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d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d3|x (>m-$XXXXXXAcrobat Distiller,,,,0!r[0s 3#37=CIQYag1.a.i.(1)(a)(i)1)a)Y i)W0U T m-!Xm4XXm4XXXm4  _&    I7XXm4I7I7      ' wT     Xm4XI7Xm4XXXm4    &    I7XXm4I7I7       I7AppendixC:DefenseOffsetsDisclosureActof1999#I7I# co<' T     Xm4XI7Xm4XXXm4          2 ` XBXXXm4 PublicLaw106113 : ^ `   TitleXII  &  SubtitleD--DefenseOffsetsDisclosure       5rXXBSEC.1241.SHORTTITLE. Z~  ̀Thissubtitlemaybecitedasthe DefenseOffsetsDisclosureActof   1999. Lp    5r5r5r5r      SEC.1242.FINDINGSANDDECLARATIONOFPOLICY.   \any    5r5r5r5r      a)Findings.--Congressmakesthefollowingfindings:   0  (1)Afairbusinessenvironmentisnecessarytoadvance (#(# Ѐinternationaltrade,economicstability,anddevelopment 0T Ѐworldwide,isbeneficialforAmericanworkersandbusinesses,  ЀandisintheUnitedStatesnationalinterest. | Ѐ(2)Insomecases,mandatedoffsetrequirementscancause "F Ѐeconomicdistortionsininternationaldefensetradeand  Ѐunderminefairnessandcompetitiveness,andmaycauseparticular n Ѐharmtosmall-andmedium-sizedbusinesses. 8 Ѐ(3)Theuseofoffsetsmayleadtoincreasingdependenceon  ЀforeignsuppliersfortheproductionofUnitedStatesweapons ` Ѐsystems. * Ѐ(4)Theoffsetdemandsrequiredbysomepurchasing  Ѐcountries,includingsomeclosealliesoftheUnitedStates, Rv  Ѐequalorexceedthevalueofthebasecontracttheyareintended ! Ѐtooffset,mitigatingmuchofthepotentialeconomicbenefitof " Ѐtheexports. Dh# Ѐ(5)Offsetdemandsoftenundulydistortthepricesof $ Ѐdefensecontracts. % Ѐ(6)Insomecases,UnitedStatescontractorsarerequiredto 6Z& Ѐprovideindirectoffsetswhichcannegativelyimpact_nondefense_Ԁ ' Ѐindustrialsectors.  ( Ѐ(7)UnilateraleffortsbytheUnitedStatestoprohibit (!L) Ѐoffsetsmaybeimpracticalinthecurrenteraofglobalization !* ЀandwouldseverelyhinderthecompetitivenessoftheUnited t"+ ЀStatesdefenseindustryintheglobalmarket. #>, Ѐ(8)Thedevelopmentofglobalstandardstomanageand #- ЀrestrictdemandsforoffsetswouldenhanceUnitedStatesefforts f$. Ѐtomitigatethenegativeimpactofoffsets.  %0/   b)DeclarationofPolicy.--ItisthepolicyoftheUnitedStatesto X&| 1 monitortheuseofoffsetsininternationaldefensetrade,topromote &"!2 fairnessinsuchtrade,andtoensurethatforeignparticipationinthe '!3 productionofUnitedStatesweaponssystemsdoesnotharmtheeconomyof J(n"4 theUnitedStates. (#5 SEC.1243.DEFINITIONS. <*`$7 ̀Inthissubtitle: +%9 Ѐ(1)Appropriatecongressionalcommittees.--Theterm .,R&: Ѐ appropriatecongressionalcommitteesmeans-- ,&; Ѐ(A)theCommitteeonForeignRelationsofthe z-'< ЀSenate;and  .D(= _Ԁ(B)theCommitteeonInternationalRelationsofthe  ЀHouseofRepresentatives.  Ѐ(2)G-8.--Theterm G-8meansthegroupconsistingof (L ЀFrance,Germany,Japan,theUnitedKingdom,theUnitedStates,  ЀCanada,Italy,andRussiaestablishedtofacilitateeconomic t Ѐcooperationamongtheeightmajoreconomicpowers.  > Ѐ(3)Offset.--Theterm offsetmeanstheentirerangeof   Ѐindustrialandcommercialbenefitsprovidedtoforeign f  Ѐgovernmentsasaninducementorconditiontopurchasemilitary  0 Ѐgoodsorservices,includingbenefitssuchascoproduction,    Ѐlicensedproduction,subcontracting,technologytransfer,in- X |  Ѐcountryprocurement,marketingandfinancialassistance,and  "  Ѐjointventures.    