Sec. 602. Leveling playing field for domestic manufacturers
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Not later than 1 year after the date of enactment of this Act, the Administrator, by regulation, shall designate, in accordance with paragraph
(2)and with the advice of the Council, each eligible industrial sector that is subject to a climate duty under this section. An industrial sector shall be an eligible industrial sector if the industrial sector— is— energy-intensive; and trade-intensive; or has an energy intensity of not less than 20 percent, as determined by the Council, based on the quotient obtained by dividing, as determined using the average of the 3 most recent calendar years for which data are available— the cost of electricity and fuel purchased by the industrial sector; by the value of the sales of the industrial sector. Not later than 1 year after the date of enactment of this Act, and not less frequently than once every 3 years thereafter, the Administrator shall publish or update, as applicable, in the Federal Register a list of eligible industrial sectors designated under paragraph (1). The President, in consultation with the Administrator, with the concurrence of the Council and the Commissioner of U.S. Customs and Border Protection, shall promulgate regulations that— establish— a list of countries from which the United States imports covered goods; a methodology for calculating— the incremental cost of producing covered goods in— the United States; and each foreign country included on the list under clause (i); and subject to subsection (c)(3)(A), the amount of the climate duty to be imposed on imports of covered goods from each eligible industrial sector; a list of the climate duties to be applied to imports from each eligible industrial sector, as determined in accordance with the methodology under clause (ii)(II); and procedures to prevent circumvention of the climate duty for a covered good that is manufactured or processed in more than 1 foreign country; subject to subsection (c)(3)(B), require the payment of an appropriate climate duty for the importation into the customs territory of the United States of covered goods; and describe the procedures to be applied by U.S. Customs and Border Protection relating to the declaration and entry of covered goods into the customs territory of the United States. Not less frequently than once every 3 years, the President, with the advice of the Council, shall publish in the Federal Register revised incremental cost calculations for the United States and foreign countries, to be determined in accordance with paragraph (1)(A)(ii)(I), as necessary to account for any modifications during the preceding 3 calendar years to applicable climate- and energy-related laws (including regulations). The owner or operator of an entity that imports a covered good shall pay to the Commissioner of U.S. Customs and Border Protection the climate duty required under subsection
(b)with respect to the applicable eligible industrial sector. The owner or operator of an entity that imports a covered good may submit to the President a petition for a waiver of the climate duty required for the covered good under this subsection. The President shall provide to an owner or operator the waiver requested in a petition submitted under subparagraph (A), if the owner or operator demonstrates to the satisfaction of the President that the covered good imported by the owner or operator has an energy intensity or trade intensity, as calculated in accordance with paragraph
(5)or (8), respectively, of section 601(b), equal to less than the energy intensity or trade intensity calculated for the overall eligible industrial sector in which the covered good is classified. A climate duty imposed on the importation of a covered good pursuant to this subsection shall not exceed an amount equal to the incremental cost of domestic production of the covered good, as determined in accordance with subsection (b)(1)(A)(ii)(I). A product that originates from a foreign country that meets any of the following criteria shall be exempt from a climate duty under this subsection: The United Nations has identified the country as among the least developed of developing countries. The country has been determined to be responsible for less than 0.5 percent of total global greenhouse gas emissions. The country has been determined to be responsible for less than 5 percent of United States imports for an eligible industrial sector. The country is a party to an international agreement to which the United States is also a party that includes a nationally enforceable and economywide greenhouse gas emissions reduction commitment for that country, which is at least as stringent as the commitment of the United States. The country is party to a multilateral or bilateral emissions reduction agreement to which the United States is also a party relating to an applicable eligible industrial sector. The country has an annual energy intensity, as calculated in accordance with section 601(b)(5), for an eligible industrial sector that is not greater than the energy intensity for the eligible industrial sector in the United States during the most recent 3-calendar-year period for which data are available.