SPEAKERS CONTENTS INSERTS Tables
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VISA WAIVER PILOT PROGRAM
TUESDAY, JUNE 17, 1997
House of Representatives,
Subcommittee on Immigration and Claims,
Committee on the Judiciary,
Washington, DC.
The subcommittee met, pursuant to notice, at 9:39 a.m., in room 2226, Rayburn House Office Building, Hon. Lamar Smith (chairman of the subcommittee) presiding.
Present: Representatives Lamar Smith, William L. Jenkins, Edward A. Pease, and Melvin L. Watt.
Also present: Cordia A. Strom, chief counsel; Edward R. Grant, counsel; Judy Knott, staff assistant; and Martina Hone, minority counsel.
OPENING STATEMENT OF CHAIRMAN SMITH
Mr. SMITH. The Subcommittee on Immigration and Claims will come to order. Last month the subcommittee held a revealing hearing on the issue of visa fraud and immigration benefits application fraud. The hearing drew attention to problems that received little publicity, but posed as severe a threat to the security of our borders as any other aspect of illegal immigration.
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We have learned that as the United States improves in certain traditional aspects of border control, those seeking to reach our shores illegally will adapt and employ new measures. The greatest prize in this game is permission to enter the United States legally, even if that permission has been procured by fraud.
Millions of travelers to the United States pose no such threat. In order to facilitate their travel, Congress in 1986 established the Visa Waiver Pilot Program. This program allows temporary visitors for business or pleasure to forgo the need to obtain a nonimmigrant B visa from a U.S. consulate prior to departing for the United States.
By statute, the privilege is available to nationals of countries who have a negligible rate of refusal when they apply for a B visa. Furthermore, the privilege may be retained only by countries that have a negligible rate of visa overstays. Other conditions also apply. Currently, 25 countries are eligible to participate in the Visa Waiver Program.
In fiscal year 1996, over 12 million foreign visitors, or more than half of the total tourist and temporary business visitors who entered the United States, entered under this privilege. Today's hearing is the first opportunity in several years for Congress to examine in detail the merits of continuing the Visa Waiver Program or allowing it to expire. Without the benefit of an oversight hearing such as this, Congress in the 1996 Immigration Act, extended the program for 1 year, through September 30, 1997. We expect to hear today a great deal regarding the purported benefits of this program.
In addition to admitting over 10 million visitors, eliminating the visa requirement lessens the workload at U.S. consulates in eligible countries. Easing travel requirements also can have the effect of encouraging tourism and temporary business travel. As we consider these benefits, we must also keep in mind the unique status of the United States as the most favored destination for intending immigrants, both legal and illegal. Because of this, the law sets stringent conditions for being granted and for retaining the visa waiver privilege. Without strict enforcement of these standards, the visa waiver privilege is open to abuse.
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Before Congress considers extending this program, the following concerns should be addressed:
Visa waiver entrants are able to enter the United States upon presentation of a passport from a participating country, so the improvements in security of the U.S. visa are no deterrent to fraudulent entries from these countries. In addition, the Visa Waiver Program places a premium on passports from countries that participate in the program. What measures should we be taking to ensure that those who present a passport from a visa waiver country actually are entitled to carry that passport?
Continued participation in the Visa Waiver Program requires that a country maintain a negligible visa overstay rate. However, the Immigration and Naturalization Service has been unable since 1992 to provide accurate estimates of the visa overstay rate for individual countries. What progress is the INS making to rectify this problem?
Even if a country meets the basic eligibility standards, granting the visa waiver privilege is a discretionary decision by the Attorney General that must take into account factors of national security and immigration enforcement. Does the INS believe that due to the escalating phenomenon of passport fraud, the visa waiver privilege poses a risk to border security?
One requirement for participation in the program is that countries have adopted or are in the process of adopting a machine readable document program. Do current visa waiver countries meet this requirement?
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Expansion of the visa waiver privilege to additional countries hinges on the visa refusal rate. What are the current trends in refusal rates and what factors are influencing those trends?
The focus of this hearing is oversight of the current operation of the Visa Waiver Program, the enforcement of existing statutory regulations and the conditions under which the program should be extended, if at all.
We also will hear today from witnesses, including Members of Congress, advocating that we depart from the statutory standards of eligibility to grant the visa waiver privilege to nations that currently do not meet those standards.
In regard to these initiatives, and with due respect to them, let me mention a couple of points.
In my judgment, they threaten to undermine, not strengthen, the case for continuing the visa waiver privilege.
First, they seek to replace an objective standard based on U.S. national interests with a standard based on subjective factors.
Second, they send the wrong message regarding our resolve to stringently enforce passport and visa requirements and to deter fraud.
Third, they invite other nations who do not meet the objective standards to lobby for inclusion in the Visa Waiver Program.
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And finally, it seems inconsistent to argue that the Visa Waiver Program has been successful and thus should be extended, while at the same time, asking for an exemption from the very standards that have allowed the program to be successful.
These and many other questions, I think, need to be addressed today and we look forward to hearing from a number of witnesses and we will begin in just a moment with our colleagues in Congress, but first, I would like to recognize the gentleman from North Carolina, Mr. Watt, for his comments.
Mr. WATT. Thank you, Mr. Chairman, and I want to apologize to you and to our panel of witnesses, my colleagues, for being a little late this morning. I am actually setting a standard that is much higher than the standard that was set in the committee before, but even I get a few minutes late every once in a while. I try to be on time for these things.
Last week, the chairman and I met and I said to him that I was not very fond of having hearings about things that didn't relate to particular bills, and I guess I should be happy today that we are having a hearing about some bills and about something that in the very near future will be necessary.
The Visa Waiver Program expires at the end of this fiscal year, and if we are going to reauthorize it, we need to begin the legislative process soon. It seems to me there are two questions before our subcommittee today. The first question is whether we should reauthorize the Visa Waiver Pilot Program, and the second one is for how long, and whether it should be expanded.
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Since I am not particularly fond of hearings, I think that this is a good program. I hope we will extend it for more than 1 year so we don't come back here a year from now and have another hearing about whether it ought to be extended again, so at least we ought to consider that as a possibility.
The second question is whether the Visa Waiver Pilot Program should be expanded to countries that do not currently meet the statutory or regulatory requirements for participation, or maybe there are some who meet those standards and are not in the program, and several of my colleagues will be testifying today about legislation they have introduced, which would expand the Visa Waiver Pilot Program to such countries.
As always, I am eager to hear their thoughts and ideas, always happy to hear some of my favorite colleagues on these questions, so—but I guess I should warn them in advance, I have some reservations about continuing to carve out exceptions and some reservations about the pilot program in general, especially the fact that it seems to be especially skewed toward European countries and at a time when we are expressing our wrath against closer countries and countries that are near our borders, I think we need to be very careful in setting some very consistent standards about immigration policies and so I kind of approached this with that mindset, and hope that nothing that is being proposed today or little that is being proposed today will be inconsistent with that, and hope that I can support what is being proposed, especially by my colleagues who are testifying here today.
Thank you, Mr. Chairman.
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Mr. SMITH. Thank you, Mr. Watt. We will go to our first panel. Again, we welcome our colleagues. We will begin with Representative Jay Kim.
STATEMENT OF HON. JAY KIM, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA
Mr. KIM. Thank you. Before I proceed, I would like to ask unanimous consent that my written statement be submitted as part of the official record.
Mr. SMITH. Without objection, the whole statement will be part of the record.
Mr. KIM. Thank you. Instead of reading the whole statement, I will just cover a few points. Thank you again, Mr. Chairman, Mr. Watt. Let me tell you again why this particular Visa Waiver Program is so important and so unique.
As you know, it takes about a month, average, in Korea to process a visa application, and a lot of—many—people are still standing in line in adverse conditions, and the question is arising again and again as to why it is so difficult to get a visa. In the past, we have rejected President Kim Yong-sam's own sister and also the daughter of the chairman of Hyundai. Their visas were rejected. Obviously, the system is not working. Each time somebody submits an application, which is incomplete, they return it, and they consider it as one rejection. That, in my opinion, is unfair.
So the criteria they have is outdated, something like a 15-year-old criteria and they are still using it. For example personal wealth is a very important issue to get a visa. Sometimes, many times, an application was simply rejected without giving any reason. Again, that counts as one rejection.
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Let's take a look at the factual information. Korean travel to United States is very important right now. Korea will be the fifth in ranking. They spend more than $2,000 per tourist, which amounts to be roughly $1 billion a year. That is a lot of money being spent in the U.S.A., mostly on a traveling visa. And that is not including airfare, by the way.
Also, Korea is important as a trade partner. They are our No. 6 trading partner, $55 billion in bilateral trade and Korea is the only country where we are experiencing surplus, roughly a $10 billion a year surplus. Korea is the only nation in Asia who actually has this large a trade surplus, not like in China or Japan.
Many Korean businesses are having trouble entering into joint ventures with American firms because it is so difficult to get a visa. For 90 days or 60 days is what I am talking about, not a year, 60 days or 90 days. We will lose a lot of business, a lot of cooperative ventures with Korean businesses because of their difficulty in getting a visa. Obviously, we are losing a lot of investments to other countries.
Now, this resolution that I submitted to you, it has been supported by every Governor in the United States, all 50 Governors, representing 50 States, have endorsed this. They think it is an excellent idea. In addition to the Governors, all the Governors, the American Hotel & Motel Association, they support it; travel industry, they support it, and the American Chamber in Korea, represented by Ms. Overby who is here today sacrificing her own vacation. She is going to be testifying pretty soon. All of them are unanimously supporting this Visa Waiver Pilot Program.
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Now, what is in the bill? They are only asking for a 1 year pilot program, just 1 year, and if it doesn't work out right, the Attorney General can reject it, so that we can forget all this Visa Waiver Program. It is just a trial, just 1 year, to see how it is.
Now, there are other countries, such as Canada and New Zealand, they have a Visa Waiver Program with Korea. They have never experienced a huge illegal immigration problem whatsoever. That is the fear right now, that is why I am asking: let's try 1 year and see what happens.
Now, what is so unique about Korea? First of all, Korea is a major economic ally and military ally. We have 37,000 troops out there. The second, as I told you earlier, it is the only country we know of right now that actually we experience a huge trade surplus, a $10 billion a year trade surplus. Third, that they are the one who is spending almost $1 billion a year in the United States. It has a great impact on a lot of States, such as California, Florida and New York. Few other country has that kind of spending on tourism that Korea does
Those are unique, in my opinion, and certainly, I look at this visa waiver for certain countries, such as Republic of Andorra, San Marino, and the principality of Liechtenstein and I know that Korea spends a lot more money, has stronger military ties and stronger economic ties than those countries. I think it is worthwhile to grant this 1 year visa pilot program.
Thank you, Mr. Chairman. I would like to thank Tami Overby for sacrificing her own vacation, by the way, to be here to testify. Thank you, Mr. Chairman, I appreciate it.
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[The prepared statement of Mr. Kim follows:]
PREPARED STATEMENT OF HON. JAY KIM, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA
Thank you, Mr. Chairman, Ranking Member and members of the committee for inviting me here this morning to testify on the Visa Waiver Pilot Program (VWPP). I appreciate the opportunity to speak to you this morning, and I look forward to answering any questions you may have.
Let me begin by saying that I strongly support the Visa Waiver Pilot Program. It has served to enhance our business and cultural exchanges by facilitating travel and tourism with countries such as Canada, Great Britain, France, Germany and Japan, in addition to 22 others. The VWPP benefits all of us and each of our districts, since it increases tourism and business travel to the United States.
Mr. Chairman, I would like to focus on the case of a country which is not currently a member of the VWPP: South Korea. Whenever I meet with people concerned about U.S.—Korea relations, no matter whether it is a government delegation from Seoul, a group of U.S. businessmen who conduct business with Korean companies, a couple on their honeymoon, or a Korean businessman who wants to invest in the United States, they all want to talk about one thing: the difficulties Koreans face in getting a visa to visit the United States.
Koreans who want visas face long lines and significant delays in obtaining their documents. During the busy tourism season, a potential tourist or business person wishing to visit the U.S. may have to wait over a month in order to receive their visa. Who can wait that long? Many business people and tourists can't plan that far ahead. They need immediate service.
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This situation is embarrassing. South Korea has a long history as a strong U.S. ally in the Asia-Pacific region. We currently deploy 37,000 U.S. troops in South Korea which maintain peace and stability both on the Korean peninsula and in the region as a whole.
Is this any way to treat an ally?
The visa problem, combined with the Clinton Administration's engagement and appeasement policy with North Korea, has created a growing distrust among South Koreans of the United States.
Beyond the embarrassment and resentment that result from this situation, we are creating an environment that is hostile to business cooperation between our two countries. Due to the visa hassle, Korean businesses are understandably becoming hesitant to either invest in the U.S., or enter into cooperative ventures with U.S.-based companies. Would you want to invest time and money in a country that you could not easily visit? I certainly would want to be able to check up on my investments.
I have met with many U.S. businesses who feel that they have lost opportunities to enter into business relationships and attract investment to the U.S. from Korean companies because the Koreans don't want to have to deal with our visa hassle. That business is now going to Canada or Australia, both countries that have either removed or relaxed visa restrictions on Koreans.
In addition to being a political ally, Korea is a major U.S. trade partner, currently our sixth largest. Last year, U.S.-Korea bilateral trade amounted to $54.4 billion—greater than our trade with 23 of the 27 VWPP countries. In 1995 the U.S. held a $6 billion trade surplus with Seoul. That surplus is expected to grow to be nearly $10 billion by the end of this year. If we expect to continue to have this strong trade relationship with Seoul, I believe we must cultivate a more business-friendly environment. I believe that this is one of the situations that the VWPP was designed to address.
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Including Korea in the VWPP will also have a tremendous direct effect on our local economies. Studies show that each Korean visitor spends an average of just over $2,000 during a visit to the U.S., not including airfare. Last year 700,000 Korean visitors spent nearly $1 billion in the U.S. This is money spent in each of our communities: dollars to local hotels, restaurants and other businesses. We can expect this economic impact to dramatically increase if Korea were allowed into the program.
As you probably know, in both the 104th and 105th Congresses, I have offered legislation to provide a one year trial for Korea in the VWPP. The current version is H.R. 203. Upon the completion of Korea's one year trial, my bill calls on the Secretary of State and the Attorney General to report to Congress on Korea's performance. If we see a dramatic increase in Koreans overstaying their visas, the Attorney General and Secretary of State can end Korea's inclusion. But I fully expect to see nothing but positive effects from Korea's inclusion in the VWPP.
Some have raised the concern that including Korea in the VWPP would lead to a dramatic increase in illegal immigration from Korea. It is important to realize that neither Canada nor New Zealand has reported a dramatic increase since they waived their visa requirements for Koreans. On the contrary, they are seeing a higher than ever number of Koreans visiting their countries and spending money in their communities.
I have also heard concerns that if Korea becomes a member of the VWPP, more Koreans will visit the United States and overstay their visas in order to get jobs. This argument overlooks the fact that Korea currently has the world's 11th largest economy and has growth and wage rates among the highest in Asia. Who would want to leave that? The fact is, we have seen a recent trend that indicates that more Koreans and Korean-Americans than ever are returning to Korea in order to take advantage of the economic boom there.
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I understand the concern that some people may have that exempting Korea may set a precedent where other countries ask for the same exemption. However, I argue that Korea is a special case. South Korea is the only country within our top 15 trading partners, with whom we maintain a significant trade surplus, who is not in the VWPP. Also, I believe that overworked consular staff—remember, this is our busiest consulate in the world—may simply reject visas with small, insignificant errors, whereas a less taxed staff may take the time to work with the applicant to correct those errors, and accept the application. In short, I believe that the Korean refusal rate is artificially high due to the overworked staff.
Mr. Chairman and members of the committee, thank you again for inviting me to testify. Before I answer any questions you may have, I want to recognize the tireless efforts of Ms. Tami Overby—the Executive Director of the American Chamber of Commerce in Korea—from whom you will hear in a few minutes. In order to testify today, and represent the interests of U.S. businesses currently doing business in Korea, Ms. Overby at the last minute was forced to cancel a long-awaited and hard-earned vacation. She is to be commended for her hard work and dedication on this issue.
Mr. Chairman, the Visa Waiver Pilot Program is a good program, and it serves the United States well by easing visa requirements on people in countries with which we have had close ties. I support the reauthorization of the VWPP, and simply ask that we consider extending the program to include one of our most important strategic, business and cultural allies: South Korea.
Thank you, Mr. Chairman, and I welcome the opportunity to answer the committee's questions.
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Mr. SMITH. Thank you, Mr. Kim.
Mr. Abercrombie.
STATEMENT OF HON. NEIL ABERCROMBIE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF HAWAII
Mr. ABERCROMBIE. Thank you very much, Mr. Chairman. Mr. Chairman, I, too, would like to ask your permission to submit a written statement for the official record and to submit a statement from the Governor of our State, Benjamin Cayetano and Lt. Gov. Mazi Hirono.
Mr. SMITH. Without objection, that will be a part of the record.
Mr. ABERCROMBIE. Thank you very much, Mr. Chairman. They have a particular interest. Mr. Cayetano is the son of a Filipino immigrant and the highest elected Filipino-American in the country, and Lieutenant Governor Hirono was herself an immigrant as a child from Japan and has now risen to be Lieutenant Governor of the State.
Mr. Chairman, I hope at the end of my testimony—and I appreciate your admonition that our testimony should focus on the issues you raise which are real and pertinent, not only to this legislation, but to the whole subject matter with which your committee deals, a hope that at the end, certainly, Mr. Kim's testimony and mine will help you to conclude, and Mr. Watt as well, that this is a question of jobs and income, not immigrant fraud cases; that our program or whatever bill is adopted, if you should choose to do that, will address positively the question of jobs, and not undermine in any respect, shape or form your charge to deal with immigrant fraud and related issues.
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We hope that we can convince you that this will be a revenue gainer, a continued revenue gain, not a drain, on the United States, and that the benefit is to the entire Nation, not just to Hawaii or California because of the extensive Korean-American communities now located throughout the country.
I, too, would like to focus my comments in that context, Mr. Chairman, trying to be responsive to your admonition on South Korea and the Visa Waiver Pilot Program. Also, couching my remarks in the context of South Korea as a political and military ally of the United States, we are not dealing with an entity, institutionally or otherwise, with which we are in confrontation. Quite the opposite. We can argue back and forth about what—how much money is spent. I think it is agreed by all, there is a net revenue gain to the United States from this activity.
There has been economic growth and jobs for the United States, particularly those areas visited by South Korean tourists. Traveling tourism is an area where the United States has had a favorable balance of trade, not just with South Korea, but in all aspects, and I think we need to foster and encourage the industry.
I am familiar with it, I represent Waikiki, among other tourist destination areas in Hawaii, and I can safely say as a result of my understanding of travel and tourism, that the South Korean market, Mr. Chairman, is one of the most lucrative and as yet untapped for the general prosperity of this Nation.
The State Department has a position which continues to restrict Korean travelers by not allowing them to participate in the Visa Waiver Program. It has proven successful in the past, and I quite agree with you. It is time to reexamine the standards which are used to determine which nations are designated. I think you are quite correct that we simply can't go adrift on what may have been the standards in the past. And I hope that the legislation we are asking you to consider today addresses those questions, and if it does not, certainly we are open to improving them to meet your concerns.
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Since 1987, the United States has seen a steady growth in Korean visitors, but as Mr. Kim has pointed out, there is a cumbersome visa process which we believe is needlessly sacrificing our market share to countries like Australia and Canada. I believe both of those nations have an—are equally concerned with fraudulent visa cases, particularly with the closing of Hong Kong from British rule and those considerations, and they have found it convenient to accommodate an expanding Korea visitor base without compromising their immigration and security interests.
On the other hand, the economic boom in South Korea resulted in a 900-percent increase in Korean visitors to the United States since 1987. I am assured by friends of mine in the travel and tourism industry, Mr. Chairman and Mr. Watt, that this is just scratching the surface of what is possible where South Korea is concerned.
My contention, vis-a-vis the State Department objections, is that tourism resulting from the waiver program would result in a decrease in the phenomenon of overstays, particularly with the increase of package tours which would follow the implementation. These visa standards, Mr. Chairman, and I hope you will agree, will not prevent individuals determined to overstay from doing so.
My experience is, Mr. Chairman, if someone is determined to overstay, they will do whatever is necessary to obtain a visa, no matter how long it takes, whereas the average tourist is not going to be involved in that at all. They have no such intention. It runs counter to our interests to deny the obvious benefits that would come from having tourists who have no intention and no likelihood of overstaying a visa. Nowhere is this more evident than in Hawaii.