Ѐ(4)Transatlanticeconomicpartnership.--Theterm Jn  Ѐ TransatlanticEconomicPartnershipmeansthejoint   ЀcommitmentmadebytheUnitedStatesandtheEuropeanUnionto   Ѐreinforcetheircloserelationshipthroughaninitiative <`  Ѐinvolvingtheintensificationandextensionofmultilateraland   Ѐbilateralcooperationandcommonactionsintheareasoftrade   Ѐandinvestment. .R  Ѐ(5)Wassenaararrangement.--Theterm Wassenaar   ЀArrangementmeansthemultilateralexportcontrolregimein z  ЀwhichtheUnitedStatesparticipatesthatseekstopromote  D Ѐtransparencyandresponsibilitywithregardtotransfersof  Ѐconventionalarmamentsandsensitivedual-useitems. l Ѐ(6)Worldtradeorganization.--Theterm WorldTrade 6 ЀOrganizationmeanstheorganizationestablishedpursuantto  ЀtheWTOAgreement. ^ Ѐ(7)WTOagreement.--Theterm WTOAgreementmeansthe ( ЀAgreementEstablishingtheWorldTradeOrganizationenteredinto  ЀonApril15,1994. Pt SEC.1244.SENSEOFCONGRESS.   ̀ItisthesenseofCongressthat--  " Ѐ(1)theexecutivebranchshouldpursueeffortstoaddress # Ѐtradefairnessbyestablishingreasonable,business-friendly 4X$ Ѐstandardsfortheuseofoffsetsininternationalbusiness % ЀtransactionsbetweentheUnitedStatesanditstradingpartners & Ѐandcompetitors; &J' [[Page113STAT.1501A-502]] r ) ̀(2)theSecretaryofDefense,theSecretaryofState,the !+ ЀSecretaryofCommerce,andtheUnitedStatesTrade d", ЀRepresentative,ortheirdesignees,shouldraisewithother  #.- Ѐindustrializednationsateverysuitablevenuetheneedfor #. Ѐtransparencyandreasonablestandardstogoverntheroleof V$z/ Ѐoffsetsininternationaldefensetrade; $ 0 Ѐ(3)theUnitedStatesGovernmentshouldenterinto %1 Ѐdiscussionsregardingtheestablishmentofmultilateral H&l 2 Ѐstandardsfortheuseofoffsetsininternationaldefensetrade &!3 Ѐthroughtheappropriatemultilateralfora,includingsuch '!4 ЀorganizationsastheTransatlanticEconomicPartnership,the :(^"5 ЀWassenaarArrangement,theG-8,andtheWorldTrade (#6 ЀOrganization;and )#7 Ѐ(4)theUnitedStatesGovernment,inenteringintothe ,*P$8 Ѐdiscussionsdescribedinparagraph(3),shouldtakeintoaccount *$9 Ѐthedistortionsproducedbytheprovisionofotherbenefitsand x+%: Ѐsubsidies,suchasexportfinancing,byvariouscountriesto ,B&; Ѐsupportdefensetrade. ,&< SEC.1245.REPORTINGOFOFFSETAGREEMENTS. .4(> Ї(a)InitialReportingofOffsetAgreements.--  Ѐ(1)Government-to-governmentsales.--Section36(b)(1)ofthe  ЀArmsExportControlAct(22U.S.C.2776(b)(1))isamendedin (L Ѐsubparagraph(C)ofthefifthsentence,bystriking anda  Ѐdescriptionandallthatfollowsandinserting anda t Ѐdescriptionofanyoffsetagreementwithrespecttosuch  > Ѐsale;.   Ѐ(2)Commercialsales.--Section36(c)(1)oftheArmsExport f  ЀControlAct(22U.S.C.2776(c)(1))isamendedinthesecond  0 Ѐsentence,bystriking ifknownonthedateoftransmittalof    Ѐsuchcertification)andinserting andadescriptionofany X |  Ѐsuchoffsetagreement.  "  ̀(b)ConfidentialityofInformationRelatingtoOffsetAgreements.