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5

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meter equivalents of goods entered under subheading 9802.00.80 of the HTS.

(C) PRIOR CONSULTATION.-The President may implement the preferential tariff treatment described in subparagraph (A) only after consultation with representatives of the United States textile and apparel industry and other interested parties regarding

(i) the specific articles to which such treatment will be extended, and

(ii) the annual quantities of such articles that may be imported at the pref

erential duty rates described in subparagraph (A).

(3) HANDLOOMED, HANDMADE, AND FOLKLORE ARTICLES. For purposes of paragraph (1), the United States Trade Representative shall consult with representatives of Panama for the purpose of identifying particular textile and apparel goods that

20 are mutually agreed upon as being handloomed, handmade, or folklore goods of a kind described in

section 2.3 (a), (b), or (c) or Appendix 3.1.B.11 of the Annex.

(4) BILATERAL

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(i) bilateral emergency tariff actions of a

kind described in section 4 of the Annex with

respect to any textile or apparel article imported from Panama if the application of tariff

treatment under paragraph (1) to such article results in conditions that would be cause for the

taking of such actions under such section 4

with respect to an article described in the same

8-digit subheading of the HTS that is imported from Mexico; or

(ii) bilateral emergency quantitative restriction actions of a kind described in section 5 of the Annex with respect to imports of any

textile or apparel article described in clauses (i) and (ii) of paragraph (2)(A) if the importation of such article into the United States results in conditions that would be cause for the taking of such actions under such section 5 with respect

to a like article that is a product of Mexico.

(B) The requirement in paragraph (5) of section 4 of the Annex (relating to providing compensa

tion) shall not be deemed to apply to a bilateral

emergency action taken under this paragraph.

(C) For purposes of applying bilateral emer

gency action under this paragraph

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2

3

4

5

6.

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(i) the term "transition period" in sections

4 and 5 of the Annex shall be deemed to be the

period defined in subsection (h)(8); and

(ii) any requirements to consult specified in section 4 or 5 of the Annex are deemed to be satisfied if the President requests consultations with Panama and Panama does not agree to consult within the time period specified

under such section 4 or 5, whichever is applicable.

(f) TREATMENT OF CERTAIN OTHER ARTICLES

12 ORIGINATING IN PANAMA.—

(1) EQUIVALENT TARIFF TREATMENT.—

(A) IN GENERAL.-Subject to subparagraph (B), the tariff treatment accorded at any time during the transition period to any article

referred to in any of paragraphs (2) through (5) of section 213(b) of the Caribbean Basin Economic Recovery Act that originates in Panama shall be identical to the tariff treatment

that is accorded at such time under Annex

302.2 of the NAFTA to an article described in

the same 8-digit subheading of the HTS that is

a good of Mexico and is imported into the United States.

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(B) EXCEPTION.-Subparagraph (A) does

not apply to any article accorded duty-free

treatment under U.S. Note 2(b) to subchapter II of chapter 98 of the HTS.

(2) RELATIONSHIP TO OTHER DUTY REDUCTIONS.-If at any time during the transition period

the rate of duty that would (but for action taken

under paragraph (1)(A) in regard to such period)

apply with respect to any article under section 213(h) of the Caribbean Basin Economic Recovery Act is a rate of duty that is lower than the rate of duty resulting from such action, then such lower rate of duty shall be applied for the purposes of im

plementing such action.

(g) CUSTOMS PROCEDURES.

(1) IN GENERAL.—

(A) REGULATIONS.-Any importer that claims preferential tariff treatment under subsection (e) or (f) shall comply with customs procedures similar in all material respects to the requirements of Article 502(1) of the NAFTA as implemented pursuant to United States law, in accordance with regulations promulgated by

the Secretary of the Treasury.

17

(B) DETERMINATION.-In order to qualify for such preferential tariff treatment and for a

Certificate of Origin to be valid with respect to

any article for which such treatment is claimed,

there shall be in effect a determination by the

President that Panama has implemented and

follows, or is making substantial progress toward implementing and following, procedures

and requirements similar in all material respects to the relevant procedures and requirements under chapter 5 of the NAFTA.

(2) CERTIFICATE OF ORIGIN.-The Certificate of Origin that otherwise would be required pursuant to the provisions of paragraph (1) shall not be required in the case of an article imported under sub

section (e) or (f) if such Certificate of Origin would

not be required under Article 503 of the NAFTA (as implemented pursuant to United States law), if the article were imported from Mexico.

(3) PENALTIES FOR TRANSSHIPMENTS.—If the President determines, based on sufficient evidence,

that an exporter has engaged in willful illegal transshipment or willful customs fraud with respect to textile or apparel articles for which preferential tariff treatment under paragraph (1) or (2) of sub