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We are not in Hawaii experiencing a recovery as much as the rest of the Nation is, at least not to the same degree. Our economy, very obviously, Mr. Chairman, is depending on tourism. We are a service economy. With this legislation or whatever in your wisdom would come from the committee, you would allow us to open our doors to new markets and new visitors and we would benefit directly, Mr. Chairman, by welcoming Korean visitors. That is the primary reason I introduced H.R. 627 as a companion to S. 290 introduced by Senator Murkowski from Alaska. It is a good faith effort to be responsive to your concerns.
Let me just cite very briefly the major provisions. The Secretary of State and the Attorney General shall establish a pilot program within 6 months. The program would last for 3 years. Obviously, all this is subject to your consideration. It is open only to Koreans seeking admission as a visitor for pleasure, part of a group tour. This would not be something where individuals could just role in. The period would be not more than 15 days. They must have a round-trip ticket. They will have to be determined not to be a threat to welfare, health, safety or security of the United States.
They would be subject to the following restrictions: Tour operators would post a $200,000 bond with the Secretary of State. The tour operators would meet standards set by the Secretary of State. The tour operators would have to provide personal information on each perspective tour group member to the Secretary of State for purposes of security screening.
I hope I am being directly responsive to your concerns, Mr. Chairman. Tour operators must provide certification which document the return of each Korean visitor and failure to meet the specified requirements would result in financial penalties for the individual Korean tour operator. Secretary of State would determine tour agent participation in the program, based on periodic reviews of the overstay rate. This is to operate on the tour agents to make sure they are doing the work. The Attorney General and the Secretary of State may terminate the program one year after the establishment depending on overstay rights.
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Mr. Chairman, I believe each of those elements, again, directly addresses the serious questions you have proposed. And I would like to conclude, Mr. Chairman, by making a reference to a program already in existence, which has not received much publicity, interestingly enough, perhaps because it is working so well. If we had some egregious violations, maybe we would know more about it.
This is the Travel Agent Referral Program, commonly known as TARP. It is limited to tourist visas. It was put in place at the discretion of our Embassy in Seoul. Under this program, Korean travel agents designated the U.S. Embassy—designated by the U.S. Embassy in Seoul must obtain specific information and are given specific guidelines which they must follow in order to submit visa applications on behalf of their clients.
The applications are still reviewed by consulate officers, but the front-end work and the application process is done by Korean travel agents. This is already in existence. Thirty-five percent of the visa applications processed are initiated through TARP.
During the last couple of years, our embassy in Seoul worked out a system whereby Korean travel agents participating in the TARP program can enter the data electronically. While the State Department could not give me exact figures, it is my understanding that the approval rate for applications initiated under TARP is very near 100 percent. TARP gives us the infrastructure to make H.R. 627 work and my bill is based on—I am not trying to reinvent the wheel or just throw something in, Mr. Chairman, to appear to be responsive to your concerns. I believe the bill directly reflects the ongoing experience under the travel agent program. So they have a vested interest, in other words, in making the program work, Mr. Chairman. They make their living by making the program work and meeting the standards set by our Embassy and the Secretary of State.
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It contains very strict criteria. It does not shift enforcement responsibility to foreign agents. It does not compromise the security interest of the United States, and it provides adequate time for Federal officials to check perspective visitors against law enforcement databases. So in conclusion, Mr. Chairman, I believe we need to move forward on this issue. I hope you feel that I have been responsive to your concerns. I hope that we can move forward on it, because I feel, otherwise, other Nations will take the initiative on travel and tourism issues, and not just the issues, but travel and tourism itself and will be the beneficiaries and we will fall behind. Thank you for your kind indulgence at this time.
[The prepared statement of Mr. Abercrombie follows:]
PREPARED STATEMENT OF HON. NEIL ABERCROMBIE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF HAWAII
Mr. Chairman and members of the Subcommittee, I appreciate the opportunity to present testimony in regard to the visa waiver pilot program. Specifically, I would like to focus my comments on South Korea and the Visa Waiver Pilot Program (VWPP).
In 1995, South Korean visitors entering the United States spent nearly $2 billion. This meant economic growth and jobs for Americans particularly those in states most visited by South Korean tourists. At the top of Korean visitor destinations in the United States is California, visited by 56% of Korean visitors, followed by New York at 21% and Hawaii at 18%.
Travel and tourism is an area where the United States has a favorable balance of trade with the rest of the world. We must continue to foster and encourage this industry.
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For these reasons I cannot accept the State Department's position which continues to restrict Korean travelers by not allowing Republic of Korea to participate in the VWPP. While the VWPP has proven to be successful in the past, it is time to reexamine the standards used to determine which nations are designated VWPP. For example, while the designation of countries such as Liechtenstein and San Marino as VWPP participants facilitate administrative procedures, such action does nothing to substantially boost the U.S. travel and tourism industry. Since 1987, the United States has seen a steady growth in Korean visitors but with our cumbersome visa process we are needlessly sacrificing our market share to countries like Australia and Canada which have found it possible to accommodate an expanding Korean visitor base without compromising their immigration and security interests.
The argument against tourist visa waivers revolves around overstays under current policies. My contention is tourism resulting from a VWPP would result in a decrease in this phenomenon, particularly with the increase in package tours which would follow implementation of a VWPP. Even stiff visa standards will not prevent individuals determined to overstay from doing so. The average tourist in a VWPP has no such intention. To deprive our economy of the obvious benefits associated with increased tourism runs counter to our interests.
Nowhere is this more evident than in Hawaii. Unfortunately, Hawaii's economy is not experiencing the same recovery as the rest of the nation. Maybe more than any other state, our economy is dependent on tourism. You must allow us to open our doors to new markets and new visitors. Our economy will benefit by welcoming Korean visitors.
This is the primary reason that I have introduced legislation, H.R. 627, on this issue. H.R. 627 is a companion measure to legislation, S. 290, introduced in the United States Senate by Senator Frank Murkowski from Alaska. It is a good faith effort to acknowledge and be responsive to concerns on this issue.
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Major provisions of the bill include:
The Secretary of State and the Attorney General shall establish a pilot program within six months of the date enactment.
The program period will last for three years upon establishment.
The program is only open to Koreans seeking admission to the United States as a visitor for pleasure, as part of a group tour.
The period of stay by visitors to the United States shall not last more than 15 days.
Visitors must have a round-trip ticket.
The alien has been determined not to represent a threat to the welfare, health, safety, or security of the United States.
Under the pilot project small Korean tour groups could bring Korean visitors to the United States without visas subject to the following restrictions:
Tour operators must post a $200,000 bond with the Secretary of State.
Tour operators must meet the standards set by the Secretary of State.
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Tour operators must provide personal information on each prospective tour group member to the Secretary of State for the purposes of security screening.
Tour operators must provide certification which documents the return of each Korean visitor.
Failure to meet the specified requirements will result in financial penalties for the individual Korean tour operator.
The Secretary of State may terminate tour agent participation in the program based on periodic reviews on the over stay rate.
The Attorney General and Secretary of State may terminate the program one year after the establishment of the program dependent on overstay rates.
I want H.R. 627 to build upon the Travel Agent Referral Program (TARP). Just like TARP, H.R. 627 is limited to tourist visas. As you know, TARP was put into place at the discretion of our post in Seoul. Under TARP, Korean travel agents designated the U.S. Embassy in Seoul must obtain specific information and are given specific guidelines which they must follow to submit visa applications on behalf of their clients. The applications are still reviewed by consular officers, but the front end work in the application process is all done by Korean travel agents. Already, 35 percent of the visa applications processed are initiated through TARP.
During the last couple of years our embassy in Seoul has worked out a system whereby Korean travel agents participating in TARP can enter the data electronically. While the State Department cannot give me exact figures, it is my understanding that the approval rate for applications initiated under the TARP is very near to 100 percent. TARP gives us the infrastructure to make H.R. 627 work.
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Under H.R. 627 Korean travel agents have a vested interest in sticking to the rules. H.R. 627 contains strict criteria. H.R. 627 does not shift enforcement or responsibility to foreign agents. H.R. 627 does not compromise the security interests of the United States. H.R. 627 provides adequate time for federal officials to check prospective visitors against law enforcement data bases.
The United States needs to move forward on this issue. We cannot stand still while the rest of the world takes the initiative on the travel and tourism.
Mr. KIM. Would you yield just 1 minute on that point?
Mr. SMITH. Let me first thank Mr. Abercrombie for his testimony and I appreciate the good-faith effort to be responsive to some of the concerns that I have mentioned.
Mr. Kim.
Mr. KIM. Thank you, Mr. Chairman. The difference between the gentleman from Hawaii's bill and my bill is as follows——
Mr. SMITH. That was actually going to be my first question. If you don't mind, let's hear from Mr. Frank and we will come back to you in a minute, Mr. Kim.
Mr. Frank.
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STATEMENT OF HON. BARNEY FRANK, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MASSACHUSETTS
Mr. FRANK. Thank you, Mr. Chairman. I believe my colleagues have some good points to make, but I did want to say, I was caught by Mr. Kim's denigration of the military contribution of Andorra, San Marino, and Liechtenstein. I believe if you look at the current allocation of costs in NATO, they contribute just as much to our defense as do France, Germany, and Italy, so I don't want to single them out as not doing enough.
I also have legislation that would amend the Visa Waiver Program. It is motivated by concern about the exclusion of Portugal and the serious problems that causes for American citizens who live in this country. But my bill is not country-specific. I offer on behalf of myself, Mr. Pombo, and Patrick Kennedy, all of us concerned with the impact on Portuguese-Americans resident here, and what it would do is set up a new criteria, and I would add to the bill, I think it ought to be sunsetted and tested.
What this would do would be an alternative way of getting into the program, which would be refusal rate of 3.5 percent or less, provided that it was a refusal rate on the way down; that is that it had been at least a 50-percent drop in refusal rate.
First, let me say why I am doing this in this case. There are a large number of people of Portuguese descent who live in this country who are citizens, who would like to be visited by their relatives. We have a particular interesting situation here, because the Azores, which are the source of the islands, which are the source of the heart of the immigration from Portugal and the United States, in fact, former constant Tony Coelho and Senator Ben Campbell both are of Brazilian ancestry.
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The Azores are 2,000 miles away. You can get here fairly easily. It is a fairly common practice among Portuguese-Americans to invite their relatives from the Azores to graduations, weddings, people want to attend funerals. We are talking here about some interaction, and I have seen cases where American consuls, following the rules that are given to them, turn people down who really just want to come visit their friends and relatives. The Azores are as close to southeastern Massachusetts as Denver and are as easily reachable much of the year when there are direct flights, and that is what we are talking about. So my focus here is not on the people who live in Azores, it is on people who live in America and would like to have some interaction with relatives.
Now, I understand the concern we try to keep people out. First, I have to say I don't think excluding a country from the Visa Waiver Program is a very effective way to prevent illegal immigration. It would seem to me the overwhelmingly majority of illegal immigrants in this country began in countries that are not in the Visa Waiver Program, and I don't think that people who have decided illegally to emigrate to the United States, say, darn, if I was only in the Visa Waiver Program, I could slip into the United States, but given my country is not eligible for the Visa Waiver Program, I will have to live here forever. I don't think the Visa Waiver Program is a very strong fence.
There is another problem and that is it is a self-fulfilling prophecy. If, in fact, we could measure the number of people who overstayed, and we found countries had a high rate of people overstaying, I would have no objection, but apparently we don't do that very well, so what we do is we base this on refusal rate.
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Well, the refusal rate is subject to a lot of arbitrary abuse. The refusal rate is based on the consul's estimate of who would have cheated if they would have let them in, so there really is no objectivity.
I also note, by the way, a 2 percent rate or a 3.5-percent rate, even if you assumed the consuls were 100 percent accurate, you are punishing 96.5 percent of the people because 3.5 might cheat, and you are not, in my judgment, deterring the cheaters.
I would hope we could look at some very much more effective way to deal with people who stay beyond their visa, and in fact, if we were to expand the Visa Waiver Program and simply substitute a kind of notification, I bet we could take a lot of the manpower that now goes into visa monitoring and put that into the overstay issue, which is what really ought to be the case.
I think with regard to the Azores, sometimes people are kind of—they are not fully familiar with this, it doesn't seem plausible to them in some cases that this person wants to come for the weekend because we are not used to having people come for the weekend. Well, people will come from the Azores to New Bedford or East Providence or whatever for the weekend because there is a family event going on and this is the extended family. So I think what happens is there is an excessive denial rate, people are penalized by the excessive denial rate, but most important, I don't think it is an effective way to deter people from staying. I really don't think there are any significant number of people who immigrate here personally, illegally, because of the Visa Waiver Program. It certainly would not, it seems to me, deter anybody who has seriously intended. So I would hope we would jump it up to 3.5.
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The final point I would make is this: People are aware of this, people in America are aware of this. Portuguese-Americans are aware of this, they feel they are frankly discriminated against, which they are objectively, although there is no discriminatory motivation, but this is a place where they have a lot of fairly close relatives and they find, in many cases, they are frustrated when they want to get the relatives to come and participate in a family celebration or share family sadness, just to have that kind of interaction.
If we were to let them in on a—well, any country that qualified, on a trial basis, you would be generating peer pressure not to have people abuse that. The problem, of course, is that peer pressure doesn't work when it is the denial rate. If all the people in Fall River and New Bedford and Providence decide that no one should abuse this program, it is irrelevant right now because it depends on what the American consul says and Ponta Delgada and other parts of the Azores.
What we ought to be looking at is some way to try and deal with the overstay. And what we are now doing is penalizing some Americans who would like to have their relatives be able to come and visit with an exclusion from the program, which I think has no significant impact on illegal immigration. And, again, when we talk about 2 percent or 3 percent, we are clearly deciding that because a small handful of people might be seen as abusers, we subject a whole lot of other people to a whole lot of inconvenience in the visa situation.
Sometimes these things come up suddenly, literally, like funerals. Well, you can come from the Azores to go to a funeral, and it is not at all uncommon in closely knit families, where people want to come to a funeral, but as Mr. Kim pointed out, with the waiting lines and everything else, people have to miss funerals because there is no way to get a visa in time. It would be different if they were Jewish because then it would be the next day, but there are not that many Jewish people that come.
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Mr. SMITH. Thank you, Mr. Frank.
We have been joined by Congressman Ed Pease of Indiana and we appreciate his presence.
Mr. Frank, since you were the last to testify, let me ask a couple questions to you first. You mentioned your bill is not country-specific. Do you know, and I do not know the answer myself, whether under the standards you set, one would say a lowering of the standards to the 3.5 percent, other countries, besides Portugal, would be eligible for the Visa Waiver Program?
Mr. FRANK. I don't know because, obviously, I was focused on Portugal. We don't know. So I would assume a couple might be, because it is not just the 3.5 percent, also in the 2 previous full fiscal years, the rate was dropping by 50 percent.
Mr. SMITH. I presume there are some countries between 2 and 3.5 percent. We can ask the State Department.
Mr. FRANK. I would say, assuming that my very able staff did their job well, as they do, this is clearly designed to meet Portugal, but it was not designed to exclude others. But it also had the denial rate as well, the reduction of the denial rate as another factor.
Mr. SMITH. OK. One last observation, not a question. You mentioned the example, as I have heard before, about family members wanting to come over for a relative's graduation or something like that. Just to point out the obvious, of course they can still get visas if they plan further ahead and go through a few actions. Just because they are not a participant in the Visa Waiver Program doesn't preclude from travel or coming here.
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Mr. FRANK. Well, Mr. Chairman, may I ask a question?
Mr. SMITH. Yes.
Mr. FRANK. The next time one calls my office and says they wouldn't give me a visa, can I have you call the INS?
Mr. SMITH. I would like to know why they didn't get a visa.
Mr. FRANK. I will tell you, there are two things. That is a reasonable point, but sometimes there are emergencies, funerals, as I mentioned, is an issue. But secondly, there is a higher denial rate than there should be. I think I have problems with people who go there and are not used to the fact that we have this foreign country, Portugal, 2,000 miles away from America, most Americans aren't aware, and I wasn't fully until I became the Congressman representing this part of the State of Massachusetts. We have, 2,000 miles away, with direct flights during much of the year, a group of a couple hundred thousand people on these Azores islands who are so closely interrelated to Americans, so you have this kind of constant back and forth. But the other problem is that they get denied.
I mean, it is not simply they didn't apply in time, some of them get denied. It seems to me for no good reason, except they think it is not plausible that this 22-year-old wanted to come for a wedding. We think she is going to sneak in, so it was partly to prevent arbitrary denials, I should acknowledge.
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Mr. SMITH. Thank you, Mr. Frank. Mr. Kim, I will ask you the question which you anticipated a while ago. Will you explain briefly the difference between your bill and Mr. Abercrombie's bill.
Mr. KIM. Yes, the big difference is as follows. My colleague from Hawaii, his bill only applies to group tours. And while it is still better than nothing, I am afraid this might send the wrong message; that they have to post a bond, a $200,000 bond, almost like, I hate to say this, like a kind of criminal. And my emphasis is clearly on a business trip, 90 days, a short period of time, that is my emphasis.
We should grant the same visa program to business trips, not just a group tour. That is what is vitally important on this thing, and right now a lot of Korean people are concerned about the U.S. warming relations with North Korea, and I am afraid that we don't want to send the wrong message or it may create a growing public distrust of the United States among Koreans.
Why don't they just qualify as any other country? I mentioned a few countries, I didn't mean to single them out. I am just saying, this is qualified to the same category. I think you should grant the whole thing, including business, or nothing. I don't think it is right only granting to the group tour. I think that is maybe an insult to them.
I urge you to look at this H.R. 203. All I am saying is short-term trips for businesses and tourism, in the 1-year pilot program, at the end of 1 year, if nothing has been improved, the Attorney General can cancel the whole program.
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Mr. SMITH. Mr. Abercrombie, please feel free to respond to that, but I want to ask one final question and let me say, we neglected to put on the time to apply to me. We have a 5-minute rule around here, and that is not to have a different standard for other colleagues that are members of the subcommittee. Unlike the Visa Waiver Program, all of us are subject to the same standards.
Mr. WATT. Except the chairman.
Mr. ABERCROMBIE. Mr. Chairman, I am a member of Mr. Young's committee, so this is an easy day for me.
Mr. SMITH. Mr. Abercrombie, a final question for you and add any comments that you want to, is that in the last 10 years, the amount of travel and trade from South Korea has increased tenfold, about 100 percent a year I guess would be the average. I guess your point is that one could either say a visa requirement has not been a deterrent of travel and trade if it has gone up 1000 percent in the last 10 years, but your point is it would go up even more if there weren't the visa requirement. Respond to that, if you will.
Mr. ABERCROMBIE. It is a good point. I think I alluded to it fairly specifically, but if I didn't make it clear enough, I will now. In my contact with the Korean Chamber of Commerce and travel agents in Hawaii alone and with their contacts on the mainland, they said even though it has increased, despite some of the difficulties, that they feel they could increase it perhaps four times, and do not believe that the refusal rate, although Mr. Frank has made clear what that is, would increase. That the overstays, the actual overstays, as opposed to the refusal rate, if you would measure the actual overstays, they don't believe that would happen.
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Part of the reason they don't believe it would happen has to do with the TARP program. Again, I have been in legislative activity long enough over the years, Mr. Chairman, to know a particular bill and particular elements of bills are not written in stone. Mine isn't written in stone. I am trying to be responsive to the express concerns of the committee, and so whatever combination would work would be fine with me. I believe it is an untapped source yet, that it would increase even more and that the experience of the TARP program shows there already is an existing mechanism that could apply to business travelers just as easy as group tours.
I am not adverse to any combination, that if you felt that this was a reasonable way of dealing with the program, that you might evolve in any legislation that would be forthcoming. The bottom line, Mr. Chairman, is that the questions are real; the concerns are real. I have tried to address my legislation to those concerns, not to abstract philosophical positions, with which I might be very much emotionally attached to or philosophically attached to.
Mr. SMITH. Thank you, Mr. Abercrombie. Mr. Watt is recognized.
Mr. WATT. Thank you, Mr. Chairman. I maybe wanted to encourage Representatives Kim and Abercrombie to maybe take a closer look at Representative Frank's bill. My staff advises me that Korea would be covered by his bill also because of the decline rate. And it seems to me that doing this on some less arbitrary basis makes some sense, and that maybe the ultimate answer to this is to try to get some funding into the INS to upgrade their software, so that they can really begin to monitor the overstay issue, and then grant the visa waivers to the top 50 countries or the bottom 50 countries in terms of overstays every year, if we had an accurate way to monitor overstays.
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Then, you would have some scientific basis for rewarding countries that are doing well. The countries would then have a better basis for upgrading their own oversight over people who overstay in the United States, and so then we would be really accomplishing something.