-- Jn  Section36oftheArmsExportControlAct(22U.S.C.2776)isamended--   Ѐ(1)byredesignatingthesecondsubsection(e)(asaddedby   Ѐsection155ofPublicLaw104-164)assubsection(f);and <`  Ѐ(2)byaddingattheendthefollowingnewsubsection:   ̀ (g)Informationrelatingtooffsetagreementsprovidedpursuantto .R  subparagraph(C)ofthefifthsentenceofsubsection(b)(1)andthe   secondsentenceofsubsection(c)(1)shallbetreatedasconfidential z  informationinaccordancewithsection12(c)oftheExport  D AdministrationActof1979(50U.S.C.App.2411(c))..  SEC.1246.EXPANDEDPROHIBITIONONINCENTIVEPAYMENTS. 6 ̀(a)InGeneral.--Section39A(a)oftheArmsExportControlAct(22 ^ U.S.C.2779a(a))isamended-- ( Ѐ(1)byinserting orlicensedafter sold;and  Ѐ(2)byinserting orexportafter sale. Pt ̀(b)DefinitionofUnitedStatesPerson.--Section39A(d)(3)(B)(ii)of   theArmsExportControlAct(22U.S.C.2779a(d)(3)(B)(ii))isamendedby Bf! inserting orbyanentitydescribedinclause(i)after  "  subparagraph(A). # SEC.1247.ESTABLISHMENTOFREVIEWCOMMISSION. % ̀(a)InGeneral.--ThereisestablishedaNationalCommissiononthe &J' UseofOffsetsinDefenseTrade(inthissectionreferredtoasthe (  Commission)toaddressallaspectsoftheuseofoffsets r ) ininternationaldefensetrade. !<* Ѐ(b)CommissionMembership.--Notlaterthan120daysafterthedate !+ ofenactmentofthisAct,thePresident,withtheconcurrenceofthe d", MajorityandMinorityLeadersoftheSenateandtheSpeakerandMinority  #.- LeaderoftheHouseofRepresentatives,shallappoint11individualsto #. serveasmembersoftheCommission.Commissionmembershipshall V$z/ include-- $ 0 Ѐ(1)representativesfromtheprivatesector,including-- %1 Ѐ(A)oneeachfrom-- H&l 2 Ѐ(i)alabororganization, &!3 Ѐ(ii)aUnitedStatesdefensemanufacturing '!4 Ѐcompanydependentonforeignsales, :(^"5 Ѐ(iii)aUnitedStatescompanydependenton (#6 Ѐforeignsalesthatisnotadefensemanufacturer, )#7 Ѐand ,*P$8 Ѐ(iv)aUnitedStatescompanythatspecializes *$9 Ѐininternationalinvestment,and x+%: Ѐ(B)twomembersfromacademiawithwidelyrecognized ,B&; Ѐexpertiseininternationaleconomics;and ,&< Ѐ(2)fivemembersfromtheexecutivebranch,includinga j-'= Ѐmemberfrom-- .4(> Ѐ(A)theOfficeofManagementandBudget,  Ѐ(B)theDepartmentofCommerce,  Ѐ(C)theDepartmentofDefense, (L Ѐ(D)theDepartmentofState,and  Ѐ(E)theDepartmentofLabor. t ThememberdesignatedfromtheOfficeofManagementandBudgetshall   serveasChairpersonoftheCommission.ThePresidentshallensurethat f  theCommissionisnonpartisanandthatthefullrangeofperspectiveson  0 thesubjectofoffsetsinthedefenseindustryisadequately    represented. X |  Ѐ(c)Duties.--TheCommissionshallberesponsibleforreviewingand  "  reportingon--    Ѐ(1)thefullrangeofcurrentpracticesbyforeigngovernments Jn  Ѐinrequiringoffsetsinpurchasingagreementsandtheextentand   ЀnatureofoffsetsofferedbyUnitedStatesandforeigndefense   Ѐindustrycontractors; <`  Ѐ(2)theimpactoftheuseofoffsetsondefense   Ѐsubcontractorsandnondefenseindustrialsectorsaffectedby   Ѐindirectoffsets;and .R  Ѐ(3)theroleofoffsets,bothdirectandindirect,on   Ѐdomesticindustrystability,UnitedStatestradecompetitiveness z  Ѐandnationalsecurity.  D ̀(d)CommissionReport.