PUBLIC LAW 98-369—JULY 18, 1984
98 STAT. 1173
"(1) VALUE ADDED REQUIREMENT FOR PUERTO RICO.—Any article, other than an article containing distilled spirits, shall in no event be treated as produced in Puerto Rico unless the sum of— "(A) the cost or value of the materials produced in Puerto Rico, plus "(B) the direct costs of processing operations performed in Puerto Rico, equals or exceeds 50 percent of the value of such article as of the time it is brought into the United States. "(2) PROHIBITION OF FEDERAL EXCISE TAX SUBSIDIES.—
"(A) IN GENERAL.—No amount shall be transferred under subsection (a)(3) or (b)(8) in respect of taxes imposed on any article, other than an article containing distilled spirits, if the Secretary determines that a Federal excise tax subsidy was provided by Puerto Rico or the Virgin Islands (as the case may be) with respect to such article. "(B) FEDERAL EXCISE TAX SUBSIDY.—For purposes of this paragraph, the term 'Federal excise tax subsidy' means any subsidy— "(i) of a kind different from, or "(ii) in an amount per value or volume of production greater than, the subsidy which Puerto Rico or the Virgin Islands offers generally to industries producing articles not subject to Federal excise taxes. "(3) DIRECT COSTS OF PROCESSING OPERATIONS.—For purposes of
this subsection, the term 'direct cost of processing operations' has the same meaning as when used in section 213 of the Caribbean Basin Economic Recovery Act.". 97 Stat. 384. (b) EFFECTIVE DATES AND SPECIAL RULES.— H use 2703. (1) IN GENERAL.—Except as provided in paragraph (2), the note amendments made by subsection (a) shall apply with respect to articles brought into the United States on or after March 1, 1984. (2) EXCEPTION FOR PUERTO RICO FOR PERIODS BEFORE JANUARY
1, 1985.— (A) IN GENERAL.—Subject to the limitations of subparagraphs (B) and (C), the amendments made by subsection (a) shall not apply with respect to articles containing distilled spirits brought into the United States from Puerto Rico after February 29, 1984, and before January 1, 1985, (B) $130,000,000 LIMITATION.—In the case of such articles brought into the United States after February 29, 1984, and before July 1, 1984, the aggregate amount payable to Puerto Rico by reason of subparagraph (A) shall not exceed the 6XC6SS of*~**
(i) $130,000,000, over
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(ii) the aggregate amount payable to Puerto Rico under section 7652(a) of the Internal Revenue Code of 1954 with respect to such articles which were brought into the United States after June 30, 1983, and before March 1, 1984, and which would not meet the requirements of section 7652(c) of such Code. Ante, p. 1172. (C) $75,000,000 UMiTATiON.—The aggregate amount payable to Puerto Rico by reason of subparagraph (A) shall not exceed $75,000,000 in the case of articles—
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