International Trade Law News: "April 23, 2005
BULLETIN: U.S. Companies Urged to Assess Impact of Basell Sale on Their Operations
BULLETIN: As recently reported by Bloomberg and other news sources, Royal Dutch/Shell Group and BASF AG the owners of Basell NV ('Basell'), the world's largest producer of polypropylene and advanced polyolefins products, are seeking to sell their stakes in the company. Basell has manufacturing operations in 20 countries, including plants in Louisiana, Tennessee and Texas. According to these reports, the leading bidder for Basell appears to be Iran's National Petrochemical Company (NPC), owned by the Government of Iran. NPC is competing against a consortium that includes India's Haldia Petrochemicals, the Chatterjee Group and several U.S. investors, for the right to purchase the company.
While it appears that Basell's U.S. operations will be excluded from a sale to NPC due to the U.S. sanctions on Iran, the broad reach of U.S. sanctions may prohibit foreign subsidiaries of U.S. companies from purchasing products made by Basell outside the U.S. In addition, such a sale may have a negative impact on the availability and price of polypropylene and polyethylene raw material in the U.S. and abroad.
U.S. companies and their foreign subsidiaries that purchase polypropylene, polyethylene and other products from Basell's U.S. or non-U.S. plants or purchase parts, components and packaging materials produced from polypropylene and polyethylene, are urged to consider the impact of the sale of Basell to NPC on the their operations.
We are closely following this matter for several clients and have some information that may be useful to companies that purchase polypropylene, polyethylene and other products from Basell. Please contact us at info@djacobsonlaw.com for more information on this important issue."
Sunday, April 24, 2005
Saturday, April 23, 2005
Businessworld: Against the flood
Businessworld: Against the flood: "TEXTILES
Against the floodTEXTILES
Against the flood
India is finding it tough to hold its own as China's textile exports are surging dramatically.
Latha Jishnu
Stitching a success: Chinese garment makers are busier than ever post quota.
COTTON skirts from India are proving to be more popular than ever in the US, although the synthetic variety has shown a small dip. Together, a total of 15.85 million skirts (15,851,664 to be precise) were exported to the US in the first three months of 2005 alone, compared with 22.75 million skirts (or 22,750,776) for the whole of 2004. In other words, exports have been booming since the US, like the European Union and Canada, lifted their decades-long textile quotas from January 2005.
Cause, indeed, for celebration as this is the first sign that the end of the quota regime is helping the Indian textile sector to burgeon. According to the latest US import figures released by the Office of Textiles and Apparel (OTA), India's exports of cotton skirts from January to March this year have shot up by 211 per cent compared with the same period of 2004.
Now comes the damper. Chinese skirts of both varieties are doing even better. From sales of just 9.29 million in 2004, exports have soared to dizzying levels since quotas were dismantled. For the first three months of 2005, China exported 20.97 million skirts - a scorching 1,102 per cent increase over the comparable period for 2004. In short, India is no longer skirt king.
It is the same story in a host of other cotton apparel items (see 'Where It Hurts Most') although a caveat is in order here. The OTA figures are provisional and are being revised periodically. It provides just the volume of growth and not the values. But all the same it is significant because the US is India's top market for textiles, accounting for close to a quarter of its fabric, made-up and yarn exports and nearly a third of its garment exports. The OTA data is the clearest indicator so far of what India's post-quota outlook is in the short term.
In some significant respects, it outlines a dismaying prospect for a country that has been widely projected as one of the two clear winners in a world without quotas. Take, for instance, what has happened to cotton dresses, a category where India has a clear edge. Exports went up by 24.61 per cent to touch 4.96 million units. This is a creditable performance till one looks at the other players. Here again, China whooshed past with exports of 5.64 million dresses - a growth of 268 per cent over the comparable figures for the previous year. The more telling figures are that in 2004, its total exports of dresses was just 3 million whereas India's exports were well over 11 million. India is no longer dress king either.
Although it was widely accepted that China would race ahead, the OTA figures are disquieting even if some industry representatives point to the "generally respectable growth rates (36-117 percent)" in a range of items, from knit shirts, woven blouses, slacks and trousers, to baby garments.