--Notlaterthan12monthsafterthe l Commissionisestablished,theCommissionshallsubmitareporttothe 6 appropriatecongressionalcommittees.Inadditiontotheitemsdescribed  undersubsection(c),thereportshallinclude-- ^ Ѐ(1)ananalysisof-- ( Ѐ(A)thecollateralimpactofoffsetsonindustry  Ѐsectorsthatmaybedifferentthanthoseofthe Pt Ѐcontractorprovidingtheoffsets,includingestimatesof  Ѐcontractsandjobslostaswellasanassessmentof   Ѐdamagetoindustrialsectors; Bf! Ѐ(B)theroleofoffsetswithrespectto  " ЀcompetitivenessoftheUnitedStatesdefenseindustryin # Ѐinternationaltradeandthepotentialdamagetothe 4X$ ЀabilityofUnitedStatescontractorstocompeteif % Ѐoffsetswereprohibitedorlimited;and & Ѐ(C)theimpactonUnitedStatesnationalsecurity, &J' ЀanduponUnitedStatesnonproliferationobjectives,of ( Ѐtheuseofcoproduction,subcontracting,andtechnology r ) Ѐtransferwithforeigngovernmentsorcompaniesthat !<* Ѐresultsfromfulfillingoffsetrequirements,with !+ Ѐparticularemphasisonthequestionofdependencyupon d", Ѐforeignnationsforthesupplyofcriticalcomponentsor  #.- Ѐtechnology; #. Ѐ(2)proposalsforunilateral,bilateral,ormultilateral V$z/ Ѐmeasuresaimedatreducinganydetrimentaleffectsofoffsets; $ 0 Ѐand %1 Ѐ(3)anidentificationoftheappropriateexecutivebranch H&l 2 Ѐagenciestoberesponsibleformonitoringtheuseofoffsetsin &!3 Ѐinternationaldefensetrade. '!4 ̀(e)PeriodofAppointment;Vacancies.--Membersshallbeappointed (#6 forthelifeoftheCommission.AnyvacancyintheCommissionshallnot )#7 affectitspowers,butshallbefilledinthesamemannerasthe ,*P$8 originalappointment. *$9 Ѐ(f)InitialMeeting.--Notlaterthan30daysafterthedateonwhich x+%: allmembersoftheCommissionhavebeenappointed,theCommissionshall ,B&; holditsfirstmeeting. ,&< Ѐ(g)Meetings.--TheCommissionshallmeetatthecallofthe j-'= Chairman. .4(> Ѐ(h)CommissionPersonnelMatters.--  Ѐ(1)Compensationofmembers.--EachmemberoftheCommission  ЀwhoisnotanofficeroremployeeoftheFederalGovernment (L Ѐshallbecompensatedatarateequaltothedailyequivalentof  ЀtheannualrateofbasicpayprescribedforlevelIVofthe t ЀExecutiveScheduleundersection5315oftitle5,UnitedStates  >    5r5r5r      5rԀCode,foreachday(includingtraveltime)duringwhichsuch    Kori    5r5r5r5r    ݀memberisengagedintheperformanceofthedutiesofthe f  ЀCommission.AllmembersoftheCommissionwhoareofficersor  0 ЀemployeesoftheUnitedStatesshallservewithoutcompensation    Ѐinadditiontothatreceivedfortheirservicesasofficersor X |  ЀemployeesoftheUnitedStates.  "  Ѐ(2)Travelexpenses.--ThemembersoftheCommissionshallbe    Ѐallowedtravelexpenses,includingperdieminlieuof Jn  Ѐsubsistence,atratesauthorizedforemployeesofagenciesunder   ЀsubchapterIofchapter57oftitle5,UnitedStatesCode,while   Ѐawayfromtheirhomesorregularplacesofbusinessinthe <`  ЀperformanceofservicesfortheCommission.   Ѐ(3)Staff.--   Ѐ(A)Ingeneral.--TheChairmanoftheCommissionmay, .R  Ѐwithoutregardtothecivilservicelawsand   Ѐregulations,appointandterminateanexecutivedirector z  Ѐandsuchotheradditionalpersonnelasmaybenecessary  D ЀtoenabletheCommissiontoperformitsduties.The  Ѐemploymentofanexecutivedirectorshallbesubjectto l ЀconfirmationbytheCommission. 6 Ѐ(B)Compensation.