United States Export Finance Agency Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 3407 To strengthen the competitiveness of the United States, to modernize and reform the United States Export Finance Agency, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JUNE 21, 2019 Ms. WATERS (for herself and Mr. MCHENRY) introduced the following bill; which was referred to the Committee on Financial Services A BILL To strengthen the competitiveness of the United States, to modernize and reform the United States Export Finance Agency, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘United States Export 4 Finance Agency Act of 2019’’. 5 SEC. 2. TABLE OF CONTENTS. 6 The table of contents of this Act is as follows: 7 Sec. 1. Short title. Sec. 2. Table of contents. Sec. 3. Findings. Sec. 4. Renaming of the Export-Import Bank of the United States. VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6211 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 2 •HR 3407 IH TITLE I—PROMOTING UNITED STATES LEADERSHIP AND INNOVATION Sec. 101. Authorization period. Sec. 102. Aggregate loan, guarantee, and insurance authority. Sec. 103. Program on China and transformational exports. Sec. 104. Strengthening support for U.S. small businesses. Sec. 105. Office of Minority and Women Inclusion. Sec. 106. Support for United States territories. Sec. 107. Promoting renewable energy exports. Sec. 108. Alternative procedures during quorum lapse. Sec. 109. Information technology systems. Sec. 110. Administratively determined pay. Sec. 111. Survey on blockchain use in the operations of United States export- ers. TITLE II—IMPROVING AGENCY OPERATIONS AND ENHANCING TRANSPARENCY AND ACCOUNTABILITY Sec. 201. Annual testimony. Sec. 202. Independent audit of regional export finance centers. Sec. 203. Risk Management Committee. Sec. 204. Ensuring Agency compliance with additionality requirements. Sec. 205. Reinsurance program. Sec. 206. Report on new Agency policies, procedures, and bylaws. Sec. 207. Report on travel practices of Agency employees. Sec. 208. Report on steps taken to correct deficiencies related to information security. Sec. 209. Additional requirements involving certain transactions. Sec. 210. Anti-fraud reforms. TITLE III—FOREIGN POLICY CONSIDERATIONS Sec. 301. Chinese government-owned enterprises. Sec. 302. International negotiations on export subsidies. Sec. 303. Prohibition on financing for exports involving state sponsors of ter- rorism. TITLE IV—MISCELLANEOUS PROVISIONS Sec. 401. Miscellaneous updates relating to the United States Export Finance Agency. Sec. 402. Prohibition on financing for certain aviation-related vehicles. SEC. 3. FINDINGS. 1 The Congress finds as follows: 2 (1) The Export-Import Bank of the United 3 States (EXIM)—the official export credit agency of 4 the United States—is designed to help create and 5 support U.S. jobs by providing American exporters 6 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 3 •HR 3407 IH with the financing tools necessary to compete in the 1 global markets. 2 (2) Over its 85-year history, under both Repub- 3 lican and Democratic administrations, the Export- 4 Import Bank of the United States has been reau- 5 thorized 17 times with large bipartisan majorities in 6 Congress. 7 (3) Over the last 10 years, the Export-Import 8 Bank of the United States has financed more than 9 $186,000,000,000 in authorizations supporting more 10 than $255,000,000,000 in United States exports 11 and supported 1,600,000 United States jobs in all 12 50 states; in fiscal year 2018, EXIM authorized 13 $3,300,000,000 in financing and supported an esti- 14 mated 33,000 United States jobs. 15 (4) By its charter, it is the policy of the United 16 States that the Export-Import Bank of the United 17 States should not compete with the private sector, 18 but rather to fill export financing gaps through its 19 insurance, loan guarantee, and direct lending pro- 20 grams when the private sector is unable or unwilling 21 to do so. 22 (5) With more than 100 export credit agencies 23 globally, the Export-Import Bank of the United 24 States, if appropriately utilized, can level the playing 25 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 4 •HR 3407 IH field to ensure that United States companies will not 1 lose out on a sale of United States exports because 2 of financing terms offered by foreign governments. 