§2462. Beneficiary developing countries

(a) Designation by President

(1) For purposes of this subchapter, the term "beneficiary developing country" means any country with respect to which there is in effect an Executive order or Presidential proclamation by the President of the United States designating such country as a beneficiary developing country for purposes of this subchapter. Before the President designates any country as a beneficiary developing country for purposes of this subchapter, he shall notify the House of Representatives and the Senate of his intention to make such designation, together with the considerations entering into such decision.

(2) If the President has designated any country as a beneficiary developing country for purposes of this subchapter, he shall not terminate such designation (either by issuing an Executive order or Presidential proclamation for that purpose or by issuing an Executive order or Presidential proclamation which has the effect of terminating such designation) unless, at least 60 days before such termination, he has notified the House of Representatives and the Senate and has notified such country of his intention to terminate such designation, together with the considerations entering into such decision.

(3) For purposes of this subchapter, the term "country" means any foreign country, any overseas dependent territory or possession of a foreign country, or the Trust Territory of the Pacific Islands. In the case of an association of countries which is a free trade area or customs union, or which is contributing to comprehensive regional economic integration among its members through appropriate means, including, but not limited to, the reduction of duties, the President may by Executive order or Presidential proclamation provide that all members of such association other than members which are barred from designation under subsection (b) of this section shall be treated as one country for purposes of this subchapter.

(4) For purposes of this subchapter the term "internationally recognized worker rights" includes-

(A) the right of association;

(B) the right to organize and bargain collectively;

(C) a prohibition on the use of any form of forced or compulsory labor;

(D) a minimum age for the employment of children; and

(E) acceptable conditions of work with respect to minimum wages, hours of work, and occupational safety and health.

(b) Countries ineligible for designation as beneficiary developing countries

No designation shall be made under this section with respect to any of the following:

 Australia

 Austria

 Canada

 European Economic Community member states

 Finland

 Iceland

 Japan

 Monaco

 New Zealand

 Norway

 Sweden

 Switzerland

In addition, the President shall not designate any country a beneficiary developing country under this section-

(1) if such country is a Communist country, unless (A) the products of such country receive nondiscriminatory treatment, (B) such country is a contracting party to the General Agreement on Tariffs and Trade and a member of the International Monetary Fund, and (C) such country is not dominated or controlled by international communism;

(2) if such country is a member of the Organization of Petroleum Exporting Countries, or a party to any other arrangement of foreign countries, and such country participates in any action pursuant to such arrangement the effect of which is to withhold supplies of vital commodity resources from international trade or to raise the price of such commodities to an unreasonable level and to cause serious disruption of the world economy;

(3) if such country affords preferential treatment to the products of a developed country, other than the United States, which has, or is likely to have, a significant adverse effect on United States commerce, unless the President has received assurances satisfactory to him that such preferential treatment will be eliminated before January 1, 1976, or that action will be taken before January 1, 1976, to assure that there will be no such significant adverse effect, and he reports those assurances to the Congress;

(4) if such country-

(A) has nationalized, expropriated, or otherwise seized ownership or control of property, including patents, trademarks, or copyrights, owned by a United States citizen or by a corporation, partnership, or association which is 50 percent or more beneficially owned by United States citizens,

(B) has taken steps to repudiate or nullify an existing contract or agreement with a United States citizen or a corporation, partnership, or association which is 50 percent or more beneficially owned by United States citizens, the effect of which is to nationalize, expropriate, or otherwise seize ownership or control of property, including patents, trademarks, or copyrights, so owned, or

(C) has imposed or enforced taxes or other exactions, restrictive maintenance or operational conditions, or other measures with respect to property, including patents, trademarks, or copyrights, so owned, the effect of which is to nationalize, expropriate, or otherwise seize ownership or control of such property,

unless-

(D) the President determines that-

(i) prompt, adequate, and effective compensation has been or is being made to such citizen, corporation, partnership, or association,

(ii) good faith negotiations to provide prompt, adequate, and effective compensation under the applicable provisions of international law are in progress, or such country is otherwise taking steps to discharge its obligations under international law with respect to such citizen, corporation, partnership, or association, or

(iii) a dispute involving such citizen, corporation, partnership, or association over compensation for such a seizure has been submitted to arbitration under the provisions of the Convention for the Settlement of Investment Disputes, or in another mutually agreed upon forum, and

promptly furnishes a copy of such determination to the Senate and House of Representatives;

(5) if such country fails to act in good faith in recognizing as binding or in enforcing arbitral awards in favor of United States citizens or a corporation, partnership, or association which is 50 percent or more beneficially owned by United States citizens, which have been made by arbitrators appointed for each case or by permanent arbitral bodies to which the parties involved have submitted their dispute;

(6) if such country aids or abets, by granting sanctuary from prosecution to, any individual or group which has committed an act of international terrorism; and

(7) if such country has not taken or is not taking steps to afford internationally recognized worker rights to workers in the country (including any designated zone in that country).