In made-ups, too, India has patched together a success of sorts. An increase of over 66 per cent has pushed cotton sheets exports to 25.41 million square metres - putting it just behind China's 25.88 million sq. m (a fierce 229 per cent growth) - and pillowcases to nearly 5 million sq. m, putting it a wee bit ahead of its main rival. However, it slipped on pile towels, a 7 per cent decline in exports allowing Pakistan to emerge as the clear leader. In fact, in several categories, cotton dresses among them, Pakistan is snapping at India's heels.
Knit fabrics recorded a creditable 235 per cent jump to touch nearly 8 million sq. m, along with handsome increases in other non-woven fabrics. Ditto for some wool items. In manmade fibres, where India is present only in niche products, the performance, on the whole, was dismal with declines recorded in 18 categories.
So is India doing well or badly? That would depend entirely on which segment of the industry one is speaking to. While the government says it is too early to tell, disquiet has begun to surface.
Exports by Indian units, have been constrained by lack of capacity.
Arumugam Sakthivel, chairman, Apparels Export Promotion Council (AEPC), admits life after quotas is not rosy. He says exports in the first three months of 2005 have grown just 7-8 per cent and "the prospects are not as good as we expected. We are being beaten down on prices by China, among other things and we could even end up with a negative growth this year".
Apart from the big edge that a pegged yuan rate gives China, its exporters also enjoy major tax incentives. The AEPC chief's immediate worry is the cut in the duty drawback scheme, which was changed in January from a value-based rate to a weight-based structure. This was done to discourage the misuse of the facility by exporters who were inflating their invoices. But, effectively, it has brought down the drawback rate from 10.5 per cent to around 3.25 per cent. Points out Sakthivel: "China gives its exporters a straight 13 per cent refund of VAT. How can we compete?"
As Chinese textiles flood the world, and calls mount in the US and EU for import restraints, every statistic on textile exports is being put under the microscope. On 19 March, China's ministry of commerce released figures for January and February that showed that its post-quota growth in non-garment exports has been phenomenal. Exports were up 33 per cent to touch $ 5.21 billion, primarily on the back of a sharp rise in prices of man made fibre (MMF) fabrics and made-ups. And apart from surging sales to the US and EU (63 per cent and 57 per cent respectively), China had made significant inroads into South Korea, Iran and Bangladesh.
"Where is the surprise in this?" asks Sudhir Dhingra, chairman and managing director of Orient Craft, one of the top garment exporting firms. "If there is growth in India's exports, it is cause for celebration, but otherwise, there is no point in these comparisons." True enough, given China's huge capacities and huge market share (see 'Too Little, Too Late', BW 15 November 2004). Some industry experts had warned last year that India would fail to make capital of the first two years of a quota-free world.
As Dhingra stresses, China is ahead of us by at least 10 years, because of the government's unwavering focus on the textile sector; in India, on the other hand, the government has choked the mill sector. "Now, we have the results and it should not surprise us," he says.
India has so far released provisional figures for just January and these are far from reassuring. Preliminary data compiled by the directorate-general of commercial intelligence and statistics (DGCIS) reflect a 7.6 per cent dip in exports in January at $1.16 billion. However, the textile ministry thinks it is too early in the year to see a definite trend, specially since the figures of exports to the US have shown an overall 20 per cent rise in volumes.
There are others, too, who believe that too much is being read into these provisional figures. The Indian Cotton Mills Federation points out that a true picture will not emerge till much later on what impact the abolition of quotas has had on India's textiles exports. Its secretary-general D.K. Nair maintains that Chinese competition to our present lines of production is minimal. Countries which will be hurt in a world without quotas will be Bangladesh, Sri Lanka, Vietnam and Cambodia. And though the market leader will grow much faster than India, "China," he declares, "is not growing at our expense."
Such a view does not take into account the fact that China has already displaced India in the US as the leading supplier of cotton skirts, dresses and bedsheets. Going by past performance, it is not unlikely that China's scorching growth will cut into India's lead in other segments, too. In 2002, quotas were lifted on three categories: bras, vegetable fibre garments and silk blend garments. In none of these did India make much inroads while Chinese exports grew by around 200 per cent.
