Caribbean Basin Economic Recovery Act

(Reported to House from the Committee on Foreign Affairs with amendment, H. Rept. 97-665 (Part I))

Caribbean Basin Economic Recovery Act - Title I: Duty-Free Treatment - Authorizes the President to proclaim duty-free treatment for all eligible articles from Caribbean countries the President designates as beneficiary countries. Prohibits the President from terminating a country's beneficiary designation unless both Houses of Congress are notified 60 days before the termination.

Requires the President to consider only specified countries and territories as beneficiary countries.

Prohibits the President from designating as a beneficiary country any country that: (1) is a Communist country; (2) has nationalized or seized control, or effectively nationalized or seized control, of U.S. property, unless the President determines that a good faith effort is being made to compensate for such seizure; (3) fails to act in good faith in recognizing as binding or in enforcing arbitral awards in favor of U.S. citizens or corporations; or (4) grants preferential treatment to the products of a developed country other than the United States which may have a significant adverse effect on U.S. commerce, unless the President reports to Congress that certain assurances have been made.

Permits the President to designate as a beneficiary country a Communist country, an expropriating country, or a country that fails to act in good faith with respect to an arbitral award if the President determines and reports to Congress that such designation will be in the national interest.

Lists factors the President should consider in determining whether to grant beneficiary designation.

Amends the Tariff Schedules of the United States to grant to imports from U.S. insular possessions, subject to specified provisions of this Act, duty treatment no less favorable than the treatment afforded such imports from a beneficiary country.

Directs the President to withdraw or suspend a country's beneficiary designation, if the President determines that changed circumstances in such country would prohibit such designation under the guidelines in this title.

Requires duty-free treatment to apply to any article imported from a beneficiary country, unless otherwise excluded from eligibility, if: (1) the article is imported directly from such country into U.S. customs territory; and (2) the sum of specified costs of the article is not less than 25 percent of its appraised value at the time of its entry.

Prohibits this duty-free treatment from applying to textile and apparel articles covered by textile agreements.

Sets forth the manner of governing the importation and duty-free treatment of certain sugars, sirups, and molasses.

Authorizes the President to suspend the duty-free treatment provided by this title and to proclaim a duty for an eligible article if such action is taken pursuant to certain import relief or national security provisions.

Requires the International Trade Commission (ITC) in any report on a petition for import relief under the Trade Act of 1974 to state how its findings and recommendations apply to any duty-free article imported from beneficiary countries. Authorizes the President to reduce or end the application of import relief measures with respect to articles imported from beneficiary countries earlier than otherwise scheduled.

Provides that suspension of duty-free treatment provided by this title shall be treated as an increase in duty for purposes of the import relief section of the Trade Act of 1974. Prohibits such a suspension of duty-free treatment unless the ITC finds that the harm caused by the imports results from its duty-free treatment by this title.

Authorizes the filing of petitions for import relief with the Secretary of Agriculture, as well as with the ITC, for injury from imports of perishable products from beneficiary countries. Directs the Secretary to recommend the granting or denying of such petition within 14 days of its filing. Requires the President to take emergency action or to publish a notice of determination not to take emergency action within seven days of receiving the Secretary's recommendation. Sets forth the limits on the duration of the emergency action. Defines perishable products to include certain fresh or chilled vegetables, fresh mushrooms, fresh fruit, and fresh cut flowers. Exempts from proclamations under this title certain fees imposed pursuant to the Agricultural Adjustment Act.

Amends the Tariff Schedules of the United States to increase to five liters (currently, four liters) the amount of duty-free liquor that may be brought into the United States. Requires that not more than four liters, of such five liter limit, may have been produced outside American Samoa, Guam, or the U.S. Virgin Islands.

Authorizes the President to withdraw duty-free treatment on rum if the amount of excise taxes on rum that is paid into the treasuries of Puerto Rico and the Virgin Islands falls below the amount that would have been paid if the rum had been produced in Puerto Rico or the Virgin Islands.

