Sec. 7. Protections against unlawful transshipment

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The President may not proclaim duty-free treatment described in section 6 for textile or apparel articles described in subsection

(b)of that section that are imported from a Reconstruction Opportunity Zone unless the President determines that the Government of Pakistan or Afghanistan, as the case may be— has adopted an effective visa or electronic certification system, domestic laws, and enforcement procedures applicable to such articles to prevent unlawful transshipment of the articles and the use of false documents relating to the importation of such articles into the United States; has enacted legislation or promulgated regulations that would permit U.S. Customs and Border Protection verification teams to have the access necessary to investigate thoroughly allegations of unlawful transshipment through Pakistan or Afghanistan, as the case may be; agrees to provide U.S. Customs and Border Protection with a monthly report on shipments of such articles from each facility engaged in the production of such articles in a Reconstruction Opportunity Zone; will cooperate fully with the United States to address and take action necessary to prevent circumvention, as described in article 5 of the Agreement on Textiles and Clothing; agrees to require each entity engaged in the production or manufacture of such articles in a Reconstruction Opportunity Zone— to register with the competent government authority; to provide that authority with— the name and address of the entity, including the location of all textile or apparel facilities owned or operated by that entity in Pakistan or Afghanistan, as the case may be; the telephone number, facsimile number, and electronic mail address of the entity; the names and nationalities of the owners, directors, and corporate officers of the entity, and their positions within the entity; the number of employees of the entity and their occupations; a general description of the textile and apparel articles described in section 6(b) the entity produces and the production capacity of the entity; the number and type of machines the entity uses to produce such articles at each facility; the approximate number of hours the machines operate per week; the identity of any supplier to the entity of such articles, or fabrics, yarns, or fibers used in the production of such articles; and the name of, and contact information for, each of the customers of the entity in the United States; and to update the information under clause

(ii)as changes occur; agrees to provide to U.S. Customs and Border Protection on a timely basis all of the information received by the competent government authority under subparagraph

(E)and to provide U.S. Customs and Border Protection with an annual update of that information; agrees to require that all producers and exporters of textile and apparel articles described in section 6(b) in a Reconstruction Opportunity Zone maintain complete records of the production and the export of such articles, including materials used in the production, for at least 5 years after the production or export (as the case may be); and agrees to provide, on a timely basis, at the request of U.S. Customs and Border Protection, documentation establishing the eligibility of such articles for duty-free treatment under section 6. For purposes of paragraph (1)(H), documentation establishing the eligibility of a textile or apparel article described in section 6(b) for duty-free treatment under section 6 includes documentation such as production records, information relating to the place of production, the number and identification of the types of machinery used in production, the number of workers employed in production, and certification from the manufacturer and the exporter. The Secretary of the Treasury, after consultation with the United States Trade Representative, shall prescribe regulations setting forth customs procedures similar in all material respects to the requirements of article 5.4 of the USMCA as implemented pursuant to United States law, which shall apply to any importer that claims duty-free treatment for an article under section 6. In order for articles produced in a Reconstruction Opportunity Zone to qualify for duty-free treatment under section 6, there shall be in effect a determination by the President that Pakistan or Afghanistan, as the case may be— has implemented and follows, or is making substantial progress toward implementing and following, procedures and requirements similar in all material respects to the relevant procedures and requirements under chapter 5 of the USMCA. A certificate of origin that otherwise would be required pursuant to the provisions of paragraph

(1)shall not be required in the case of an article imported under section 6 if such certificate of origin would not be required under article 5.5 of the USMCA, as implemented pursuant to United States law, if the article were imported from Mexico. If the President determines, based on sufficient evidence, that an entity has engaged in unlawful transshipment described in paragraph (4), the President shall deny for a period of 5 years beginning on the date of the determination duty-free treatment under section 6 for articles of the entity, any successor of the entity, and any other entity owned, operated, or controlled by the principals of the entity. For purposes of this section, unlawful transshipment occurs when duty-free treatment for a textile or apparel article described in section 6(b) has been claimed on the basis of material false information concerning the country of origin, manufacture, processing, or assembly of the article or any of its components. For purposes of the preceding sentence, false information is material if disclosure of the true information would mean or would have meant that the article is or was ineligible for duty-free treatment under section 6. The Commissioner of U.S. Customs and Border Protection shall monitor and, not later than March 31 of each year, submit to Congress a report on— the effectiveness of the visa or electronic certification systems and the implementation of legislation and regulations described in subsection (a); and measures taken by the governments of Pakistan and Afghanistan to prevent circumvention as described in article 5 of the Agreement on Textile and Clothing. The Commissioner of U.S. Customs and Border Protection shall— make available technical assistance to Pakistan and Afghanistan— in the development and implementation of visa or electronic certification systems, legislation, and regulations described in subparagraphs

(A)and

(B)of subsection (a)(1); and to train officials of Pakistan and Afghanistan in anti-transshipment enforcement; send production verification teams to Pakistan and Afghanistan as necessary; and to the extent feasible, include Pakistan and Afghanistan in the Electronic Certification System of U.S. Customs and Border Protection or other relevant electronic certification program. There is authorized to be appropriated to U.S. Customs and Border Protection to carry out this subsection $10,000,000 for each of fiscal years 2021 through 2031.