Mr. FRANK. If the gentleman would yield for just one second. Generally, you would generate peer pressure in the United States against the overstays, because the recipients in the United States are the water in which those fish swim, and if they see this as a danger, they become a lot less hospitable.
Mr. ABERCROMBIE. May I also—the response to that, that is why in my bill, I am trying to zero in on Mr. Smith's questions and observations. Under the TARP program, as modified in my bill, the tour operators would provide certification, which documents the return of each visitor. There is your overstay scientific data right there.
Mr. WATT. I agree with that, but I am also persuaded by Representative Kim's notion that—I understand that the tourism question addresses your primary concern, but it then leaves out a bunch of businesspeople and other people who might be coming to the United States, and we are kind of carving out even a sub, sub, subgroup.
Mr. ABERCROMBIE. But even independent travelers almost universally use travel agents. Very few people, particularly in Asia and more particularly in Korea, make their own independent reservations, et cetera, even business travelers tend to use an agency. The business itself will have a designated agency, so it shouldn't be too much difficulty to have a certification process, if that is the principal concern.
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I understand philosophically what you are saying and perhaps it would make legislative sense, but I am trying to be realistic in how this is being handled and trying to find a practical way to deal with it. If the State Department is the primary objector, they have raised the primary objections here, and the State Department, and I hope I am not speaking out of turn for my two colleagues, but the State Department has made it clear what their objections are, but they have been pretty scarce about trying to come up with solutions.
They don't seem to be too concerned about whether or not the prosperity of this country is enhanced or our relationships with Korea is enhanced or Portugal, for that matter. So we are trying to come up with good faith solutions. They keep saying this is why we don't want to do it. So the provision in my bill is, OK, if that is your objection, that there are overstays and you are not sure what they are. I tried to come up with something that would try and measure what they are.
Mr. WATT. How would you do that to address the other people, other than tourists, though? I guess your bill specifically limits it to tourists, so you haven't addressed that.
Mr. KIM. Mr. Watt, if you would yield on that point. I appreciate the gentleman from Hawaii. Hawaii heavily relies on tourism and I appreciate that, but my main concern is to resolve this.
Mr. WATT. I don't want you all to get territorial because this is not a tug of war between the two of you. I am interested in both of them, so what we need to do is come up with a system that accommodates both of them. We are not trying to bring in only businesspeople and exclude tourists, we are not trying to bring in all the tourists and exclude businesspeople.
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Mr. FRANK. And don't leave out my family values.
Mr. WATT. And I am also very interested in his family values business.
Mr. ABERCROMBIE. I think the way to deal with this, though, is through the travel agent certification.
Mr. WATT. One more question, Mr. Chairman, if you don't mind. I just got handed a note that says that one impediment to Korea qualifying under Barney Frank's bill would be that Korea doesn't have a machine readable passport program and that is something that the United States apparently has been trying to encourage them to do. Does either of you know whether Korea is making any progress on that front? That might help a little bit, if they were helping us to be a little bit more into this century.
Mr. KIM. I was just informed that that program is in development right now.
Mr. WATT. Do you have any idea how long it might take before they get out of process?
Mr. ABERCROMBIE. If you would pass the legislation it would be a lot quicker.
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Mr. FRANK. I was just going to say, passing this bill would be helpful.
Mr. KIM. This bill will certainly expedite that process.
Mr. WATT. OK. Thank you, Mr. Chairman.
Mr. SMITH. Thank you, Mr. Watt. Gentlemen from Indiana, Mr. Pease.
Mr. PEASE. Thank you, Mr. Chairman. Mr. Frank, I think I do prefer your approach, which attempts to set a standard by which any nation would be evaluated. My concern is that I think I heard you say that your opinion is that the current program where refusals are, in fact, made by the State Department is in large measure, or at least in some measure, subjective, and so I am a bit troubled by trying to set an objective standard that relies on somebody's subjective evaluation, and if that is, in fact, the case, if I understand you correctly, how would you respond to that?
Mr. FRANK. I think that is exactly the core of our problem and I think that is what the gentleman from North Carolina was sketching out, is ultimately, we ought to be trying to measure the number of people coming here and staying longer than they are supposed to because that is the root of the problem and that is the correctable problem.
I agree that the current one is subjective, and in the short term, I stay within the subjective framework. The one thing I would point out is it has been my experience that the subjectivity works against the foreign country, rather than for it; that is, the consuls, at least I think in the case of the Orient situation, probably some others, if anything, they may have a bias to keep more people out than to let them in, so I would say, in the short term, we have no option, but to stay within the framework of subjectivity, but working for some kind of standard which measured—not just measured the overstays, but by the very active measure, gave the authorities here in the United States better control over who they were and where they were and the ability to penalize the host country for the overstay, that then generates the right kind of incentives to diminish it.
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Mr. PEASE. I appreciate that. I guess I would prefer we go the route that Mr. Watt has suggested and in the short term, we look more at adding Portugal. Because, if for instance, the evaluation is still a subjective one, and I don't want to attribute motives to those in the State Department, but if there is a bias toward keeping folks out, they could easily circumvent the statute by refusing more folks.
Mr. FRANK. I agree, although I think from their standpoint, that is a fair concern, but if we were to pass legislation which went up and the refusal rate went up shortly afterwards, I think we could do a post talk analysis and that they would be very—I think we could discourage them from doing anything quite that blatant.
Mr. KIM. Can you yield 1 second?
Mr. PEASE. Certainly, and then Mr. Watt.
Mr. KIM. We are so bogged down on this rejection rate I don't think we should accept the countries who simply meet this rejection rate. Some countries have hardly any visa applications. They don't have a high excellence score. I think it is our prerogative that we accept individual countries, we evaluate individual countries and reject and accept on a per country basis. I don't think it is right that we have to accept all of them regarding this rate, simply because they meet certain criteria, which is arbitrary criteria. It is our prerogative, that is why I am not supporting the concept.
Mr. PEASE. Thank you, Mr. Kim.
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Mr. Watt, I will yield.
Mr. WATT. I was just going to say, as long as you have this kind of subjective criteria in place, I kind of alluded to this in my opening statement, what you end up with is a criteria that is always going to benefit European countries, and you really need an objective criteria, and the only way you can get there is really to get to a point where you can monitor overstays, not refusal rates.
Refusal rates are always going to be subjective. It is going to be subjective based on—it favors processors who have more comfort with the people that they are processing. I mean, that is just—and I am putting that gently, so that it gets in the record gently, but everybody in the audience I think understands what I am saying. You know, you go down this list of countries, and, you know, it kind of reflects on Americans' bias toward certain countries, and it is not unlike the bias that exists inside our country. That is the point I am getting to.
Mr. FRANK. You are saying you wouldn't want the refusal rate for housing to be the trigger for your eligibility to go before the Fair Housing Commission.
Mr. PEASE. Thank you, Mr. Chairman.
Mr. ABERCROMBIE. Mr. Pease, may I? I see the green light is still on. I don't recall whether you were in the room when I first testified about the travel agent program already in existence.
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Mr. PEASE. Yes, I was.
Mr. ABERCROMBIE. In answer to your question very quickly then, there is specific information that is gathered by the tour agents before they do the upfront work and the Embassy has already set that up, so I think if we made some reference there, we could handle the question of subjectivity a bit more objectively. There is objective criteria, in other words, Mr. Chairman, right now that is used in the TARP program.
It doesn't address all the questions that Mr. Watt raised because it is not free form and open. The travel agents do determine the personal finances of the people involved and so on, which is just good prudent business sense on their part. They want to make sure people can pay for the tickets, et cetera. So I do think that with the TARP program, Mr. Pease, is the possibility of at least addressing in a reasonable way, in the immediate future, your question about subjectivity.
Mr. FRANK. Mr. Chairman, may I ask one question? I would be interested if immigration had the statistics of the people who have been deported from the United States, how many came in here on a visa and overstayed and how many came here illegally in the first place. My feeling is a minuscule percentage came in on a visa and overstayed as opposed to people who came in just totally illegally in the first place.
Mr. WATT. What deportations are you talking about? That is the question the chairman is going to ask. The chairman doesn't think we have deported enough people. That is another issue.
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Mr. PEASE. Thank you, Mr. Chairman.
Mr. SMITH. That is a good question. I don't know and maybe we can ask the INS.
We will ask in a minute. My guess is they do support a fair number of visa overstayers. How that compares to those who enter the country illegally, I don't know. Thank you. We thank our colleagues for their testimony. We will proceed to the next panel.
Our second panel consists of Mary Ryan, Assistant Secretary of the Bureau of Consular Affairs, Department of State and Michael Cronin, Assistant Commissioner, Office of Inspections, Immigration and Naturalization Service. We welcome you both. Ms. Ryan, we will begin with your testimony, and if you will proceed, thank you.
STATEMENT OF MARY A. RYAN, ASSISTANT SECRETARY, BUREAU OF CONSULAR AFFAIRS, DEPARTMENT OF STATE
Ms. RYAN. Good morning, Mr. Chairman, members of the committee. I have a written statement I would like to submit for the record and I have a short oral statement which I would like to now read.
I am delighted to have been invited today to testify on behalf of the Department of State about the nonimmigrant Visa Waiver Program. I can say, without reservation, that this program has been a resounding success. It has bolstered the U.S. economy through expedited admission of millions of legitimate short-term visitors for business, allowing the negotiation of contracts for the provision of American goods and services to the world.
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It has provided a welcome boost to the U.S. tourism industry, which employs thousands of American citizens through the visa-free admission of millions of foreign tourists. In addition, it has enabled the U.S. Government to use its limited resources more efficiently and productively, during a period of budgetary constraint. We support permanent reauthorization of this highly effective program.
During the 1980's, economic prosperity in Europe and Japan contributed to an explosion in international travel. The State Department found itself in a position of devoting increasing resources to visa issuance, which was virtually perfunctory. Let there be no mistake about it, a British national applying for a visa to visit the United States in 1987 was not required to go to the Embassy, let alone to have a visa interview. Yet even this perfunctory processing consumed major personnel resources, owing to the sheer volume of visa issuance.
The Visa Waiver Pilot Program was a logical response to that situation. Its objective was to determine if a selective waiver of the nonimmigrant visa requirement would improve the use of U.S. Government resources and encourage travel to the United States without diminishing U.S. border security. It went into effect on July 1, 1988, initially in 8 countries, jointly designated by the Secretary of State and the Attorney General and has now expanded to 25 countries.
The program simultaneously helped U.S. business, generated growth in the U.S. tourist industry and allowed the State Department to redirect its consular resources to higher risk situations, like the newly independent States in the former Soviet Union. The Visa Waiver Program was not just a win-win situation, it was a win for business, it was a win for tourism and it was a win for effective management of the State Department.
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Strict criteria for participation were established to assure the test program would not entail unacceptable risks to our ability to control our borders. Furthermore, before any country is designated as a participant, the Attorney General must determine that U.S. law enforcement interests would not be compromised by its destination.
A number of countries have met some criteria, but not been accepted for the program because of law enforcement or security reasons. The criteria laid out in the legislation have worked astoundingly well. The established requirements have insured that only low-fraud, low-risk countries, such as Germany, the United Kingdom, Japan, France, Norway, are designated as participants. Strict adherence to the criteria have enabled the representatives of the State Department overseas to respond honestly and straightforwardly to requests from numerous friendly countries, to be included in the program by noting their current ineligibility to meet the criteria.
More significantly, the criteria have insured that the nations received equitable treatment in line with the historical principles of the United States. We strongly support continued adherence to the criteria which have maintained the integrity of the program over the years. Any proposal to dilute the qualifying criteria must be carefully evaluated to see if it is consistent with the program's stated aims, and with U.S. border security concerns.
Safeguards have been included in the program to deter the admission of ineligible aliens. The mere fact that a country participates in the Visa Waiver Program does not mean that all of its citizens will be admitted to the United States upon application, or that if admitted under the waiver program, they will be granted all the privileges they would enjoy if they are admitted with visas.
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All individuals applying for admission, including those in the Visa Waiver Program, are subject to the same lookout checks at the port of entry that they would be subjected to at the time of visa issuance overseas. The Department of State and the Immigration and Naturalization Service share data to ensure all information on ineligible aliens is available to both agencies.
I am convinced that the application of the criteria for admission, outlined in the legislation, plus our enhanced data share programs, offer U.S. agencies appropriate control over those seeking admission without visas. Based on the information we have available, issuing visas to all the travelers who entered under the Visa Waiver Program would have been a considerable drain on the resources of the State Department, without any discernible benefits to our national security. Some would argue that the program weakens U.S. border security. I would advance a counterargument.
The Visa Waiver Program was not and is not a loser for U.S. border security. Rather than weakening border security, indeed, the Visa Waiver Program has strengthened it. It has allowed the Department of State to focus our resources upon those countries and regions where the fraud potential is the greatest.
The resource savings were applied to opening of posts and to staffing consular sections in the former Soviet Union and to administering legislatively mandated immigrant visa lottery programs. In addition, the Department has been able to move personnel into straight antifraud work or to adjudicatory positions in immigration-push countries. So what would the resource implications be for the Department of State if the Visa Waiver Program were ended?
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It is really almost impossible to calculate and, in fact, it is daunting to contemplate. We eliminated positions in visa waiver countries and we have even closed many consulates in those countries. The cost of reestablishing those posts and positions would be significant. Since the program began, the demand for nonimmigrant visas in nonvisa waiver countries has grown considerably.
The resources which were reprogrammed to those countries are essential to providing adequate service and to maintaining antifraud initiatives. Estimating what it would cost—what would be the cost to the United States to restore consular service to all the nations who currently participate in the Visa Waiver Program is admittedly an inexact science. However, one rough measure would be based on the number of foreigners who entered the United States in 1996 using the Visa Waiver Program.
Last year, some 12.4 million aliens entered the United States on the Visa Waiver Program. The current machine readable application fee is $20. Even if only half the aliens who entered the United States last year required a visa, that would mean the additional cost to the United States would be over $120 million and that does not even cover the cost of expanding facilities or hiring and training all the additional staff the Department would require.
Our business and tourism would suffer, the cost to the U.S. Government would be high and border security would not be improved. While the Government has benefited enormously from the Visa Waiver Program, it has really been the U.S. economy that has won the gold ring on this ride. The World Tourism Organization statistics for 1996 show the United States was the second most popular international tourist destination, with 44.8 million arrivals, but it was number one, as far as tourism receipts go. International tourists, many of them on the Visa Waiver Program, spent $64.4 billion in 1996 in the United States.
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In closing, I would like to stress, once again, the value of the Visa Waiver Program to the U.S. Government, to U.S. travel, and to the tourism industry and to our relations with the participating countries. Even a short disruption of this vital program would have disastrous economic, political and resource implications for the United States. We support the permanent reauthorization of the Visa Waiver Pilot Program and we would work with the Department of State to that end. Thank you for your attention and I would be pleased to take any questions.
[The prepared statement of Ms. Ryan follows:]
PREPARED STATEMENT OF MARY A. RYAN, ASSISTANT SECRETARY, BUREAU OF CONSULAR AFFAIRS, DEPARTMENT OF STATE
Mr. Chairman and Members of the Committee, I am delighted to have been invited today to testify on behalf of the Department of State about the nonimmigrant visa waiver program. I can say without reservation that this program is a resounding success. It has bolstered the U.S. economy through the expedited admission of millions of legitimate short term visitors for business, thus allowing for the negotiation of contracts for the provision of American goods and services to the world. It has provided a welcome boost to the U.S. tourism industry, which employs thousands of American citizens, through the visa-free admission of millions of foreign tourists. In addition, it has enabled the U.S. government to use its limited resources more efficiently and productively during a period of budgetary constraint. We support permanent reauthorization of this highly effective program.
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During the 1980's, economic prosperity in Europe and Japan and the growing interdependence of the world's economy contributed to an explosion in international travel. The State Department found itself in the position of devoting increasing resources to visa issuance which was virtually perfunctory. Let there be no mistake about it—a British national applying for a visa to visit the U.S. in 1987 was not required to go to the Embassy, let alone have a visa interview. Yet, even this perfunctory processing consumed major personnel resources owing to the sheer volume of visa issuance.
The visa waiver pilot program was a logical response to that situation. It was instituted pursuant to the Immigration Reform and Control Act of 1986. Its objective was to determine if a selective waiver of the nonimmigrant visa requirement would improve the use of U.S. government resources and encourage travel to the United States, without diminishing U.S. border security. The program waives the visa requirement only for touristic or business trips of ninety days or less in duration. Others, such as students and temporary workers, from qualifying countries all still need visas to travel to the U.S. It went into effect on July 1, 1988, in eight countries jointly designated by the Secretary of State and the Attorney General. Under joint administration of the Secretary of State and the Attorney General the program has now expanded to encompass 25 countries which have met the statutory criteria.
The program simultaneously helped U.S. business, generated growth in the U.S. tourist industry and allowed the State Department to redirect its consular resources to higher risk situations like the newly independent states in the former Soviet Union. The visa waiver program was not just a win/win situation, it was a win for business, a win for tourism and a win for effective management of the Department of State.
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Strict criteria for participation were established to ensure that the test program would not entail unacceptable risks to our ability to control our borders. To qualify for the program, nations must:
Have a minimal nonimmigrant visa refusal rate;
Issue or agree to issue a machine readable travel document;
Reciprocate the visa waiver by permitting visa-free entry to Americans for business or tourism.
Furthermore, before any country is designated as a participant, the Attorney General must determine that U.S. law enforcement interests would not be compromised by the designation. Formal and informal consultations take place within the border security community before a country is nominated. A number of countries have the requisite refusal rates and machine readable documents but have not been accepted for the program because of law enforcement or security concerns.
The criteria laid out in the legislation have worked astoundingly well. The established requirements have ensured that only low-fraud, low-risk countries, such as Germany, the United Kingdom, Japan, France and Norway, have been designated as participants. Strict adherence to the criteria has enabled representatives of the Department of State overseas to respond honestly and straightforwardly to requests from numerous friendly nations to be part of the program by noting their current inability to meet the criteria Most significantly, the criteria have ensured that nations have received equitable treatment in line with the historical principles of the United States. We strongly support continued adherence to these criteria which have maintained the integrity of the program over the years. Any proposal to dilute the qualifying criteria must be carefully evaluated to see if it is consistent with the program's stated aims and U.S. border security interests.
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Safeguards have been included in the program to deter the admission of ineligible aliens. The mere fact that a country participates in the visa waiver program does not mean that all of its citizens will be admitted to the United States upon application or that, if admitted under the waiver program, they will be granted all the privileges they would enjoy if they were admitted with visas. They first must not be inadmissible under the Immigration and Nationality Act. In addition, they may not seek review of any removal of admission under the visa waiver program or contest removal under the visa waiver program, other than on the basis of an application for asylum. They must have a roundtrip ticket so that they can depart immediately if found excludable. All individuals applying for admission, including those in the visa waiver program, are subject to the same look-out checks at the port of entry that they would be subjected to at the time of visa issuance overseas.
The Department of State and the INS share data to ensure that all information on ineligible aliens is available to both agencies. I am convinced that application of the criteria for admission outlined in the legislation plus our enhanced data share programs offer U.S. agencies appropriate control over those seeking admission without visas. Based on the information we have available, issuing visas to all of the travelers who entered under the visa waiver would have been a considerable drain on resources without any discernible benefit to our national security.
Some would argue that this program weakens U.S. border security, I would advance the counter argument. The visa waiver program was not and is not a ''loser'' for U.S. border security. Indeed, rather than weakening border security, the visa waiver program has strengthened it, because it has allowed the Department of State to focus its resources upon those countries and regions where fraud potential is greatest. The resource savings were applied to the opening of posts and staffing of consular sections in the former Soviet Union and to administering legislatively-mandated immigrant visa lottery programs. In addition, the Department has been able to move personnel previously engaged in relatively pro forma nonimmigrant visa adjudication into straight anti-fraud work or to adjudicatory positions in immigration-push countries.
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So what would be the resource implications for the Department of State if the visa waiver program were ended? It is almost impossible to calculate and daunting to contemplate. We have eliminated positions in visa waiver countries and even closed many consulates, especially in Western Europe, which used to provide perfunctory visa services. The cost of reestablishing these posts and positions would be significant. Since 1988 when the visa waiver program began, the demand for nonimmigrant visas in nonvisa waiver countries has grown considerably. The resources which were reprogrammed to these countries are essential to providing adequate service and maintaining anti-fraud initiatives.
Estimating what it would cost to the U.S. to restore consular services to all the nations that currently participate in the visa waiver program is admittedly an inexact science. However, one rough measure would be based on the number of foreigners who entered the U.S. in 1996 using the visa waiver program. Last year some 12.4 million aliens entered the U.S. on the visa waiver program. The current Machine Readable Visa application fee is $20, based on a 1991 cost of service study. Even if only half the aliens who entered the U.S. last year required a visa (since some of those visitors probably entered more than once in 1996 and some would be dissuaded from traveling here by a visa requirement), that would mean that the additional cost to the U.S. would be over $120 million—and that does not even cover the cost of expanding facilities or hiring and training all of the additional staff the Department would require. Our business and tourism would suffer, the cost to the U.S. government would be high, and U.S. border security would not be improved. As I noted earlier, I really don't even like to think about it.
