
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 12USC635i-3]

 
                       TITLE 12--BANKS AND BANKING
 
           CHAPTER 6A--EXPORT-IMPORT BANK OF THE UNITED STATES
 
                    SUBCHAPTER I--GENERAL PROVISIONS
 
Sec. 635i-3. Tied Aid Credit Fund and program


(a) Findings

    The Congress finds that--
        (1) tied aid and partially untied aid credits offered by other 
    countries are a predatory method of financing exports because of 
    their market-distorting effects;
        (2) these distortions have caused the United States to lose 
    export sales, with resulting losses in economic growth and 
    employment;
        (3) these practices undermine market mechanisms that would 
    otherwise result in export purchase decisions made on the basis of 
    price, quality, delivery, and other factors directly related to the 
    export, where official financing is not subsidized and would be a 
    neutral factor in the transaction;
        (4) support of commercial exports by donor countries with tied 
    aid and partially untied aid credits impedes the growth of 
    developing countries because it diverts development assistance funds 
    from essential developmental purposes; and
        (5) there should be established in the Bank a tied aid program 
    to target the export markets of those countries which make extensive 
    use of tied aid or partially untied aid credits for commercial 
    advantage for the purposes of--
            (A) enforcing compliance with the existing Arrangement 
        restricting the use of tied aid and partially untied aid credits 
        for commercial purposes; and
            (B) facilitating efforts to negotiate, establish, and 
        enforce new or revised comprehensive international arrangements 
        effectively restricting the use of tied aid and partially untied 
        aid credits for commercial purposes;

    and such program should be used aggressively for such purposes.

(b) Establishment of tied aid credit program

                           (1) In general

        The Bank shall establish a tied aid credit program under which 
    grants shall be made from funds available in the Tied Aid Credit 
    Fund established under subsection (c) of this section--
            (A) to supplement the financing of a United States export 
        when there is a reasonable expectation that predatory financing 
        will be provided by another country for a sale by a competitor 
        of the United States exporter with respect to such export and 
        with special attention to matching tied aid and partially untied 
        aid credits extended by other governments--
                (i) in violation of the Arrangement; or
                (ii) in cases in which the Bank determines that United 
            States trade or economic interests justify the matching of 
            tied aid credits extended in compliance with the 
            Arrangement, including grandfathered cases;

            (B) to supplement the financing of United States exports to 
        foreign markets which are actual or potential export markets for 
        any country which the Bank determines--
                (i) engages in predatory official export financing 
            through the use of tied aid or partially untied aid credits, 
            and impedes negotiations or violates agreements on tied aid 
            to eliminate the use of such credits for commercial 
            purposes; or
                (ii) engages in predatory financing practices that seek 
            to circumvent international agreements on tied aid; or

            (C) to supplement the financing of United States exports 
        under such other circumstances as the Bank may determine to be 
        appropriate for carrying out the purposes of this section.

                    (2) Administration of program

        The tied aid credit program shall be administered by the Bank--
            (A) in consultation with the Secretary and in accordance 
        with the Secretary's recommendations on how such credits could 
        be used most effectively and efficiently to carry out the 
        purposes described in subsection (a)(5) of this section;
            (B) in cooperation with United States exporters and private 
        financial institutions or entities, and in consultation with 
        other Federal agencies, as appropriate; and
            (C) in consultation with the National Advisory Council on 
        International Monetary and Financial Policies.

            (3) Coordination with other export financing

        Under the tied aid credit program, the Bank may combine grants 
    from the Tied Aid Credit Fund with--
            (A) any guarantee, insurance, or other extension of credit 
        provided by the Bank under this subchapter;
            (B) any export financing provided by any private financial 
        institution or other entity; and
            (C) any other type of export financing,

    in such manner and under such terms as the Bank determines to be 
    appropriate, including combinations of export financing in the form 
    of blended financing and parallel financing.

