DRAWBACK.

SEC. 204. DRAWBACK. (a) Definition.—For purposes of this section, the term “drawback eligible goods” means— (1) goods provided for under paragraph 8 of article 404 of the Agreement; (2) goods provided for under paragraphs 4 and 5 of such article; and (3) goods other than those referred to in paragraphs (1) and (2) that the United States and Canada agree are not subject to paragraphs 1, 2, and 3 of such article. 102 STAT. 1862 No drawback may be paid with respect to countervailing duties or antidumping duties imposed on drawback eligible goods. (b) Implementation of Article 404,— The President is authorized— (1) to proclaim the identity, in accordance with the nomenclature of the Harmonized System, of goods referred to in subsection (a)(1); and (2) subject to the consultation and lay-over requirements of section 103(a), to proclaim— (A) the identity, in accordance with the nomenclature of the Harmonized System, of goods referred to in subsection (a)(3); and (B) a delay in the taking effect of article 404 of the Agreement to a date later than January 1, 1994, with respect to any merchandise if the United States and Canada agree to the delay under paragraph 7 of such article. (c) Consequential Amendments.— (1) Bonded manufacturing warehouses.—Section 311 of the Tariff Act of 1930 (19 U.S.C, 1311) is amended by adding at the end thereof the following new paragraph: “No article manufactured in a bonded warehouse, except to the extent that such article is made from an article that is a drawback eligible good under section 204(a) of the United States-Canada Free-Trade Agreement Implementation Act of 1988, may be withdrawn from such warehouse for exportation to Canada on or after January 1, 1994, or such later date as may be proclaimed by the President under section 204(b)(2)(B) of such Act of 1988, without payment of a duty on such imported merchandise in its condition, and at the rate of duty in effect, at the time of importation.”. (2) Bonded smelting and refining warehouses.— Section 312 of the Tariff Act of 1930 (19 U.S.C. 1312) is further amended— (A) by inserting after “exportation” in each of paragraphs (1) and (4) of subsection (b) the following: “(other than exportation to Canada on or after January 1, 1994, or such later date as may be proclaimed by the President under section 204(b)(2)(B) of the United States-Canada Free-Trade Agreement Implementation Act of 1988, except to the extent that the metal-bearing materials were of Canadian origin as determined in accordance with section 202 of such Act of 1988)”; and (B) by inserting after “exportation” in subsection (d) the following: “(other than exportation to Canada on or after January 1, 1994, or such later date as may be proclaimed by the President under section 204(b)(2)(B) of the United States-Canada Free-Trade Agreement Implementation Act of 1988, except to the extent that the product is a drawback eligible good under section 204(a) of such Act of 1988)”. (3) Drawback.—Section 313 of the Tariff Act of 1930 (19 U.S.C. 1313) is amended by adding at the end thereof the following new subsections: “(n) For purposes of subsections (a), (b), (f), (h), and (j)(2), the shipment on or after January 1, 1994, or such later date as may be proclaimed by the President under section 204(b)(2)(B) of the United States-Canada Free-Trade Agreement Implementation Act of 1988, to Canada of an article made from or substituted for, as appropriate, 102 STAT. 1863a drawback eligible good under section 204(a) of such Act of 1988 does not constitute an exportation. “(o) For purposes of subsection (g), vessels built for Canadian account and ownership, or for the Government of Canada, may not be considered to be built for any foreign account and ownership, or for the government of any foreign country, except to the extent that the materials in such vessels are drawback eligible goods under section 204(a) of the United States-Canada Free-Trade Agreement Implementation Act of 1988.”. (4) Manipulation in warehouse.—The second sentence of section 562 of the Tariff Act of 1930 (19 U.S.C. 1562) is amended by striking out the proviso thereto and the colon preceding such proviso and inserting the following: “; except that upon permission therefor being granted by the Secretary of the Treasury, and under customs supervision, at the expense of the proprietor, merchandise may be cleaned, sorted, repacked, or otherwise changed in condition, but not manufactured, in bonded warehouses established for that purpose and be withdrawn therefrom without payment of duties— “(1) for exportation to Canada, but on or after January 1, 1994, or such later date as may be proclaimed by the President under section 204(b)(2)(B) of the United States-Canada Free-Trade Agreement Implementation Act of 1988, such exemption from the payment of duties applies only in the case of the exportation to Canada of merchandise that— “(A) is only cleaned, sorted, or repacked in a bonded warehouse, or “(B) is a drawback eligible good under section 204(a) of such Act of 1988; “(2) for exportation to any foreign country except Canada; and “(3) for shipment to the Virgin Islands, American Samoa, Wake Island, Midway Island, Kingman Reef, Johnston Island or the island of Guam. Merchandise may be withdrawn from bonded warehouse for consumption, or for exportation to Canada if the duty exemption under paragraph (1) of the preceding sentence does not apply, upon the payment of duties accruing thereon, in its condition and quantity, and at its weight, at the time of withdrawal from warehouse, with such additions to or deductions from the final appraised value as may be necessary by reason of change in condition.”. (5) Foreign trade zones.—Section 3(a) of the Act of June 18, 1934 (commonly known as the “Foreign Trade Zones Act”; 19 U.S.C. 81c) is further amended by adding before the period at the end thereof the following: “Provided, further,That with the exception of drawback eligible goods under section 204(a) of the United States-Canada Free-Trade Agreement Implementation Act of 1988, no article manufactured or otherwise changed in condition (except a change by cleaning, testing or repacking) shall be exported to Canada on or after January 1, 1994, or such later date as may be proclaimed by the President under section 204(b)(2)(B) of such Act of 1988, without the payment of a duty that shall be payable on the article in its condition and quantity, and at its weight, at the time of its exportation to Canada unless the privilege in the first proviso to this subsection was requested. ”.