While the government has benefited enormously from the visa waiver program, it has been the U.S. economy that really won the gold ring on this ride. The World Tourism Organization statistics for 1996 show that the United States was the second most popular international tourist destination with 44.8 million arrivals but number one as far as tourism receipts go. International tourists spent $64.4 billion here in 1996. Lots of them entered the U.S. on the visa waiver program.
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In closing, I would like to stress once again the value of the visa waiver program to U.S. government operations, to the U.S. travel and tourism industry and to our relations with participating countries. Even a short disruption of this vital program would have disastrous economic, political and resource implications for the U.S. government. We support permanent reauthorization of the visa waiver program and will work with the Department of Justice to that end.
Thank you for your attention. I will be pleased to take your questions.
Mr. SMITH. Thank you, Ms. Ryan.
Mr. Cronin.
STATEMENT OF MICHAEL D. CRONIN, ASSISTANT COMMISSIONER FOR INSPECTIONS, IMMIGRATION AND NATURALIZATION SERVICE
Mr. CRONIN. Thank you very much, Mr. Chairman, members of the subcommittee. I welcome the opportunity to testify on the Visa Waiver Pilot Program. I have submitted written testimony for the record and I would like to summarize that in a brief statement. Under the provisions of this program, visitors for pleasure or business from countries designated jointly by the attorney general and the Secretary of State, who meet express statutory criteria may enter the United States without a visa for a period of 90 days. They are required to waive in writing any right to the review of an immigration officer's determination that they are admissible or removable from the United States. The four criteria for inclusion of countries in the program are, they offer reciprocal privileges to U.S. citizens; they have had a visitor visa refusal rate of under 2 percent for the previous 2 years and under 2.5 percent for any one of those 2 years; that they certify that they issue or are in the process of developing a machine-readable passport and the Attorney General make a determination that inclusion of the country in the program does not pose a law enforcement risk to the United States.
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The act further provides the Attorney General in consultation with the Secretary of State may refrain from including countries in the program or remove them for any reason, including national security.
Applicants for admission under the program are examined by immigration officers who are aware that these individuals have not been screened through a visa process. The officers check the name of applicants against a lookout data base. The officers may open and pursue any appropriate line of inquiry to make a determination concerning the individual's inadmissibility.
In fiscal year 1996, 76 percent of nonimmigrants from the 25 participating countries entered under this program. This was over 12 million travelers, or just under one-half of all documented nonimmigrants. Prior to the 1996 statutory modifications, the agencies involved in making the necessary determinations for addition of countries to the program had developed a process for the inclusion of countries.
The Bureau of Consulate Affairs and the Department of State makes the necessary threshold determinations of eligibility. Before making a recommendation that a country be included in the program, the Bureau considers any other relevant foreign relations or national security issues. Upon receipt of States' recommendations, the Department of Justice requests information from INS and the FBI concerning immigration and national security considerations.
Upon analysis of this information, a recommendation is made to the attorney general as to inclusion or rejection of the country. Under the 1996 amendment, the authority to designate a country to participate in the program was vested solely in the Attorney General in consultation with the Secretary of State. The number of persons applying for admission under the Visa Waiver Pilot Program who were refused entry increased significantly in fiscal years 1995 and 1996, by approximately 2,000 persons a year, to 7,000, 11 refusals in 1996.
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This recent increase appears attributable in part to the fraudulent use of travel documents from countries in the program, which I will discuss later. However, statistics relating to the apprehension and removal of nationals of visa waiver countries, as shown on a chart attached to my testimony, indicates the countries remain low risk for immigration law violations.
The Visa Waiver Pilot Program has grown tremendously and has proven extremely popular with nationals of visa waiver countries and with travel and tourism interests. It has significantly reduced the consulate workload, but has not markedly degraded facilitation at U.S. ports-of-entry.
At the same time, port-of-entry enforcement capabilities have been enhanced by the addition of select data from a consulate lookout and support system into the interagency border inspection system data base. The Visa Waiver Pilot Program, however, is attractive to the perspective illegal entrants in the same way it is for the legitimate traveler.
Entry to the United States can be achieved with nothing but a passport and without the necessity of a visa in the document. Consequently, fraudulent document vendors and alien smugglers have targeted the passports of visa waiver countries. As the Department of State has increased the fraud resistance of the U.S. nonimmigrant visa, by including biographical information and the various digitized photographs on the visa, the attractiveness of using visa waiver country passports for nonvisa waiver nationals seeking to enter the United States illegally has also increased.
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Attraction of smugglers to visa waiver passports is encouraged by several factors, including limited security features present in some passports and the existence of multiple passport-issuing authorities and procedures in some visa waiver countries. The use of lost or stolen blank visa waiver passports also presents a serious fraud concern.
The INS intelligence program collects information about the universe of fraudulent document efforts. It distributes to field offices intelligence reports on the variety of documents and schemes in use to move aliens to the United States and to attempt to get through the inspections process. The INS forensic documents laboratory sends to all ports-of-entry alerts whenever a significant new fraudulent document appears. These alerts include color photographs of the fraudulently produced or altered documents, or the fraudulent visa stamps, as well as a written description of what features to look for to determine the fraud.
The Department of Justice has been conducting a review of the Visa Waiver Pilot Program to assess the risks associated with further expansion of the program, including incremental effects of program expansion on the effectiveness of ports of entry. That review is being expanded to an interagency working group, which will evaluate the program as a whole, its extension and the continued destination of current countries and criteria to be applied to determinations about the addition of further countries to the program.
The program provides that one qualification for continued participation is that the number of nationals of the member country who were denied admission at the time of arrival or withdraw the application for admission and the number of nationals of that country who violated the terms of such admission during the previous fiscal year remained below 2 percent of the total number of nationals of that country who applied for admission as nonimmigrant visitors during that year.
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Data are collected in the nonimmigrant information system on the number of withdrawals for visa waiver countries and can be provided for each year, since the beginning of the program. Similarly, comprehensive data on visa waiver refusals can be provided. Data are available from 1988 to 1989, and 1991 to 1992, for Visa Waiver Pilot Program countries whose nationals violated the terms of their admission, as measured by nonimmigrant visa overstay rates.
Nonimmigrant overstay rates have not been estimated since July 1994, when calculation of fiscal year 1993 rates were attempted due to inconsistent numbers of apparent overstays in the nonimmigrant system. The numbers of apparent overstays have been reviewed every 6 months, through February 1997, in attempts to estimate defensible nonimmigrant overstay rates.
However, data from the nonimmigrant system continues to be inadequate for this purpose. From the 1994 realization that corrective action was required, plans were made to rewrite the nonimmigrant information systems software to improve data integrity, identify new requirements and convert the old data base. This development effort began in 1995 and continued until the new system was introduced in July 1996.
The new system is now being analyzed for further corrections. INS recognizes the inability to provide this information as a serious deficiency. We hope to have completed and introduced corrective actions to the nonimmigrant system by early 1998.
As we have stated in the past, INS recommends that legislation be enacted to require the Visa Waiver Pilot Program countries to introduce highly fraud-resistant, machine-readable passports by a date certain. Current language does not refer to fraud resistance and some countries have failed to introduce machine-readable documents to date.
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The provisions requiring transportation lines to be signatory to agreements with INS and requiring air and sea passengers to be in possession of onward tickets have posed some difficulties in relation to private and military conveyances and that is an issue that we may want to look at in terms of statutory amendment. This completes my testimony and I will be happy to respond to any questions.
[The prepared statement of Mr. Cronin follows:]
PREPARED STATEMENT OF MICHAEL D. CRONIN, ASSISTANT COMMISSIONER FOR INSPECTIONS, IMMIGRATION AND NATURALIZATION SERVICE
Mr. Chairman and Members of the Subcommittee, I welcome the opportunity to testify on the Visa Waiver Pilot Program (VWPP). During the last nine years, this Program has become a regular part of the inspection and admission process for visitors from 25 countries.
DEVELOPMENT AND EXPANSION OF THE VISA WAIVER PILOT PROGRAM.
The Visa Waiver Pilot Program was established by the Immigration Reform and Control Act of 1986. Under its provisions, visitors for pleasure or business from countries designated jointly by the Attorney General and the Secretary of State, who meet express statutory criteria, may enter the United States without a visa for a period of ninety days. They are required to waive in writing any right to the review of an immigration officer's determination that they are inadmissible or removable from the United States. They may only contest removal based on an application for asylum. They are also required, if arriving by air or sea, to travel on a transportation line which is signatory to an agreement with the Immigration and Naturalization Service permitting the line to transport passengers under the Program, and they are required to be in possession of a round-trip or onward ticket.
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The four criteria for inclusion of countries in the program are:
1) that they offer reciprocal privileges to United States citizens;
2) that they have had a nonimmigrant visitor visa refusal rate of under 2 percent for the previous two years and under 2.5 percent for any one of these two years;
3) that they certify that they issue or are in the process of developing a machine-readable passport; and
4) that the Attorney General make a determination that inclusion of the country in the Program does not pose a law enforcement risk to the United States.
The Act further provides that the Attorney General, in consultation with the Secretary of State, may refrain from including countries in the Program or remove them for any reason, including national security.
Applicants for admission under the program must complete a Form I–94W, answering questions regarding their admissibility to the United States and executing the waiver noted above. They are examined by immigration officers who are aware that these individuals have not been screened through a visa process. The officers check the names of these applicants against a lookout database. These officers may open and pursue any appropriate line of inquiry to make a determination concerning the individual's admissibility.
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From its inception in 1988 through fiscal year 1996, the Program grew from one to 25 participating countries. In Fiscal Year 1996, seventy-six percent of nonimmigrants from participating countries entered under this program. This was over 12 million travelers, or just under one-half of all documented nonimmigrants.
Prior to the statutory modifications made by the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA), the agencies involved in making the necessary determinations for addition of countries to the program had developed a process for the inclusion of countries. The Bureau of Consular Affairs of the Department of State makes the necessary threshold determinations of eligibility, i.e., that the visa refusal rates are within the statutory criteria; that the country is issuing or intends to issue a machine readable passport; and that the country extends or will extend reciprocal privileges to U.S. travelers. Before making a recommendation that a country be included in the Program, the Bureau of Consular Affairs considers any other relevant foreign relations or national security issues. Upon receipt of a recommendation from the Department of State that a country be included in the Program, the Department of Justice requests information from the Immigration and Naturalization Service and the Federal Bureau of Investigation concerning immigration, criminal, and national security considerations and data. As necessary, a team may be dispatched to the country to consult with its law enforcement and criminal justice organizations and to review such activities as border control and passport issuance procedures. Upon analysis of this information, a recommendation is made to the Attorney General as to inclusion or rejection of the country. Under IIRIRA, the authority to designate a country to participate in the Program was vested solely in the Attorney General, in consultation with the Secretary of State.
The number of persons applying for admission under the Visa Waiver Pilot Program who are refused entry grew, through Fiscal Year 1994, in a manner consistent with the growth of the Program, from 22 persons in 1988 to 1,876 persons in 1994. This number increased significantly in Fiscal Years 1995 and 1996, by approximately 2,000 persons a year, to 7,011 refusals in 1996. This recent increase appears attributable in part to the fraudulent use of travel documents from countries in the Program, which will be discussed below. However, statistics relating to the apprehension and removal of nationals of Visa Waiver countries, as shown on the attached chart, indicate that these countries remain low-risk for immigration law violations.
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THE SUCCESS OF THE VISA WAIVER PILOT PROGRAM.
The Visa Waiver Pilot Program has grown tremendously and has proven extremely popular with nationals of visa waiver countries and with travel and tourism interests. It has significantly reduced consular workload but has not markedly degraded facilitation at United States ports-of-entry. Port-of-entry enforcement capabilities have been enhanced by the addition of select data from the Consular Lookout and Support System (CLASS) to the Interagency Border Inspection System (IBIS) database.
FRAUD IN THE VISA WAIVER PILOT PROGRAM
The Visa Waiver Pilot Program is attractive to the prospective illegal entrant in the same way it is for the legitimate traveler—entry to the United States can be achieved with nothing but a passport and without the necessity of visa issuance. Consequently fraudulent document vendors and alien smugglers have targeted the passports of Visa Waiver countries. As the Department of State has increased the fraud resistance of the United States nonimmigrant visa by including biographical information and the bearer's digitized photograph in the visa, the attractiveness of using VWPP passports for non-VWPP nationals seeking to enter the United States illegally has also increased. The attraction of smugglers to VWPP passports is encouraged by several factors, including limited security features present in some VWPP passports (which simplify the alteration and forgery of them) and the existence of multiple passport-issuing authorities and procedures in some VWPP countries.
The use of lost or stolen blank VWPP passports presents a serious fraud concern. There is also a large supply of stolen blank VWPP passports on the market today. INS Intelligence has received reports dealing with the increasing involvement of international organized crime groups in the theft of these documents and their vending to smuggling rings or individual aliens.
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The INS Intelligence Program collects information about the universe of fraudulent document efforts. It distributes to the field intelligence reports on the variety of documents and schemes in use to move aliens to the U.S. and to attempt to get through the inspections process. The Forensic Documents Laboratory sends to all ports of entry ''Alerts'' whenever a significant new fraudulent document appears. These Alerts include color photographs of the fraudulently produced or altered documents or the fraudulent visa stamps as well as written description of what features to look for to determine the fraud. In this manner, fraudulent documents uncovered by one inspector or by a consular officer or government official overseas become known to INS inspectors at all ports of entry.
To ensure compliance with the terms of the Program, INS has worked with the airline industry to develop criteria for the use of electronic ticketing on international flights to the United States. Under recent direction from INS Headquarters, visa waiver applicants may use electronic tickets provided that they can, upon demand, present some proof of onward travel arrangements and provided that, also upon demand, participating transportation lines cooperate with INS requests for verification of travel arrangements.
ADMINISTRATION REVIEW OF THE VISA WAIVER PILOT PROGRAM.
The Department of Justice has been conducting a review of the Visa Waiver Pilot Program to assess the risks associated with further expansion of the Program, including incremental effects of program expansion on the effectiveness of ports-of-entry. That review is being expanded to an interagency working group which will evaluate the Program as a whole, its extension, whether it should be made permanent, the continued designation of current countries, and criteria to be applied to determinations about the addition of further countries to the Program.
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NONIMMIGRANT INFORMATION SYSTEM AND VISA OVERSTAY RATES
The Program provides that one qualification for continued participation is that the number of nationals of a member country who were denied admission at the time of arrival or withdrew their application for admission, and the number of nationals of that country who violated the terms of such admission during the previous fiscal year remain below 2 percent of the total number of nationals of that country who applied for admission as nonimmigrant visitors during such previous fiscal year.
Data are collected in the Nonimmigrant Information System (NIIS) on the number of withdrawals for VWPP counties, and can be provided for each year since the beginning of the program (1988). Similarly, comprehensive data on VWPP refusals can be provided.
Data are available in NIIS from 1988–89 and 1991–92 for VWPP countries whose nationals violated their terms of admission (as measured by nonimmigrant visa overstay rates). These data are estimates of overstay rates which are based on apparent overstay numbers from NIIS. INS developed a methodology that reduces the number of apparent overstays by an estimate of the ''system error.'' The system error (historically about 8–10 percent for all countries) begins with the failure of many aliens departing the United States to turn in their departure forms to their carriers or as they depart across the land borders. Other sources of system error are keypunching and processing problems. This methodology was refined as a result of review by the General Accounting Office in 1995.
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Nonimmigrant overstay rates have not been estimated since July 1994 (when calculation of fiscal year 1993 rates were attempted) due to inconsistent numbers of apparent overstays in NIIS. Because of the magnitude and variation of apparent overstays since 1992, the INS' established methodology cannot currently be used to produce overstay rates with the required level of reliability to make relative comparisons among countries. The numbers of apparent overstays have been reviewed every 6 months through February 1997 in attempts to estimate defensible nonimmigrant overstay rates; however, data from NIIS continue to be inadequate for this purpose.
From the 1994 realization that corrective action was required, plans were made to rewrite the NIIS software to improve data integrity, identify new requirements and convert the old database. This development effort began in 1995 and continued until the new system was introduced in July 1996. Operation of the new system was encumbered by the process of converting the old database of admissions, withdrawals, and departures from 1983 through June 1996. Backlogs caused by the necessity of maintaining dual processing were not eliminated until May 1997.
INS recognizes the inability to provide this information as a serious deficiency. We hope to have completed and introduced corrective actions to the NIIS by the early 1998.
INS is presently engaged in extensive efforts related to the provisions of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 which deal with automation, card technology, biometrics, and departure management. This work will result in significant improvement in INS's ability to track arrivals and departures, identify overstays, and generate more precise overstay statistics.
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RECOMMENDATIONS
As Congress considers extension of the VWPP, INS has several recommendations. As we have stated in the past, INS recommends that legislation be enacted to require Visa Waiver Pilot Program countries to introduce highly fraud-resistant, machine-readable passports by a date certain. Current language does not refer to fraud resistance and some countries have failed to introduce machine-readable documents to date. It should be noted that the initial eight VWPP countries entered the program before this requirement was introduced by the Immigration Act of 1990.
The provisions requiring transportation lines to be signatory to agreements with INS and requiring air and sea passengers to be in possession of onward tickets have posed some difficulties in relation to private and military conveyances. Individuals familiar with other countries less regulated visa waiver schemes seldom focus on the noted U.S. requirements. It may be appropriate to review the Program provisions with the aim of accommodating private and military conveyances.
This completes my testimony. I would be glad to respond to any questions you may have.
INSERT OFFSET RING FOLIOS 1 TO 3 HERE
Mr. SMITH. Mr. Cronin, thank you.
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Ms. Ryan, let me direct my initial questions to you. You mentioned in your prepared testimony, and this is a quote, strict adherence to the criteria has made this a successful program. We strongly support continued adherence to these criteria. Any proposal to dilute the qualifying criteria must be carefully evaluated to see if it is consistent with the program's stated aims and U.S. border security interest. I gather, then, that you do not recommend that the standard for visa refusal rates be changed; is that correct?
Ms. RYAN. That is correct, Mr. Chairman.
Mr. SMITH. I want to go now to the question of fraud, at places around the world, but let me begin with the fraud rating because I know you had them as low, medium high, I think. What is the fraud rating for the consulate post in Portugal and South Korea?
Ms. RYAN. They are low fraud.
Mr. SMITH. OK. You grade other consulate posts. Are there any countries who participate now in the Visa Waiver Program who have other than a low fraud?
Ms. RYAN. No, sir.
Mr. SMITH. OK. In the case of Portugal and South Korea, just to focus on them for a second, how would extending the Visa Waiver Program to those two countries affect alien smuggling, in your judgment?
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Ms. RYAN. Mr. Chairman, if we were going to amend the Visa Waiver Program, we would prefer that it be amended on objective criteria. In other words, if you want to raise the refusal rate to a higher percentage, rather than singling out countries like Portugal or South Korea, that would make it very difficult.
In the case of Portugal, for example, there are 19 countries with lower refusal rates that are not in the program. It is 17, I think, in the case of Korea. So we think that it would be better to have objective criteria of a certain percentage of the refusal rate. In terms of alien smuggling, it is difficult to say.
One thing I can point out to you is that we have seen a marked increase in lost and stolen Korean passports over the last couple of years. In 1993, 8,000 South Korean passports were reported as stolen or lost. In 1995, there were 24,000. So it would indicate, perhaps, that some people are trying to steal Korean passports with the intention of photo substituting them and trying to get in that way. It is not, you know, a perfect criteria or a perfect judgment, but I think it is interesting that there has been such a marked increase in the lost or stolen Korean passports.
Mr. SMITH. You actually anticipated my next question. So obviously you expressed concern about the Visa Waiver Program providing an incentive to those who want to come in the country, come in fraudulently.
Ms. RYAN. That is correct, it could be. But as Mr. Cronin pointed out, the same lookout system is employed by the inspectors at the ports of entry, and they are very skilled at detecting photo-substituted passports.
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Mr. SMITH. If we were to extend visa waiver privileges to countries such as South Korea and Portugal, what other countries would, as a result, be eligible for the same privileges?
Ms. RYAN. I have a list that I would be happy to submit to you.
Mr. SMITH. How many countries are on there?