Paragraphs (4), (6), (7), and (8) ¹ shall not prevent the designation of any country as a beneficiary developing country under this section if the President determines that such designation will be in the national economic interest of the United States and reports such determination to the Congress with his reasons therefor.

(c) Factors determinative of whether to designate country as beneficiary developing country

In determining whether to designate any country a beneficiary developing country under this section, the President shall take into account-

(1) an expression by such country of its desire to be so designated;

(2) the level of economic development of such country, including its per capita gross national product, the living standards of its inhabitants, and any other economic factors which he deems appropriate;

(3) whether or not the other major developed countries are extending generalized preferential tariff treatment to such country;

(4) the extent to which such country has assured the United States it will provide equitable and reasonable access to the markets and basic commodity resources of such country and the extent to which such country has assured the United States that it will refrain from engaging in unreasonable export practices;

(5) the extent to which such country is providing adequate and effective means under its laws for foreign nationals to secure, to exercise, and to enforce exclusive rights in intellectual property, including patents, trademarks, and copyrights;

(6) the extent to which such country has taken action to-

(A) reduce trade distorting investment practices and policies (including export performance requirements); and

(B) reduce or eliminate barriers to trade in services; and

(7) whether or not such country has taken or is taking steps to afford to workers in that country (including any designated zone in that country) internationally recognized worker rights.

(d) Exemptions

(1) The President may exempt from the application of paragraph (2) of subsection (b) of this section any country during the period during which such country (A) is a party to a bilateral or multilateral trade agreement to which the United States is also a party if such agreement fulfills the negotiating objectives set forth in section 2118 of this title of assuring the United States fair and equitable access at reasonable prices to supplies of articles of commerce important to the economic requirements of the United States and (B) is not in violation of such agreement by action denying the United States such fair and equitable access.

(2) The President may exempt from the application of paragraph (2) of subsection (b) of this section any country that enters into a bilateral product-specific trade agreement with the United States under section 2111 or 2112 of this title before January 3, 1980. The President shall terminate the exemption granted to any country under the preceding sentence if that country interrupts or terminates the delivery of supplies of petroleum and petroleum products to the United States.

( Pub. L. 93–618, title V, §502(a)–(c), (e), Jan. 3, 1975, 88 Stat. 2066–2069 ; Pub. L. 94–455, title XVIII, §1802, Oct. 4, 1976, 90 Stat. 1763 ; Pub. L. 96–39, title XI, §§1106(g)(1), (2), 1111(a)(1), (2), July 26, 1979, 93 Stat. 312 , 313, 315; Pub. L. 98–573, title V, §503, Oct. 30, 1984, 98 Stat. 3019 ; Pub. L. 99–47, §8(b)(2), June 11, 1985, 99 Stat. 85 ; Pub. L. 99–514, title XVIII, §1887(a)(5), Oct. 22, 1986, 100 Stat. 2923 ; Pub. L. 99–570, title IX, §9002(a), Oct. 27, 1986, 100 Stat. 3207–166 ; Pub. L. 101–179, title III, §301, Nov. 28, 1989, 103 Stat. 1311 ; Pub. L. 101–382, title I, §131, Aug. 20, 1990, 104 Stat. 643 ; Pub. L. 103–66, title XIII, §13802(a), Aug. 10, 1993, 107 Stat. 667 ; Pub. L. 103–149, §4(b)(9), Nov. 23, 1993, 107 Stat. 1506 .)

References in Text

Paragraphs (6), (7), and (8), referred to in subsec. (b), were redesignated paragraphs (5), (6), and (7) of subsec. (b) by section 9002(a)(2) of Pub. L. 99–570.

Codification

Subsec. (d) was, in the original, subsec. (e) of section 502 of Pub. L. 93–618. Subsec. (d) of section 502 of Pub. L. 93–618 amended General Headnote 3(a) of the Tariff Schedules of the United States.

Amendments

1993-Subsec. (b). Pub. L. 103–149 struck out "Republic of South Africa" in list of countries preceding par. (1).

Pub. L. 103–66 struck out "Union of Soviet Socialist Republics" in list of countries preceding par. (1).

1990-Subsec. (b). Pub. L. 101–382 struck out "Czechoslovakia" and "Germany (East)" in list of countries preceding par. (1).

1989-Subsec. (b). Pub. L. 101–179 struck out "Poland" in list of countries preceding par. (1).

1986-Subsec. (b). Pub. L. 99–570, §9002(a)(3), struck out "(5)," after "(4)," in last sentence.

Subsec. (b)(4)(A) to (C). Pub. L. 99–514 amended subpars. (A) to (C) generally. Prior to amendment, subpars. read as follows:

"(A) has nationalized, expropriated, or otherwise seized ownership or control of property, including patents, trademarks, or copyrights owned by a United States citizen or by a corporation, partnership, or association which is 50 percent or more beneficially owned by United States citizens,

"(B) has taken steps to repudiate or nullify an existing contract or agreement with a United States citizen or a corporation, partnership, or association which is 50 percent or more beneficially owned by United States citizens, the effect of which is to nationalize, expropriate, or otherwise seize ownership or control of property, including patents, trademarks, or copyrights so owned, or

"(C) has imposed or enforced taxes or other exactions, restrictive maintenance or operational conditions, or other measures with respect to property so owned, the effect of which is to nationalize, expropriate, or otherwise seize ownership or control of such property, including patents, trademarks, or copyrights,".

