01-5501. Procedures in Considering Requests Under the Textile and Apparel “Short Supply” Provisions of The African Growth and Opportunity Act and The United States-Caribbean Basin Trade Partnership Act

March 2, 2001.

AGENCY:

Committee for the Implementation of Textile Agreements.

ACTION:

Notice of Procedures.

SUMMARY:

This notice sets forth the procedures the Committee for the Implementation of Textile Agreements (the Committee) will follow in implementing certain provisions of the Trade and Development Act of 2000 (the Act). Title I of the Act (the African Growth and Opportunity Act or the AGOA) and Title II of the Act (the United States-Caribbean Basin Trade Partnership Act or the CBTPA) provide for quota- and duty-free treatment for qualifying textile and apparel products from designated beneficiary countries. Such treatment is generally limited to products manufactured from yarns or fabrics formed in the United States or a beneficiary country. However, the AGOA and the CBTPA authorize quota- and duty-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 or a beneficiary country, provided the President has determined that such yarns or fabric cannot be supplied by the domestic industry in commercial quantities in a timely manner and has proclaimed such treatment. The President has delegated to the Committee the authority to determine whether yarns or fabrics cannot be supplied by the domestic industry in commercial quantities in a timely manner under the AGOA and the CBTPA and has ordered the Committee to establish procedures to ensure appropriate public participation in any such determination. The Committee hereby notifies interested parties of the procedures it will follow in considering requests.

EFFECTIVE DATE:

March 6, 2001.

FOR FURTHER INFORMATION CONTACT:

Philip J. Martello, Office of Textiles and Apparel, U.S. Department of Commerce, [phone].

SUPPLEMENTARY INFORMATION:

Authority: Section 112(b)(5)(B) of the Act and Section 211 of the Act, amending Section 213(b)(2)(A)(v)(II) of the Caribbean Basin Economic Recovery Act; Sections 1 and 6 of Executive Order No. 13191 of January 17, 2001.

Background

The AGOA and the CBTPA provide for quota- and duty-free treatment for qualifying textile and apparel products. Such treatment is generally limited to products manufactured from yarns or fabrics formed in the United States or a beneficiary country. In addition, the AGOA provides for preferential treatment for apparel articles wholly assembled in one or more lesser developed beneficiary sub-Saharan African countries regardless of the country of origin of the fabric used to make such articles. Both the AGOA and the CBTPA provide for quota- and duty-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 or a beneficiary country, to the extent that apparel articles of such fabrics or yarns would be eligible for preferential treatment, without regard to the source of the fabric or yarn, under the rules of origin for the North American Free Trade Agreement.

In addition, the AGOA and the CBTPA authorize quota- and duty-free treatment for apparel products assembled in a beneficiary country from yarn or fabric that cannot be supplied by the U.S. industry in commercial quantities in a timely manner. More specifically, the AGOA authorizes quota- and duty-free treatment for apparel articles that are both cut (or knit-to-shape) and sewn or otherwise assembled in one or more beneficiary sub-Saharan African countries from fabric or yarn that is not formed in the United States or a beneficiary sub-Saharan African country, provided the President has determined that such yarns or fabric cannot be supplied by the domestic industry in commercial quantities in a timely manner and has proclaimed such treatment. (Section 112(b)(5)(B) of the Act). Similarly, the CBTPA authorizes quota- and duty-free treatment for apparel articles that are both cut (or knit-to-shape) and sewn or otherwise assembled in one or more the CBTPA beneficiary countries from yarns or fabrics that are not formed in the United States or in one or more the CBTPA beneficiary countries, provided the President has determined that such yarns or fabric cannot be supplied by the domestic industry in commercial quantities in a timely manner and has proclaimed such treatment. (Section 211 of the Act, amending Section 213(b)(2)(A)(v)(II) of the Caribbean Basin Economic Recovery Act).

Under these provisions (the Short Supply Provisions), interested parties may request that the President proclaim quota- and duty-free treatment for apparel articles assembled from a fabric or yarn that cannot be supplied by the domestic industry in commercial quantities in a timely manner. In order to proclaim such treatment, the Act requires the President to submit a report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate within 60 calendar days of the request setting forth the proposed action to be proclaimed and the reasons for such actions. Moreover, within these 60 calendar days, the President must seek advice from the appropriate advisory committees and the U.S. International Trade Commission (USITC) and consult with the Congressional committees. The President may not proclaim quota- and duty-free treatment under the Short Supply Provisions until 60 calendar days after the report, including the advice obtained from the USITC and the appropriate advisory committees, has been submitted to the Congressional committees.