The flood begins: Massive capacities are helping Chinese exports, especially in the manmade fabrics segment, where India is losing out rapidly
That, as industry experts point out, was only to be expected since India did not have capacities in these categories. The popular, and comforting, view is that the textile quotas were deliberately fashioned to restrict India's textile industry. China was allowed to grow much more than India before quotas were clamped on it -which means that huge capacities had already been built up.
What the statistics may be throwing up is the fact Indian firms are operating at close to full capacities. There simply is no slack left to exploit the market opening. But Nair is hopeful that the investments that are being made will fill the gap although industry specialists like Arvind Singhal, chairman of KSA Technopak, a leading textiles consultancy, have been warning that by the time India expands capacity it may be late into 2006 or even 2007.
Given this backdrop, it is no surprise that Indian exporters are waiting to see if the US will take safeguard action against Chinese textile exports. Under the WTO accession agreement signed by Beijing, countries can imposes product specific and general safeguards on its exports till 2008.
"Investments in India are growing faster than ever. But we have no time to lose," says Nair. We have till 2008 to consolidate our position." What it means is that the China safeguards would come in handy for India.
Against the floodTEXTILES
Against the flood
India is finding it tough to hold its own as China's textile exports are surging dramatically.
Latha Jishnu
Stitching a success: Chinese garment makers are busier than ever post quota.
COTTON skirts from India are proving to be more popular than ever in the US, although the synthetic variety has shown a small dip. Together, a total of 15.85 million skirts (15,851,664 to be precise) were exported to the US in the first three months of 2005 alone, compared with 22.75 million skirts (or 22,750,776) for the whole of 2004. In other words, exports have been booming since the US, like the European Union and Canada, lifted their decades-long textile quotas from January 2005.
Cause, indeed, for celebration as this is the first sign that the end of the quota regime is helping the Indian textile sector to burgeon. According to the latest US import figures released by the Office of Textiles and Apparel (OTA), India's exports of cotton skirts from January to March this year have shot up by 211 per cent compared with the same period of 2004.
Now comes the damper. Chinese skirts of both varieties are doing even better. From sales of just 9.29 million in 2004, exports have soared to dizzying levels since quotas were dismantled. For the first three months of 2005, China exported 20.97 million skirts - a scorching 1,102 per cent increase over the comparable period for 2004. In short, India is no longer skirt king.
It is the same story in a host of other cotton apparel items (see 'Where It Hurts Most') although a caveat is in order here. The OTA figures are provisional and are being revised periodically. It provides just the volume of growth and not the values. But all the same it is significant because the US is India's top market for textiles, accounting for close to a quarter of its fabric, made-up and yarn exports and nearly a third of its garment exports. The OTA data is the clearest indicator so far of what India's post-quota outlook is in the short term.
In some significant respects, it outlines a dismaying prospect for a country that has been widely projected as one of the two clear winners in a world without quotas. Take, for instance, what has happened to cotton dresses, a category where India has a clear edge. Exports went up by 24.61 per cent to touch 4.96 million units. This is a creditable performance till one looks at the other players. Here again, China whooshed past with exports of 5.64 million dresses - a growth of 268 per cent over the comparable figures for the previous year. The more telling figures are that in 2004, its total exports of dresses was just 3 million whereas India's exports were well over 11 million. India is no longer dress king either.
Although it was widely accepted that China would race ahead, the OTA figures are disquieting even if some industry representatives point to the "generally respectable growth rates (36-117 percent)" in a range of items, from knit shirts, woven blouses, slacks and trousers, to baby garments.
In made-ups, too, India has patched together a success of sorts. An increase of over 66 per cent has pushed cotton sheets exports to 25.41 million square metres - putting it just behind China's 25.88 million sq. m (a fierce 229 per cent growth) - and pillowcases to nearly 5 million sq. m, putting it a wee bit ahead of its main rival. However, it slipped on pile towels, a 7 per cent decline in exports allowing Pakistan to emerge as the clear leader. In fact, in several categories, cotton dresses among them, Pakistan is snapping at India's heels.
Knit fabrics recorded a creditable 235 per cent jump to touch nearly 8 million sq. m, along with handsome increases in other non-woven fabrics. Ditto for some wool items. In manmade fibres, where India is present only in niche products, the performance, on the whole, was dismal with declines recorded in 18 categories.
