05-20115. Designations under the Textile and Apparel Commercial Availability Provision of the United States-Caribbean Basin Trade Partnership Act (CBTPA) and the Andean Trade Promotion and Drug Eradication Act (ATPDEA)

September 29, 2005.

AGENCY:

The Committee for the Implementation of Textile Agreements (CITA)

ACTION:

Designation.

EFFECTIVE DATE:

October 5, 2005.

SUMMARY:

CITA has determined that certain compacted, plied, ring spun cotton yarns, with yarn counts in the range from 42 to 102 metric, classified in subheadings 5205.42.0020, 5205.43.0020, 5205.44.0020, 5205.46.0020, and 5205.47.0020 of the Harmonized Tariff Schedule of the United States (HTSUS), for use in U.S. formed fabric used in men's and boys' woven cotton trousers and shirts, and women's and girls' woven cotton trousers, shirts, and blouses, cannot be supplied by the domestic industry in commercial quantities in a timely manner under the CBTPA and ATPDEA. CITA hereby designates such apparel articles, that are both cut and sewn or otherwise assembled in one or more eligible CBTPA beneficiary country from U.S. formed fabrics containing such yarns, as eligible to enter free of quotas and duties under HTSUS subheading 9820.11.27, provided all other yarns used in the apparel articles are U.S. formed and all other fabrics used in the apparel articles are U.S. formed from yarns wholly formed in the United States. CITA also hereby designates such yarns as eligible under HTSUS subheading 9821.11.10, if used in the referenced apparel articles, that are sewn or otherwise assembled in one or more eligible ATPDEA beneficiary countries from U.S. formed fabrics containing such yarns. The referenced apparel articles from U.S. formed fabrics containing such yarns shall be eligible to enter free of quotas and duties under this subheading, provided all other yarns used in the apparel articles are U.S. formed and all other fabrics used in the apparel articles are U.S. formed from yarns wholly formed in the United States. CITA notes that this designation under the ATPDEA renders apparel articles, sewn or otherwise assembled in one or more eligible ATPDEA beneficiary countries, containing such yarns as eligible for quota-free and duty-free treatment under HTSUS subheading 9821.11.13, provided the requirements of that subheading are met.

FOR FURTHER INFORMATION CONTACT:

Richard Stetson, Office of Textiles and Apparel, U.S. Department of Commerce, [phone].

SUPPLEMENTARY INFORMATION:

Authority: Section 213(b)(2)(A)(v)(II) of the Caribbean Basin Economic Recovery Act, as added by Section 211(a) of the CBTPA (19 U.S.C. 2703(b)(2)(A)(v)(II)); Section 6 of Executive Order No. 13191 of January 17, 2001; Presidential Proclamation 7351 of October 2, 2000; Section 204 (b)(3)(B)(ii) of the ATPDEA (19 U.S.C. 3203(b)(3)(B)(ii)); Presidential Proclamation 7616 of October 31, 2002, Executive Order 13277 of November 19, 2002, and the United States Trade Representative's Notice of Further Assignment of Functions of November 25, 2002.

BACKGROUND:

The commercial availability provisions of the CBTPA and the ATPDEA provide for duty-free and quota-free treatment for apparel articles that are both cut (or knit-to-shape) and sewn or otherwise assembled in one or more beneficiary countries from fabric or yarn that is not formed in the United States if it has been determined that such yarns or fabrics cannot be supplied by the domestic industry in commercial quantities in a timely manner and certain procedural requirements have been met. In Presidential Proclamation 7351 of October 4, 2000 and in Presidential Proclamation 7616 of October 31, 2002, the President proclaimed that this treatment would apply to such apparel articles from fabrics or yarns designated by the appropriate U.S. government authority in the Federal Register. In Section 6 of Executive Order No. 13191 of January 17, 2001; Executive Order 13277 of November 19, 2002; and the United States Trade Representative's Notice of Further Assignment of Functions of November 25, 2002, the CITA was authorized to determine whether yarns or fabrics cannot be supplied by the domestic industry in commercial quantities in a timely manner under the CBTPA and the ATPDEA.

