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HR 2798 RFSS

110th CONGRESS Calendar No. 593

1st 110th CONGRESS

2d Session

H. R. 2798

[Report No. 110-273]

IN THE SENATE OF THE UNITED STATES

July 24, 2007

Received; read twice and referred to the Committee on Foreign Relations

March 4, 2008

Reported by Mr. BIDEN, with an amendment

[Strike out all after the enacting clause and insert the part printed in italic]

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AN ACT

To reauthorize the programs of the Overseas Private Investment Corporation, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Overseas Private Investment Corporation Reauthorization Act of 20078'.

SEC. FINDINGS.The Congress finds the following:(1) Since its founding in 1971, the Overseas Private Investment Corporation (in this section referred to as `OPIC') has helped to mobilize and facilitate private capital by United States investors in developing and emerging market countries in support of United States foreign policy and development goals.(2) OPIC assistance should not, in any way, support projects in countries that reject their obligations to support international peace, security, and basic human rights.(3) OPIC assistance should not be provided to those who support enemies of the United States.(4) OPIC assistance is a privilege and should be granted to persons that, along with their affiliated companies, demonstrate responsible and sustainable business practices, particularly with regard to the environment, international worker rights, and efforts against genocide and nuclear proliferation. Denial of OPIC assistance is not a penalty or sanction.(5) Over OPIC's 35-year history, OPIC has supported $177,000,000,000 in operating investments in more than 150 developing countries, helping to create more than 800,000 jobs and some $13,000,000,000 in host-government revenues.(6) OPIC projects have generated $71,000,000,000 in United States exports and supported more than 271,000 United States jobs.(7) Projects assisted by OPIC in fiscal year 2006 are projected to generate $1,000,000,000 in United States exports, support more than2,700 United States jobs, and have a positive impact on the United States balance of payments.(8) In fiscal year 2006, 87 percent of all OPIC-supported projects supported small-and-medium-sized businesses in the United States.(9) In an era of limited Federal budgetary resources, OPIC has consistently demonstrated an ability to operate on a self-sustaining basis to support United States companies, all at a net cost of zero to the United States taxpayer.(10) OPIC has reserves totaling approximately $5,300,000,000 and will make an estimated net budget contribution to the international affairs account of $159,000,000 in fiscal year 2008.SEC. 3. 2. REAUTHORIZATION OF OPIC PROGRAMS.

Section 235(a)(2) of the Foreign Assistance Act of 1961 (22 U.S.C. 2195(a)(2)) is amended by striking `September 30, 2007' and inserting `September 30, 2011'.

SEC. 4. PREFERENTIAL CONSIDERATION OF CERTAIN INVESTMENT PROJECTS.3Section 231(f) of the Foreign Assistance Act of 1961 (22 U.S.C. 2191(f)) is amended to read as follows:`(f) to give preferential consideration to investment projects in less developed countries the governments of which are receptive to private enterprise, domestic and foreign, and to projects in countries the governments of which are willing and able to maintain conditions that enable private enterprise to make its full contribution to the development process;'.SEC. 5. REQUIREMENTS REGARDING INTERNATIONALLY RECOGNIZED WORKER RIGHTS.

(a) Country Requirements- Subsection (a) of section 231A of the Foreign Assistance Act of 1961 (22 U.S.C. 2191a(a)) is amended--(1) by amending the subsection heading to read as follows:

`International `(a) Internationally Recognized Worker Rights';-

(2) in paragraph (4), by striking `(4) In' and inserting `(5) ADDITIONAL DETERMINATION- In'; and(3) by striking paragraphs (1) through (3) and inserting the following:`(1) LIMITATION ON OPIC ACTIVITIES- (A)IN GENERAL- The Corporation may insure, reinsure, guaranteey, or finance a project only if--

`(A) the country in which the project is to be undertaken is eligible for designation as a beneficiary developing country under the Generalized System of Preferences (19 U.S.C. 2461 et seq.) and has madenot been determined to be ineligible for such designation on the basis of section 502(b)(2)(G) of the Trade Act of 1974 (19 U.S.C. 2462(b)(2)(G)) (relating to internationally recognized worker rights), or section 502(b)(2)(H) of such Act (19 U.S.C. 2462(b)(2)(H) (relating to the worst forms of child labor); or

`(B) the country in which the project is making significant progress towardsto be undertaken is not eligible for designation as a beneficiary country under the recognition, adoption, and implementationGeneralized System of Preferences, the government laws of that substantially provide international worker rights, includingcountry has taken or is taking steps to afford workers in the country (including any designated zone, or special administrative region or area, in that country.) internationally recognized worker rights (as defined in section 507(4) of the Trade Act of 1974) (19 U.S.C. 2467(4)).

`(2) LIMITATION INAPPLICABLE- The limitation contained in paragraph (1) shall not apply to providing assistance for humanitarian services.

`(3) USE OF REPORTS- The Corporation shall, in implementing paragraph (1), consider--

`(A) information contained in the reports required by sections 116(d) and 502B(b) of this Act and the report required by section 504 of the Trade Act of 1974 (19 U.S.C. 2464);

`(B) other relevant sources of information readily available to the Corporation, including observations, reports, and recommendations of the International Labour Organization; and

`(C) information provided in the hearing required under subsection (c).

`(4) CONTRACT LANGUAGE- The Corporation also shall include the following language, in substantially the following form, in all contracts which the Corporation enters into with eligible investors to financial provide support under this title:

`The investor agrees not to take any actions to obstruct or prevent employees of the foreign enterprise from exercising their international employees' internationally recognized worker rights (as defined in section 238(h507(4) of the Foreign AssistancTrade Act of 1961),74) (19 U.S.C. 2467(4)) and the investor agrees to adhere to the obligations regarding those international worker rights.'rights. The investor agrees to prohibit discrimination with respect to employment and occupation.'.

