E7-3394. Generalized System of Preferences (GSP): Import Statistics Relating to Competitive Need Limitations (CNLs); Invitation for Public Comment on CNL Waivers Subject to Potential Revocation Based on New Statutory Thresholds, Possible De Minimis

AGENCY:

Office of the United States Trade Representative (USTR).

ACTION:

Notice.

SUMMARY:

This notice is to inform the public of the availability of full 2006 calendar year import statistics relating to competitive need limitations (CNLs) under the Generalized System of Preferences (GSP) program. Public comments are invited by 5 p.m., Friday, March 16, 2007, regarding possible de minimis CNL waivers with respect to particular articles and possible redesignations under the GSP program of articles currently not eligible for GSP benefits because they previously exceeded the CNLs. Additionally, public comments are invited by 5 p.m., Friday, March 23, 2007, regarding the potential revocation of CNL waivers that meet the new statutory thresholds set forth by section 503(d)(4)(B)(ii) of the Trade Act of 1974 (19 U.S.C. 2463(d)(4)(B)(ii)), as amended by Public Law 109-432.

FOR FURTHER INFORMATION CONTACT:

The GSP Subcommittee of the Trade Policy Staff Committee, Office of the United States Trade Representative, 1724 F Street, NW., Room F-220, Washington, DC 20508. The telephone number is [phone].

SUPPLEMENTARY INFORMATION:

 

I. Competitive Need Limitations

The GSP program provides for the duty-free importation of designated articles when imported from designated beneficiary developing countries (BDCs). The GSP program is authorized by title V of the Trade Act of 1974 (19 U.S.C. 2461, et seq.), as amended (the “1974 Act”), and is implemented in accordance with Executive Order 11888 of November 24, 1975, as modified by subsequent Executive Orders and Presidential Proclamations.

Section 503(c)(2)(A) of the 1974 Act sets out the two CNLs. When the President determines that a BDC exported to the United States during a calendar year either (1) a quantity of a GSP-eligible article having a value in excess of the applicable amount for that year ($125 million for 2006), or (2) a quantity of a GSP-eligible article having a value equal to or greater than 50 percent of the value of total U.S. imports of the article from all countries (the “50 percent CNL”), the President must terminate GSP duty-free treatment for that article from that BDC by no later than July 1 of the next calendar year.

De minimis waivers. Under section 503(c)(2)(F) of the 1974 Act, the President may waive the 50 percent CNL with respect to an eligible article imported from a BDC if the value of total imports of that article from all countries during the calendar year did not exceed the applicable de minimis amount for that year ($18 million for 2006).

Redesignations. Under section 503(c)(2)(C) of the 1974 Act, if imports of an eligible article from a BDC ceased to receive duty-free treatment due to exceeding a CNL in a prior year, the President may, subject to the considerations in sections 501 and 502 of the 1974 Act, redesignate such an article for duty-free treatment if imports in the most recently completed calendar year did not exceed the CNLs.

CNL waiver revocation. Under Section 503(d)(5) of the 1974 Act, a CNL waiver remains in effect until the President determines that it is no longer warranted due to changed circumstances. Section 503(d)(4)(B)(ii) of the 1974 Act, as amended by Public Law 109-432, also provides that, “[n]ot later than July 1 of each year, the President should revoke any waiver that has then been in effect with respect to an article for 5 years or more if the beneficiary developing country has exported to the United States (directly or indirectly) during the preceding calendar year a quantity of the article (I)—having an appraised value in excess of 1.5 times the applicable amount set forth in subsection (c)(2)(A)(ii) for that calendar year [$187.5 million in 2006]; or (II) exceeding 75 percent of the appraised value of the total imports of that article into the United States during that calendar year.”

II. Implementation of Competitive Need Limitations, Waivers, and Redesignations

Exclusions from GSP duty-free treatment where CNLs have been exceeded will be effective July 1, 2007, unless granted a waiver by the President. Any CNL-based exclusions, CNL waiver revocations, and decisions with respect to de minimis waivers and redesignations will be based on full 2006 calendar year import data.

III. 2006 Import Statistics

In order to provide notice of articles that have exceeded the CNLs for 2006, and to afford an opportunity for comment regarding potential de minimis waivers, redesignations, and the potential revocation of waivers that are subject to the new CNL waiver thresholds provided by section 503(d)(4)(B)(ii) of the 1974 Act, as amended by Public Law 109-432, import data for 2006 are available at http://www.ustr.gov/​Trade_​Development/​Preference_​Programs/​GSP/​Section_​Index.html). Full 2006 calendar year data for individual tariff subheadings may be viewed on the Web site of the U.S. International Trade Commission at http://dataweb.usitc.gov/​.

The lists available on the USTR Web site contain, for each article, the Harmonized Tariff Schedule of the United States (HTSUS) subheading and BDC country of origin, the value of imports of the article for the 2006 calendar year, and the percentage of total imports of that article from all countries. The annotations on the lists indicate, among other things, the status of GSP eligibility.

The computer-generated lists published on the USTR Web site are for informational purposes only. They may not include all articles to which the GSP CNLs may apply. All determinations and decisions regarding the CNLs of the GSP program will be based on full 2006 calendar year import data with respect to each GSP-eligible article. Each interested party is advised to conduct its own review of 2006 import data with respect to the possible application of the GSP CNL provisions.