       (4) Information on countries which engage in official 
             predatory export financing and impede negotiations

        In order to assist the Bank to make the most efficient use of 
    funds available for supplemental financing under paragraph (1)(B), 
    the United States Trade Representative and the Secretary of Commerce 
    may provide information on principal sectors and key markets of 
    countries described in paragraph (1)(B) to the Bank, the Secretary, 
    and the National Advisory Council on International Monetary and 
    Financial Policies. The Bank shall also request and take into 
    consideration the views of the private sector on principal sectors 
    and key markets of countries described in paragraph (1)(B).

(c) Tied Aid Credit Fund

                           (1) In general

        There is hereby established within the Bank a fund to be known 
    as the ``Tied Aid Credit Fund'' (hereinafter in this section 
    referred to as the ``Fund''), consisting of such amounts as may be 
    appropriated to the Fund pursuant to the authorization contained in 
    subsection (e) of this section.

                     (2) Expenditures from Fund

        Amounts in the Fund shall be available for grants made by the 
    Bank under the tied aid credit program established pursuant to 
    subsection (b) of this section and to reimburse the Bank for the 
    amount equal to the concessionality level of any tied aid credits 
    authorized by the Bank.

(d) Consistency with Arrangement

    Any export financing involving the use of a grant under the tied aid 
credit program shall be consistent with the procedures established by 
the Arrangement, as in effect at the time such financing is approved.

(e) Authorization

    There are authorized to be appropriated to the Fund such sums as may 
be necessary to carry out the purposes of this section. Such sums are 
authorized to remain available until expended.

(f) Nonreviewability

    No action taken under this section shall be reviewable by any court, 
except for abuse of discretion.

(g) Report to Congress

                           (1) In general

        The Bank, in consultation with the Secretary, shall submit an 
    annual report on tied aid credits to the Committee on Banking, 
    Housing, and Urban Affairs of the Senate and the Committee on 
    Banking, Finance and Urban Affairs of the House of Representatives.

                       (2) Contents of reports

        Each report required under paragraph (1) shall contain a 
    description of--
            (A) the implementation of the Arrangement restricting tied 
        aid and partially untied aid credits for commercial purposes, 
        including the operation of notification and consultation 
        procedures;
            (B) all principal offers of tied aid credit financing by 
        foreign countries during the previous 6-month period, including 
        all offers notified by countries participating in the 
        Arrangement, and in particular--
                (i) offers grandfathered under the Arrangement; and
                (ii) notifications of exceptions under the Arrangement;

            (C) any use by the Bank of the Tied Aid Credit Fund to match 
        specific offers, including those that are grandfathered or 
        exceptions under the Arrangement; and
            (D) other actions by the United States Government to combat 
        predatory financing practices by foreign governments, including 
        additional negotiations among participating governments in the 
        Arrangement.

                    (3) Confidential information

        To the extent the Bank determines any information required to be 
    included in the report under this subsection should not be made 
    public, such information may be submitted separately on a 
    confidential basis or provided orally, rather than in written form, 
    to the Chairmen and ranking minority Members of the Committees of 
    the Senate and the House of Representatives with jurisdiction over 
    the subject matter of the report.

(h) Definitions

    For purposes of this section, the following definitions shall apply:

            (1) Tied aid and partially untied aid credit

        The terms ``tied aid credit'' and ``partially untied aid 
    credit'' mean any credit which--
            (A) has a grant element greater than zero percent, as 
        determined by the Development Assistance Committee of the 
        Organization for Economic Cooperation and Development;
            (B) is, in fact or in effect, tied to--
                (i) the procurement of goods or services from the donor 
            country, in the case of tied aid credit; or
                (ii) the procurement of goods or services from a 
            restricted number of countries, in the case of partially 
            untied aid credit; and

            (C) is financed either exclusively from public funds or 
        partly from public and partly from private funds.

                            (2) Secretary

        The term ``Secretary'' means the Secretary of the Treasury.

                           (3) Arrangement

        The term ``Arrangement'' means the Arrangement on Guidelines for 
    Officially Supported Export Credits established through the 
    Organization for Economic Cooperation and Development.

                        (4) Blended financing

        The term ``blended financing'' means financing provided through 
    any combination of official development assistance, official export 
    credits, and private commercial credit which is integrated into a 
    single agreement with a single set of financial terms.