`(2 `(5) PREFERENCE TO CERTAIN COUNTRIES- To the degree possible and cConsistent with its development objectives, the Corporation shall give preferential consideration to projects in countries that--

`(A) have adopted, maintain, and enforce laws that substantially provide international worker rights.`(3) USE OF ANNUAL REPORTS ON INTERNATIONAL WORKER RIGHTS- The Corporation shall, in carrying out paragraph (1)(A), use, among other sources, the reports submitted to the Congress pursuant to section 504 of the Trade Act of 1974. Such other sources include the observations, reports, and recommendations of the International Labor Organization, and other relevant organizations.`(4) INAPPLICABILITY TO HUMANITARIAN ACTIVITIES- Paragraph (1) shall not prohibit the Corporation from providing any insurance, reinsurance, guaranty, financing, or other assistance for the provision of humanitarian assistance in a country.'.(b) Board of Directors- Section 233(b) of the Foreign Assistance Act of 1961 (22 U.S.C. 2193(b)) is amended by adding at the end the following: `The selection of the small business, organized labor, and cooperative directors should be made, respectively, in consultation with relevant representative organizations.'.maintained,(c) Definitions- Section 238 of the Foreign Assistance Act of 1961 (22 U.S.C. 2198) is amended--(1) subsection (f), by striking `and' after in the semicolon;country's laws(2) in subsection (g), by striking the period at the end and inserting `; and'; andregulations,(3) by adding at the end the following:`(h) the term `international worker rights' means--`(1) internationally recognized worker rights, as defined in section 507(4) of the Trade Act of 1974 (well as19 U.S.C. 2467(4)); and`(2) the elimination of discrimination with respect to employment and occupation.'.; and

(d) General Provisions and Powers- Section 239 of the Foreign Assistance Act of 1961 ( `(B) are effectively enforcing those laws.22 U.S.C. 2199) is amended--(1) in subsection (h), by adding at the end the following: `In addition, the Corporation should consult with relevant stakeholders in developing such criteria.'; and(2) in subsection (i), in the first sentence, by inserting `, including international worker rights,' after `fundamental freedoms'.

SEC. 6. ENVIRONMENTAL ASSESSMENTS.4. PREFERENTIAL CONSIDERATION OF CERTAIN INVESTMENT PROJECTS.

Section 231A(b(f) of the Foreign Assistance Act of 1961 (22 U.S.C. 2191a(b(f)) is amended to read as follows:

`(b) Environmental Impact- The Board of Directors of the Corporation shall not vote in favor of any action proposed to be taken by the Corporation that is likely `(f) have significant adverse environmental impacts, unless for at least 60 days before to the date of the vote--greatest degree practicable and consistent with`(1) an environmental impact assessment, or initial environmental audit, analyzing the environmental impactgoals of the proposed action and of alternativesCorporation, to the proposed action has been completed by the project applicant and made availablegive preferential consideration to investment projects in any less developed country the Boardgovernment of Directors; andwhich is receptiv`(2) such assessment or audit has been made available to the public of the United States, locally affected groups in the host country,both domestic and hostforeign private enterprise and to projects in any nongovernmental organizations.'.SEC. 7. COMMUNITY SUPPORT.Section 237 of country the Foreign Assistance Acgovernment of 1961 (which22 U.S.C. 2197) is amended by adding at the end the following:willing and able to maintain conditions`(p) Community Support- To the maximum extent practicable, the Corporation shall require the applicant for a project that is subjectenable private enterprise to section 231A(b)make a full contribution obtain broad community support for to the project.development process;'.

SEC. 85. CLIMATE CHANGE MITIGATION ACTION PLAN.

Title IV of chapter 2 of part I of the Foreign Assistance Act of 1961 (22 U.S.C. 22191 et seq.) is amended by inserting after section 234A the following new section:

`SEC. 234B. CLIMATE CHANGE MITIGATION.

`(a) Mitigation Action Plan- The Corporation shall, not later than 180 days after the date of the enactment of the Overseas Private Investment Corporation Reauthorization Act of 20078, institute a climate change mitigation action plan that includes the following:

`(1) CLEAN AND EFFICIENT ENERGY TECHNOLOGY-TECHNOLOGY-

`(A) INCREASING ASSISTANCE- The Corporation shall establish a goal of substantially increasing its support of projects that use, develop, or otherwise promote the use of clean energy technologies overduring the 410-year period beginning on the date of the enactment of the Overseas Private Investment Corporation Reauthorization Act of 2007.8.

`(B) PREFERENTIAL TREATMENT TO PROJECTS- The Corporation shall give preferential treatment to the evaluationevaluating and of awarding assistance for, and provide greater flexibility in supporting, projects that use, develop, or otherwise promote the use of and efficient clean energy technologies.

`(C) REPORT ON PLAN- The Corporation shall, not later than 180 days after the date of the enactment of the Overseas Private Investment Corporation Reauthorization Act of 2008, submit to the Committees on Foreign Relations and Appropriations of the Senate and the Committees on Foreign Affairs and Appropriations of the House of Representatives a report on the plan developed to carry out subparagraph (A). Thereafter, the Corporation shall include in its annual report required under section 240A a discussion of the plan and its implementation.

`(2) ENVIRONMENTAL IMPACT ASSESSMENTS-

`(A) GREENHOUSE GAS EMISSIONS- The Corporation shall, in making an environmental impact assessment or initial environmental audit for a project under section 231A(b), also take into account the degree to which the project contributes to the emission of greenhouse gases.

`(B) OTHER DUTIES NOT AFFECTED- The requirement provided for under subparagraph (A) is in addition to any other requirement, obligation, or duty thatof the Corporation has..