Subsec. (b)(5) to (8). Pub. L. 99–570, §9002(a)(1), (2), redesignated pars. (6) to (8) as (5) to (7), respectively, and struck out former par. (5) which provided that the President could not designate any country a beneficiary developing country under this section if such country did not take adequate steps to cooperate with the United States to prevent narcotic drugs and other controlled substances (as listed in the schedules in section 812 of title 21) produced, processed, or transported in such country from entering the United States unlawfully.

1985-Subsec. (a)(1) to (3). Pub. L. 99–47 inserted "or Presidential proclamation" after "Executive order" wherever appearing.

1984-Subsec. (a)(4). Pub. L. 98–573, §503(a), added par. (4).

Subsec. (b). Pub. L. 98–573, §503(b)(1), struck out "Hungary" in list of countries in first sentence.

Pub. L. 98–573, §503(b)(7), inserted reference to par. (8) in last sentence.

Subsec. (b)(4)(A), (B). Pub. L. 98–573, §503(b)(2), which directed the insertion of ", including patents, trademarks, or copyrights" after "control of such property" in subpars. (A) and (B), was executed by inserting that phrase in subpars. (A) and (B) following "control of property".

Subsec. (b)(4)(C). Pub. L. 98–573, §503(b)(3), inserted ", including patents, trademarks, or copyrights" after "control of such property".

Subsec. (b)(8). Pub. L. 98–573, §503(b)(4)–(6), added par. (8).

Subsec. (c)(4). Pub. L. 98–573, §503(c)(2), substituted "and the extent to which such country has assured the United States that it will refrain from engaging in unreasonable export practices;" for the period at end.

Subsec. (c)(5) to (7). Pub. L. 98–573, §503(c)(1), (3), added pars. (5) to (7).

1979-Subsec. (a)(3). Pub. L. 96–19, §1111(a)(1), inserted reference to associations of countries which are contributing to comprehensive regional economic integration among its members through appropriate means, including, but not limited to, the reduction of duties.

Subsec. (b)(2). Pub. L. 96–39, §1106(g)(1), struck out "withhold supplies of vital commodity resources from international trade or to raise the price of such commodities to an unreasonable level which causes serious disruption of the world economy" thereby correcting a typographical error in Pub. L. 93–618 under which that phrase had been set out twice.

Subsec. (b)(6). Pub. L. 96–39, §1106(g)(2), inserted a comma after "partnership".

Subsec. (d). Pub. L. 96–39, §1111(a)(2), designated existing provisions as par. (1) and added par. (2).

1976-Subsec. (b). Pub. L. 94–455 added par. (7) and inserted reference to par. (7) in last sentence.

Effective Date of 1984 Amendment

Amendment by Pub. L. 98–573 effective Jan. 4, 1985, see section 508 of Pub. L. 98–573, set out as a note under section 2461 of this title.

Effective Date of 1979 Amendment

Amendment by Pub. L. 96–39 effective July 26, 1979, see section 1114 of Pub. L. 96–39, set out as an Effective Date note under section 2581 of this title.

Termination of Trust Territory of the Pacific Islands

For termination of Trust Territory of the Pacific Islands, see note set out preceding section 1681 of Title 48, Territories and Insular Possessions.

Plan Amendments Not Required Until January 1, 1989

For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§1101–1147 and 1171–1177] or title XVIII [§§1801–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of Title 26, Internal Revenue Code.

Executive Order No. 11844

Ex. Ord. No. 11844, Mar. 24, 1975, 40 F.R. 13295, which related to the designation of beneficiary developing countries, was superseded by Ex. Ord. No. 11888, Nov. 24, 1975, 40 F.R. 55276, see note below.

Ex. Ord. No. 11888. Implementing the Generalized System of Preferences

Ex. Ord. No. 11888, Nov. 24, 1975, 40 F.R. 55276, as amended, amended the Tariff Schedules of the United States in order to implement the Generalized System of Preferences established by this subchapter. The text of Ex. Ord. No. 11888 is not set out in the Code because the Tariff Schedules are not set out in the Code. See Publication of Tariff Schedules note set out under section 1202 of this title.

Executive Order No. 11960

Ex. Ord. No. 11960, Jan. 19, 1977, 42 F.R. 4317, which amended the Generalized System of Preferences, was revoked by Ex. Ord. No. 11974, Feb. 25, 1977, 42 F.R. 11230A, which amended Ex. Ord. No. 11888, see note above.

Section Referred to in Other Sections

This section is referred to in sections 2411, 2463, 2464, 2702, 3202, 3331, 3551 of this title; title 15 section 4711; title 22 sections 262p–4p, 2191a; title 26 section 871.

¹ See References in Text note below.