A bipartisan group of 20 senators introduced the Currency Exchange Rate Oversight Reform Act of 2011 that combines elements of China currency legislation passed by the House last year with those of a Senate currency bill previously introduced by Sens. Schumer, D-N.Y., and Graham, R-S.C.

“Passage of the bill would put China on notice that undervaluation of the renminbi (RMB) would no longer go unchallenged by the United States,” the cosponsors said.

Senate Majority Leader Reid, D-Nev., said the Senate will act "quickly" on a bill to counteract China's undervalued currency as a jobs measure. He said the vote on the currency bill will precede any action on the president’s jobs package, which he introduced in the Senate.

"The first major jobs bill we're going to have will send a message to the Chinese, where we've lost 2.8 million jobs during the last eight years, and that is we're going to do something about Chinese currency," Sen. Reid said. Co-sponsors are: Sens. Schumer, Graham, Brown, D-Ohio; Sessions, D-Ala.; Burr, R-N.C.; Stabenow, D-Mich.; Bob Casey, D-Pa.; Hagan, D-N.C.; Snowe, R-Maine; Whitehouse, D-R.I.; Reed, D-R.I.; Blumenthal, D-Conn.; Conrad, D-N.D.; Collins, R-Maine; Cardin, D-Mad.; Levin, D-Mich.; Gillibrand, D-N.Y.; Menendez, D-N.J.; Manchin, D-W.V.; and Nelson, D-Neb.

In advance of the introduction, 51 U.S. business and agricultural groups urged senators to oppose any currency bill because passage would be "counterproductive," according to a letter coordinated by the US-China Business Council. Using provisions of previous Schumer-Graham legislation, the new bill would establish criteria by which the Treasury Dept. would define fundamentally misaligned currencies and misaligned currencies for priority action in a semi-annual report to Congress. If a country's currency is designated for priority action and the country fails to adopt "appropriate" policies as a remedy, the administration would be obligated to take immediate action. If no policy changes occur after 360 days the U.S. Trade Representative must request dispute settlement consultations on the currency policy in the World Trade Organization.

The bill puts pressure on the Commerce Dept. to investigate claims made as part of countervailing duty petitions that China's currency bestows an unfair subsidy. The bill also puts into statute a new standard that Commerce must investigate whether a currency undervaluation by a government provides a subsidy if a U.S. industry requests such an investigation in its petition and provides the proper documentation for doing so.