`(3) REPORT TO CONGRESSIONAL COMMITTEESGOALS FOR REDUCING GREENHOUSE GAS EMISSIONS-

`(A) IN GENERAL- The Corporation shall, within 180 days after continue to maintain--

`(i) a goal for reducing direct greenhouse gas emissions associated with projects in the Corporation's portfolio on the date of the enactment of the Overseas Private Investment Corporation Reauthorization Act of 2007, submit to8 by 20 percent during the Committee10-year period beginning on Foreign Affairssuch date of the Housenactment; and

`(ii) a goal for limiting annual investments in projects that have significant greenhouse gas emissions after such date of Representatives andenactment in a manner that reduces greenhouse gas emissions associated with projects in the Committeerporation's total portfolio by 20 percent during the 10-year period beginning on Foreign Relationssuch date of enactment.

`(B) SPECIAL RULES-

`(i) BASELINE- For purposes of determining the Senate a report onpercentage by which greenhouse gas emissions are reduced under subparagraph (A), the plan developed to carry out paragraph (1)(A). Thereafter,Corporation shall use the aggregate estimated greenhouse gas emissions for projects in the Corporation's portfolio.

`(ii) SIGNIFICANT GREENHOUSE GAS EMISSIONS PROJECTS- For purposes of this paragraph, projects that have significant greenhouse gas emissions are projects that result in the emission of more than 100,000 tons of CO2 equivalent each year.

`(C) REPORTING REQUIREMENTS- The Corporation shall include, in itseach annual report required under section 240A, the following information with respect to the period covered by the report:

`(i) The annual greenhouse gas emissions attributable to each project in the Corporation's active portfolio that has significant greenhouse gas emissions.

`(ii) The estimated greenhouse gas emissions for each new project that has significant greenhouse gas emissions for which the Corporation provided insurance, reinsurance, a discussion of such planguaranty, or financing, since the previous report.

`(iii) The extent to which the Corporation is meeting the goals described in subparagraph (A) for reducing greenhouse gas emissions.

`(iv) Each new project for which the Corporation provided insurance, reinsurance, a guaranty, or financing, that involves renewable energy and its implementation.environmentally beneficial products and services, including increased clean energy technology.

`(b) Extraction Investments-

`(1) PRIOR NOTIFICATION TO CONGRESSIONAL COMMITTEES-

`(A) IN GENERAL- The Corporation may not approve any contractshall provide notice of insurance or reinsurance, or any guaranty, or enter into any agreementconsideration of approval of a project described in subparagraph (B) to provide financing for anythe Committees on Foreign Relations and Appropriations of the Senate and the Committees on Foreign Affairs and Appropriations of the House of Representatives not later than 60 days before approval of such project.

`(B) PROJECT DESCRIBED- A project which significantly involvesdescribed in this subparagraph is a Category A project (as defined in section 237(q)(3)) relating to an extractive industry and inproject or any extractive industry project for which the assistance to be provided by the Corporation would beis valued at $10,000,000 or more (including contingent liability), until at least 30 days after the Corporation notifies the Committee on Foreign Affairs of the House of Representatives and the Committee on Foreign Relations of the Senate of such contract or agreement..

`(2) COMMITMENT TO EITI PRINCIPLES-

T `(A) IN GENERAL- Except as provided in subparagraph (B), the Corporation may approve a contract of insurance or, reinsurance, or anya guaranty, or enter into an agreement to provide financing to an eligible investor for a project that significantly involves an extractive industry only if--

`(A `(i) the eligible investor has agreed to implement the Extractive Industries Transparency Initiative principles and criteria, or substantially similar principles and criteria; or related to the specific project to be carried out; and

`(B `(ii)(I) the host country where the project is to be carried out has committed to the Extractive Industries Transparency Initiative principles and criteria, or substantially similar principles and criteria.; or

`(II) the host country where the project is to be carried out has in place or is taking the necessary steps to establish functioning systems for--

`(aa) accurately accounting for revenues and expenditures in connection with the extraction and export of the type of natural resource to be extracted or exported; `(bb) the independent audit of such revenues and expenditures and the widespread public dissemination of the finding of the audit; and `(cc) verifying government receipts against company payments, including widespread dissemination of such payment information, and disclosure of such documents as host government agreements, concession agreements, and bidding documents, and allowing in any such dissemination or disclosure for the redaction of, or exceptions for, information that is commercially proprietary or that would create a competitive disadvantage.

`(B) EXCEPTION- If a host country does not meet the requirements of subparagraph (A)(ii) (I) or (II), the Corporation may approve a contract of insurance, reinsurance, or a guaranty, or enter into an agreement to provide financing for a project in the host country if the Corporation determines it is in the foreign policy interest of the United States for the Corporation to provide support for the project in the host country and the host country does not prevent an eligible investor from complying with subparagraph (A)(i).

`(3) PREFERENCE FOR CERTAIN PROJECTS- With respect to all projects that significantly involve an extractive industry, the Corporation, to the degree possiextent practicable and consistent with itthe Corporation's development objectives, shall give preference to a project in both which the eligible investor has agreed to implement the Extractive Industries Transparency Initiative principles and criteria, or substantially similar principles and criteria, and the host country where the project is to be carried out has committed to the Extractive Industries Transparency Initiative principles and criteria, or substantially similar principles and criteria.