So is India doing well or badly? That would depend entirely on which segment of the industry one is speaking to. While the government says it is too early to tell, disquiet has begun to surface.
Exports by Indian units, have been constrained by lack of capacity.
Arumugam Sakthivel, chairman, Apparels Export Promotion Council (AEPC), admits life after quotas is not rosy. He says exports in the first three months of 2005 have grown just 7-8 per cent and "the prospects are not as good as we expected. We are being beaten down on prices by China, among other things and we could even end up with a negative growth this year".
Apart from the big edge that a pegged yuan rate gives China, its exporters also enjoy major tax incentives. The AEPC chief's immediate worry is the cut in the duty drawback scheme, which was changed in January from a value-based rate to a weight-based structure. This was done to discourage the misuse of the facility by exporters who were inflating their invoices. But, effectively, it has brought down the drawback rate from 10.5 per cent to around 3.25 per cent. Points out Sakthivel: "China gives its exporters a straight 13 per cent refund of VAT. How can we compete?"
As Chinese textiles flood the world, and calls mount in the US and EU for import restraints, every statistic on textile exports is being put under the microscope. On 19 March, China's ministry of commerce released figures for January and February that showed that its post-quota growth in non-garment exports has been phenomenal. Exports were up 33 per cent to touch $ 5.21 billion, primarily on the back of a sharp rise in prices of man made fibre (MMF) fabrics and made-ups. And apart from surging sales to the US and EU (63 per cent and 57 per cent respectively), China had made significant inroads into South Korea, Iran and Bangladesh.
"Where is the surprise in this?" asks Sudhir Dhingra, chairman and managing director of Orient Craft, one of the top garment exporting firms. "If there is growth in India's exports, it is cause for celebration, but otherwise, there is no point in these comparisons." True enough, given China's huge capacities and huge market share (see 'Too Little, Too Late', BW 15 November 2004). Some industry experts had warned last year that India would fail to make capital of the first two years of a quota-free world.
As Dhingra stresses, China is ahead of us by at least 10 years, because of the government's unwavering focus on the textile sector; in India, on the other hand, the government has choked the mill sector. "Now, we have the results and it should not surprise us," he says.
India has so far released provisional figures for just January and these are far from reassuring. Preliminary data compiled by the directorate-general of commercial intelligence and statistics (DGCIS) reflect a 7.6 per cent dip in exports in January at $1.16 billion. However, the textile ministry thinks it is too early in the year to see a definite trend, specially since the figures of exports to the US have shown an overall 20 per cent rise in volumes.
There are others, too, who believe that too much is being read into these provisional figures. The Indian Cotton Mills Federation points out that a true picture will not emerge till much later on what impact the abolition of quotas has had on India's textiles exports. Its secretary-general D.K. Nair maintains that Chinese competition to our present lines of production is minimal. Countries which will be hurt in a world without quotas will be Bangladesh, Sri Lanka, Vietnam and Cambodia. And though the market leader will grow much faster than India, "China," he declares, "is not growing at our expense."
Such a view does not take into account the fact that China has already displaced India in the US as the leading supplier of cotton skirts, dresses and bedsheets. Going by past performance, it is not unlikely that China's scorching growth will cut into India's lead in other segments, too. In 2002, quotas were lifted on three categories: bras, vegetable fibre garments and silk blend garments. In none of these did India make much inroads while Chinese exports grew by around 200 per cent.
The flood begins: Massive capacities are helping Chinese exports, especially in the manmade fabrics segment, where India is losing out rapidly
That, as industry experts point out, was only to be expected since India did not have capacities in these categories. The popular, and comforting, view is that the textile quotas were deliberately fashioned to restrict India's textile industry. China was allowed to grow much more than India before quotas were clamped on it -which means that huge capacities had already been built up.
What the statistics may be throwing up is the fact Indian firms are operating at close to full capacities. There simply is no slack left to exploit the market opening. But Nair is hopeful that the investments that are being made will fill the gap although industry specialists like Arvind Singhal, chairman of KSA Technopak, a leading textiles consultancy, have been warning that by the time India expands capacity it may be late into 2006 or even 2007.