                       (5) Parallel financing

        The term ``parallel financing'' means financing provided by any 
    combination of official development assistance, official export 
    credits, and private commercial credit which is not integrated into 
    a single agreement and does not have a single set of financial 
    terms.

           (6) Offers grandfathered under the Arrangement

        The term ``offers grandfathered under the Arrangement'' means--
            (A) financing offers made or lines of credit extended on or 
        before February 15, 1992; or
            (B) financing offers extended for subloans under lines of 
        credit referred to in subparagraph (A) made on or before August 
        15, 1992, or, in the case of Mexico, on or before December 31, 
        1992.

(July 31, 1945, ch. 341, Sec. 10, formerly Sec. 15, as added Pub. L. 99-
472, Sec. 19, Oct. 15, 1986, 100 Stat. 1205; amended Pub. L. 100-217, 
Dec. 29, 1987, 101 Stat. 1454; Pub. L. 100-418, title III, Sec. 3302(b), 
Aug. 23, 1988, 102 Stat. 1383; Pub. L. 101-240, title I, Sec. 101(b), 
Dec. 19, 1989, 103 Stat. 2493; Pub. L. 101-513, title V, Sec. 562(d), 
Nov. 5, 1990, 104 Stat. 2036; renumbered Sec. 10 and amended Pub. L. 
102-429, title I, Secs. 103, 121(c)(4), Oct. 21, 1992, 106 Stat. 2187, 
2199; Pub. L. 104-97, Sec. 1, Jan. 11, 1996, 109 Stat. 984; Pub. L. 104-
107, title V, Sec. 579, Feb. 12, 1996, 110 Stat. 751; Pub. L. 105-121, 
Sec. 3, Nov. 26, 1997, 111 Stat. 2528; Pub. L. 106-569, title XI, 
Sec. 1103(d)(2), Dec. 27, 2000, 114 Stat. 3031.)


                            Prior Provisions

    A prior section 10 of act July 31, 1945, ch. 341, repealed section 
713b of Title 15, Commerce and Trade.