`(4) DEFINITIONS- In this subsection:EFFECT ON OTHER REQUIREMENTS- Nothing`(A) EXTRACTIVE INDUSTRY- The term `extractive industry' refers to an enterprise engaged in this subsection shall affect the exploration, development, or extraction of oil and gas reserves, metal ores, gemstones, industrial minerals, or coal.limitation`(B) EXTRACTIVE INDUSTRIES TRANSPARENCY INITIATIVE PRINCIPLES AND CRITERIA- The term `Extractive Industries Transparency Initiative principles and criteria' means the principles and criteria of the Extractive Industries Transparency Initiative, as set forth in Annex Aprohibitions with respect to the Anti-Corruption Policies and Strategies Handbook of the Corporation, as publishdirect investments described in September 2006.section 234(c).

`(5) REPORTING REQUIREMENT- The Corporation shall include in its annual report required under section 240A a description of its activities to carry out this subsection.

`(c) Definitions- In this section:

`(1) AND EFFICIENT CLEAN ENERGY TECHNOLOGY- The term `and efficient clean energy technology' means an energy supply or end-use technology--`(A) such as--`(i) solar technology;`(ii) wind technology;`(iii) geothermal technology;`(iv) hydroelectric technology; and`(v) carbon capture technology; and`(B) over its life cycle and that, compared to a similar technology already in widespread commercial use-- in a host country, will--

`(i) is reliable, affordable, economically viable, socially acceptable, and compatible with the needs and norms of the country involved; `(A) reduce`(ii) results in--`(I) reduced emissions of greenhouse gases; or

`(II) increased geological sequestration; and `(B) decrease the intensity`(iii) may--`(I) substantially lower emissions of air pollutants; or`(II) generate substantially smaller and less hazardous quantities of solid or liquid waste.energy usage.

`(2) GREENHOUSE GAS- The term `greenhouse gas' means--

`(A) carbon dioxide;

`(B) methane;

`(C) nitrous oxide;

`(D) hydrofluorocarbons;

`(E) perfluorocarbons; or

`(F) sulfur hexafluoride.

'. `(3) EXTRACTIVE INDUSTRYSEC. 9. PROHIBITION ON ASSISTANCE TO DEVELOP OR PROMOTE CERTAIN RAILWAY CONNECTIONS AND RAILWAY-RELATED CONNECTIONS.Section 237 of the of the Foreign Assistance Act of 1961 (22 U.S.C. 2197) is further amended by adding at the end the following:`(q) Prohibition on Assistance for Certain Railway Projects- The Corporation may not provide insurance, reinsurance, a guaranty, financing, or other assistanceterm `extractive industry' refers to supportan enterprise engaged in the developmentexploration, development, or promoextraction of any railway connection or railway-related connection that does not traverse or connect with Armenia and does connect Azerbaijanoil and Turkeygas reserves, metal ores, gemstones, industrial minerals (except rock used for construction purposes), or coal.'.

SEC. 10. INELIGIBILITY OF PERSONS DOING CERTAIN BUSINESS WITH STATE SPONSORS OF TERRORISM.6. INCREASED TRANSPARENCY.

(a) In General- Section 2371A(c)(2) of the Foreign Assistance Act of 1961 (22 U.S.C. 21971a) further is amended by adding at the end the following:replacing (c)(2) with`(r) Ineligible Projects-`(1) IN GENERAL- A project will not be eligible to receive support provided by the Corporation under this title if either of the following applies:paragraph:

`(A)(i) An applicant for insurance, reinsurance, financing, or other support for a project provided to the government of a state sponsor of terrorism a loan, or an extension of credit, that remains outstanding.`(ii) For purposes of this subparagraph, the sale of goods, other than food or medicine, on any terms other than a cash basis shall be considered to be an extension of credit.`(B) An applicant for insurance, reinsurance, financing, or other support for a project has an investment commitment valued at $20,000,000 or more for the energy sector in a country that is a state sponsor of terrorism.`DEFINITIONS- (2) In this subsection:conjunction`(A) CASH BASIS- The term `cash basis' refers to a sale in which the purchaser of goods or services is required to make payment in full within 45 days after receiving the goods or services.`(B) ENERGY SECTOR- The term `energy sector' refers to activities to develop or transport petroleum or natural gas resources.`(C) INVESTMENT COMMITMENT- The term `investment commitment' means any of the following activities if such activity is undertaken pursuant to a commitment, or pursuant to the exercise of rights under a commitment, that was entered into with the government of a state sponsor of terrorism or a nongovernmental entity in a country that is a state sponsor of terrorism:each meeting`(i) The entry into a contract that includes responsibility for the development of petroleum resources located in a country that is a state sponsorits Board of terrorism, or the entry into a contract providing forDirectors, the general supervision and guarantee of another person's performance of such a contract.Corporation shall hold`(ii) The purchase of a share of ownership, including an equity interest, in that development.`(iii) The entry into a contract providing for the participation in royalties, earnings, or profitspublic hearing in that development, without regardorder to the form of the participation.afford an opportunity`(D) STATE SPONSOR OF TERRORISM- The term `state sponsor of terrorism' means a country the government of which the Secretary of State has determined, purposes of section 6(j) of the Export Administration Act of 1979, section 620A of the Foreign Assistance Act of 1961, section 40 of the Arms Export Control Act, or for other provision of law, to be a government that has repeatedly provided support for acts of international terrorism.`(3) CERTIFICATION-`(A) BY APPLICANTS- A any or entity applying for insurance, reinsurance, a guaranty, financing, or other assistance under this title may not receive such support unless its chief executive officer certifies person to present views regarding the Corporation, under penalty of perjury, that the person or entity and its majority-owned subsidiaries are not engaged in any activity described in subparagraph (A) or (B)activities paragraph (1).`(B) BY ULTIMATE PARENT ENTITIES- In of the case of an applicant that isCorporation. The Corporation shall notice such a majority-owned entity of another entity, in addition to the certification under subparagraph (A), the chief executive officer of the ultimate parent entity of the applicant must certify, under penalty of perjury, that it and its majority-owned subsidiaries are not engaged in any activity describedhearing at least 20 days in subparagraph (A) or (B) of paragraph (1).advance. At least 15 days`(C) APPLICATION TO STRAW MAN TRANSACTIONS- In any case in which--advance`(i) an applicant for insurance, reinsurance, financing, or other assistance under this title is providing goods and services to a project,`(ii) more than 50 percent of such goods and services are acquired from an unaffiliated entity, andhearing`(iii) the unaffiliated entity is receiving $20,000,000 or more, or sums greater than 50 percent of the amount of the assistance provided by the Corporation for the project (including contingent liability), for such goods or services,shallthen the chief executive officer of the unaffiliated entity must make a certification under subparagraph (A), and any ultimate parent entity must make available a certification required by subparagraph (B).public summary`(D) DILIGENT INQUIRY- A certification required by subparagraph (A), (B), or (C) may be made to the best knowledge and belief of the certifying officer if that officer states that he or she has made diligent inquiry into the matter certified.`(E) EXCEPTION- (i) A chief executive officer of an applicant or other entity may provide a certification required by subparagraph (A), (B), or (C) with respecteach project, including information related to the activity of a majority-owned subsidiary or entity notwithstanding activity by such majority-owned subsidiary or entity that would cause a projectworkers rights, to be ineligible for support under subparagraph (A) or (B) of paragraph (1) if such activity is carried out under a contract or other obligation of such majority-owned subsidiary or entity that was entered into or incurred before the acquisition of such majority-owned subsidiary or entity by the applicant or ultimate parent entity.considered at`(ii) Clause (i) shall not apply if the terms of such contract or other obligation are expanded or extended after such acquisition.`(F) DEFINITION- For purposes of this paragraph, a person is an ultimate parent of an entity if the person owns directly, or through majority ownership of other entities, greater than 50 percent of the equity of the entity.meeting.`(4) EXCEPTION- prohibition in paragraph (1) shall not--`(A) apply to a loan, extension of credit, or investment commitment by an applicant, or other entity covered by a certification under subparagraph (A), (B), or (C) of paragraph (3), in Southern Sudan, Southern Kordofan/Nuba Mountains State, Blue Nile State, or Abyei, Darfur, if the Corporation, with the concurrence of the Secretary of State, determines that such loan, extension of credit, or investment commitment will provide emergency relief, promote economic self-sufficiency, or implement a nonmilitary program in support of a viable peace agreement in Sudan, including the Comprehensive Peace Agreement for Sudan and the Darfur Peace Agreement; or`(B) prohibit the The from providing support for projects in Southern Sudan, Southern Kordofan/Nuba Mountains State, Blue Nile State, and Abyei, Darfur, if the Corporation, with the concurrence of the Secretary of State, determines that such projects will provide emergency relief, promote economic self-sufficiency, or implement a nonmilitary program in support of a viable peace agreement in Sudan, including the Comprehensive Peace Agreement for Sudan and the Darfur Peace Agreement.`(5) PROSPECTIVE APPLICATION OF SUBSECTION- This subsection Corporation shall not be applied to limit support by the Corporation under this title because an applicant, or other entity covered by a certification under subparagraph (A), (B), or (C) of paragraph (3) engagedinclude any confidential business information commercial activity specifically licensed by the Office of Foreign Assets Control of the Department of in the Treasury.'.summary(b) Termination-(1) IN GENERAL- The amendment made byavailable under this sectionubsection. Such views cease to shall be effective with respect to a country that is a state sponsor of terrorism 30 days after the President certifies to the appropriate congressional committees that--made part(A) the country has ceased providing support for acts of international terrorism and no longer satisfies the requirements for designation as a state sponsor of terrorism;(B) the country does not possess nuclear weapons or a significant program to develop nuclear weapons; and(C) the country is not committing genocide or conducting a program of ethnic cleansing against a civilian population that approaches genocide.(2) DEFINITIONS- In this subsection:(A) APPROPRIATE CONGRESSIONAL COMMITTEES- The term `appropriate congressional committees' means the Committee on Foreign Affairs of the House of Representatives and the Committee on Foreign Relations of the Senate.(B) STATE SPONSOR OF TERRORISM- The term `state sponsor of terrorism' has the meaning given that term in section 237(r)(2)(D) of the Foreign Assistance Act of 1961, as added by subsection (a) of this section.record.'.

SEC. 11. INCREASED TRANSPARENCY. (b) Additional Transparency(a) In General- Section 237 of the Foreign Assistance Act of 1961 (22 U.S.C. 2197) further is amended by adding at the end the following new subsections:

`(s) Availability of Project Information- Beginning 90 days after the date of the enactment of the Overseas Private Investment Corporation Reauthorization Act of 2007, the Corporation shall make public, and post on its Internet website, summaries of all new projects supported by the Corporation, and other relevant information, except that the Corporation shall not include any confidential business information in the summaries and information made available under this subsection. `(p`(t) Review of Methodology- Not later than 180 days after the date of the enactment of the Overseas Private Investment Corporation Reauthorization Act of 20078, the Corporation shall publish in the Federal Register and periodically revise, subjectmake available to a period ofthe comment, public detailed the methodology, including relevant regulations, used to assess and monitor the impact of projects supported by the Corporation on employment in the developmentUnited States and environment ofon the development, the environment, and internationalthe protection of internationally recognized worker rights in, host countries,, as well as the elimination of discrimination with respect to employment and on United States employment.ccupation, in host countries.