Amends the Trade Agreements Act of 1979 to repeal the provision for protecting U.S. possessions against revenue losses caused by concessions granted by the United States in the Tokyo Round of the Multilateral Trade Negotiations.

Prohibits any action under this title from affecting a tariff imposed by Puerto Rico on coffee imported into Puerto Rico.

Limits the duration of duty-free treatment under this Act to 12 years.

Title II: Caribbean-Central America Economic Revitalization - Caribbean-Central America Economic Revitalization Act of 1982 - Authorizes appropriations for FY 1982 for economic support funds to countries in the Caribbean and Central America. Requires at least 80 percent of such funds to be used to generate local currencies. Requires such currencies to be used to support objectives consistent with the objectives of specified sections of the Foreign Assistance Act of 1961.

Earmarks specified amounts for: (1) activities carried out in accordance with the provisions of the Foreign Assistance Act dealing with development assistance policy, rural agricultural development, population planning and health programs, education and human resources development, and development of indigenous energy resources; (2) scholarships for Caribbean and Central American students in the United States; and (3) activities of the Inter-American Foundation in the Caribbean and Central America.

Limits the amount of funds that may be used for any one country.

Directs the President to seek a reasonable balance in allocating funds under this title between supporting the public sector and supporting the private sector of such countries and between balance of payments support and support for development projects.

Requires agreements relating to assistance under this title to emphasize using assistance in a manner that will not cause serious injury to sales of U.S. farm products.

Prohibits using funds under this title for aid to Haiti until the President has certified to Congress that Haiti has met certain fiscal performance targets established by the International Monetary Fund.

Authorizes providing additional funding for EL Salvador to facilitate the implementation of that country's land reform program.

Prohibits using any of the funds appropriated under this title for EL Salvador unless the President reports to Congress that El Salvador: (1) has not altered the land reform program in a manner detrimental to the rights of the beneficiaries or the potential beneficiaries of the program; and (2) is making substantial progress in implementing the program.

Directs the President to include in the annual report to Congress on foreign assistance programs a detailed description of the disposition of the funds appropriated under this title.

Title III: Tax Provisions - Amends the Internal Revenue Code to require excise taxes on rum imported into the United States to be paid to Puerto Rico and the U.S. Virgin Islands. Limits the amount paid to Puerto Rico and the U.S. Virgin Islands to the amount those possessions would have received if the rum had been produced in Puerto Rico or the Virgin Islands and transported to the United States.

Provides an investment tax credit for investments in Caribbean Basin property placed in service within five years after enactment. Defines Caribbean Basin property as new investment credit property used predominantly in a country that is: (1) a beneficiary country, as defined under this Act; and (2) a party to a bilateral agreement providing for exchange of information between the United States and the beneficiary country. Authorizes the Secretary of the Treasury to conclude an agreement with a beneficiary country to provide information to carry out the tax laws of the United States and the beneficiary country.

Prohibits allowing an investment tax credit to foreign corporations for Caribbean Basin property.

Allows an investment tax credit to a U.S. shareholder of a foreign corporation that invests in Caribbean Basin property if the shareholder holds five percent of the foreign corporation's stock.

Requires recapture of the investment credit if, during any taxable year, the Caribbean Basin property is used predominantly outside a qualifying country or the United States.

Extends an investment tax credit and accelerated cost recovery deduction to property owned or used by U.S. corporations or citizens engaged in trade or business in Puerto Rico or other U.S. possessions. (Current law excludes such corporations and citizens from obtaining such credit and deduction.)

Authorizes certain corporations that own stock in corporations doing business in Puerto Rico or another U.S. possession to receive a portion of the investment tax credit and accelerated cost recovery deduction available to corporations doing business in Puerto Rico or another U.S. possession.

Authorizes certain corporations that own stock in corporations doing business in the Virgin Islands to receive a portion of the investment tax credit and the accelerated cost recovery deduction available to the corporations doing business in the Virgin Islands.

Excludes from the definition of qualified leased property for purposes of the accelerated cost recovery deduction Caribbean Basin property and property in Puerto Rico or U.S. possessions owned by certain U.S. corporations or citizens.