3 (6) In fiscal year 2018, 90.5 percent of the Ex- 4 port-Import Bank of the United States’ authoriza- 5 tions directly supported small businesses, including 6 315 small businesses that used the Export-Import 7 Bank of the United States for the first time. 8 (7) In fiscal year 2014, when the Export-Im- 9 port Bank of the United States was last fully oper- 10 ational, EXIM authorized $751,000,000 to support 11 minority- and women-owned business exports. 12 (8) In fiscal year 2018, the Export-Import 13 Bank of the United States approved $451,400,000 14 in support of minority- or woman-owned businesses, 15 which accounted for 21 percent of total small busi- 16 ness authorizations. 17 (9) The charter of the Export-Import Bank of 18 the United States requires the Bank to lend only if 19 there exists reasonable assurance that it will be re- 20 paid, and Congress subjects EXIM to statutory re- 21 strictions and oversight to safeguard its fiscal sound- 22 ness, limit mismanagement, and prevent corruption. 23 (10) EXIM was last reauthorized in December 24 2015, and its charter expires September 30, 2019. 25 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 5 •HR 3407 IH (11) Despite bicameral support for the Bank’s 1 reauthorization in 2015, the Senate did not confirm 2 the directors of EXIM until May 2019. As a result, 3 the Bank did not have a quorum and could not ap- 4 prove transactions over $10,000,000. 5 SEC. 4. RENAMING OF THE EXPORT-IMPORT BANK OF THE 6 UNITED STATES. 7 (a) IN GENERAL.—The Export-Import Bank of the 8 United States is hereby redesignated as the United States 9 Export Finance Agency. 10 (b) REFERENCES.—Any reference to the Export-Im- 11 port Bank of the United States in any law, rule, regula- 12 tion, certificate, directive, instruction, or other official 13 paper in force on the date of the enactment of this Act 14 shall be considered to refer and apply to the United States 15 Export Finance Agency. 16 TITLE I—PROMOTING UNITED 17 STATES LEADERSHIP AND IN- 18 NOVATION 19 SEC. 101. AUTHORIZATION PERIOD. 20 Section 7 of the Export-Import Bank Act of 1945 21 (12 U.S.C. 635f) is amended by striking ‘‘2019’’ and in- 22 serting ‘‘2026’’. 23 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 6 •HR 3407 IH SEC. 102. AGGREGATE LOAN, GUARANTEE, AND INSURANCE 1 AUTHORITY. 2 Section 6(a)(2) of the Export-Import Bank Act of 3 1945 (12 U.S.C. 635e(a)(2)) is amended to read as fol- 4 lows: 5 ‘‘(2) APPLICABLE AMOUNT DEFINED.—In this 6 subsection, the term ‘applicable amount’ means— 7 ‘‘(A) $145,000,000,000 for fiscal year 8 2020; 9 ‘‘(B) $150,000,000,000 for fiscal year 10 2021; 11 ‘‘(C) $155,000,000,000 for fiscal year 12 2022; 13 ‘‘(D) $160,000,000,000 for fiscal year 14 2023; 15 ‘‘(E) $165,000,000,000 for fiscal year 16 2024; 17 ‘‘(F) $170,000,000,000 for fiscal year 18 2025; and 19 ‘‘(G) $175,000,000,000 for fiscal year 20 2026.’’. 21 SEC. 103. PROGRAM ON CHINA AND TRANSFORMATIONAL 22 EXPORTS. 23 (a) IN GENERAL.—Section 2 of the Export-Import 24 Bank Act of 1945 (12 U.S.C. 635) is amended by adding 25 at the end the following: 26 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 7 •HR 3407 IH ‘‘(l) PROGRAM ON CHINA AND TRANSFORMATIONAL 1 EXPORTS.— 2 ‘‘(1) IN GENERAL.—The Agency shall establish 3 a Program on China and Transformational Exports 4 to support the extension of loans, guarantees, and 5 insurance, at rates and on terms and other condi- 6 tions, to the extent practicable, that are fully com- 7 petitive with rates, terms, and other conditions es- 8 tablished by the People’s Republic of China or by a 9 covered country, that aim to— 10 ‘‘(A) directly neutralize export subsidies 11 for competing goods and services financed by 12 official export credit, tied aid, or blended fi- 13 nancing provided by the People’s Republic of 14 China or by a covered country; or 15 ‘‘(B) advance the comparative leadership 16 of the United States with respect to the Peo- 17 ple’s Republic of China, or support United 18 States innovation, employment, and techno- 19 logical standards, through direct exports in any 20 of the following areas: 21 ‘‘(i) Artificial intelligence. 22 ‘‘(ii) Biotechnology. 23 ‘‘(iii) Biomedical sciences. 24 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 8 •HR 3407 IH ‘‘(iv) Wireless communications equip- 1 ment (including 5G or subsequent wireless 2 technologies). 3 ‘‘(v) Quantum computing. 4 ‘‘(vi) Renewable energy, energy effi- 5 ciency, and energy storage. 6 ‘‘(vii) Semiconductor and semicon- 7 ductor machinery manufacturing. 8 ‘‘(viii) Emerging financial tech- 9 nologies, including technologies that facili- 10 tate— 11 ‘‘(I) financial inclusion through 12 increased access to capital and finan- 13 cial services; 14 ‘‘(II) data security and privacy; 15 ‘‘(III) payments, the transfer of 16 funds, and associated messaging serv- 17 ices; and 18 ‘‘(IV) efforts to combat money 19 laundering and the financing of ter- 20 rorism. 