`(u `(q) Public Notice Prior to Project Approval-

`(1) PUBLIC NOTICE-

`(A) IN GENERAL- The Board of Directors of the Corporation may not vote in favor of any action proposed to be taken by the Corporation on any Category A project until at leastbefore the date that is 60 days after the Corporation--

`(A `(i) makes available for public comment a summary of the project and relevant information about the project; and

`(B) makes the `(ii) such summary and information described in paragraph (1)clause (i) has been made available locally affected to groups in the area of impact ofthat may be impacted by the proposed project, and host country to nongovernmental organizations. in the host country.

`(B) EXCEPTION- The Corporation shall not include business any confidential business information in the summary and information made available under subparagraphs (Aclauses (i) and (B).ii) of subparagraph (A).

`(2) PUBLISHED RESPONSE- To the extent practicable, the Corporation shall publish responses to the comments received under paragraph (1)(A)(i) with respect to a Category A project and submit the responses to the Board not later than 7 days before a vote is to be taken on any action proposed by the Corporation on the project.

`(3) DEFINITIONS- In this subsection, tCATEGORY A PROJECT DEFINED- The term `Category A project' means any project or other activity for which the Corporation proposes to provide insurance, reinsurance, a guaranty, financing, or other supportassistance under this title and which is likely to have a significant adverse environmental impacts.'..'.

(b (c) Office of Accountability- Section 237 of the Foreign Assistance Act of 1961 (22 U.S.C. 2197), as amended by subsection (b) of this section, further is amended by adding at the end the following new subsection:

`(v `(r) Office of Accountability- The Corporation shall maintain an Office of Accountability to provide, to the maximum extent practicable, upon request, problem-solving services for projects supported by the Corporation to and review of the Corporation's compliance with its environmental, social, internationally recognized worker rights, human rights, and transparency policies and procedures, to the maximum extent practicable. The Office of Accountability shall operate in a manner that is fair, objective, and transparent.'.

SEC. 12. FRAUD AND OTHER BREACHES OF CONTRACT.7Section 237(n) of the Foreign Assistance Act of 1961 (22 U.S.C. 2197(n)) is amended--(1) by striking `Whoever' and inserting:`(1) IN GENERAL- Whoever'; and(2) by adding at the end the following:`(2) DEFERRALS TO DEPARTMENT OF JUSTICE- (A) The President of the Corporation shall refer to the Department of Justice for appropriate action information known to the Corporation concerning any substantial evidence of--`(i) a violation of this title;`(ii) a material breach of contract entered into with the Corporation by an eligible investor; or`(iii) a material false representation made by an investor to the Corporation.`(B) Subparagraph (A) does not apply if the President of the Corporation concludes that the matter described in clause (i), (ii), or (iii), as the case may be, of subparagraph (A)--`(i) is not evidence of a possible violation of criminal law; and`(ii) is not evidence that the Federal Government is entitled to civil remedy or to impose a civil penalty.'.SEC. 13. TRANSPARENCY AND ACCOUNTABILITY OF INVESTMENT FUNDS.

(a) In General- Section 239 of the Foreign Assistance Act of 1961 (22 U.S.C. 2199) is amended by adding at the end the following:

`(l) Transparency and Accountability of Investment Funds-

`(1) COMPETITIVE SELECTION OF INVESTMENT FUND MANAGEMENT- With respect to any investment fund that the Corporation creates on or after the date of the enactment of the Overseas Private Investment Corporation Reauthorization Act of 20078, the Corporation may select persons to manage the fund only by contract using competitive procedures that are full and open competitive procedures..

`(2) CRITERIA FOR SELECTION- In assessing proposals for investment fund management proposals, the Corporation shall consider, in addition to other factors, the following:

`(A) The prospective fund management's experience, depth, and cohesiveness.

`(B) The prospective fund management's track record in investing risk capital in emerging markets.

`(C) The prospective fund management's experience, management record, and monitoring capabilities in its target countrithe countries in which the management operates, including details of local presence (directly or through local alliances).

`(D) The prospective fund management's experience as a fiduciary in managing institutional capital, meeting reporting requirements, and administration.

`(E) The prospective fund management's record in avoiding investments in companies that would be disqualified under section 237(r).9(m).

`(3) ANNUAL REPORT- The Corporation shall include in each annual report under section 240A an analysis of the investment fund portfolio of the Corporation, including the following:

`(A) FUND PERFORMANCE- An analysis of the aggregate financial performance of the investment fund portfolio grouped by region and maturity.

`(B) STATUS OF LOAN GUARANTIES- The amount of guaranties committed by the Corporation to support investment funds, including the percentage of such amount that has been disbursed to the investment funds.

`(C) RISK RATINGS- The definition of risk ratings, and the current aggregate risk ratings for the investment fund portfolio, including the number of investment funds in each of the Corporation's rating categories.

`(D) COMPETITIVE SELECTION OF INVESTMENT FUND MANAGEMENT- The number of proposals received and evaluated for each newly established investment fund.'.

(b) GAO AuditReview- Not later than 1 year after the submission of the first report to Congress under section 240A of the Foreign Assistance Act of 1961 that includes the information required by section 239(l)(3) of that Act (as added by subsection (a) of this section), the Comptroller General of the United States shall prepare and submit to the Committee on Foreign AffairRelations of the House of RepresentativesSenate and the Committee on Foreign RelationAffairs of the SenateHouse of Representatives an independent assessment of the investment fund portfolio of the Overseas Private Investment Corporation, covering the items required to be addressed under such section 239(l)(3).

SEC. 14. EXTENSION OF AUTHORITY8. PROHIBITION ON ASSISTANCE TO OPERATE IN IRAQ.DEVELOP OR PROMOTE CERTAIN RAILWAY CONNECTIONS AND RAILWAY-RELATED CONNECTIONS.

