GARLIC Act

I 116TH CONGRESS 1ST SESSION H. R. 4448 To address loopholes in the Harmonized Tariff Schedule of the United States that allow companies to avoid the duty rate applicable to dehydrated garlic. IN THE HOUSE OF REPRESENTATIVES SEPTEMBER 20, 2019 Mr. PANETTA introduced the following bill; which was referred to the Committee on Ways and Means A BILL To address loopholes in the Harmonized Tariff Schedule of the United States that allow companies to avoid the duty rate applicable to dehydrated garlic. 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 ‘‘Giving Agriculture Re- 4 lief from Loopholes in International Commerce Act’’ or 5 the ‘‘GARLIC Act’’. 6 SEC. 2. FINDINGS. 7 Congress finds the following: 8 (1) The United States domestic dried garlic in- 9 dustry currently provides approximately 50,000,000 10 VerDate Sep 11 2014 22:56 Sep 27, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4448.IH H4448 lotter on DSKBCFDHB2PROD with BILLS 2 •HR 4448 IH pounds of dried garlic for the United States market 1 and has the capacity to increase production. 2 (2) Dried garlic imported from China accounts 3 for approximately 140,000,000 pounds of the total 4 amount sold in the United States market. 5 (3) Dried garlic is classifiable under subheading 6 0712.90.40 of the Harmonized Tariff Schedule of 7 the United States, with a duty rate of 29.8 percent. 8 (4) Chinese companies have found apparent 9 loopholes in the Harmonized Tariff Schedule and are 10 importing dehydrated garlic at much lower tariff 11 rates, causing direct harm to the United States do- 12 mestic industry. 13 (5) Imports of Chinese dehydrated garlic under 14 the subheading for dried garlic, 0712.90.40, have 15 decreased approximately 70 percent over the past 16 few years, but there has not been a corresponding 17 change in United States consumption or imports 18 from other locations. 19 (6) Importers of Chinese dried garlic are now 20 engaging in limited further processing of the product 21 and importing it as a ‘‘further processed vegetable’’ 22 classifiable under subheading 2005.99.97, at a duty 23 rate of 11.2 percent. 24 VerDate Sep 11 2014 22:56 Sep 27, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4448.IH H4448 lotter on DSKBCFDHB2PROD with BILLS 3 •HR 4448 IH (7) Importers of Chinese dried garlic are also 1 adding minimal amounts of other dehydrated vegeta- 2 bles, such as onion, to the dehydrated garlic and im- 3 porting it as ‘‘other mixed vegetables’’ classifiable 4 under subheading 0712.90.85, at a duty rate of 8.3 5 percent. 6 (8) The dried garlic products imported from 7 China under subheadings 2005.99.97 and 8 0712.90.85 are still marketed and sold in the United 9 States as dried garlic and directly compete against 10 United States-produced dried garlic. 11 SEC. 3. SENSE OF CONGRESS. 12 It is the sense of Congress that— 13 (1) the duty rate on dried garlic was set at 29.8 14 percent to support United States domestic producers 15 of dried garlic and create a more level playing field 16 when competing against low-cost dried garlic im- 17 ported from China; 18 (2) the use of these loopholes in the Har- 19 monized Tariff Schedule of the United States is di- 20 rectly harming United States domestic dried garlic 21 producers, their employees, and the farmers that 22 grow garlic in support of this domestic industry; and 23 (3) the use of these loopholes in the Har- 24 monized Tariff Schedule of the United States has 25 VerDate Sep 11 2014 22:56 Sep 27, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4448.IH H4448 lotter on DSKBCFDHB2PROD with BILLS 4 •HR 4448 IH resulted in a loss of approximately $40,000,000 in 1 revenue to the United States over the past 2 years 2 alone. 3 SEC. 4. ADDITION OF U.S. NOTES AND NEW SUBHEADINGS 4 RELATED TO DEHYDRATED GARLIC. 5 (a) ADDITION OF U.S. NOTE.—The Additional U.S. 6 Notes to chapter 7 of the Harmonized Tariff Schedule of 7 the United States are amended by inserting in numerical 8 sequence the following: 9 ‘‘6. In the assessment of duty on dried garlic, 10 the presence of other vegetables mixed with the 11 dried garlic shall not remove the product from sub- 12 heading 0712.90.40 unless the percentage of garlic, 13 by weight, is less than 50 percent. 14 ‘‘7. In the assessment of duty on dried garlic, 15 the application of additional heat to dried garlic does 16 not constitute further processing such that the dried 17 garlic would be excluded from subheading 18 0712.90.40 unless the resulting dried garlic has an 19 extractable color (optical index) of 1000+/¥500 as 20 set forth under Section IV.C.5 of the American De- 21 hydrated Onion and Garlic Association (ADOGA) 22 standards for roasted or toasted garlic.’’. 23 VerDate Sep 11 2014 22:56 Sep 27, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4448.IH H4448 lotter on DSKBCFDHB2PROD with BILLS 5 •HR 4448 IH SEC. 5. EFFECTIVE DATE. 1 This Act and the amendments made by this Act 2 shall— 3 (1) take effect on the 30th day after the date 4 of the enactment of this Act; and 5 (2) apply to articles entered, or withdrawn from 6 warehouse for consumption, on or after such 30th 7 day. 8 Æ VerDate Sep 11 2014 22:56 Sep 27, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6301 E:\BILLS\H4448.IH H4448 lotter on DSKBCFDHB2PROD with BILLS