21 ‘‘(ix) Associated services necessary for 22 use of any of the foregoing exports. 23 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 9 •HR 3407 IH ‘‘(2) COVERED COUNTRIES.—In this subsection, 1 the term ‘covered country’ means any country 2 that— 3 ‘‘(A) the Secretary of the Treasury des- 4 ignates as a covered country in a report to the 5 Committee on Financial Services of the House 6 of Representatives and the Committee on Bank- 7 ing, Housing, and Urban Development of the 8 Senate; and 9 ‘‘(B) is not a participant in the Arrange- 10 ment on Officially Supported Export Credits of 11 the Organization for Economic Cooperation and 12 Development (in this subsection referred to as 13 the ‘Arrangement’); and 14 ‘‘(C) is not in substantial compliance with 15 the financial terms and conditions of the Ar- 16 rangement. 17 ‘‘(3) FINANCING.— 18 ‘‘(A) IN GENERAL.—It shall be a goal of 19 the Agency to reserve not less than 20 percent 20 of the applicable amount (as defined in section 21 6(a)(2)) for support made pursuant to the Pro- 22 gram on China and Transformational Exports. 23 ‘‘(B) EXCEPTION.—The Secretary of the 24 Treasury may reduce or eliminate the 20 per- 25 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 10 •HR 3407 IH cent goal in subparagraph (A), on reporting to 1 the Committee on Financial Services of the 2 House of Representatives and the Committee 3 on Banking, Housing, and Urban Affairs of the 4 Senate that the People’s Republic of China is in 5 substantial compliance with— 6 ‘‘(i) the financial terms and conditions 7 of the Arrangement; and 8 ‘‘(ii) the rules and principles of the 9 Paris Club. 10 ‘‘(C) SUNSET AND REPORT.—The program 11 established under paragraph (1) shall expire on 12 September 30, 2026. Not later than 4 years 13 after enactment of this subsection, the Presi- 14 dent of the Agency shall submit a report to the 15 Committee on Financial Services of the House 16 of Representatives and the Committee on Bank- 17 ing, Housing, and Urban Affairs of the Senate 18 assessing the following: 19 ‘‘(i) The capacity and demand of 20 United States entities to export goods and 21 services in the areas described in para- 22 graph (1)(B) in consultation with the Sec- 23 retary of Commerce. 24 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 11 •HR 3407 IH ‘‘(ii) The availability of private-sector 1 financing for exports in the areas. 2 ‘‘(iii) The feasibility and advisability 3 of continuing the goal of subparagraph (A) 4 of this paragraph with respect to para- 5 graph (1)(B) after September 30, 2026. 6 ‘‘(D) NATIONAL ADVISORY COUNCIL ON 7 INTERNATIONAL FINANCIAL AND MONETARY 8 PROBLEMS.—The National Advisory Council on 9 International Financial and Monetary Problems 10 shall ensure that Agency authorizations pursu- 11 ant to the Program on China and Trans- 12 formational Exports are considered or reviewed 13 expeditiously, consistent with the other credit 14 standards required by law.’’. 15 (b) REQUIRED REPORTING.—Section 8 of such Act 16 (12 U.S.C. 635g) is amended by adding at the end the 17 following: 18 ‘‘(l) REPORT ON AUTHORIZATIONS UNDER THE PRO- 19 GRAM ON CHINA AND TRANSFORMATIONAL EXPORTS.— 20 The Agency shall include in its annual report to Congress 21 under subsection (a) a narrative and financial summary 22 of the authorizations made under the Program on China 23 and Transformational Exports.’’. 24 VerDate Sep 11 2014 00:10 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H3407.IH H3407 pamtmann on DSKBFK8HB2PROD with BILLS 12 •HR 3407 IH (c) RULE OF CONSTRUCTION.—Nothing in section 1 2(l)(1)(B) of the Export-Import Bank Act of 1945 shall 2 be construed to weaken any export controls affecting crit- 3 ical technologies (as defined in section 721(a)(6)(A) of the 4 Defense Production Act of 1950 (50 U.S.C. 5 4565(a)(6)(A))). 6 SEC. 104. STRENGTHENING SUPPORT FOR U.S. SMALL BUSI- 7 NESSES. 8 (a) INCREASING SMALL BUSINESS THRESHOLD.— 9 Section 2(b)(1)(E)(v) of the Export-Import Bank Act of 10 1945 (12 U.S.C. 635(b)(1)(E)(v)) is amended— 11 (1) by striking ‘‘25 percent of such authority 12 for each fiscal year’’ and inserting ‘‘25 percent of 13 such authority for each of fiscal years 2020, 2021, 14 and 2022, and 30 percent of such authority for each 15 fiscal year thereafter’’; and 16 (2) by adding at the end the following: ‘‘For t [Text truncated for display. Full text available on Congress.gov.]