Section 2397 of the Foreign Assistance Act of 1961 (22 U.S.C. 21997), as amended by section 6,) is amended by adding at the end the following:

`(m) Operations in Iraq- Notwithstanding subsections (a) `(s) Prohibition on Assistance for Certain Railway Projects- The Corporation may not provide insurance, reinsurance, a guaranty, financing, or other assistance to support the development or promotion of a railway connection or railway-related connection that connects Azerbaijan and (b)Turkey without connecting or traversing with Armenia.'.

SEC. 9. INELIGIBILITY OF PERSONS DOING CERTAIN BUSINESS WITH STATE SPONSORS OF TERRORISM.

(a) In General- Section 231 section 237, of the CorporationForeign Assistance Act of 1961 (22 U.S.C. 2191) is authorizedmended by--

(1) striking `and' at the end of division (m); (2) by striking the period at the end of division (n) and inserting `; and'; and (3) by adding at the end the following:

`(o) to undertake in Iraqdecline to issue any program authorized by this title.'.contract of insurance or reinsurance, or any guaranty, or to enter into any agreement to provide financing or any other assistance for a prospective eligible investor who enters, directly or through an affiliate, into certain discouraged transactions with a state sponsor of terrorism.'.

SEC. 15. CONSISTENCY WITH EXISTING LAW. (b) General Provisions and Powers- Section 239 of the Foreign Assistance Act of 1961 (22 U.S.C. 2199), as amended by section 7, further is amended by adding at the end the following:

`(n) Consistency With Other Law- Section 620L `(m) State Sponsor of Terrorism-

`(1) IN GENERAL- In order to carry out the policy set forth in section 231(o) of this Act, the Corporation shall apply torequire a certification from an officer of a prospective OPIC-supported United States investor that the investor and all affiliates of the investor are not engaged in a discouraged transaction with a state sponsor of terrorism.

`(2) DISCOURAGED TRANSACTION- In this subsection, the term `discouraged transaction' means any insurance, reinsurance, guaranty,of the following activities:

`(A) An investment commitment of $20,000,000 or other financing issuedmore by the Corporation for projectsinvestor in the West Bank and Gazaenergy sector in a state sponsor of terrorism.

`(B) Any loan, or an extension of credit, to the same extent as such section applies to other assistance under this Act.government of a state sponsor of terrorism by the investor that--

`(o) Limitation `(i) is outstanding Assistance to Gaza and on the West Bank-date the Corporation enters into a contract with the investor; and

`(ii) that has a value of more than $5,000,000, including the sale of goods for which payment is not required by the purchaser within 45 days.

`(C) The transfer by the investor of goods that are included on the United States Munitions List, referred to in section 38(a)(1) of the Arms Export Control Act (22 U.S.C. 2778(a)(1)) to a state sponsor of terrorism within the 3-year period preceding the date the Corporation enters into a contract with the investor.

`(3) EXCEPTION- An officer of a prospective OPIC-supported United States investor not may insurance, reinsurance, provide a guaranty, financing,certification under this subsection notwithstanding the fact that an affiliate of the investor is engaged in a discouraged transaction if the transaction is carried out under a contract or other assistance to supportobligation of the affiliate that was entered into or incurred before the acquisition of such affiliate by the prospective OPIC-supported United States investor or the parent company of the OPIC-supported United States investor.

`(4) DEFINITIONS- In this subsection:

`(A) AFFILIATE- The term `affiliate' means any person that is directly or indirectly controlled by, under common control with, or controls a projecspective OPIC-supported United States investor or the parent company of such investor.

`(B) INVESTMENT COMMITMENT IN THE ENERGY SECTOR OF A STATE SPONSOR OF TERRORISM- The term `investment commitment in the energy sector of a state sponsor of terrorism' means part any Gaza or of the West Bank unlessfollowing activities if such activity is undertaken pursuant to a commitment, or pursuant to the Secretaryexercise of State determinesrights under a commitment, that was entered into with the locationgovernment of a state sponsor of terrorism or a nongovernmental entity in a country that is a state sponsor of terrorism:

`(i) The entry into a contract that includes responsibility for the projecdevelopment or transportation of petroleum or natural gas resources located in a country that is not undea state sponsor of terrorism, or the effective controlntry into a contract providing for the general supervision or guaranty of Hamasanother person's performance of such a contract.

`(ii) The purchase of a share of ownership, including an equity interest, in the development of petroleum or natural resources described in clause (i).

`(iii) The entry into a contract providing for the participation in royalties, earnings, or profits in the development of petroleum or natural resources described in clause (i), without regard to the form of the participation.

`(C) STATE SPONSOR OF TERRORISM- The term `state sponsor of terrorism' --

`(i) means any other foreign terrorist organization designated undercountry the government of which the Secretary of State has determined has repeatedly provided support for acts of international terrorism pursuant to section 2196(j) of the Immigration and NationalityExport Administration Act (of 1979, section 620A of this Act, or section 40 of the Arms Export Control Act; and

8 U.S.C. 1189 `(ii) does not include Southern Sudan, Southern Kordofan/Nuba Mountains State, Blue Nile State, and Abyei, Darfur, if the Corporation, with the concurrence of the Secretary of State, determines that providing assistance for projects in such regions will provide emergency relief, promote economic self-sufficiency, or implement a nonmilitary program in support of a viable peace agreement in Sudan, such as the Comprehensive Peace Agreement for Sudan and the Darfur Peace Agreement).'.

SEC. 160. CONGRESSIONAL NOTIFICATION REGARDING MAXIMUM CONTINGENT LIABILITY.