--TheChairmanoftheCommission  Ѐmayfixthecompensationoftheexecutivedirectorand ^ Ѐotherpersonnelwithoutregardtotheprovisionsof ( Ѐchapter51andsubchapterIIIofchapter53oftitle5,  ЀUnitedStatesCode,relatingtoclassificationof Pt ЀpositionsandGeneralSchedulepayrates,exceptthat  Ѐtherateofpayfortheexecutivedirectorandother   ЀpersonnelmaynotexceedtheratepayableforlevelVof Bf! ЀtheExecutiveScheduleundersection5316ofsuchtitle.  " Ѐ(4)Detailofgovernmentemployees.--AnyFederalGovernment # ЀemployeemaybedetailedtotheCommissionwithout 4X$ Ѐreimbursement,andsuchdetailshallbewithoutinterruptionor % Ѐlossofcivilservicestatusorprivilege. & Ѐ(5)Procurementoftemporaryandintermittentservices.--The &J' ЀChairmanoftheCommissionmayprocuretemporaryand ( Ѐintermittentservicesundersection3109(b)oftitle5,United r ) ЀStatesCode,atratesforindividualswhichdonotexceedthe !<* Ѐdailyequivalentoftheannualrateofbasicpayprescribedfor !+ ЀlevelVoftheExecutiveScheduleundersection5316ofsuch d", Ѐtitle.  #.- ̀(i)Termination.--TheCommissionshallterminate30daysafterthe V$z/ transmissionofthereportfromthePresidentasmandatedinsection $ 0 1248(b). %1 SEC.1248.MULTILATERALSTRATEGYTOADDRESSOFFSETS. &!3 ̀(a)InGeneral.--ThePresidentshallinitiateareviewtodetermine :(^"5 thefeasibilityofestablishing,andthemosteffectivemeansof (#6 negotiating,amultilateraltreatyonstandardsfortheuseofoffsets )#7 ininternationaldefensetrade,withagoaloflimitingalloffset ,*P$8 transactionsthatareconsideredinjurioustotheeconomyoftheUnited *$9 _States. x+%: Ѐ(b)ReportRequired.--Notlaterthan90daysafterthedateonwhich ,B&; theCommissionsubmitsthereportrequiredundersection1247(d),the ,&< Presidentshallsubmittotheappropriatecongressionalcommitteesa j-'= reportcontainingthePresident'sdeterminationpursuanttosubsection .4(> (a),and,ifthePresidentdeterminesamultilateraltreatyisfeasible  ordesirable,astrategyforUnitedStatesnegotiationofsuchatreaty.  Oneyearafterthedatethereportissubmittedunderthepreceding (L sentence,andannuallythereafterfor5years,thePresidentshall  submittotheappropriatecongressionalcommitteesareportdetailing t theprogresstowardreachingsuchatreaty.  > Ѐ(c)RequiredInformation.--Thereportrequiredbysubsection(b)   shallinclude-- f  Ѐ(1)adescriptionoftheUnitedStateseffortstopursue  0 Ѐmultilateralnegotiationsonstandardsfortheuseofoffsetsin    Ѐinternationaldefensetrade; X |  Ѐ(2)anevaluationofexistingmultilateralforaas  "  Ѐappropriatevenuesforestablishingsuchnegotiations;    Ѐ(3)adescriptiononacountry-by-countrybasisofany Jn  ЀUnitedStateseffortstoengageinnegotiationstoestablish   Ѐbilateraltreatiesoragreementswithrespecttotheuseof   Ѐoffsetsininternationaldefensetrade;and <`  Ѐ(4)anevaluationonacountry-by-countrybasisofany   Ѐforeigngovernmenteffortstoaddresstheuseofoffsetsin   Ѐinternationaldefensetrade. .R     5r5r5r      5r ,eori    5r5r5r5r    ݀(d)ComptrollerGeneralReview.--TheComptrollerGeneralofthe z  UnitedStatesshallmonitorandperiodicallyreporttoCongressonthe  D progressinreachingamultilateral_treaty.__XBX5rXm4XXXB_&      & %XXm4&T % %&        & A   &T % %&T&T % %&T        & A   &T % %&T&T % %&T        & A   &T % %&T&T % %&T        & A    &T % %&T&T % %&T             _ jeUn      _