Given this backdrop, it is no surprise that Indian exporters are waiting to see if the US will take safeguard action against Chinese textile exports. Under the WTO accession agreement signed by Beijing, countries can imposes product specific and general safeguards on its exports till 2008.
"Investments in India are growing faster than ever. But we have no time to lose," says Nair. We have till 2008 to consolidate our position." What it means is that the China safeguards would come in handy for India.
Thursday, April 21, 2005
No US Antidumping Duty on PET Resin from India
International Trade Law News: "ITC Issues Negative Final Injury Determinations on AD and CVD Investigations on PET Resin
On April 18, 2005.
The U.S. International Trade Commission (ITC) issued negative injury determinations in the antidumping and countervailing duty investigations on bottle-grade Polyethylene Terephthalate (PET) Resin from India, Indonesia and Thailand (Investigations Nos. 701-TA-439 and 731-TA-1077, 1078 and 1080 (Final)).
By a 5-1 vote, the ITC Commissioners determined that a U.S. industry is not materially injured or threatened with material injury by reason of imports of polyethylene terephthalate (PET) resin from India that the U.S. Department of Commerce has determined are subsidized and imports of this product from India, Indonesia, and Thailand (the U.S. Department of Commerce has determined are sold in the U.S. at less than fair value).
Chairman Stephen Koplan, Vice Chairman Deanna Tanner Okun, and Commissioners Jennifer A. Hillman, Charlotte R. Lane, and Daniel R. Pearson voted in the negative. Commissioner Marcia E. Miller voted in the affirmative. As a result of the Commission's negative determinations, no countervailing duty or antidumping duty orders on imports of this product from India, Indonesia and Thailand will be issued.
The antidumping and countervailing petitions that launched this case were field by the U.S. PET Resin Producers' Coalition, consisting of DAK Americas, LLC, Nan Ya Plastics Corporation, Voridian, a division of Eastman Chemical Company and Wellman, Inc.
- posted by Douglas Jacobson on Tuesday, April 19, 2005"
On April 18, 2005.
The U.S. International Trade Commission (ITC) issued negative injury determinations in the antidumping and countervailing duty investigations on bottle-grade Polyethylene Terephthalate (PET) Resin from India, Indonesia and Thailand (Investigations Nos. 701-TA-439 and 731-TA-1077, 1078 and 1080 (Final)).
By a 5-1 vote, the ITC Commissioners determined that a U.S. industry is not materially injured or threatened with material injury by reason of imports of polyethylene terephthalate (PET) resin from India that the U.S. Department of Commerce has determined are subsidized and imports of this product from India, Indonesia, and Thailand (the U.S. Department of Commerce has determined are sold in the U.S. at less than fair value).
Chairman Stephen Koplan, Vice Chairman Deanna Tanner Okun, and Commissioners Jennifer A. Hillman, Charlotte R. Lane, and Daniel R. Pearson voted in the negative. Commissioner Marcia E. Miller voted in the affirmative. As a result of the Commission's negative determinations, no countervailing duty or antidumping duty orders on imports of this product from India, Indonesia and Thailand will be issued.
The antidumping and countervailing petitions that launched this case were field by the U.S. PET Resin Producers' Coalition, consisting of DAK Americas, LLC, Nan Ya Plastics Corporation, Voridian, a division of Eastman Chemical Company and Wellman, Inc.
- posted by Douglas Jacobson on Tuesday, April 19, 2005"
Friday, April 15, 2005
Textile exports to US shoot up in post-quota era
Textile exports to US shoot up in post-quota era
Textile exports to US shoot up in post-quota era
Yarn takes the cake, exports up by 60% in January, February 2005
SANTANU GHOSH
NEW DELHI, APRIL 14: The US market is spinning out rather well for the Indian textile sector in the post-quota regime. Yarn has been in the forefront of an export boom to the US, with exports shooting up by as much as 60 per cent in the first two months of January and February 2005 as compared to the same period last year.
Sector watchers are of the view that the US market is the hottest destination for Indian textile exports. According to D.K. Nair, secretary general of the Indian Cottons Mills’ Federation (ICMF), for all segments that have come out of the quota regime since January 2005, exports to US have shot up the most.