                               Amendments

    2000--Subsec. (g)(1). Pub. L. 106-569 substituted ``The Bank'' for 
``On or before October 15, 1992, and every 6 months thereafter, the 
Bank'' and ``submit an annual report'' for ``submit a report''.
    1997--Subsec. (c)(2). Pub. L. 105-121, Sec. 3(a), struck out 
``through September 30, 1997'' after ``authorized by the Bank''.
    Subsec. (e). Pub. L. 105-121, Sec. 3(b), amended first sentence 
generally. Prior to amendment first sentence read as follows: ``There 
are authorized to be appropriated to the Fund such sums as may be 
necessary for each of fiscal years 1996 and 1997.''
    1996--Subsec. (c)(2). Pub. L. 104-107, Sec. 579(a), which directed 
substitution of ``1997'' for ``1995'', could not be executed because 
``1995'' does not appear in text after amendment by Pub. L. 104-97. See 
below.
    Pub. L. 104-97, Sec. 1(a), substituted ``1997'' for ``1995''.
    Subsec. (e). Pub. L. 104-107, Sec. 579(b), which directed 
substitution of ``1996 and 1997'' for ``1993, 1994, and 1995'', could 
not be executed because that language does not appear in text after 
general amendment by Pub. L. 104-97. See below.
    Pub. L. 104-97, Sec. 1(b), substituted ``There are authorized to be 
appropriated to the Fund such sums as may be necessary for each of 
fiscal years 1996 and 1997.'' for ``There are authorized to be 
appropriated to the Fund $500,000,000 for each of fiscal years 1993, 
1994, and 1995.''
    1992--Subsec. (a). Pub. L. 102-429, Sec. 103(c)(1), (2), substituted 
``predatory'' for ``predacious'' in par. (1), struck out ``temporary'' 
before ``tied aid program'' in introductory provisions of par. (5), and 
substituted ``existing Arrangement'' for ``existing arrangement'' in 
par. (5)(A).
    Subsec. (b)(1). Pub. L. 102-429, Sec. 103(c)(3)(A), substituted 
``The'' for ``To carry out the purposes of subsection (a)(5) of this 
section, the''.
    Subsec. (b)(1)(A). Pub. L. 102-429, Sec. 103(c)(1), (3)(B), 
substituted ``predatory'' for ``predacious'' and inserted before 
semicolon ``and with special attention to matching tied aid and 
partially untied aid credits extended by other governments--'' followed 
by cls. (i) and (ii).
    Subsec. (b)(1)(B). Pub. L. 102-429, Sec. 103(c)(1), (3)(C), in cl. 
(i) substituted ``predatory'' for ``predacious'' and ``partially untied 
aid credits, and impedes negotiations or violates agreements on tied aid 
to eliminate the use of such credits for commercial purposes; or'' for 
``partially untied aid credits; and'', added cl. (ii), and struck out 
former cl. (ii) which read as follows: ``impedes negotiations to 
eliminate the use of such credits for commercial purposes; or''.
    Subsec. (b)(2). Pub. L. 102-429, Sec. 103(c)(4), (5), struck out 
``of the Treasury'' after ``Secretary'' in subpar. (A) and substituted 
``United States exporters and private financial institutions or 
entities, and in consultation with other Federal agencies'' for 
``private financial institutions or entities'' in subpar. (B).
    Subsec. (b)(4). Pub. L. 102-429, Sec. 103(c)(6), inserted at end 
``The Bank shall also request and take into consideration the views of 
the private sector on principal sectors and key markets of countries 
described in paragraph (1)(B).''
    Subsec. (c)(2). Pub. L. 102-429, Sec. 103(a), substituted 
``September 30, 1995'' for ``fiscal year 1992''.
    Subsec. (e). Pub. L. 102-429, Sec. 103(b), amended subsec. (e) 
generally, substituting present provisions for provisions which 
authorized appropriations for fiscal years 1987 through 1992 and 
provided authority for Presidential rescission.
    Subsec. (g)(1). Pub. L. 102-429, Sec. 103(c)(7), amended par. (1) 
generally. Prior to amendment, par. (1) read as follows: ``Report 
required.--Before the end of the 6-month period beginning on October 15, 
1986, and every six months thereafter, the Bank, in consultation with 
the Secretary, shall prepare and transmit a report on tied aid credits 
to the President of the Senate and the Speaker of the House of 
Representatives.''
    Subsec. (g)(2). Pub. L. 102-429, Sec. 103(c)(7), amended par. (2) 
generally. Prior to amendment, par. (2) read as follows: ``Contents of 
report.--Each report required by paragraph (1) shall contain a 
description of--
        ``(A) the principal offers of predacious financing by foreign 
    countries during the course of the previous 6 months;
        ``(B) steps taken by the United States to combat specific 
    predacious financing practices of foreign countries;
        ``(C) any use by the Bank of the Tied Aid Credit Fund to match 
    specific predacious financing practices of foreign countries and to 
    initiate tied aid credit offers;
        ``(D) any additional steps the United States may take in the 
    future to discourage use of predacious financing practices; and
        ``(E) the progress achieved by negotiations conducted to carry 
    out the purposes described in subsection (a)(5) of this section.''
    Subsec. (h). Pub. L. 102-429, Sec. 103(c)(8), substituted ``For 
purposes of this section, the following definitions shall apply:'' for 
``For the purpose of this section--'' in introductory provisions and 
added par. (6).
    1990--Subsec. (c)(2). Pub. L. 101-513, Sec. 562(d)(2), substituted 
``1992'' for ``1991''.
    Subsec. (e)(1). Pub. L. 101-513, Sec. 562(d)(1), substituted ``for 
fiscal year 1990, $300,000,000, and for each of fiscal years 1991 and 
1992, $500,000,000'' for ``and for fiscal years 1990 and 1991, 
$300,000,000''.
    1989--Subsec. (a)(5). Pub. L. 101-240, Sec. 101(b)(1), substituted 
``for the purposes of--'', pars. (A) and (B), and concluding provisions 
for ``for the purpose of facilitating the negotiation of a comprehensive 
international arrangement restricting the use of tied aid and partially 
untied aid credits for commercial purposes, and such program should be 
aggressively used until such an arrangement is established.''
    Subsec. (b)(1). Pub. L. 101-240, Sec. 101(b)(2), inserted 
introductory provisions and struck out former introductory provisions 
which read as follows: ``For the purpose of facilitating the negotiation 
of a comprehensive international arrangement restricting the use of tied 
aid and partially untied aid credits for commercial purposes, the Bank 
shall establish a tied aid credit program under which grants shall be 
made from funds available in the Tied Aid Credit Fund established under 
subsection (c) of this section--''.
    Subsec. (b)(2)(A). Pub. L. 101-240, Sec. 101(b)(3), substituted 
``carry out the purposes described in subsection (a)(5) of this 
section'' for ``promote the negotiation of a comprehensive international 
arrangement restricting the use of tied aid and partially untied aid 
credits for commercial purposes''.
    Subsec. (c)(2). Pub. L. 101-240, Sec. 101(b)(4), substituted 
``amount equal to the concessionality level'' for ``cost'' and ``through 
fiscal year 1991'' for ``during fiscal years 1986, 1987, 1988, and 
1989''.
    Subsec. (e)(1). Pub. L. 101-240, Sec. 101(b)(7), which directed the 
insertion of ``, and for fiscal years 1990, 1991, and 1992, 
$200,000,000'' after ``$300,000,000'' was not executed in view of 
earlier amendment by section 101(b)(5) of Pub. L. 101-240, which 
inserted ``, and for fiscal years 1990 and 1991, $300,000,000'' after 
``$300,000,000'', and in view of Senate floor amendment of the bill 
which added the authorization contained in section 101(b)(5) and was 
intended to replace the authorization now appearing in section 
101(b)(7). See Cong. Rec., Vol. 135, pt. 22, pp. 31199, 31203.
    Pub. L. 101-240, Sec. 101(b)(5), inserted ``, and for fiscal years 
1990 and 1991, $300,000,000'' after ``$300,000,000''.
    Subsec. (g)(2)(E). Pub. L. 101-240, Sec. 101(b)(6), amended subpar. 
(E) generally. Prior to amendment, subpar. (E) read as follows: ``any 
progress achieved in negotiations to establish a comprehensive 
international arrangement restricting the use of tied aid and partially 
untied credits for commercial purposes.''
    1988--Subsecs. (c)(2), (e)(1). Pub. L. 100-418 substituted ``1988, 
and 1989'' for ``and 1988''.
    1987--Subsec. (c)(2). Pub. L. 100-217 substituted ``during fiscal 
years 1986, 1987, and 1988'' for ``during fiscal year 1986''.