Ms. RYAN. Nineteen countries are ahead of Portugal in terms of low refusal rates. One, I would highlight, is the Canadian experience, which we heard the congressional panel talk about. Canada had Chile in its Visa Waiver Program because their refusal rates were very low in terms of visas. As soon as Chile entered that program with Canada, Canada had a growing number of asylum requests by Chileans, which indicated to them that maybe previously people were not even applying for visas, knowing that they would probably be refused. So Canada has gone back to requiring visas from citizens of Chile. We might very well experience the same kind of thing with the countries that have lower refusal rates than Portugal and Korea or with those two countries themselves.
[The information follows:]
NOTE: The information above was reported by Foreign Service posts whose consular districts include the above countries. Countries listed above have not necessarily agreed to waive visas for American citizens.
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Mr. SMITH. Thank you, Ms. Ryan. Let me ask a couple of questions in regard to the procedures used by the consulate offices in other countries and ask you to respond to a couple of assertions that have been made in regard to the screening process. Do you think the visa screening process is outdated or are you using up-to-date technology?
Ms. RYAN. I don't think it is outdated. One of the criticisms I heard from the congressional panel was the subjectivity of it. The law requires the aliens seeking a nonimmigrant visa to overcome the presumption that he or she is an intending immigrant, so for the consular officer, that person must overcome that presumption.
It is not—as in our legal system, it is not an assumption of innocence, if you will. It is an assumption that the person is an intending immigrant. That is the way the law is written. The visa applicant must persuade the consular officer that he or she will, in fact, return. People who are young, unemployed, with little education, in countries where the economy is very difficult, are not able to overcome that presumption. That is not a bias against those individuals. That is a strict adherence to the law.
We have improved our technology, thanks to the Congress' foresight in allowing us to charge and to keep the machine-readable visa fee. We have made gigantic strides in automating and with data share with the Immigration Service, so I don't think the technology is outmoded. Yes, we could do it better, of course, and we are aiming to do that, but it is not outmoded technology and I really don't think the law is outmoded either.
Mr. SMITH. I am convinced. Let me ask another question in regard to the procedure. Do you think there has been arbitrary abuse by consulate officers in regard to refusing visas?
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Ms. RYAN. I don't think there has been any arbitrary abuse. I think that consular officers are human beings, like everybody else. If you are lied to every day, numerous times a day by people in front of you who want what we have, which is a way into the United States, you may become somewhat jaded. You may think everyone is trying to put one over on you, but I don't think it is an arbitrary thing.
Mr. SMITH. Just to jump around a little bit, do you happen to know the average length of time it would take to obtain a B visa if you were applying from South Korea or Portugal?
Ms. RYAN. I know for South Korea—I think Mr. Kim was using very old information. Right now, with the people who do not require an interview, and that is a lot of the people in the TARP program Mr. Abercrombie mentioned, the Travel Agent Referral Program, it is 3 or 4 days to issue a visa if a personal appearance is not required.
If in reviewing those cases we find we do need a personal appearance, they are given an appointment within 7 days, and if the visa is issued, it is issued within 3 or 4 days. So we are talking, for most people, less than a week, and for those people who require a personal interview, around 2 weeks, not a month. The workload in Korea has increased greatly. It went up 41 percent in 1995, I think, and almost 80 percent in 1996. We have, in my judgment, the best consular manager in the service, in the Consul General in Korea and she has done remarkable things to reduce lines, to make it easy for Koreans to apply and to be granted visas.
Mr. SMITH. Real quickly, what is the average wait of time for a B visa in Portugal?
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Ms. RYAN. I don't have the statistics on Portugal, but I can't believe it is any longer.
Mr. SMITH. Longer than a week.
Ms. RYAN. Korea is our biggest post, we will do—we did 500,000.
Mr. SMITH. So Portugal is less than a week.
Ms. RYAN. It is much less.
Mr. SMITH. Thank you, Ms. Ryan. The gentleman from North Carolina, Mr. Watt.
[Additional information follows:]
TURNAROUND TIME FOR NONIMMIGRANT VISAS IN PORTUGAL
QUESTION
How long does a nonimmigrant visa applicant wait to obtain a nonimmigrant visa in Portugal?
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ANSWER
There are two visa issuing posts in Portugal, the Embassy in Lisbon and the Consulate in Ponta Delgado, Azores.
Both posts provide same day service to walk-in nonimmigrant visa applicants.
Neither post uses an appointment system whereby applicants must have an appointment to apply in person for a nonimmigrant visa.
Lisbon completes action on nonimmigrant cases submitted by mail or travel agent in three working days. Ponta Delgado processes such cases as soon as possible based on the indicated planned date of travel.
Mr. WATT. Thank you, Mr. Chairman. Let me start with the more global issue of technology, and why, in a country that is as technologically advanced as we profess to be, we can't devise a program that can monitor overstays and have a truly objective basis for countries being able to enter a Visa Waiver Program if we are going to have a Visa Waiver Program. Why is that?
Mr. CRONIN. There are several, I think, ways to answer that, Mr. Watt. First of all, there are targets given in the 1996 amendments, in terms of development of an automated entry-exit control system, which INS is working on right now, which would be an entirely new method of capturing data on persons entering and departing the United States. However, in terms of existing system, there are certainly weaknesses endemic in the system in the sense that we do not operate a staffed departure management program. We rely heavily on voluntary compliance of persons departing the United States in terms of turning in the departure portion of their landing documents. We rely on airlines carrying people out of the United States to capture and provide to us those landing cards. Basically, it is a paper-intensive system. The data is then shipped to an INS contractor for data entry. There is a lot of leakage of data, as a result of the way the system presently is constructed. However——
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Mr. WATT. It sounds like we have a problem. How can we solve the problem? Or is it solvable. What is it we are going to accomplish by early 1998? Are we going to get to a point in early 1998 where we solve the problems you described or are we never going to get that?
Mr. CRONIN. We hope to have the exiting system in sufficient condition to continue or to renew the process of doing defensible overstay estimates, based on the data in that system.
Mr. WATT. So we will have a bunch of estimates, and maybe the estimates will be reliable, but it won't help to set up any kind of objective criteria for a Visa Waiver Program.
Mr. CRONIN. I think it would, Congressman, in the sense it wouldn't be an exact match.
Mr. WATT. So are you saying in early 1998, we could set up, in the law, an objective criteria where we, for example, said the top 50 countries in terms of overstay performance would be eligible for a Visa Waiver Program and everybody above that would not be eligible? Are you saying we could be there in early 1998?
Mr. CRONIN. That is our objective at this point and our estimate.
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Mr. WATT. So then we could scrap the whole Visa Waiver Program set up on the current criteria and really have some objective criteria.
Mr. CRONIN. I think that visa refusal rate remains something we want to look at in terms of criteria for the program. There is a range of criteria right now, and I think it is useful to look at numerous facets of performance.
Mr. WATT. Then you would reduce the percentage. This refusal rate is—what is it under the program now?
Mr. CRONIN. Two percent.
Mr. WATT. Two percent. So you would reduce it down to like .5 percent overstay, as opposed to 2 percent of refusals. And we would achieve a better objective, I take it, by having some objective criteria. Are we together on this?
Mr. CRONIN. I think we are, Congressman.
Mr. WATT. So we can write some legislation now to do exactly what we are talking about doing.
Mr. CRONIN. Also——
Mr. WATT. Maybe I better stop you because Ms. Ryan is flinching as I keep saying this. Do you agree with what Mr. Cronin is saying, I mean, can, in 1998, we scrap the existing Visa Waiver Program and set up one that has objective criteria? Suppose we did it effective January 1, 1999, that gives you another whole year.
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Ms. RYAN. We think the existing program does have objective criteria because it has refusal rate and I would want to——
Mr. WATT. Then, if we went from 2,000 refusal, up to 7,000 refusal in the last year, I would think we would have kicked all of the countries out of the program that are in it.
Ms. RYAN. Well, even if INS refused entry of up to 7,000 people on the Visa Waiver Program, or people overstayed, you still have to recognize that some 12 1/2 million people entered the United States on the Visa Waiver Program in 1996.
Mr. WATT. But this is not people who overstayed. These are people you didn't let into the United States to overstay, right? I mean, this is not an overstay statistic that increased from 2,000 to 7,000. It is a refusal statistic that increased from 2,000 to 7,000, and my point is the refusal statistic is absolutely unreliable, subjective criteria.
Now, maybe, you know, subjective, objective, you are going to say, yes, we got some rational people out there who are trying to be objective in deciding who comes in, but, still, in terms of the ultimate objective, which is getting people into the United States and back out of the United States, and getting them to go home when the time comes for them to go home, I mean, refusing them doesn't measure any of that.
Mr. CRONIN. First of all, Congressman, I think the 7,000 number we referred to is refusals at the port of entry.
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Mr. WATT. Right.
Mr. CRONIN. And, again, we attribute at least some of that to abuse of documents of visa waiver countries. The refusal rates used to establish participation in the program are the refusal rates by consulates of visas overseas, people applying for visas at U.S. consulates and Embassies.
Mr. WATT. Well, actually, I mean, I think this is encouraging. I hope we are going to get there. What you are saying is we have the technology and if we can tinker with it and get it, then maybe we can set up something. But I am not sure I understand whether Ms. Ryan is saying that she thinks that would be a better system or a worse system than we have now.
Ms. RYAN. I think that the combination of the review on refusal rates with the immigration findings at the ports of entry is the way to go.
Mr. WATT. But why would you need refusal rates in that system if you had a reliable system for determining who goes home when they are supposed to?
Ms. RYAN. Then, are you saying we wouldn't issue visas anywhere in the world, that people would just show up at the port of entry and the Immigration Service would turn back the people who were coming here to work?
Mr. WATT. No, I am not saying that. I am just saying that—I am saying that that would be a more reliable system than the one we have now. I mean, the one we are measuring now is just virtually worthless. And I will tell you, I am inclined to vote against reauthorizing it, unless we can get some understanding about how we can get from what I think is a truly subjective system that works against certain countries, to a more objective criteria, that accomplishes the objectives that our Nation ought to be trying to accomplish, which is making sure that people come in and go back out when they are supposed to and don't overstay.
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Ms. RYAN. But unemployment rates and economies of countries are not subjective criteria; those are objective. Those are measurable. If there is a high unemployment rate in a country, we see more visa applicants and consequently, we refuse more.
Mr. WATT. I don't disagree with that, but if people are coming in, you probably see less visa applicants for people coming for tourist purposes, you know, and if they are going to come, their rate, their overstay rate is going to jump up substantially and they are going to be out of the Visa Waiver Program anyway, because they won't be in the top 50, but at least you have some objective criteria and that is the overstays.
Ms. RYAN. It is much more expensive for the United States to deport people from the United States who overstay than it is to keep them out of the United States in the first place.
Mr. WATT. I grant that. I can't argue with that, but it is also—we are disadvantaging a lot of people under this program, just because we think they might overstay and they may or may not. If the criteria is whether people are going to overstay, then we ought to have some system in place to apply the criteria. That is all I am saying.
Mr. CRONIN. If I may, Congressman, I think the way the statutory scheme was laid out in terms of the initial program, the overstay rate was designed to calculate the effect of granting a visa waiver to see if it did increase if a particular country was granted a visa waiver and it was set up as a basis for retention of the country in the program. That seems to be—certainly something would have to be calculated in terms of how a country performs once visa waiver is granted.
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Mr. WATT. I know I am over my time, but suppose we ran the existing waiver program and the new waiver program concurrently for 3 years, and then kicked those countries out that didn't meet the objective criteria after that 3-year period and continued to apply the existing criteria for that 3-year period, wouldn't that solve the problem you are concerned about?
What you are saying is you wouldn't have any criteria to start off with if you didn't start somewhere, and I think that is a—that is a legitimate concern, but if you ran both programs concurrently for some period of time, 3 years, 4 years, 5 years, whatever time period you think is reasonable, at least you would get, after that period, to an objective criteria for applying this program. We don't have one right now.
I mean, with all respect to what you are saying, you know, somebody deciding that because Nigeria has a high unemployment rate, two doctors are not going to go back home after they come to the wedding of their daughter in the United States, is arbitrary. I mean, you know, and this is a true story that I am talking about.
Two doctors, all the vested interest in their own country that I can imagine, because they are from a country where there is a high unemployment rate, there is a presumption that they are going to stay here, so they never even get to come for their daughters' wedding. That is subjective, that is arbitrary. Now, if Nigeria has a higher failure to return rate, then I can understand, but at least it is a subjective criteria—an objective criteria, rather. I have shown my biases this morning.
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Mr. SMITH. Thank you, Mr. Watt. I think Mr. Watt enjoys these hearings more than he admits.
The gentleman from Indiana, Mr. Pease is recognized and we also welcome another member of the panel, Mr. Jenkins.
Mr. PEASE. Thank you, Mr. Chairman. Mr. Cronin, I wanted to follow up on the same subject matter Mr. Watt has raised. The standards that you listed appear to me, in large measure, to be objective. I mean, it is fairly clear, it is knowable whether there is a reciprocal program in the other country. It is knowable whether there is a machine-readable passport program in the other country, and those appear to be objective, either they are or they aren't.
But even though the numbers by which we evaluate the refusal rate might of themselves appear to be an objective criteria, either you meet x percentage or you don't, I think the discussion comes into the fact that there is some subjectivity that goes into creating those numbers that are then used on an objective basis. And the forth one, I think, was a law enforcement risk, which would appear to me to be even more subjective than the one on the refusal rate. Given that, how—well, tell me how you determine what goes into the refusal rate itself. Maybe that would help to understand how subjective or objective that determination is.
Mr. CRONIN. I think Ms. Ryan is better situated to answer that.
Ms. RYAN. You mean why do we refuse people?
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Mr. PEASE. Are there criteria established, and if so, how are they applied?
Ms. RYAN. The first criteria is all that applicants for nonimmigrant visas are assumed to be intending immigrants, that is the way the law is written, so they must overcome the presumption that they are intending to stay in the United States. The way we do that is to try to estimate the reasons why the person would return to his or her own country after a short visit in the United States. And that ties to the family, job, money, those kind of things.
I mean, is the economy of the country stable or is it not stable? Is the government of the country oppressive in any way, all of those kinds of things come into play. As I said earlier, we do have what everybody around the world wants and that is a way into the United States, and so consular officers have to be skilled. It isn't an objective process, if you will. It is experience on the line, as we call it, on the visa line, of seeing dozens, if not hundreds, of people a day, all of whom have a story of why they want to go to the United States and how short their visit will be. It is the experience one develops in the country over a period of time which is used in evaluating whether this person is telling the truth or not.
Of course, we make mistakes. We will issue visas to people who have every intention of remaining in the United States as long as they possibly can, and we refuse people who have every intention of returning home. But I think on balance, we do a very good job of judging who is going to stay and who isn't.
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Mr. PEASE. I appreciate that and I also appreciate how difficult the job must be, but I was just concerned of what degree of subjectivity and objectivity goes into that determination. Is the refusal rate calculated in the country of origin or does it also include those who are refused as they attempt to enter the United States because of documentation or otherwise?
Ms. RYAN. The refusal rate is just the visa refusal rate, and it is only for visas that are called the B's, B–1 and B–2's, not the entire visa refusal statistic covering students and exchange visitors and other categories. It just covers the short-term vistor—B–1, B–2's.
Mr. PEASE. I appreciate that. Given the standards, either Ms. Ryan or Mr. Cronin, that you mentioned on the refusal rate, which I understood was under 2 percent overall, but not more than 2 1/2 percent in any 1 year.
Ms. RYAN. Yes.
Mr. PEASE. OK. And looking at the chart you provided us, I reveal my ignorance on this subject and the fact I am trying to learn quickly, it doesn't appear Ireland complies, and why is that?
Ms. RYAN. The chart I have covers refusal rates for 1996. Ireland isn't on it because they are in the Visa Waiver Program, so they don't apply for B–1/B–2 visas.
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Mr. CRONIN. I think it is the refusal rate at ports of entry. I think we are having some trouble with terminology here. When INS talks about refusals and State talks about refusals, it is two different issues. INS is talking about refusals of persons applying for admission to ports of entry, and State is talking about refusals of visas.
Ms. RYAN. Well, the refusal rate which formed the basis of admission to the program of Ireland was part of a probationary program set up within the pilot program, and Ireland qualified for that. Since then, the new immigration law eliminated the probationary period. I think that is what this chart shows. Ireland did not meet the visa refusal rates of 2 percent, 2.5 percent.
Mr. PEASE. Clearly.
Ms. RYAN. But they did meet the requirements for probationary program that the Congress set up, which was a higher—slightly higher refusal rate, but a declining refusal rate over the past years. I don't remember specifically what the probationary program rate was—where is Ireland on the chart?
Mr. PEASE. Well, I won't speculate on the political reasons Ireland is on this list.
Ms. RYAN. I have been trying to avoid that, Mr. Pease.
Mr. PEASE. Well, what has been the experience with Ireland since, because what I understand Mr. Frank proposing is a similar sort of thing for Portugal. Has the experience since then proven that this is a problem?
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Mr. CRONIN. This is referring to the difficulty, sir, of the lack of the overstay data or the ability to make that determination on overstays. We have certainly reviewed all available enforcement data in relation to all the countries in the program, including removals from the United States, criminal removals, percentage of aliens in the Federal prison population and the answer is, no. By those indicia, there doesn't appear to be a serious problem, but the critical need is to get the overstay data to the point where we can give an accurate—at least a defensible estimate of overstay rates and, hopefully, in the future, an accurate overstay rate.
Mr. PEASE. And as I understand it, that will be available, you think, early next year.
Mr. CRONIN. The improvements to the system of capturing and tracking and matching data on arrivals and departures is targeted for completion by early 1998. We would need some data to move through the system before overstay rates could be projected from the system.
Mr. PEASE. Thank you.
Thank you, Mr. Chairman.
Mr. SMITH. Thank you, Mr. Pease.
The gentleman from Tennessee, Mr. Jenkins, is recognized.
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Mr. JENKINS. I don't have any questions.
Thank you, Mr. Chairman.
Mr. SMITH. Thank you, Mr. Jenkins. I will go back to my questions. Ms. Ryan, let me return to the couple countries I was asking you about a while ago and just finish up. In regard to South Korea, how do you account for the high incidence of fraud when the refusal rate is relatively low.
Ms. RYAN. We haven't found a high incidence of fraud in Korea. I think Korea is considered a low fraud threat. I think I have that somewhere in here. But I thought that both Korea and Portugal were——
Mr. SMITH. We had other information from the staff, but I don't want to ask that question unless you can consult a staff or we can go on to another question. Whatever you prefer.
Ms. RYAN. Whatever you prefer.
Are you talking about malfeasance within the consulate section or are you talking about fraud by Koreans?
Mr. SMITH. In this case, the fraud that I am referring to is what you used to determine whether a country is low-, medium-, or high-fraud post, and we were told Korea was a medium-fraud post, maybe that is not accurate. We can come back to that.
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Ms. RYAN. I will answer for the record because I really don't know.
[Additional information follows:]
VISA FRAUD IN SOUTH KOREA
QUESTION
Does the Department of State consider South Korea a high-, low-, or medium-visa fraud post?
ANSWER
Seoul is viewed as a medium-fraud, very high-volume visa post. The substantial Korean population, legal and illegal, now in the U.S. continues to act as a magnet for future potential immigrants.
Several major fraud scams over the past few years indicate a continuing interest among Koreans in immigrating illegally to the U.S.:
Last year, Korean newspaper reporters posing as visa ''clients'' paid $4800 each to visa brokers to receive an entire package of documents (income talc certificates, employment certificates, family census records) that was to be used to apply for a U.S. nonimmigrant visa (NIV). The reporters turned the information over to the police before running the story. Eventually, eight visa brokers, one local government official and 37 clients were arrested on charges of forgery or falsifying documents.
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In 1994–95, a ring fraudulently obtained new Korean passports in false identities for several hundred previously-refused visa applicants and managed to secure NIVs for most of their clients.
Mr. SMITH. Let me finish up by saying that you mentioned in your testimony the Visa Waiver Program allows you to devote more personnel to antifraud efforts. Has a number of personnel devoted to antifraud efforts been increasing over the past several years? Is it level? What are we doing there?
Ms. RYAN. We have a slight increase, thanks to the provision of 245(i) of the law, which allows people who are here in the United States, out of status, to adjust their status without having to go back overseas for immigrant visa interviews, so we were able to move some of those immigrant visa officers to antifraud and to more nonimmigrant adjudicatory positions.
What we did, thanks to the Visa Waiver Program, initially, was to staff the former Soviet Union, so not all of those positions were antifraud, but we were able to open the post in the former Soviet Union without having to ask for additional personnel resources.
Mr. SMITH. Thank you, Ms. Ryan. Mr. Cronin, let me go to you for some additional questions. You mentioned in your prepared testimony, ''the attractiveness of using the Visa Waiver Program passports for non-Visa Waiver Program nationals seeking to enter the United States illegally has also increased.'' You say the attraction of smugglers to the Visa Waiver Program passports is encouraged as well.