On May 23, 2005, the Chairman of CITA received a petition from AM&S Trade Service, L.L.P., on behalf of their client, Galey and Lord, Inc., alleging that certain compacted, plied, ring spun cotton yarns, with yarn counts in the range from 42 to 102 metric, classified in HTSUS subheadings 5205.42.0020, 5205.43.0020, 5205.44.0020, 5205.46.0020, 5205.47.0020, cannot be supplied by the domestic industry in commercial quantities in a timely manner. It requested duty-free treatment under the CBTPA and the ATPDEA for men's and boys' woven cotton trousers and shirts and women's and girls' woven cotton trousers, shirts, and blouses that are both cut (or knit-to-shape) and sewn in one or more eligible CBTPA or ATPDEA beneficiary countries from U.S.-formed fabrics containing such yarns. On May 25, 2005, CITA published a Federal Register notice requesting public comment on the petition. See Request for Public Comments on Commercial Availability Petition under the United States-Caribbean Basin Trade Partnership Act (CBTPA) and the Andean Trade Promotion and Drug Eradication Act (ATPDEA), 70 FR 30705 (May 25, 2005). On June 16, 2005, CITA and the Office of the U.S. Trade Representative (USTR) sent memoranda seeking the advice of the Industry Trade Advisory Committee (ITAC) for Textiles and Clothing and the ITAC for Distribution Services. No advice was received from either ITAC. On June 16, 2005, CITA and USTR sent memoranda offering to consult with the Senate Finance Committee and the House Committee on Ways and Means. No consultations were requested on this petition. USTR requested the advice of the U.S. International Trade Commission (ITC) on the probable economic effects on the domestic industry of granting the petition.

Based on the information and advice received and its understanding of the industry, CITA determined that the yarns set forth in the request cannot be supplied by the domestic industry in commercial quantities in a timely manner. On July 22, 2005, the CITA and USTR submitted a report to the Congressional Committees that set forth the action proposed, the reasons for such action, and advice obtained. A period of 60 calendar days since this report was submitted has expired, as required by the CBTPA and ATPDEA.

CITA hereby designates men's and boys' woven cotton trousers and shirts, and women's and girls' woven cotton trousers, shirts, and blouses, made from U.S. formed fabrics containing certain compacted, plied, ring spun cotton yarns, with yarn counts in the range from 42 to 102 metric, classified in HTSUS subheadings 5205.42.0020, 5205.43.0020, 5205.44.0020, 5205.46.0020, and 5205.47.0020, that are sewn or otherwise assembled in an eligible CBTPA beneficiary country, as eligible to enter free of quotas and duties under HTSUS subheading 9820.11.27. However, all other yarns used in the referenced apparel articles must be U.S. formed and all other fabrics used in the referenced apparel articles must be U.S. formed from yarns wholly formed in the United States, subject to the special rules for findings and trimmings, certain interlinings and de minimis fibers and yarns under section 213(b)(2)(A)(vii) of CBERA (19 U.S.C. 2703(b)(2)(A)(vii)), and that such articles are imported directly into the customs territory of the United States from an eligible CBTPA beneficiary country.

An “eligible CBTPA beneficiary country” means a country which the President has designated as a CBTPA beneficiary country under section 213(b)(5)(B) of the CBERA (19 U.S.C. 2703(b)(5)(B)) and which has been the subject of a finding, published in the Federal Register, that the country has satisfied the requirements of section 213(b)(4)(A)(ii) of the CBERA (19 U.S.C. 2703(b)(4)(A)(ii)) and resulting in the enumeration of such country in U.S. note 1 to subchapter XX of Chapter 98 of the HTSUS.

CITA also hereby designates such yarns as eligible under HTSUS subheading 9821.11.10, if used in men's and boys' woven cotton trousers and shirts, and women's and girls' woven cotton trousers, shirts, and blouses, sewn or otherwise assembled in one or more eligible ATPDEA beneficiary country from U.S. formed fabric containing such yarns. Such apparel containing such yarns shall be eligible to enter free of quotas and duties under this subheading, provided all other yarns used in the referenced apparel articles are U.S. formed and all other fabrics used in the referenced apparel articles are U.S. formed from yarns wholly formed in the United States, subject to the special rules for findings and trimmings, certain interlinings and de minimis fibers and yarns under section 204(b)(3)(B)(vi) of the ATPDEA, and that such articles are imported directly into the customs territory of the United States from an eligible ATPDEA beneficiary country.

An “eligible ATPDEA beneficiary country” means a country which the President has designated as an ATPDEA beneficiary country under section 203(a)(1) of the Andean Trade Preference Act (ATPA) (19 U.S.C. 3202(a)(1)), and which has been the subject of a finding, published in the Federal Register, that the country has satisfied the requirements of section 203(c) and (d) of the ATPA (19 U.S.C. 3202(c) and (d)), resulting in the enumeration of such country in U.S. note 1 to subchapter XXI of Chapter 98 of the HTSUS.

James C. Leonard III,

Chairman, Committee for the Implementation of Textile Agreements.