995..........................................           60 percent
      1996..........................................           40 percent
      1997..........................................           20 percent
      1998..........................................            0 percent
              (2) Special rule for 1998.--For calendar year 1998, the 0 
          percent trade deficit reduction target shall be treated as 
          having been met if the merchandise trade deficit of the United 
          States with Japan during such year does not exceed--
                      (A) an amount equal to 5 percent of the value of 
                  the aggregate bilateral merchandise trade between the 
                  United States and Japan during such year; or
                      (B) $5,000,000,000.
      (b) Computations.--
              (1) In general.--Not later than January 1 following each 
          calendar year listed in subsection (a)(1), the Secretary shall 
          compute whether the trade deficit reduction target for such 
          year was met.
              (2) Announcement of import restriction implementation 
          period.--If the Secretary finds under paragraph (1) that the 
          trade deficit reduction target specified under subsection (a) 
          for a calendar year was not met, the Secretary shall announce, 
          by publication in the Federal Register, that the import 
          restriction implementation period is in effect beginning on 
          January 1 of the year after the year to which the finding 
          applies.
  
  SEC. 202. COMPUTATION OF IMPORT RESTRICTIONS IF TRADE DEFICIT REDUCTION 
                TARGET NOT MET.
  
      (a) In General.--On January 1 of the first calendar year (and each 
  calendar year thereafter) for which an import restriction 
  implementation period is in effect, the Secretary shall compute and 
  publish in the Federal Register the quantitative import restrictions 
  for such calendar year.
      (b) Computation.--
              (1) In general.--For purposes of subsection (a), the term 
          ``quantitative import restrictions'' means the aggregate 
          quantity of Japanese motor vehicles and the aggregate quantity 
          of Japanese motor vehicle parts that may be entered into the 
          United States (in accordance with paragraph (2) or (3)) for a 
          calendar year described in subsection (a).
              (2) First year restrictions.--The aggregate quantity of 
          Japanese motor vehicles and Japanese motor vehicle parts that 
          may be entered into the United States, during the first 
          calendar year for which an import restriction implementation 
          period is in effect, may not exceed the aggregate quantity of 
          such motor vehicles and the aggregate quantity of such motor 
          vehicle parts entered into the United States during 1993, 
          reduced by 20 percent.
              (3) Subsequent years.--In the case of any calendar year for 
          which an import restriction period is in effect after the first 
          such calendar year, the aggregate quantity of Japanese motor 
          vehicles and Japanese motor vehicle parts that may be entered 
          into the United States shall not exceed the amount of such 
          motor vehicles and motor vehicle parts entered during the most 
          recent preceding calendar year for which an import restriction 
          implementation period was in effect, reduced by 20 percent.
              (4) Administration.--In order to prevent import surging or 
          to otherwise ensure the efficient administration of this Act, 
          the Secretary may impose temporary quantitative import 
          restrictions on Japanese motor vehicles and Japanese motor 
          vehicle parts entered during the first 3 months of a calendar 
          year in an import restriction implementation period.
  
  SEC. 203. REPORTS.
  
      Within 30 days after a computation is made under section 201 or 202 
  with respect to a calendar year, the Secretary shall submit to the 
  Congress a report setting forth the bases of the computation.
  
  SEC. 204. SENSE OF CONGRESS REGARDING ACHIEVEMENT OF MERCHANDISE TRADE 
                DEFICIT REDUCTION TARGETS.
  
      It is the sense of the Congress that representatives of the United 
  States and Japanese Governments should undertake continuing discussions 
  regarding the means and measures, to be selected by the Japanese 
  Government, to achieve the merchandise trade deficit reduction targets 
  required under section 201(a). During the discussions, the Trade 
  Representative should particularly address market access priorities for 
  United States exports to Japan.
target: TABLE OF CONTENTS: 
       Title I:  Findings and Definitions 
       Title II:  Merchandise Trade Deficit Reduction 
  United States-Japan Trade Equalizing Act of 1993 - 
  Title I: Findings and Definitions
   - Sets forth congressional findings and purposes with respect to access to Japanese markets by U.S. manufacturers of motor vehicles and motor vehicle parts. 
  Title II:  Merchandise Trade Deficit Reduction
   - Sets forth annual merchandise trade deficit reduction targets with respect to Japan's trade deficit with the United States.  Requires the Secretary of Commerce to:  (1) compute annually whether the target has been met for each year; (2) publish in the Federal Register that the import restriction implementation period is in effect for the year following the year a target has not been met; and (3) compute annually and publish in the Federal Register the quantitative import restrictions for years in which import restrictions are effective. 
  Prohibits the quantity of Japanese motor vehicles and parts that may be entered into the United States in:  (1) the first year in which a restriction is in effect from exceeding the quantity of such vehicles and parts entered during 1993, reduced by 20 percent; and (2) subsequent years from exceeding the quantity entered during the most recent year for which a restriction was in effect, reduced by 20 percent. 
  Authorizes the Secretary to impose temporary quantitative import restrictions on such motor vehicles and parts during the first three months of an import restriction implementation period in order to prevent surging. 
  Expresses the sense of the Congress that representatives of the U.S. and Japanese Governments should undertake continuing discussions regarding the measures to be selected by the Japanese Government to achieve the merchandise trade deficit reduction targets.
feat_title: United States-Japan Trade Equalizing Act of 1993