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It seems to me that if we are making other efforts as a Nation to try to reduce illegal immigration, we therefore may be putting more pressure on the Visa Waiver Program in the sense that individuals who might have tried to enter the country illegally might now try to enter illegally through the Visa Waiver Program. Do you agree with that and do you have any examples?
Mr. CRONIN. Yes, we do agree with that, Congressmen, and we are seeing that at the ports of entry, that certain visa waiver country passports that are less fraud-resistent become the targets of document vendors and alien smugglers in terms of photo substitution or similar alterations on the document. We are also, as I indicated in the testimony, extremely concerned about passport issuance procedures in some countries; that there have been thefts of large numbers of blank valid passports from some countries, where the passport issuance process is somewhat distributed and not centralized. So there are concerns. We have seen roughly a quarter of the visa waiver refusals involve document fraud.
Mr. SMITH. Mr. Cronin, I was given by the INS, perhaps you, examples of stolen and fraudulent Icelandic passports, French passports and Belgium passports. I will make these a part of the record. But this is what you are talking about, I gather, how easy it is to have fraudulent visas. Are there any countries today who are not in compliance with the current visa waiver statutory requirements?
Mr. CRONIN. In terms of passports, you mean?
Mr. SMITH. Since that is all we have to go on.
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Mr. CRONIN. The only requirement is the country has certified that it is developing that. I haven't gotten an exhaustive list right now, but some countries have not yet developed machine-readable documents and INS has, of course, also recommended that some language about fraud resistance be included.
Mr. SMITH. If and when countries fall out of compliance, how does the administration propose dealing with those.
Mr. CRONIN. I would assume, Congressman, that the way to do that is for a determination to be made that on some basis, if the overstayed data are available on that basis or perhaps on a national security issue, that the proper way to do it would be by exchange of notes or by a diplomatic note to the country. Perhaps Ms. Ryan can assist.
Ms. RYAN. Mr. Chairman, if I may, there are seven countries participating in the Visa Waiver Program that do not have machine-readable passports yet.
Mr. SMITH. Seven countries.
Ms. RYAN. Seven countries. Belgium, France, Iceland, Italy, Monaco, Norway and Switzerland. Iceland has told us that they will have a machine-readable passport by September of this year. Belgium says by October 1997, they will be moving toward a machine readable bar code, which will begin in October 1997.
I would agree with Mr. Cronin that I think we should set perhaps a date certain for this because many of these countries have been in the program from the very early days, and I think it would help them to focus on the need for this type of passport and the fraud deterrent elements in the passport if we had a date certain by which they had to achieve this, or they would be dropped from the program.
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Mr. SMITH. Thank you, Ms. Ryan. The gentleman from North Carolina, Mr. Watt.
Mr. WATT. Let me just clear up one issue. Compare Portugal and Korea with Ireland, for example, on the criteria that we are using.
Ms. RYAN. From the data that we have, that I have in front of me, I don't have both years, I just have fiscal year 1996, Korea and Portugal, for that 1 year, have lower refusal rates than Ireland had in 1993.
Mr. WATT. So if we were applying nonpolitical criteria, we would be just as justified to make Portugal and Ireland, I mean Portugal and Korea part of this program as we were to in Ireland.
Ms. RYAN. If we were applying nonpolitical criteria, we would have all the countries, whatever percentage you all determined, eligible for inclusion. That could be a higher percentage than the 2 or 2.5 percent we have now if that is what you were determined to do.
Mr. WATT. But Ireland is above 2.5 percent, right, or was at that time.
Ms. RYAN. It was at the time it was included in the probationary program.
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Mr. WATT. It's worse now, I understand.
Ms. RYAN. No. We don't issue visas for short-term visitors from Ireland, so what Mr. Cronin is talking about is the turnaround rate at the port of entry. I don't know the exact term, but it is not a visa refusal rate because we don't have those statistics anymore. Ireland is in the program, so they don't apply for B–1/B–2 visas and we don't have statistics on whether we would refuse them or not. The issue, it seems to me, is whether they are overstaying, and Mr. Cronin can address that, or we will be able to do that, we hope, in early 1998.
Mr. WATT. I am looking at this list here of alien apprehensions by selected countries. It looks to me like Germany actually has the highest number. I don't know what percentages this would be. This is people who overstay, I take it.
Mr. CRONIN. Or violated status for some other reason, it could be unauthorized employment. Those are raw data on apprehensions by nationality.
Mr. WATT. Actually, the United Kingdom has by far the highest; 532 in 1995. The next closest one is Germany at 202, according to my figures here. So maybe our mother country, Great Britain, should be the first one that gets kicked out of the program on this criteria. I am just musing. That was not a question. I'm sorry.
But speaking of our mother country, they got into this program under a—or at least they had a travel agent program, I understand, similar to the one Korea has now prior to them coming into the program. Am I mistaken about that?
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Mr. CRONIN. I am not aware of the U.K. having the program. I believe that Japan did.
Ms. RYAN. I would have to answer for the record. I don't know what they had in 1988.
[Additional information follows:]
TRAVEL AGENT PROGRAM IN THE UNITED KINGDOM
QUESTION
Did the American Embassy in London have a travel agent program in 1988 comparable to the one currently in place at the Embassy in Seoul?
ANSWER
No. While the Embassy in London did accept passports and visa applications for groups from travel agents through a regulated program in 1988, the program was not comparable to the one set up by the Embassy in Seoul.
Under the TARP (Travel Agent Referral Program) in Seoul, travel agents not only submit visa applications in bulk, they also enter passport data on the applicants into a computer program which is compatible with the Embassy's computers. This relieves the Embassy of having to handle the routine data entry for such applicants. The technology was introduced in Seoul. It was not available in London in 1988.
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Mr. WATT. All right. I think I am finished, Mr. Chairman.
Mr. SMITH. Thank you, Mr. Watt. The gentleman from Indiana, Mr. Pease.
Mr. PEASE. Thank you, Mr. Chairman. I obviously share a lot of the same concerns Mr. Watt does and I appreciate this exchange. I don't have any questions, just one observation that has nothing to do with the subject matter. My background is in literature and philosophy and words interest me and I was intrigued by these words that, we don't threaten other countries, we don't even pressure other countries, we help them focus on their need to do other things. I like that.
Mr. WATT. Read that one more time.
Mr. PEASE. That we help them focus on their need to change the way they do things.
Mr. WATT. Sonny Bono would be proud of you this morning.
Mr. PEASE. They are her words. I was just intrigued by them. No questions, Mr. Chairman.
Mr. SMITH. We thank you both for being here and we appreciate your testimony.
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We welcome our third panel, which consists of William S. Norman, president and CEO of Travel Industry Association of America; Janet Thomas, director of facilitation, Air Transport Association of America, and Tami Overby, executive director, American Chamber of Commerce in Korea. We welcome you all. We look forward to your testimony and we will begin with Mr. Norman.
STATEMENT OF WILLIAM S. NORMAN, PRESIDENT AND CEO, TRAVEL INDUSTRY ASSOCIATION OF AMERICA
Mr. NORMAN. Thank you, Mr. Chairman. On behalf of the Nation's travel and tourism industry, I appreciate the opportunity to testify briefly today on the Visa Waiver Pilot Program and its positive impact on tourism in the United States. I ask that my full statement be included in the subcommittee's record.
Mr. SMITH. Without objection, your full statement will be made part of the record.
Mr. NORMAN. As this subcommittee well knows, travel and tourism means big business for our country. It generated $467 billion in expenditures and over 6.6 million direct jobs in 1996. Opportunities are growing even faster when it comes to the international travel market.
The number of international visitors to the United States in 1996 increased 7 percent, to a record 46.3 million, generating $84 billion in expenditures, over one million direct jobs, and a trade surplus of $21.6 billion.
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Overall, 1996, was a banner year for travel and tourism and it was the first time in 3 years that the United States had an increase in international visitors. Now, while this is due to many factors, the positive influence of the addition of certain countries to the Visa Waiver Program is undeniable. For example, let's look at Argentina, which was added to the visa waiver list in July 1996.
In that year, Argentina ranked 14th in the number of visitors it sent to the United States, sending 426,000 tourists to our Nation. Impressive, but Argentina was not always ranked so high. In the year preceding inclusion in the Visa Waiver Program, Argentina tourists numbered 382,000.
In fact, sir, in the year of their inclusion, there was an increase of 44,000 visitors, up 11.5 percent. An increase of this magnitude means a proportional increase in revenue generation in the United States.
Mr. Chairman, please allow me to restate that the Visa Waiver Program is vital to the health of our industry and to our Nation. It has proven itself a viable and valuable program for almost 10 years now, and as such, seems a worthy candidate for permanency. To illustrate this, imagine what would occur if the program were allowed to expire.
First, we as a Nation would no doubt lose valuable business. Trade is in reality a two-way street. The travel and tourism business is a highly competitive one and the U.S. competes with hundreds of other countries for the same business. So if another country welcomes overseas visitors with open arms, while the U.S. requires form after form, the other country will have a competitive advantage. The United States presently ranks a distant third in the international travel market and we can slip further if we are not competitive.
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Second, if the Visa Waiver Program were allowed to expire, it would place an enormous burden on our consulate overseas. It should also be noted that this program has played a vital role in urging countries to implement technological advances, such as machine-readable passports, providing increased efficiency in regards to passenger data.
In the spirit of improving government efficiency that this Congress has embraced, we should not allow the scenario of expiration of this program to play out. And finally, the travel and tourism industry recognizes the legitimate national interest issues generated by this program. However, I believe one point should be made crystal clear and that is that we at TIA and the industry we represent wish to be of service in addressing any concerns you may have, and are dedicated to make the program work the way it was intended. Yet, if we are seriously to examine such problems and reach meaningful and realistic solutions, we need sufficient time to develop creative answers without the threat of exploration every year.
While we push for permanence, I suggest, at minimum, approval of a significant multiyear extension and expansion. Mr. Chairman, thank you for allowing me this opportunity to stress to you the important role that the Visa Waiver Program plays in international tourism and, therefore, our U.S. economy. I would be happy to answer any questions the subcommittee may have.
[The prepared statement of Mr. Norman follows:]
PREPARED STATEMENT OF WILLIAM S. NORMAN, PRESIDENT AND CEO, TRAVEL INDUSTRY ASSOCIATION OF AMERICA
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Mr. Chairman, on behalf of the nation's travel and tourism industry, I appreciate the opportunity to testify before you today.
I am William S. Norman, President and Chief Executive Officer of the Travel Industry Association of America (TIA), the national, non-profit organization representing all components of the $467 billion U.S. travel industry. TIA's mission is to promote and facilitate increased travel to and within the United States. It is on behalf of TIA and the entire travel and tourism industry that I testify today on the Visa Waiver Pilot Program (VWPP), and its positive impact upon tourism in the United States. TIA, and the travel and tourism industry it represents, fully support the highly successful VWPP program, and believe its extension, expansion and hopefully making it permanent would serve the best interest of our nation.
The VWPP, created by your Committee's action, which took effect on July 1, 1988, currently has 25 countries participating, with many others expressing great interest. Burgeoning markets such as Brazil and South Korea, for example, our 7th and 8th largest international tourism markets respectively, would be welcome additions to this program, as will other worthy countries which fall within the construct of the positive rules presently outlined. Let's look at the underlying facts. As this committee well knows, tourism means big money for our country; it generated $467 billion in expenditures and over 6.6 million direct jobs in 1996. Opportunities are growing even faster when it comes to the international travel market. The number of international visitors to the U.S. in 1996 increased 7% to a record 46.3 million, or 2.9 million more visitors than in 1995, generating $84 billion in expenditures and over one million direct jobs. Our trade surplus, attributable to international visitors continuing to spend more here than American travelers do abroad, increased to $21.6 billion, a whopping 8% increase over 1995. I cannot emphasize enough that any increase in inbound international tourism means a proportional increase in revenue generation in the U.S. However, I must note that the U.S. share of the international travel market is still a distinct third. We as an industry are committed to increasing to our nation's market share with corresponding benefits to our economy, and ask for your help.
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Let me give you an example of one way we are working to increase our market. Earlier this month, I had the opportunity to see the business of international tourism in action. From June 2nd to June 4th, TIA convened its 29th Annual Discover America International PowWow. Held this year in Nashville, TN, the purpose of International PowWow is to provide a forum in which foreign tour operators and other international travel and tourism purchasers can meet with U.S. tourism product providers. This extraordinary conference and marketplace gathers international travel and tourism buyers and close to 4000 U.S. suppliers, and what transpires in the course of three days is nothing short of miraculous. When these people meet, they establish and renew valuable fact-to-face contact, making business arrangements and negotiating contracts, which translates into billions of dollars of business. Prior surveys have estimated that between $2.5 to $3 billion worth of future business is contracted or negotiated in a mere three days at TIA's Discover America International PowWow.
How does this relate to promoting and facilitating increased travel, by international visitors, to the United States? International delegates at TIA's International PowWow account for more than 85% of the organized tour business to the U.S. Since between 12–15% of all international visitors to the U.S. use an organized tour, that is a significant percentage of our visitors. Clearly, international tour and travel producers are able to more easily sell a tour package to the U.S. by also stressing the ease of travel and the absence of a need for a visa. It is this simple—easier travel to the U.S. means bigger business for the thousands of small businesses that comprise the majority of the travel and tourism industry.
Let us now look specifically at the good the Visa Waiver Program has done in relation to the U.S. international tourism market. Overall, 1996 was a banner year for travel and tourism, and it was first time in three years that the U.S. has had an increase in international visitors. While this is due to many factors, the influence of the addition of certain countries to the Program is an undeniable factor. Let us take, for example, the country of Argentina, which was added to the VWPP list on July 8, 1996. In that year, Argentina ranked 14th in the number of visitors it sent to the U.S., sending 426,000 tourists to our nation. Impressive, but Argentina was not always ranked so high. In 1995, pre-inclusion in the VWPP, Argentinean tourists numbered 382,000. In the year of their inclusion in the VWPP, there was an increase of 44,000 visitors, up 11.5% from 1995. As stated before, an increase of this magnitude means a proportional increase in revenue generation in the U.S., and visitation is directly proportional to ease of travel.
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But let's bring this a little closer to home. As you well know, travel and tourism plays a huge role in the economy of many of your districts; such as San Antonio, Charlotte, Oxnard, New York City, and Palm Springs, which are all attractive destinations. However, for today Mr. Chairman, lets look to San Antonio specifically as an example. San Antonio has about 56,600 jobs that are supported by travel and tourism revenues. These jobs are not only in the traditional hospitality-related industries such as hotels and restaurants, but also in areas such as the retail industry which is flourishing through trade. As visitors use their purchasing power in San Antonio, totaling $1.55 billion annually, they are also supporting an estimated 23,000 retail service jobs.
Let's suppose a tour operator from Argentina wants to book a tour to San Antonio, with the highlight being a visit to the Alamo. The tour operator might book a meeting with representatives from your locally headquartered La Quinita. She would then meet with San Antonio CVB representatives to understand the myriad attractions in that area, including the Cowboy Museum and perhaps one of your local Missions. She would get a listing of all the hot spots to eat and dance. And then she would put together a tour which best showcased San Antonio's charms, hopefully making it irresistible to her clients. You begin to see the domino effect at work here travelers from abroad translate into big profits for small businesses in cities and towns across our nation. The domino effect can be seen in other ways also, for when foreign travelers visit the U.S., they affect not only the travel industry segment, but also a wide variety of other businesses within the community.
Looking nationally, allow me to restate that the Visa Waiver Program is vital to the health of our industry and out nation. To illustrate this, imagine what would occur if the Program were allowed to expire. First, we as a nation would no doubt lose valuable business. Trade is in reality a two way street, and while we must treat our trading partners with respect, we have also learned to keep a wary eye open. If we were to burden the overseas travelers by demanding that they fill out yet more paperwork, spend more time waiting for clearance, and subject themselves to unwarranted inspections, they may seek seemingly more attractive alternatives. Our overseas visitors are sensitive to the way they are treated, and make no mistake that if they feel unwelcome they may take their business elsewhere. The travel and tourism business is a highly competitive one, and the U.S. competes with hundreds of other countries for the same business. So, if another country welcomes certain overseas visitors with open arms, while the U.S. requires form after form, the other country will have a competitive advantage. Prior to the enactment of the Visa Waiver Program, national surveys indicated that the lack of visa waiver was a major complaint of international visitors to the U.S.
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Second, if the VWPP were allowed to expire, it would place an enormous burden on our consulates overseas, adding to perceived government waste of taxpayer dollars. If such a demand were placed on the State Department, it may have to respond by adding more employees to posts overseas and thereby draining its existing budget. While the number of employees needed can only be imagined, it has previously been estimated that the cost of posting each American to the field now tops $100,000 in addition to salary. In the spirit of reducing government waste and excess that this Congress has embraced, we should not allow this scenario to play out.
Finally, if we were to remove certain countries from our visa waiver list, then those countries could conceivably begin to demand visas from our citizens traveling abroad. In fact, when visa waiver was first enacted it became an inducement for Japan to offer reciprocal privileges to U.S. citizens traveling to their country. And Japan continues to be one of our most lucrative tourism markets, ranking third in annual arrivals behind Canada and Mexico. In fact, outside of Canada and Mexico, 10 of the 14 remaining top U.S. tourism generating countries are VWPP members. We must continue to grow this market by extending to other nations the same respect and welcoming attitude that they extend to us.
The travel and tourism industry recognizes the legitimate national interest issues generated by this program. We are aware of the substantive concerns which several Members of Congress have had about this Program, specifically the recording of overstay rates. However, I believe that one point must be made crystal clear, and that is that we at TIA, and the industry we represent, wish to be of service in addressing any concerns you may have, and are dedicated to making the Program work for all concerned through improving the present methods of operation and necessary upgrades. Yet if we are to seriously examine such problems and reach meaningful and realistic solutions, we need sufficient time to develop creative answers without the threat of expiration every year. With all due respect, one year may be barely enough time to strategize improvement methods for an existing government program, let alone implement them. While we push for permanence, I suggest at minimum approval of a significant, multi-year extension.
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This would allow sufficient time to implement, as one example, an efficient successor method of overstay calculation, a solution this industry will willingly assist in developing. Last year's bill allowed for significant improvement in this program by including provisions for removal of those countries who no longer meet the criteria required of them; we look forward to adding additional improvements to this year's legislation.
In closing, I would like to stress again that ease of travel to this country is directly proportional to the travel and tourism revenue generated here. TIA and the travel and tourism industry are therefore dedicated to making the VWPP a success, and we will do everything in our power to ensure its permanence and expansion. Thank you for allowing me this opportunity to stress to you the important role that VWPP plays in international tourism, and therefore our U.S. economy. I would be happy to answer any questions you may have.
INSERT OFFSET RING FOLIOS 4 TO 11 HERE
Mr. SMITH. Thank you, Mr. Norman.
Ms. Thomas.
STATEMENT OF JANET THOMAS, DIRECTOR OF FACILITATION, AIR TRANSPORT ASSOCIATION OF AMERICA
Ms. THOMAS. Thank you, Mr. Chairman and members of the subcommittee. I submit written testimony for the record and with your permission, will summarize with brief remarks. ATA represents the major commercial passenger and cargo air carriers in the United States and we very much appreciate this opportunity to present to the subcommittee the views of the U.S. commercial airline industry regarding the Visa Waiver Pilot Program.
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Since its creation, our member airlines have had a tremendous success with the program. This program has had an unprecedented success in reducing barriers to travel and tourism to and from the United States. The U.S. airline industry is very pleased to have played a role in the success.
In the nearly 10 years since the program's implementation, international airline passengers have become accustomed to the program's requirements and use it routinely. The program has served well the purpose for which it was designed, to facilitate the easy and efficient flow of low-risk foreign tourists and business travelers.
Simultaneously, the program has afforded Department of State consular officers more time to focus their efforts on those individuals whose visits to the United States are for other purposes and to drastically reduce its consular staff at low-risk locations, resulting in a significant cost savings to the U.S. taxpayer. Yet, all this pales in comparison to the real benefit of the program, that of expanded foreign travel and tourism to the United States, an $84 billion a year industry.
Simply put, the U.S. needs this program to remain competitive with the many other nations around the globe who are after the same finite travel dollar. ATA members strongly support the transition of the program to a permanent one, with expanded participation as appropriate. While the pilot has been extended periodically, the unqualified success of the program speaks strongly on behalf of its being made permanent.
The benefit of the program has been clearly proven and the need for it to remain a pilot program has ceased. To sunset the program at this time or in the future would not only require a reinvestment of significant capital, both human and otherwise, but would also prove unnecessary and counterproductive. In addition, because the program is based on reciprocity, any termination or restriction would likely result in a substantial backlash by participating nations against U.S. citizens traveling abroad when they attempt to enter other visa waiver countries.
