DRAWBACK.

SEC. 203. DRAWBACK.(a) Definition of a Good Subject to Chile FTA Drawback.—For purposes of this Act and the amendments made by subsection (b), the term “good subject to Chile FTA drawback” means any imported good other than the following:(1) A good entered under bond for transportation and exportation to Chile.(2)(A) A good exported to Chile in the same condition as when imported into the United States. (B) For purposes of subparagraph (A)—(i) processes such as testing, cleaning, repacking, inspecting, sorting, or marking a good, or preserving it in its same condition, shall not be considered to change the condition of the good; and(ii) if a good described in subparagraph (A) is commingled with fungible goods and exported in the same condition, the origin of the good for the purposes of subsection (j)(1) of section 313 of the Tariff Act of 1930 (19 U.S.C. 1313(j)(1)) may be determined on the basis of the inventory methods provided for in the regulations implementing this title.(3) A good—(A) that is—(i) deemed to be exported from the United States;(ii) used as a material in the production of another good that is deemed to be exported to Chile; or(iii) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is deemed to be exported to Chile; and(B) that is delivered—(i) to a duty-free shop;(ii) for ship’s stores or supplies for a ship or aircraft; or(iii) for use in a project undertaken jointly by the United States and Chile and destined to become the property of the United States.(4) A good exported to Chile for which a refund of customs duties is granted by reason of—(A) the failure of the good to conform to sample or specification; or(B) the shipment of the good without the consent of the consignee.(5) A good that qualifies under the rules of origin set out in section 202 that is—(A) exported to Chile;117 STAT. 925(B) used as a material in the production of another good that is exported to Chile; or(C) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is exported to Chile.(b) 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 the following new paragraph: “No article manufactured in a bonded warehouse from materials that are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, may be withdrawn from warehouse for exportation to Chile without assessment of a duty on the materials in their condition and quantity, and at their weight, at the time of importation into the United States. The duty shall be paid before the 61st day after the date of exportation, except that the duty may be waived or reduced by—“(1) 100 percent during the 8-year period beginning on January 1, 2004;“(2) 75 percent during the 1-year period beginning on January 1, 2012;“(3) 50 percent during the 1-year period beginning on January 1, 2013; and“(4) 25 percent during the 1-year period beginning on January 1, 2014.”.(2) Bonded smelting and refining warehouses.—Section 312 of the Tariff Act of 1930 (19 U.S.C. 1312) is amended—(A) in paragraph (1) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that—“(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of—“(i) the total amount of customs duties owed on the materials on importation into the United States, or“(ii) the total amount of customs duties paid to the NAFTA country on the product, and“(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the 117 STAT. 926 bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by—“(i) 100 percent during the 8-year period beginning on January 1, 2004,“(ii) 75 percent during the 1-year period beginning on January 1, 2012,“(iii) 50 percent during the 1-year period beginning on January 1, 2013, and“(iv) 25 percent during the 1-year period beginning on January 1, 2014, or”;(B) in paragraph (4) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that—“(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of—“(i) the total amount of customs duties owed on the materials on importation into the United States, or“(ii) the total amount of customs duties paid to the NAFTA country on the product, and“(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by—“(i) 100 percent during the 8-year period beginning on January 1, 2004,“(ii) 75 percent during the 1-year period beginning on January 1, 2012,“(iii) 50 percent during the 1-year period beginning on January 1, 2013, and“(iv) 25 percent during the 1-year period beginning on January 1, 2014, or”; and(C) in subsection (d), in the matter preceding paragraph (1), by striking “except that” and all that follows through the end of paragraph (2) and inserting the following: “except that—“(1) in the case of a withdrawal for exportation to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, 117 STAT. 927 as defined in section 203(a) of that Act, charges against the bond shall be paid before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the bond shall be credited (subject to section 508(b)(2)(B)) in an amount not to exceed the lesser of—“(A) the total amount of customs duties paid or owed on the materials on importation into the United States, or“(B) the total amount of customs duties paid to the NAFTA country on the product; and“(2) in the case of a withdrawal for exportation to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, charges against the bond shall be paid before the 61st day after the date of exportation, and the bond shall be credited in an amount equal to—“(A) 100 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 8-year period beginning on January 1, 2004,“(B) 75 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2012,“(C) 50 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2013, and“(D) 25 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2014.”