Section 239 of the Foreign Assistance Act of 1961 (22 U.S.C. 2199), as amended by sections 7, and 9, further is amended by adding at the end the following:

`(p `(n) Congressional Notification of Increase in Maximum Contingent Liability- The Corporation shall notify the Committee on Foreign AffairRelations of the House of RepresentativesSenate and the Committee on Foreign RelationAffairs of the SenateHouse of Representatives not later than 15 days after the date on which the Corporation's maximum contingent liability outstanding at any one time pursuant to insurance issued under section 234(a), and the amount of financing issued under sections 234(b) and (c), exceeds the previous fiscal yearCorporation's maximum contingent liability for the preceding fiscal year by 25 percent or more.'.

SEC. 171. EXTENSION OF AUTHORITY TO OPERATE IN IRAQ.

Section 239 of the Foreign Assistance Act of 1961 (22 U.S.C. 2199), as amended by sections 7, 9, and 10, is amended by adding at the end the following: `(o) Operations in Iraq- Notwithstanding subsections (a) and (b) of section 237, the Corporation is authorized to undertake in Iraq any program authorized by this title.'.

SEC. 12. LOW-INCOME HOUSING.

Not later than 1 year after the date of the enactment of this Act, the Corporation shall submit a report to the Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the House of Representatives, in consultation with appropriate departments, agencies, and instrumentalities of the United States, as well as private entities, on the feasibility of broadening the assistance the Corporation provides to projects that provide support to low-income home buyers. If the Corporation finds such assistance is feasible, the Corporation shall identify and begin to implement steps to proceed to provide such assistance.

SEC. 13. ASSISTANCE FOR SMALL BUSINESSES AND ENTITIES.

Section 240 of the Foreign Assistance Act of 1961 (22 U.S.C. 2200) is amended by adding at the end the following:

`(c) Resources Dedicated to Small Businesses, Cooperatives, and Other Small United States Investors- The Corporation shall ensure that adequate personnel and resources, including senior officers, are dedicated to assist United States small businesses, cooperatives, and other small United States investors in obtaining insurance, reinsurance, financing, and other supportassistance under this title. The Corporation shall include, in each annual report under section 240A, the following information with respect to the period covered by the report:

`(1) A description of such personnel and resources.

`(2) The number of United States small businesses, cooperatives, and other small United States investors that such received insurance, reinsurance, financing, and other supportassistance from the Corporation, and the dollar value of such insurance, reinsurance, financing, and other support.assistance.

`(3) A description of the projects for which suchthe insurance, reinsurance, financing, and other supportassistance was provided.'.

SEC. 184. TECHNICAL CORRECTIONS.

(a) Pilot Equity Finance Program- Section 234 of the Foreign Assistance Act of 1961 (22 U.S.C. 2194) is amended--

(1) by striking subsection (g); and

(2) by redesignating subsection (h) as subsection (g).

(b) Transfer Authority- Section 235 of the Foreign Assistance Act of 1961 (22 U.S.C. 2195) is amended--

(1) by striking subsection (e); and

(2) by redesignating subsection (f) as subsection (e).

(c) Guaranty Contract- Section 237(j) of the Foreign Assistance Act of 1961 (22 U.S.C. 2197(j)) is amended by inserting `insurance, reinsurance, and' after `Each'.

(d) Transfer of Predecessor Programs and Authorities-

(1) TRANSFER- Section 239 of the Foreign Assistance Act of 1961 (22 U.S.C. 2199), as amended by the preceding provisions of this Actsections 7, 9, 10, and 11, is amended--

(A) by striking subsection (b); and

(B) by the redesignating subsections (c) through (po) as subsections (b) through (o), respectively.n), respectively.

(2) CONFORMING AMENDMENTS-

(A) Section 237(m)(1) of the Foreign Assistance Act of 1961 (22 U.S.C. 2197(m)(1)) is amended by striking `239(g)' and inserting `239(f)'.

(B) Section 240A(a) of the Foreign Assistance Act of 1961 (22 U.S.C. 2200A(a)) is amended--

(i) in paragraph (1), by striking `239(h)' and inserting `239(g)'; and

(ii) in paragraph (2)(A), by striking `239(i)' and inserting `239(h)'.

(C) Section 209(e)(16) of the Admiral James W. Nance and Meg Donovan Foreign Relations Authorization Act, Fiscal Years 2000 and 2001 (as enacted into law by section 1000(a)(7) of Public Law 106-113; 31 U.S.C. 1113 note) is amended by striking `239(c)' and `2199(c)' and inserting `239(b)' and `2199(b)', respectively.

(e) Additional Clerical Amendments- Section 234(b) of the Foreign Assistance Act of 1961 (22 U.S.C. 2194(b)) is amended by striking `235(a)(2)' and inserting `235(a)(1)'.

SEC. 19. EFFECTIVE DATE. Calendar No. 593

(a) New Applications- This Act and the amendments made by this Act shall apply with respect to any application for insurance, reinsurance, a guaranty, financing, or other support under title IV of chapter 2 of part I of 110th CONGRESS

2d Session

H. R. 2798

[Report No. 110-273]

AN ACT

To reauthorize the Foreign Assistance Actprograms 1961 if the application is received by of the Overseas Private Investment Corporation on or after July 1, 2007, and the application is approved by the Corporation on or after the date of the enactment of this Act.,(b) Extensions and Renewals-(1) IN GENERAL- Subject to paragraph (2), this Act the amendments made by this Act shall apply with respect to any extension or renewal of a contract or agreement and for any such insurance, reinsurance, guaranty, financing, or support that was entered into by the Corporation before the date of the enactment of this Act if the extension or renewal is approved by the Corporation on or after such date of enactment.other purposes.

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(2) EXCEPTION- This Act and the amendments made by this Act shall not apply to any extension or renewal which is substantially identical to an extension or renewal formally requested in a detailed writing fil March 4, 2008

Reported with the Corporation before July 1, 2007.an amendment