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Visa waiver participants, by their very definition, are low-risk travelers. There has been no data which indicates that visa waiver travelers stay longer than permitted or otherwise violate the terms of their admission in any greater numbers than any other traveling population. To the contrary, we believe the opposite is true. Another important benefit of the program has been its impetus for standardization of passports and machine-readable documentation as an inducement for acceptance of a country into the program.
The ability to read a document by machine has greatly increased the efficiency of the Federal inspection process and has allowed our members to collect and transmit certain passenger data to INS in advance of the flight's arrival. While we strongly support the pilot program being made permanent as well as expanded, improvement is needed.
Congress obviously recognized the need for a better immigrant tracking system when it enacted section 109 and section 110 of the 1996 act, which mandated a joint study and a transition to automated collection of arrival and departure information. The airline industry has readily participated in this joint study and our report should be finalized in the near future. I would like to particularly emphasize that no arrival and departure system designed to accurately track passengers who overstay their visits will be complete unless all modes of entry and exit are similarly controlled, including land and seaports.
All arrivals by air do not necessarily depart by air, thus an open-looped automated system will always be statistically flawed. I would, however, emphasize that it seems unnecessary to delay making the program permanent until such a system can be put into place. The 9-year experience of this program is sufficient to prove its value. This experience has also proven the program poses limited risk to the United States.
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Keeping a program as a perpetual pilot serves no useful purpose and has actually been the source of disruption when the program has been threatened with a lapse or as in one instance, did lapse for a short period of time. The traveling public will be better served by making it permanent now.
At a minimum, a multiyear extension should be considered as an alternative to making the program permanent. In the future, should events require that the program be modified somewhat, that action could then take place at the appropriate time.
On a related issue, our members have been negotiating with INS, the U.S. Customs Service and the U.S. Department of Agriculture for the last 4 years to enter into a cooperative venture, whereby the carriers will provide biographic data electronically in advance of the arrival of international passengers. We will be meeting again with INS, the lead agency, in the next few weeks to finalize those discussions and presumably sign a memorandum of understanding to begin this program. This data will provide additional information to the INS on all passengers and particularly visa waiver passengers allowing the INS to perform its lookout checks and analyses well in advance of the arrival of passengers.
Not only will this further facilitate the entry process, but it will also prove an important and effective enforcement tool. In our preliminary joint discussions, as directed by the 1996 act, it appears this data could also serve as part of the backbone of an automated arrival and departure system. Thus, there should be no reason for further delays in making the Visa Waiver Program permanent.
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In this regard, we strongly urge the subcommittee to take action to accomplish this goal at its earliest convenience. Mr. Chairman, I would be pleased to respond to any questions you or members of the committee may have.
[The prepared statement of Ms. Thomas follows:]
PREPARED STATEMENT OF JANET THOMAS, DIRECTOR OF FACILITATION, AIR TRANSPORT ASSOCIATION OF AMERICA
Mr. Chairman and Members of the Subcommittee, I am Janet Thomas, Director of Facilitation for the Air Transport Association of America (ATA). ATA represents the major commercial passenger and cargo air carriers in the United States.(see footnote 1) Collectively, our members account for over 95 percent of all revenue passenger and cargo ton miles that scheduled air carriers operate in this country.
We very much appreciate this opportunity to present to the Subcommittee the views of the U.S. commercial airline industry regarding the Visa Waiver Pilot Program (VWPP). Since its creation by Congress in 1986, and subsequent implementation by the Immigration and Naturalization Service (INS) in 1988, our member airlines have had an extremely high success rate with the VWPP. This program affords a citizen of a participating country to forego visa application at a U.S. consulate abroad, and allows them to travel to the U.S. for business or pleasure and make application for entry directly to the INS at a port of entry. To use this privilege, an applicant agrees to waive rights to challenge the decision of the INS inspector, and agrees to depart the U.S. within 90 days. Of the total number of non-immigrant entries by citizens of Visa Waiver countries, 76% used the VWPP, or more than 10 million people in fiscal year 1995 (according to INS). This accounted for just under 50% of all temporary business and tourist entries. This program has had an unprecedented success in reducing barriers to travel and tourism to and from the United States. The U.S. airline industry is very pleased to have played a role in this success.
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In the nearly ten years since the Visa Waiver Pilot Program's implementation, international airline passengers have become accustomed to the program's requirements, and use it routinely. The program has served well the purpose for which it was designed: to facilitate the easy and efficient flow of low-risk foreign tourists and business travelers. Simultaneously, the program has afforded Department of State consular officers more time to focus their efforts on those individuals whose visits to the U.S. are for other purposes, such as employment or study, or those who intend to remain in the U.S. for extended periods. Further, it has allowed the Department of State to drastically reduce its consular staff at low-risk locations, resulting in a significant cost savings to the U.S. taxpayer. Yet, all this pales in comparison to the real benefit of the Visa Waiver Pilot Program that of expanded foreign travel and tourism to the U.S., an $84 billion a year industry. Put simply, the U.S. needs this program to remain competitive with the many other nations around the globe who are competing for the finite travel dollar.
The Air Transport Association member airlines strongly support the transition of the Visa Waiver Pilot Program to a permanent program, with expanded participation. While the pilot program has been extended periodically since its inception, the unqualified success of the program speaks strongly on behalf of it being made permanent. Further, because the program's life has at times been uncertain and somewhat unpredictable, particularly at periods near the end of its temporary life, any real or perceived lapse in the program causes much needless turmoil and uncertainly among the industry, government (both here and abroad) and, most importantly, the traveling public. In the nearly ten years since the program's implementation, the benefit of the program has been clearly proven, and the need for it to remain a pilot program has ceased. To sunset the program at this time or in the future would not only require a reinvestment of significant capital, both human and otherwise, but would also prove unnecessary and counterproductive. In addition, because the Visa Waiver Pilot Program is based on reciprocity, any termination or restriction of the program would likely result in a substantial backlash by other participating nations against U.S. citizens traveling abroad, resulting in more entry burdens for U.S. citizens when they attempt to enter other visa waiver countries.
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Visa Waiver participants, by their very definition, are low-risk travelers. There has been no data which indicates that Visa Waiver travelers stay longer than permitted or otherwise violate the terms of their admission in any greater numbers than any other population of the traveling public. To the contrary, it appears the opposite is true.
Another important benefit of the Visa Waiver Pilot Program has been its impetus for expedited standardization of passports and machine readable documentation, as an inducement for acceptance of a country into the program. The ability to read a document by machine has greatly increased the efficiency of the Federal Inspection Service Process, and has allowed our member airlines to collect and transmit certain passenger data to INS in advance of the flight arrival.
While we strongly support the pilot program being made permanent as well as expanded, we also have several suggestions which might be of use in improving the program. First, a suggested improvement to the program would be a better INS tracking system. Congress obviously recognized this need when it enacted Section 109 and Section 110 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996, which mandated a joint study and a transition to automated collection of arrival and departure information. The airline industry has readily participated in this joint study, and our report should be finalized in the near future. I would like to emphasize that no arrival and departure system designed to track accurately passengers who overstay their visits, or the movements of foreign visitors will be complete unless all modes of entry and exit are similarly controlled, including land and seaports. All arrivals by air do not depart by air; thus an open-loop automated system will always be statistically flawed.
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I would also like to emphasize that, in our opinion, it seems unnecessary to delay making the Visa Waiver Pilot Program permanent until such a system can be put into place. The nine-year experience of this program is sufficient to prove the value of the program. Concurrently, this extensive experience has also proven the program poses limited risk to the United States. Keeping the program as a perpetual pilot program serves no useful purpose, and as I mentioned previously, has actually been a source of intense disruption when the program has been threatened with a lapse period, or as in one instance, actually did lapse for a period of time. The traveling public will be better served by making it permanent now. At a minimum, a multi-year extension should be considered as an alternative to making the program permanent. In the future, should events require that the program be modified somewhat, that action could then take place at the appropriate time.
On a related issue, our member airlines have been negotiating with INS, the U.S. Customs Service, and the U.S. Department of Agriculture for the last four years to enter into a cooperative venture whereby the carriers will provide biographic data electronically, in advance of the arrival of international passengers. We will be meeting again with INS, the lead agency, in the next few weeks to finalize those discussions and presumably sign a Memorandum of Understanding (MOU) to begin this program. This data will provide additional information to the INS on all passengers, and particularly Visa Waiver passengers, allowing the INS to perform its lookout checks and analyses well in advance of the arrival of passengers. Not only will this further facilitate the entry process, but it will also prove an important and effective enforcement tool. In our preliminary joint discussions as directed by the 1996 Act, it appears this data could also serve as part of the backbone of an automated arrival and departure system. Thus, there should be no reason for further delays in making the Visa Waiver program permanent. In this regard, we strongly urge the Subcommittee to take action to accomplish this goal at its earliest convenience, but well in advance of the September 30th sunset date.
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Mr. Chairman, I would be pleased to respond to any questions you, or any Member of the Subcommittee may have.
Mr. SMITH. Thank you, Ms. Thomas.
Ms. Overby.
STATEMENT OF TAMI OVERBY, EXECUTIVE DIRECTOR, THE AMERICAN CHAMBER OF COMMENCE IN KOREA
Ms. OVERBY. Mr. Chairman, members of the subcommittee, thank you very much for the opportunity to share the views of our chamber members on these important issues. It is because of their importance that our members felt it was essential that we send a representative to this meeting today, hence, I am not in the Grand Caymans on my vacation. I apparently went overboard in my written testimony by submitting 48 pages of documents, including many letters of support, including the National Governors Association, the Southern and Western Governors Association, the California Trade and Commerce Agency, the Asia Pacific Council of American Chambers and the U.S. Business Council.
The American Chamber of Commerce in Korea represents over 800 companies and 1,800 members. The companies range in size from large corporations, like Texas Instruments, Exxon, Compact, DHL, Fed Ex, Eli Lilly, and IBM to name a few. I am pleased to tell you that American business is doing very well in Korea.
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I am sure you are already aware that Korea is the United States' fifth largest export market and seventh largest overall trade partner, according to Department of Commerce 1996 statistics. Last year, we did in excess of $50 billion worth of two-way trade between our two countries. That represents a lot of American jobs as a result of this very important and dynamic trading relationship.
It is, again, because of the strength of this relationship that our members felt it very important to weigh in on this issue. Korea's success is also represented in the fact that their economy is now the 11th largest in the world. Many experts predict that Korea will be among the top seven economies of the world by the year 2010.
Korea recently joined the Organization for Economic Cooperation and Development, the so-called Developed Countries Club, and is actively participating in the World Trade Organization and the Asia Pacific Economic Cooperation. I have been an active member of the American Chamber for over 9 years in Korea, and during that time, the early entry into the Visa Waiver Pilot Program for Korea has been our largest single U.S. issue facing our members.
Although the U.S. Embassy staff in Seoul is doing an incredible job, and please let me emphasize that point again, the staff at the Embassy in Seoul are among the very best in the world. They work very long hours under extremely difficult conditions to help promote U.S. trade in Korea, and the consular section is one of the most dedicated. They continue to process more nonimmigrant visa applications in Seoul than in any other consulate in the world.
Last year, they processed over 550,000 nonimmigrant applications. They expect over 750,000 applications this year. Again, all with no appreciable increase in resources. It is truly remarkable, considering what they have done with very little resources.
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I would also be remiss if I didn't mention how responsive the Consular Affairs people at the Department of State have been. Over the last 4 years, they worked hard to find additional resources, and more importantly, create new, innovative ways to process more applications, like the Travel Agent Referral Program you heard about earlier. However, the stark reality of the situation is that no matter how many applications they process, there are more and more Korean travelers choosing other destinations, simply because our process is too onerous and time-consuming.
Consider the fact, please, that 47 countries around the world have already made Korea visa-free. Other countries, like Australia, actually have airlines issuing visas for Korea in less than 24 hours. Even though the United States is still the number one destination of choice, many Koreans are choosing other destinations because of the ease of travel. Many people were very surprised when the American Chamber of Commerce started actively promoting early entry for Korea into the Visa Pilot Program, but when you look at the facts, it is very clear the U.S. visa process is an impediment to U.S. trade in Korea.
Simply put, we see it as an economic issue. Every American businessperson in Korea has heard visa nightmare stories about companies losing a big deal because they were not able to get the Korean buyer a visa in time. Today, in the international business environment, it is extremely competitive. Korea's other trade partners are aggressively taking advantage of our visa difficulties.
During the last 4 years, I spent countless hours working with Koreans and the U.S. Embassy Consular staff to expedite previously rejected visas. Koreans applying to immigrate to the United States has decreased significantly. Koreans have the highest repatriation among foreigners who have gone to the United States; that is, they give up their U.S. citizenship and return home.
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The American Chamber of Commerce believes it is in the best interest of the United States for Korea to be admitted to the Visa Waiver Program as soon as possible. We also strongly support the Visa Waiver Pilot Program being made permanent. I would be happy to take any questions.
[The prepared statement of Ms. Overby follows:]
PREPARED STATEMENT OF TAMI OVERBY, EXECUTIVE DIRECTOR, THE AMERICAN CHAMBER OF COMMERCE IN KOREA
Ladies and Gentlemen, thank you very much for the opportunity to share the views of our members on these important issues. The American Chamber of Commerce in Korea represents over 800 companies and 1,800 people. These companies range in size from very large like Texas Instruments, General Motors and Citibank to small independent firms.
I am pleased to tell you that American business is doing very well in Korea. I'm sure you are all aware that Korea is the United States 5th largest export market and 7th largest overall trade partner. Last year, we did in excess of $50 billion of two-way trade between our countries. That represents a lot of American jobs as a result of this dynamic trading relationship.
Korea's success is also represented in the fact their economy is now the 11th largest in the world. Many experts predict Korea will be among the top 7 economies of the world by 2010. They recently joined OECD and are active participants in WTO and APEC.
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I have been an active member of the Chamber for over nine years and during that time the Early Entry Into the Visa Waiver Pilot Program has been the largest single U.S. issue facing our members. Although our Embassy staff are doing an incredible job, and please let me emphasize that point again, the staff at the U.S. Embassy are the best in the world. They work long hours under very difficult conditions to help promote U.S. trade in Korea and the consular section is one of the most dedicated. They continue to process more non-immigrant visas in Seoul than any other consulate in the world. Last year they processed over 550,000 non-immigrant applications and they expect to do over 750,000 this year; all this with no appreciable increase in resources. I would also be remiss if I did not mention how responsive the consular affairs people have been at the Department of State over the last four years as they have worked very hard to find additional resources and most important, creative, new ways to process more applications with little additional resources.
The reality of the situation is that no matter how many applications they process, there are more and more Koreans that are choosing other destinations simply because our process is too onerous. Consider the fact that 47 countries around the world have already given Korea visa waiver status and other countries like Australia actually have the airlines issuing the visas in less than 24 hours. Even though the U.S. is still the number one destination of choice, many Koreans are choosing other destinations because of the ease of travel.
Many people were surprised when the American Chamber started actively promoting early entry for Korea in the VWPP four years ago. But when you look at the facts, it is very clear that the U.S. visa process is an impediment to U.S. trade. Chamber members who live and work in Korea strongly believe it would be in the best interests of the United States for Korea to be awarded early entry into the VWPP.
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Every American businessperson in Korea has heard visa nightmare stories about companies losing a big deal because they were not able to get the Korean buyer a visa fast enough. Many have their own experience. Today's business environment is extremely competitive and Korea's other trade partners are aggressively taking advantage of our visa difficulties.
During the last four years I have spent countless hours working with Koreans and the U.S. Embassy consular staff to expedite or reconsider previously rejected applications. Considering Koreans have the highest incidence of repatriation among foreigners who have immigrated to the U.S. and the fact that Koreans applying to immigrate to the U.S. have dropped significantly, the American Chamber of Commerce in Korea believes it would be in the best interests of the United States for Korea to be admitted to the VWPP as soon as possible. We believe it is bad business to ask your 7th largest trading partner to wait.
Thank you very much for your consideration and I would be happy to answer any questions.
Mr. SMITH. Thank you, Ms. Overby. I have a couple questions I would like to address to all of you all and let me preface the questions by making a statement. And that is, it seems today what we have heard during the—from the various witnesses is sort of a little bit of a balancing act between tourism and trade on one side and fraud and abuse on the other, and the administration, INS and State Department were concerned with both, but perhaps most concerned about fraud and abuse.
You all obviously are most interested in trade and tourism. My general questions for you all are do you feel, and Mr. Norman, I will start with you, do you feel there should be a statutory criteria by which we judge countries and determine whether or not they should receive the privileges of a Visa Waiver Program or not. And obviously, my next question is, if there are certain criteria that should be recognized, you know, in effect, where do you set the line?
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Mr. Norman.
Mr. NORMAN. On behalf of our industry, sir, we believe that appropriate and objective criteria are appropriate and we support that. The point that we are trying to make is that although we want to enhance travel to and within the United States, but we also believe that any kind of objective criteria, as has been used, would work quite well.
I think the most important thing to bear in mind is that as we look at the United States' major trading partners, in terms of travel, of the 14th largest ones, 10 of them already have visa waivers. We think there are others who could be included and everyone who meets the objective criteria that has been set forth, we would support their inclusion.
Mr. SMITH. Ms. Thomas.
Ms. THOMAS. Obviously, I mirror those remarks. An objective standard for admission into the program is an avenue of control. Our industry cooperates closely with INS in its prescreening of travelers, all travelers, be it a visa waiver or visa'd passenger and we have certain obligations as international carriers to perform that function. But an objective standard for admission or exclusion from the program is certainly appropriate.
Mr. SMITH. So far, by the way, am I right in hearing you say that you are not necessarily in favor of expanding the program, just continuing the program?
Ms. THOMAS. For ATA?
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Mr. SMITH. Yes.
Ms. THOMAS. No, we are in favor of expanding the program as appropriate, but we would not insert ourselves into the process of selecting one country over the other. That is a government function.
Mr. SMITH. As appropriate is fairly general. Thank you.
Ms. Overby.
Ms. OVERBY. Thank you. You have given me an excellent opportunity to use my nice charts over here. The chamber would agree with statutory criteria. However, we would like to emphasize that some economic data should be considered. For example, on the top chart, that shows, with the 25 current visa waiver countries, it shows their total U.S. trade, and if we put Korea into that group, you would see that Korea is No. 4, meaning we do more total trade with Korea than we do with 22 of our current visa waiver countries. And then on the bottom we look at total U.S. exports. If you put Korea in that group, it would be number three, so we believe that certainly economics should not be the only criteria, but it shouldn't be ignored either.
Mr. SMITH. Thank you, Ms. Overby. I don't think I have any other questions.
Mr. Watt.
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Mr. WATT. Thank you, Mr. Chairman. I wanted to ask Ms. Overby and Mr. Norman what their reaction was to the bond requirement in Congressman Abercrombie's proposed legislation and whether they had the same kind of reaction to it that Representative Kim seemed to have, that suggested something that we didn't necessarily want to be suggesting.
Ms. OVERBY. If I may respond, certainly in Korea, the mood towards the United States is colored as a result of our visa policy, and I think if you did consider a bond requirement, Congressman Kim is exactly right. The Koreans would be very offended. Already, many Koreans are choosing other destinations because they feel that the United States is looking down upon them by forcing them to go through a very onerous process.
Mr. WATT. Mr. Norman.
Mr. NORMAN. From our perspective, if there is going to be an objective visa waiver criteria used across the board for all countries that are going to be involved, we would support it. We would be quite concerned if there were criteria used for one country that was not used for another.
Mr. WATT. Somebody just mentioned that 10 out of the 14 highest trading partners are now participants in the Visa Waiver Program. Which are not?
Mr. NORMAN. The four countries that are not currently members are Brazil, the Republic of Korea, Taiwan, and Venezuela I did not count Canada and Mexico.
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Ms. OVERBY. Canada has its own special laws.
Mr. NORMAN. So those are the four countries that are not on the top 14 list. The reason we mentioned the top 14, Mr. Watt, is that we look at what is happening with them and, in fact, if a shift of just 1 percent of increased travel from those countries were to take place, it would mean more than $1.2 billion in receipts for the United States. So we are saying that it is to our best economic interest to have our largest tourism trading partners and other countries that are growing significantly. Brazil, the Republic of South Korea, Taiwan, and Venezuela are being mentioned specifically because they were in the list of top 14 overseas travel markets to the United States.
Mr. SMITH. Will the gentleman yield just for a minute?
Mr. WATT. Let me ask one more question about Brazil in particular. Do you happen to know how Brazil ranks on the objective criteria that we have been—objective or subjective criteria, depending on how you——
Mr. SMITH. I was glad to hear the gentleman use the word ''objective.''