In fact, in the first two months of 2005, exports of both textiles and garments went up by 18.55 per cent. While garment exports went up by 25.51 per cent, textiles went up by 14.98 per cent. Most of these products used to come under the MFA earlier, Nair added.
The figures for the first three months of 2005 show the same trend. While yarn exports to US shot up by 41 per cent during this period, exports of mens’ T-shirts went up by 15 per cent and that of ladies T-shirts went up by 20 per cent.
The same trend was also observed by another association, the Cotton Textiles Export Promotion Council (Texprocil). Stating that exports to the US on those products under MFA have shot up, Siddharth Rajagopal, executive director, Texprocil said in the first two months, both apparel and non apparel exports to US have increased from $293.6 million to $327.48 million. While apparel went up by 13 per cent, non apparel went up by 5.8 per cent.
However in an apparent paradox, data compiled by the Directorate-General of Commercial Intelligence and Statistics have shown that total textile exports in the month of January fell by 7.6 per cent.
Explaining the paradox, experts said since 50 per cent of exports were under quota previously while 50 per cent were not, it may be possible that exports of those products not under quota might have gone down. If that is so, one cannot draw any co-relation with phasing out of quota and the reported dip in exports. Once, DGFT figures are out, the correct postion will come out in the open, experts said.
Rajagopal was of the view that January to January comparison cannot give a correct perspective. “January 2005 was the period when the exporters were testing the waters in the post-quota regime. January to January comparison may not be appropriate”, he added.
Textile exports to US shoot up in post-quota era
Yarn takes the cake, exports up by 60% in January, February 2005
SANTANU GHOSH
NEW DELHI, APRIL 14: The US market is spinning out rather well for the Indian textile sector in the post-quota regime. Yarn has been in the forefront of an export boom to the US, with exports shooting up by as much as 60 per cent in the first two months of January and February 2005 as compared to the same period last year.
Sector watchers are of the view that the US market is the hottest destination for Indian textile exports. According to D.K. Nair, secretary general of the Indian Cottons Mills’ Federation (ICMF), for all segments that have come out of the quota regime since January 2005, exports to US have shot up the most.
In fact, in the first two months of 2005, exports of both textiles and garments went up by 18.55 per cent. While garment exports went up by 25.51 per cent, textiles went up by 14.98 per cent. Most of these products used to come under the MFA earlier, Nair added.
The figures for the first three months of 2005 show the same trend. While yarn exports to US shot up by 41 per cent during this period, exports of mens’ T-shirts went up by 15 per cent and that of ladies T-shirts went up by 20 per cent.
The same trend was also observed by another association, the Cotton Textiles Export Promotion Council (Texprocil). Stating that exports to the US on those products under MFA have shot up, Siddharth Rajagopal, executive director, Texprocil said in the first two months, both apparel and non apparel exports to US have increased from $293.6 million to $327.48 million. While apparel went up by 13 per cent, non apparel went up by 5.8 per cent.
However in an apparent paradox, data compiled by the Directorate-General of Commercial Intelligence and Statistics have shown that total textile exports in the month of January fell by 7.6 per cent.
Explaining the paradox, experts said since 50 per cent of exports were under quota previously while 50 per cent were not, it may be possible that exports of those products not under quota might have gone down. If that is so, one cannot draw any co-relation with phasing out of quota and the reported dip in exports. Once, DGFT figures are out, the correct postion will come out in the open, experts said.
Rajagopal was of the view that January to January comparison cannot give a correct perspective. “January 2005 was the period when the exporters were testing the waters in the post-quota regime. January to January comparison may not be appropriate”, he added.
Tuesday, April 05, 2005
U.S. initiates Safeguard Investigation on Textiles from China
U.S. Self-Initiates Safeguard Investigations on Textile Products From China
The U.S. Committee for the Implementation of Textile Agreements (CITA) today announced that it will self-initiate safeguard proceedings to determine whether imports of certain Chinese-origin textile and apparel products are contributing to the disruption of the U.S. market. CITA is the interagency group chaired by the Department of Commerce that is responsible for matters affecting U.S. textile trade policy and for supervising the implementation of all textile trade agreements.