.(3) Drawback.—Section 313 of the Tariff Act of 1930 (19 U.S.C. 1313) is amended—(A) in paragraph (4) of subsection (j)—(i) by striking “(4)” and inserting “(4)(A)”; and(ii) by adding at the end the following new subparagraph:“(B) Beginning on January 1, 2015, the exportation to Chile of merchandise that is fungible with and substituted for imported merchandise, other than merchandise described in paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, shall not constitute an exportation for purposes of paragraph (2). The preceding sentence shall not be construed to permit the substitution of unused drawback under paragraph (2) of this subsection with respect to merchandise described in paragraph (2) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.”;(B) in subsection (n)—(i) by striking “(n)” and inserting the following:“(n) Refunds, Waivers, or Reductions Under Certain Free Trade Agreements.—”;(ii) in paragraph (1)—117 STAT. 928(I) by striking “; and” at the end of subparagraph (B);(II) by striking the period at the end of subparagraph (C) and inserting “; and”; and(III) by adding at the end the following new subparagraph:“(D) the term ‘good subject to Chile FTA drawback’ has the meaning given that term in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.”; and(iii) by adding the following new paragraph at the end:“(4)(A) For purposes of subsections (a), (b), (f), (h), (j)(2), (p), and (q), if an article that is exported to Chile is a good subject to Chile FTA drawback, no customs duties on the good may be refunded, waived, or reduced, except as provided in subparagraph (B).“(B) The customs duties referred to in subparagraph (A) may be refunded, waived, or reduced by—“(i) 100 percent during the 8-year period beginning on January 1, 2004;“(ii) 75 percent during the 1-year period beginning on January 1, 2012;“(iii) 50 percent during the 1-year period beginning on January 1, 2013; and“(iv) 25 percent during the 1-year period beginning on January 1, 2014.”; and(C) in subsection (o)—(i) by striking “(o)” and inserting the following:“(o) Special Rules for Certain Vessels and Imported Materials.—”; and(ii) by adding at the end the following new paragraphs:“(3) For purposes of subsection (g), if—“(A) a vessel is built for the account and ownership of a resident of Chile or the Government of Chile, and“(B) imported materials that are used in the construction and equipment of the vessel are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act,no customs duties on such materials may be refunded, waived, or reduced, except as provided in paragraph (4).“(4) The customs duties referred to in paragraph (3) may be refunded, waived or reduced by—“(A) 100 percent during the 8-year period beginning on January 1, 2004;“(B) 75 percent during the 1-year period beginning on January 1, 2012;“(C) 50 percent during the 1-year period beginning on January 1, 2013; and“(D) 25 percent during the 1-year period beginning on January 1, 2014.”.(4) Manipulation in warehouse.—Section 562 of the Tariff Act of 1930 (19 U.S.C. 1562) is amended—(A) in paragraph (3), by striking “to a NAFTA country” and inserting “to Chile, to a NAFTA country,”;(B) by striking “and” at the end of paragraph (4)(B);117 STAT. 929(C) by striking the period at the end of paragraph (5) and inserting “; and”; and(D) by inserting after paragraph (5) the following:“(6)(A) without payment of duties for exportation to Chile, if the merchandise is of a kind described in any of paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act; and“(B) for exportation to Chile if the merchandise consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, except that—“(i) the merchandise may not be withdrawn from warehouse without assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of withdrawal from the warehouse with such additions to, or deductions from, the final appraised value as may be necessary by reason of a change in condition, and“(ii) duty shall be paid on the merchandise before the 61st day after the date of exportation, except that such duties may be waived or reduced by—“(I) 100 percent during the 8-year period beginning on January 1, 2004,“(II) 75 percent during the 1-year period beginning on January 1, 2012,“(III) 50 percent during the 1-year period beginning on January 1, 2013, and“(IV) 25 percent during the 1-year period beginning on January 1, 2014.”.(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(a)) is amended by striking the end period and inserting the following: “: Provided further, That no merchandise that consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, that is manufactured or otherwise changed in condition shall be exported to Chile without an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its exportation (or if the privilege in the first proviso to this subsection was requested, an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its admission into the zone) and the payment of the assessed duty before the 61st day after the date of exportation of the article, except that the customs duty may be waived or reduced by (1) 100 percent during the 8-year period beginning on January 1, 2004; (2) 75 percent during the 1-year period beginning on January 1, 2012; (3) 50 percent during the 1-year period beginning on January 1, 2013; and (4) 25 percent during the 1-year period beginning on January 1, 2014.”.(c) Inapplicability to Countervailing and Antidumping Duties.—Nothing in this section or the amendments made by this section shall be considered to authorize the refund, waiver, or reduction of countervailing duties or antidumping duties imposed on an imported good.117 STAT. 930