Mr. WATT. Well, I am trying to be fair. Does anybody happen to know where Brazil stacks up, whether they were in one of those 17 countries.
Ms. OVERBY. They would be below Korea. Their rejection rate, as I understand it, is significantly higher than Korea's. It is dramatic to note that in fiscal year 1995, Korea's rejection rate, visa rejection rate was 6.3 percent. Fiscal year 1996, that dropped to 2.8 percent, so certainly they are heading in the right direction.
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Mr. SMITH. Will the gentleman yield at this point?
Mr. WATT. Yes.
Mr. SMITH. Ms. Overby, I was just going to point out as a result of Mr. Watt's question, I didn't realize 10 of the 14 largest trading partners in the United States are now participants in the Visa Waiver Program. Whether or not trade and tourism is taken into consideration directly, it would seem that the result is that most of our larger trading partners are, in fact, participants and therefore we are covering the majority in the criteria; is that not the case? You just don't want to be one of the four.
Ms. OVERBY. Well, that, and if you looked at the other ten, you would find that the majority of ones who are not in are non-European countries.
Mr. SMITH. You are playing to Mr. Watt's concerns. Very nicely done.
Mr. WATT. She knows the facts. Where is Portugal in our trading? Are they on your chart down there anywhere?
Ms. OVERBY. No, Portugal is not. These actually are the—these actually are the countries who are currently in the Visa Waiver Pilot Program.
Mr. WATT. I will tell Barney Frank that you said they just come for weddings and funerals, not for trade.
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I think that is all I have, Mr. Chairman. I appreciate it and I thank the witnesses for being here.
Mr. SMITH. Thank you, Mr. Watt.
Mr. PEASE. No questions.
Mr. SMITH. Well, we are at an end. We thank you all for your contributions, for your testimony, and Mr. Watt and other members of the subcommittee look forward to consideration of what you said and the other panelists have said as well. Thank you for being here.
The subcommittee is adjourned.
[Whereupon, at 12:02 p.m., the subcommittee adjourned.]
A P P E N D I X E S
Appendix 1.—Letter Dated June 13, 1997, From Hon. Tony Knowles, Governor, State of Alaska
Hon. LAMAR SMITH, Chairman,
Subcommittee on Immigration and Claims,
U.S. House of Representatives,
Washington, DC
DEAR REPRESENTATIVE SMITH: I am writing to support permanent reauthorization of the Visa Waiver Pilot Program (VWPP), and extension of the VWPP program to the Republic of Korea (ROK).
The program, implemented in 1988, has enjoyed tremendous success. Twenty-five nations have qualified under the program. This has resulted in significant visitation increases to the United States, as well as major cost savings to the federal government. In fact, more than 50 percent of all foreign travelers to the U.S. come under the VWPP.
The State of Alaska also seeks your support for expediting extension of the VWPP to the ROK. South Korea's visa refusal rate is rapidly dropping to the 2 percent level at which point the country would automatically qualify for the program. Despite the increased number of nonimmigrant visas processed—from 65,000 to 550,000 visas in the last 10 years—the ROK's refusal rate has dropped sharply from 6.3 percent in Fiscal Year '95 to 2.87 percent in Fiscal Year '96. However, it will take at least another three years, at best. because of reporting delays and statutory requirements, for the ROK to be eligible for visa-free status. Legislative action to expedite extension of the VWPP to the ROK would prevent Alaska and other states from continuing to lose tourism and investment market share from that country.
The ROK is the eleventh largest economy in the world, in terms of gross national product and trade volume. South Korea is Alaska's second largest trading partner, importing $463 million worth of Alaska goods last year including oil and gas, seafood and minerals. With its population of 46 million, some 5,000 tourists visit Alaska annually. many on the direct air route between Anchorage and Seoul operated by Korean Air Lines. Koreans living in Alaska are incredibly productive citizens who contribute in a major way to Alaska's cultural diversity.
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Studies show easing the visa requirements would increase visitor rates to Alaska nearly tenfold. Korean travel rates are skyrocketing, but the complicated U.S. visa application process causes significant delays for South Korean visitors and has led them to choose the many other countries with friendlier entry requirements as their destinations. Presently, there are 48 nations—such as Canada, Germany and the United Kingdom that have no visa requirement for South Korean visitors. Consequently, data shows that many Koreans instead choose to travel to and invest in those destinations rather than in the United States. While total outbound travel from Korea has grown 246 percent since 1988, outbound travel to the U.S. during the same time period grew at a much slower rate of 178 percent.
The visa requirement is not an immigration issue but an economic barrier that restricts trade and tourism between Korea and the United States. It is for this reason that the National Governors' Association, the Southern Governors' Association, and the Western Governors' Association have adopted resolutions to extend visa-free status to the Republic of Korea, and to approve permanent reauthorization of the overall Visa Waiver Pilot Program. I was honored to have played a part in two of these resolutions and to learn more about this issue firsthand during my trade mission to Korea last fall.
Thank you very much for your consideration of my views.
Sincerely,
Appendix 2.—Letter Dated June 16, 1997, From Hon. Richard W. Pombo, a Representative in Congress From the State of California
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| Congress of the United States |
| House of Representatives, |
| Washington, DC, June 16, 1997. |
Hon. LAMAR SMITH,
Chairman, Subcommittee on Immigration and Claims,
Washington, DC.
DEAR CHAIRMAN SMITH: The purpose of this letter is to express my strong support for H.R. 1888, a bill to amend to the Immigration and Nationality Act to modify the qualifications for a country to be designated as a Visa Waiver Pilot Program country. I am proud to join with my colleague Congressman Barney Frank in co-sponsoring this important legislation.
As you well know, the most recent information provided by the Department of State is that the refusal rate for Portugal was slightly above the requirement fixed in the probationary status which was dropped as a mechanism to enter the Visa Waiver Pilot Program (VWPP). In addition., Portugal, as determined by the most recent data, had an overstay rate of 2.7%. Again this figure is slightly above the requirements to enter the VWPP.
I do not believe the numbers tell an accurate or a current picture of the overstay and refusal rates. If the Immigration and Naturalization Service and the Department of State were to use current data I believe Portugal would qualify for the VWPP. It is fundamentally unfair to punish the people of Portugal and their families and friends in the United States for the inability of the federal government to provide up to date information. It is clear that the trends of the last few years show that Portugal belongs in the VWPP. I understand that any tinkering with the current system brings with it various sundry problems. However, I believe that if you take a serious look at the facts surrounding Portugal's refusal rates and overstay rates you will see that their inclusion in the VWPP is warranted. To that end, H.R. 1888 is the legislative vehicle that will accomplish this most important goal.
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Thank you, in advance, for your time and consideration to this important request.
Sincerely,
| Richard W. Pombo, |
| Member of Congress. |
Appendix 3.—Letter Dated June 16, 1997, From Gov. Paul E. Patton and Gov. Edward T. Schafer, National Governors' Association
| National Governors' Association, |
| Washington, DC, June 16, 1997. |
Hon. LAMAR S. SMITH,
Chair, Immigration and Claims Subcommittee,
Judiciary Committee,
Washington, DC.
Hon. MELVIN WATT,
Ranking Democratic Member,
Immigration and Claims Subcommittee,
Judiciary Committee,
Washington, DC.
DEAR CHAIRMAN SMITH AND REPRESENTATIVE WATT: On behalf of the National Governors' Association (NGA), we commend you for holding a hearing on the status of the Visa Waiver Pilot Program (VWPP) and the extension of visa waivers to the Republic of Korea (South Korea). Based on recently adopted NGA policy, the Governors urge you to establish a permanent visa waiver program in the United States and extend visa waiver status to South Korea.
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Travel and tourism is a critical industry for states, and the Governors consistently have promoted actions to help ease the obstacles to U.S. travel for foreign businesspeople and tourists. Currently, twenty-five countries, including Australia, France, Germany, and the United Kingdom, participate in the highly successful VWPP. Without congressional action, this program will expire October 1, 1997. Expiration of VWPP would create a backlog of visa applications that would be impossible to manage efficiently under the U.S. State Department's current staff and budget restrictions.
In line with the objective of streamlining U.S. travel for foreigners, the Governors endorse the extension of visa waivers to South Korea the world's eleventh largest economy and our country's seventh largest trading partner. Despite a significant increase in foreign travel by South Korean citizens for both business and leisure purposes, the rate of their travel to the United States has risen only marginally. States have seen indications that the complicated U.S. visa application procedure means fewer Korean tourists, who are more likely to visit competing countries with ''friendlier'' entry requirements.
The Governors look forward to working with you to establish a permanent visa waiver program and extend visa waivers to South Korea as soon as possible. Thank you for your consideration of our—positions on these issues. A copy of NGA policy and of a brief background paper are attached. Please include our letter and attachments in the hearing record.
Sincerely,
| Gov. Paul E. Patton, |
| Chair, Committee on Economic Development and Commerce. |
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| Gov. Edward T. Schafer, |
| Vice Chair, Committee on Economic Development and Commerce. |
Attachments.
———
NATIONAL GOVERNORS' ASSOCIATION POLICY
EDC–12 ESTABLISHING A PERMANENT VISA WAIVER PROGRAM AND EXTENDING VISA WAIVERS TO THE REPUBLIC OF KOREA (SOUTH KOREA)
12.1 Preamble
A key objective of tourism-related efforts by the United States must be to keep delays at ports of entry from becoming a deterrent to ongoing and increased international travel to our country. Federal agencies should aggressively cut red tape and ease obstacles to travel in the United States in areas such as visas, passports, currency exchange requirements, and customs congestion. The Governors endorse the expansion of efforts in these areas, consistent with security and drug enforcement considerations. The federal government should work with states and private industry to facilitate the travel of tourists whose language and cultural differences are barriers to safe or enjoyable travel. The Governors recommend that the federal government utilize technology, where affordable and practical, to speed the entry of frequent international business travelers through points of entry.
12.2 Permanent Visa Waiver Program
In order to facilitate expansion of the tourism industry, the Governors urge Congress to enact a permanent visa waiver program. The Visa Waiver Pilot Program (VWPP), limited to three years when first implemented in 1988, has been reauthorized several times. Twenty-five countries currently participate in the program, and states have benefited economically from the program's success. Last year, Congress extended the VWPP for only one year. It will expire on October 1, 1997, unless Congress takes timely action.
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12.3 Visa Waivers for the Republic of Korea
The Governors support the inclusion of the Republic of Korea (South Korea) in the visa waiver program. Rising incomes have allowed Koreans to spend more money on travel, with the United States becoming an increasingly popular destination. However, the complicated visa application procedure in the United States means fewer Korean tourists, who are more likely to visit competing countries with ''friendlier'' entry requirements. Currently, South Korea is experiencing a ''reverse immigration'' trend, meaning South Korean immigrants living in the United States are returning to South Korea. More importantly, the visa refusal rate has dropped from 6.3 percent in fiscal 1995 to 2.87 percent in fiscal 1996. The Governors believe that extending visa waivers to South Korea will produce substantial economic benefits to the United States.
Interim Policy approved by the NGA Committee on Economic Development and Commerce, June 4, 1997.
———
NATIONAL GOVERNORS' ASSOCIATION
BACKGROUND ON THE VISA WAIVER PROGRAM
The purpose of this paper is to provide background on the issue of establishing a permanent visa waiver program and on the issue of extending visa waivers to the Republic of Korea (South Korea).
Visa Waiver Pilot Program (VWPP)
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The VWPP allows international travelers, tourists, and business people to enter the United States for a limited period of time without a visa. Citizens from countries that do not qualify for the program must apply for a visa in order to enter the United States for any period of time. U.S. Embassy officials process these visa applications for numerous tourists, business travelers, and students who wish to travel to the United States. Currently, the following twenty-five countries participate in the VWPP: Andorra, Argentina, Australia, Austria, Belgium, Brunei, Denmark, Finland, France, Germany, Iceland, Ireland, Italy, Japan, Liechtenstein, Luxembourg, Monaco, the Netherlands, New Zealand, Norway, San Marino, Spain, Sweden, Switzerland, and the United Kingdom.
Roughly fifty percent of the foreign visitors to the United States travel here under the VWPP. In 1993 alone, forty-four million foreign visitors came to the United States, and the VWPP saved U.S. taxpayers an estimated $175 million on visa processing costs. The VWPP was first implemented in 1988 and has been renewed since that time by Congress for limited intervals. It is now scheduled to expire unless Congress acts to renew it.
In order to qualify for the VWPP, a country must meet the following four requirements:
the average visa refusal rate (for tourism and temporary visas not student visas) must be
less than 2.0 percent for two consecutive years and in neither of those two years may the refusal rate be above 2.5 percent;
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the country must provide reciprocal treatment for U.S. citizens;
the country must have developed or be in the process of developing an electronically readable passport; and
the U.S. attorney general, in consultation with the U.S. Department of State, must conclude that extending visa waivers to the country will not compromise U.S. law enforcement.
The U.S. Department of Justice administers the VWPP, in consultation with the U.S. Department of State, and it is considered to be an important component of states' economic development programs. The flexibility permitted to individual visitors under the VWPP helps the tourism industry and facilitates foreign direct investment, both of which help to create new jobs and supply additional revenue to the states. NGA policy currently supports the establishment of a permanent visa waiver program, consistent with security and drug enforcement considerations.
Visa Waivers for South Korea
The Republic of Korea (South Korea), with a population of more than 46 million people, is the world's eleventh largest economy and the seventh largest trading partner of the United States. In 1996, South Korea was the United States' fifth largest merchandise export market, at $26.6 billion.
Despite concerns raised by officials at the U.S. Department of State regarding South Korea's current failure to meet the technical requirements of the program, both the Western Governors' Association (WGA) and the Southern Governors' Association (SGA) have adopted policy urging Congress to extend visa waivers to South Korea. South Korea's visa refusal rate has dropped from 6.3 percent in fiscal 1995 to 2.87 percent in fiscal 1996. With respect to the other required elements of the program, South Korea currently provides visa waivers to U.S. citizens for tourism or business trips of up to fifteen days and has an electronically readable passport. At this time, no information is available from the U.S. Department of Justice on the issue of security concerns related to the extension of visa waivers to South Korea.
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Forty-eight other countries, including Canada, France, Germany, and Great Britain, already provide visa waivers to South Korea. Many states have expressed concern that the United States is losing South Korean visitors to the countries with friendlier visa programs toward South Korea. According to available figures, 3.4 million South Koreans traveled abroad in 1994, an increase of almost five times from the rate of individuals traveling abroad in 1988. However, travel by South Koreans to the United States has increased by only about two and a half times the rate during the same time period.
Status of Legislative Action
Legislation to extend visa waivers to South Korea has been introduced in both houses. Senator Frank H. Murkowski (R–AK), Senator Daniel K. Inonye (D–HI), and Representative Neil Abercrombie (D–1st HI) have sponsored S. 290 and H.R. 627, companion bills titled ''A Bill to Establish a Visa Waiver Pilot Program for Nationals of Korea Who are Traveling in Tour Groups to the United States.'' Representative Jay Kim (R–41st CA) has sponsored H.R. 203, ''A Bill to Designate the Republic of Korea as a Visa Waiver Pilot Program Country for One Year Under the Immigration and Nationality Act.'' The Senate Judiciary Committee Subcommittee on Immigration is expected to hold hearings on S. 290 in June.
For more information contact Victoria Becker, NGA Director of International Trade Legislation and Programs, at 202/624–5368 or .
43–387CC
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1997
VISA WAIVER PILOT PROGRAM
HEARING
BEFORE THE
SUBCOMMITTEE ON
IMMIGRATION AND CLAIMS
OF THE
COMMITTEE ON THE JUDICIARY
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTH CONGRESS
FIRST SESSION
JUNE 17, 1997
Serial No. 26
Printed for the use of the Committee on the Judiciary
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For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402
COMMITTEE ON THE JUDICIARY
HENRY J. HYDE, Illinois, Chairman
F. JAMES SENSENBRENNER, Jr., Wisconsin
BILL McCOLLUM, Florida
GEORGE W. GEKAS, Pennsylvania
HOWARD COBLE, North Carolina
LAMAR SMITH, Texas
STEVEN SCHIFF, New Mexico
ELTON GALLEGLY, California
CHARLES T. CANADY, Florida
BOB INGLIS, South Carolina
BOB GOODLATTE, Virginia
STEPHEN E. BUYER, Indiana
SONNY BONO, California
ED BRYANT, Tennessee
STEVE CHABOT, Ohio
BOB BARR, Georgia
WILLIAM L. JENKINS, Tennessee
ASA HUTCHINSON, Arkansas
EDWARD A. PEASE, Indiana
CHRISTOPHER B. CANNON, Utah
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JOHN CONYERS, Jr., Michigan
BARNEY FRANK, Massachusetts
CHARLES E. SCHUMER, New York
HOWARD L. BERMAN, California
RICK BOUCHER, Virginia
JERROLD NADLER, New York
ROBERT C. SCOTT, Virginia
MELVIN L. WATT, North Carolina
ZOE LOFGREN, California
SHEILA JACKSON LEE, Texas
MAXINE WATERS, California
MARTIN T. MEEHAN, Massachusetts
WILLIAM D. DELAHUNT, Massachusetts
ROBERT WEXLER, Florida
STEVEN R. ROTHMAN, New Jersey
THOMAS E. MOONEY, Chief of Staff-General Counsel
JULIAN EPSTEIN, Minority Staff Director
Subcommittee on Immigration and Claims
LAMAR SMITH, Texas, Chairman
ELTON GALLEGLY, California
SONNY BONO, California
WILLIAM L. JENKINS, Tennessee
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EDWARD A. PEASE, Indiana
CHRISTOPHER B. CANNON, Utah
ED BRYANT, Tennessee
MELVIN L. WATT, North Carolina
CHARLES E. SCHUMER, New York
HOWARD L. BERMAN, California
ZOE LOFGREN, California
ROBERT WEXLER, Florida
CORDIA A. STROM, Chief Counsel
EDWARD R. GRANT, Counsel
GEORGE FISHMAN, Counsel
MARTINA HONE, Minority Counsel
C O N T E N T S
HEARING DATE
June 17, 1997
OPENING STATEMENT
Smith, Hon. Lamar, a Representative in Congress from the State of Texas, and chairman, Subcommittee on Immigration and Claims
WITNESSES
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Abercrombie, Hon. Neil, a Representative in Congress from the State of Hawaii
Cronin, Michael D., Assistant Commissioner for Inspections, Immigration and Naturalization Service
Frank, Hon. Barney, a Representative in Congress from the State of Massachusetts
Kim, Hon. Jay, a Representative in Congress from the State of California
Norman, William S., president and CEO, Travel Industry Association of America
Overby, Tami, executive director, the American Chamber of Commerce in Korea
Ryan, Mary A., Assistant Secretary, Bureau of Consular Affairs, Department of State
Thomas, Janet, director of facilitation, Air Transport Association of America
LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING
Abercrombie, Hon. Neil, a Representative in Congress from the State of Hawaii: Prepared statement
Cronin, Michael D., Assistant Commissioner for Inspections, Immigration and Naturalization Service: Prepared statement
Kim, Hon. Jay, a Representative in Congress from the State of California: Prepared statement
Norman, William S., president and CEO, Travel Industry Association of America: Prepared statement
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Overby, Tami, executive director, the American Chamber of Commerce in Korea: Prepared statement
Ryan, Mary A., Assistant Secretary, Bureau of Consular Affairs, Department of State:
Prepared statement
Travel Agent Program in the United Kingdom
Turnaround time for nonimmigrant visas in Portugal
Visa fraud in South Korea
Visitor visa refusal rates—fiscal year 1996
Thomas, Janet, director of facilitation, Air Transport Association of America: Prepared statement
APPENDIXES
Appendix 1.—Letter dated June 13, 1997, from Hon. Tony Knowles, Governor, State of Alaska
Appendix 2.—Letter dated June 16, 1997, from Hon. Richard W. Pombo, a Representative in Congress from the State of California
Appendix 3.—Letter dated June 16, 1997, from Gov. Paul E. Patton and Gov. Edward T. Schafer, National Governors' Association
(Footnote 1 return)
U.S. Flag members are: Alaska Airlines, Aloha Airlines, American Airlines, American Trans Air, America West Airlines, Continental Airlines, Delta Air Lines, DHL Airways, Emery Worldwide, Evergreen International Airlines, Federal Express, Hawaiian Airlines, KIWI Airlines, Midwest Express, Northwest Airlines, Polar Air Cargo, Reeve Aleutian Airways, Southwest Airlines, Trans World Airlines, United Airlines, United Parcel Service, and US Airways. Our technical members include: Air Canada, Canadian Airlines International, and KLM-Royal Dutch Airlines.