The products subject to the safeguard proceeding review will be cotton knit shirts and blouses (U.S. Textile and Apparel Category System 338/339), cotton trousers (Category 347/348), and cotton and man-made fiber underwear (Category 352/652). The decision was made to initiate this review based on substantial increases in imports of these products from China over the first quarter of this year, following the removal of textile quotas under the World Trade Organization as of January 1. Preliminary data for the first quarter of 2005 show imports from China in these categories growing by approximately 1,250 percent, 1,500 percent, and 300 percent, respectively, relative to the same quarter of last year.
CITA will soon publish in the Federal Register notices seeking public comments regarding each product subject to safeguard proceedings, providing relevant information, and specifying the date by which comments must be received. The comment period will be 30 calendar days, after which CITA has up to 60 days to render a final determination. If CITA is unable to make a determination within 60 calendar days. If the Committee makes a negative determination, this determination and the reasons for the determination will be published in the Federal Register. If the Committee makes an affirmative determination that imports of Chinese origin textile and apparel products are contributing to the disruption of the U.S. market, the Committee will request consultations with China with a view to easing or avoiding such market disruption. As of the date such consultations are requested by the United States, a quota will be put in place to limit U.S. imports of the product. Consultations with China will be held within 30 days of the Government of China's receipt of the request for consultations and the two sides will attempt to reach agreement on a mutually satisfactory solution within 90 days of receipt of the request for consultations.
Under China's World Trade Organization Accession Agreement, if the U.S. requests consultations with China, it must, at the time of the request, provide China with a detailed factual statement showing "(1) the existence or threat of market disruption; and (2) the role of products of Chinese origin in that disruption." Beginning on the date that it receives such a request, China must restrict its shipments to the United States to a level no greater than 7.5% (6% for wool product categories) above the amount entered during the first 12 months of the most recent 14 months preceding the request. If exports from China exceed that amount, the United States may enforce the restrictions.
The U.S. Committee for the Implementation of Textile Agreements (CITA) today announced that it will self-initiate safeguard proceedings to determine whether imports of certain Chinese-origin textile and apparel products are contributing to the disruption of the U.S. market. CITA is the interagency group chaired by the Department of Commerce that is responsible for matters affecting U.S. textile trade policy and for supervising the implementation of all textile trade agreements.
The products subject to the safeguard proceeding review will be cotton knit shirts and blouses (U.S. Textile and Apparel Category System 338/339), cotton trousers (Category 347/348), and cotton and man-made fiber underwear (Category 352/652). The decision was made to initiate this review based on substantial increases in imports of these products from China over the first quarter of this year, following the removal of textile quotas under the World Trade Organization as of January 1. Preliminary data for the first quarter of 2005 show imports from China in these categories growing by approximately 1,250 percent, 1,500 percent, and 300 percent, respectively, relative to the same quarter of last year.
CITA will soon publish in the Federal Register notices seeking public comments regarding each product subject to safeguard proceedings, providing relevant information, and specifying the date by which comments must be received. The comment period will be 30 calendar days, after which CITA has up to 60 days to render a final determination. If CITA is unable to make a determination within 60 calendar days. If the Committee makes a negative determination, this determination and the reasons for the determination will be published in the Federal Register. If the Committee makes an affirmative determination that imports of Chinese origin textile and apparel products are contributing to the disruption of the U.S. market, the Committee will request consultations with China with a view to easing or avoiding such market disruption. As of the date such consultations are requested by the United States, a quota will be put in place to limit U.S. imports of the product. Consultations with China will be held within 30 days of the Government of China's receipt of the request for consultations and the two sides will attempt to reach agreement on a mutually satisfactory solution within 90 days of receipt of the request for consultations.
Under China's World Trade Organization Accession Agreement, if the U.S. requests consultations with China, it must, at the time of the request, provide China with a detailed factual statement showing "(1) the existence or threat of market disruption; and (2) the role of products of Chinese origin in that disruption." Beginning on the date that it receives such a request, China must restrict its shipments to the United States to a level no greater than 7.5% (6% for wool product categories) above the amount entered during the first 12 months of the most recent 14 months preceding the request. If exports from China exceed that amount, the United States may enforce the restrictions.
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