List I on the USTR Web site shows: (a) Articles from BDCs that became ineligible for GSP treatment on or before July 1, 2006; and (b) GSP-eligible articles from BDCs that exceeded the CNL by having been exported in excess of $125 million, or by an amount greater than 50% of the total U.S. import value in 2006. Petitions to grant CNL waivers for those articles that received GSP benefits during 2006 but stand to lose GSP duty-free treatment on July 1, 2007, must have been previously submitted in the 2006 GSP Annual Review.

List II identifies GSP-eligible articles from BDCs that are above the 50 percent CNL, but that are eligible for a de minimis waiver of the 50 percent CNL. Articles eligible for de minimis waivers are automatically considered in the GSP annual review process, without petitions, and public comments are invited.

List III shows GSP-eligible articles from certain BDCs that are currently not receiving GSP duty-free treatment, but that may be considered for GSP redesignation based on 2006 trade data and consideration of certain statutory factors, as set forth above. Recommendations to the President on redesignations are normally made as part of the GSP annual review process, and public comments are invited.

List IV shows articles subject to the new CNL waiver thresholds of section 503(d)(4)(B)(ii) of the 1974 Act, as amended by Pub. L. 109-432. Recommendations to the President on revocation of these waivers will be made as part of the 2006 GSP annual review process, and public comments are invited.

IV. Public Comments

Requirements for Submissions

All submissions must conform to the GSP regulations set forth at 15 CFR part 2007, except as modified below. Furthermore, each party providing comments should indicate on the first page of the submission its name, the relevant HTSUS subheading(s), the BDC of interest, and the type of action (e.g., new statutory criteria, de minimis waiver or redesignation) in which the party is interested.

Comments must be submitted, in English, to the Chairman of the GSP Subcommittee of the Trade Policy Staff Committee (TPSC) as soon as possible, but no later than 5 p.m., Friday, March 16, 2007, for comments regarding de minimis waivers or redesignations, and no later than 5 p.m., March 23, 2007, for comments on the potential revocation of CNL waivers that meet the new statutory thresholds.

To facilitate prompt consideration of submissions, USTR will only accept electronic e-mail submissions in response to this notice. Hand-delivered submissions either by mail or other delivery options will not be accepted. Submissions should be single-copy transmissions in English with the total submission not to exceed 20 single-spaced standard letter-size pages, including attachments, and three megabytes as a digital file attached to an e-mail transmission. The e-mail transmission must use either one of the two following subject lines, based on the subject of the comment being submitted: “Comments on 2006 GSP Redesignation and De minimis Waiver Review,” or “Comments on 2006 CNL Waiver Threshold Review,” followed by the BDC country of origin and HTSUS subheading number as set out in the appropriate list. Documents must be submitted as either MSWord (“.doc”), Word Perfect (“.wpd”), Adobe (“.pdf”) or text (“.txt”) files. Documents submitted as electronic image files or containing imbedded images (for example, “.jpg”, “.tif”, “.bmp”, or “.gif” files) will not be accepted. Spreadsheets submitted as supporting documentation are acceptable as Excel, pre-formatted for printing on 81/2 x 11 inch paper. To the extent possible, any data attachments to the submission should be included in the same file as the submission itself, and not as separate files.

If the submission contains business confidential information, pursuant to 15 CFR 2003.6, a non-confidential version of the submission must also be submitted that indicates where confidential information was redacted by inserting asterisks where material was deleted. In addition, the confidential version must be clearly marked “BUSINESS CONFIDENTIAL” at the top and bottom of each page of the document. The non-confidential version must be clearly marked “PUBLIC” or “NON-CONFIDENTIAL” at the top and bottom of each page. Documents that are submitted without any marking may not be accepted or will be considered public documents.

For any document containing business confidential information submitted as an electronic attached file to an e-mail transmission, the file name of the business confidential version should begin with the characters “BC-”, and the file name of the public version should begin with the character “P-”. The “BC-” or “-”should be followed by the name of the party (government, company, union, association, etc.) which is submitting the comments.

E-mail submissions should not include separate cover letters or messages in the message area of the e-mail; information that might appear in any cover letter should be included directly in the attached file containing the submission itself, including the sender's identifying information with telephone number, fax number, and e-mail address. The e-mail address for submissions to the 2006 GSP Redesignation and De minimis Waiver Review is [e-mail]. The e-mail address for the 2006 CNL Waiver Threshold Review is [e-mail]. Documents not submitted in accordance with these instructions may not be considered in this review. If unable to provide submissions by e-mail, please contact the GSP Subcommittee to arrange for an alternative method of transmission.

Public versions of all documents relating to this review will be available for public review approximately two weeks after the due date by appointment in the USTR Public Reading Room, 1724 F Street NW., Washington, DC. Availability of documents may be ascertained, and appointments may be made from 9:30 a.m. to noon and 1 p.m. to 4 p.m., Monday through Friday, by calling 202-395-6186.

Marideth J. Sandler,

Executive Director, Generalized System of Preferences (GSP) Program, and Chair, GSP Subcommittee, Office of the U.S. Trade Representative.