                         Change of Name

    Committee on Banking, Finance and Urban Affairs of House of 
Representatives treated as referring to Committee on Banking and 
Financial Services of House of Representatives by section 1(a) of Pub. 
L. 104-14, set out as a note preceding section 21 of Title 2, The 
Congress. Committee on Banking and Financial Services of House of 
Representatives abolished and replaced by Committee on Financial 
Services of House of Representatives, and jurisdiction over matters 
relating to securities and exchanges and insurance generally transferred 
from Committee on Energy and Commerce of House of Representatives by 
House Resolution No. 5, One Hundred Seventh Congress, Jan. 3, 2001.


         Use of Fund To Discourage Predatory Financing Practices

    Section 3302(a) of Pub. L. 100-418 provided that: ``The Congress 
finds that--
        ``(1) negotiations have led to an international agreement to 
    increase the grant element required in tied aid credit offers;
        ``(2) concern continues to exist that countries party to the 
    agreement may continue to offer tied aid credits that deviate from 
    the agreement;
        ``(3) in such cases, the United States could continue to lose 
    export sales in connection with the aggressive, and in some cases, 
    unfair, tied aid practices of such countries; and
        ``(4) in such cases, the Export-Import Bank of the United States 
    should continue to use the Tied Aid Credit Fund established by 
    section 15(c) [now 10(c)] of the Export-Import Bank Act of 1945 [12 
    U.S.C. 635i-3(c)] to discourage the use of such predatory financing 
    practices.''

                  Section Referred to in Other Sections

    This section is referred to in section 635 of this title.