In Executive Order No. 13191, the President delegated to the Committee the authority under the Short Supply Provisions to determine whether yarns or fabrics cannot be supplied by the domestic industry in commercial quantities in a timely manner and ordered the Committee to establish procedures to ensure appropriate public participation in any such determination. The Committee and the United States Trade Representative (USTR) were jointly authorized to obtain advice from the appropriate advisory committees, to submit a report to the Congressional committees cited above, and to consult with those Congressional committees. The USTR was authorized to obtain advice from the USITC. The Committee intends to comply with the following procedures in carrying out this authority.

These agency procedures are not subject to the requirement to provide prior notice and opportunity for public comment, pursuant to 5 U.S.C. 553(b)(A).

Procedures for Considering Requests

The Committee will consider requests sent to Chairman, Committee for the Implementation of Textile Agreements, Room H3100, U.S. Department of Commerce, 14th and Constitution Avenue, NW., Washington, DC 20230. The Committee will consider only requests that address a single yarn or single fabric. The term “a single yarn or single fabric” means a single product, which may be classified in more than one heading of the Harmonized Tariff Schedule of the United States or may be only part of a heading.

In considering requests, the Committee will consider of particular relevance the following information: (1) The requester's description of the yarn or fabric that is the subject of the request; (2) The basis for the requester's belief that the product cannot be supplied by the domestic industry in commercial quantities in a timely manner, which may include (if available) correspondence with manufacturers of the product that is the subject of the request, manufacturers of substitutable products, and/or manufacturers of similar products; (3) The basis for the requester's belief that other products that are supplied by the domestic industry in commercial quantities in a timely manner are not substitutable for the product that is the subject of the request for purposes of the intended use.

Within seven days of receipt of a request, the Committee will determine whether the request provides the information necessary for the Committee to consider the request in light of the considerations set forth above. If the request does not, the Committee will promptly notify the requester of the reasons for this determination, and the request will not be considered. However, the Committee will reevaluate any request that is resubmitted with additional information.

If the Committee determines that the request provides the information necessary for the Committee to consider the request in light of the considerations set forth above, the Committee will cause to be published in the Federal Register a notice seeking public comments regarding the request, which will include a summary of the request and the date by which comments must be received. If a comment submitted alleges that the product can be supplied by a domestic manufacturer in commercial quantities in a timely manner, the Committee will closely review any supporting documentation, such as a signed statement by a manufacturer of the yarn or fabric stating that it produces the product that is the subject of the request, including the quantities that can be supplied and the time necessary to fill an order, as well as any relevant information regarding past production.

Prior to determining that a fabric or yarn cannot be supplied by the domestic industry in commercial quantities in a timely manner, the Committee, working with the USTR, will seek advice from appropriate advisory committees established under section 135 of the Trade Act of 1974 (19 U.S.C. 2155) and will consult with the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate; and USTR will obtain the advice of the USITC.

With respect to any request considered by the Committee, the Committee will make a determination within 60 calendar days of receipt. If the Committee makes a negative determination, it will cause this determination and the reasons therefore to be published in the Federal Register. If the Committee makes an affirmative determination, it will submit a report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate setting forth the action proposed to be proclaimed, the reasons for such action, and the advice obtained. In the event the President proclaims that a fabric or yarn is eligible for preferential treatment under the Short Supply Provisions, the Proclamation will be published in the Federal Register.

Business Confidential Information, Public Reading Room

The Committee will protect any business confidential information that is marked business confidential from disclosure to the full extent permitted by law.

As noted above, the Committee will cause to be published in the Federal Register a notice seeking public comments regarding a request that is being considered, a notice which will include a summary of the request. Moreover, the Committee will make available to the public non-confidential versions of the request and non-confidential versions of any public comments received with respect to a request in room 3100 in the Herbert Hoover Building, 14th and Constitution Avenue, NW., Washington, DC 20230. Persons submitting a request or comments on a request are encouraged to include a non-confidential version and a non-confidential summary.

D. Michael Hutchinson,

Acting Chairman, Committee for the Implementation of Textile Agreements.