Issue Summary & Advocacy - 2012
The Textile Fiber Products Identification Act, also known as the “Textile Labeling Rule,” requires brands to attach a label to covered textile products containing the generic names and percentages by weight of each fiber in the product, the name under which the manufacturer or other responsible party does business or RN number, and the name of the country in which the product was processed or manufactured.
In a Federal Register Notice on November 7, 2011, the Federal Trade Commission (FTC) requested comments on “the overall costs, benefits, necessity, and regulatory and economic impact of the FTC’s Rules and Regulations pursuant to the Textile Fiber Products Identification Act.” Specifically, the Commission requested comment on the following:
The Commission specifically requests comment on whether it should: Modify the provision addressing generic fiber names so that the reference to the international standard for manufactured fibers reflects the updated standard; clarify the provisions addressing textile products containing elastic material and “trimmings”; address the use of multiple languages in making required disclosures; clarify disclosure requirements applicable to written advertising, including Internet advertising; clarify or revise the list of exclusions from the Textile Fiber Products Identification Act; add or clarify definitions of terms set forth in the Rules; and modify its consumer and business education materials and continue printing paper copies of these materials. In addition, the Commission seeks comment on: the benefits and costs of the requirement of the Textile Fiber Products Identification Act that, under certain circumstances, businesses use identification issued by the FTC; and the extent to which retailers obtain guarantees and continuing guarantees for textile products and whether the extent or manner of importation indicates that the guarantee provisions of the Act and Rules should be modified.
On February 2, 2012, the United States Association of Importers of Textiles & Apparel (USA-ITA), now United States Fashion Industry Association (USFIA), filed comments in response to the FTC’s request. In the comments, we made a few important points:
- There is an apparent conflict between the very detailed rules of origin as found in the trade laws, specifically 19 USC § 3592, and the more general rule of origin found in Section 303.33(d) of the Rules.
- USA-ITA recommends that the FTC seriously consider mutual recognition of differing international approaches to labeling requirements.
- USA-ITA strongly urges the FTC to modify Section 303.7 to address the development of ISO 2076-2010. Further, USA-ITA suggests that the revised provision be modified so that it applies to any new developments in the standard. This would relieve the FTC from being required to amend the regulations every time the standard is amended.
USA-ITA, now USFIA, also joined a number of textile and apparel associations in submitting similar comments. In these comments, the associations contend that the rules “should be updated to reflect the most recent version adopted by the international standards” and that “fiber performance related hang tags, and other non-permanently affixed point-of-sale information, should be held to ‘non-deceptive’ requirements, but not to regulatory mandates requiring information unavailable to fiber producers.”
Issue Summary & Advocacy – 2013
In a Federal Register Notice on May 20, 2013, the FTC requested comments on a proposed update to the rules and regulations, including amending 19 CFR § 303.17 to recognize that a fiber performance-related hang-tag need not provide a complete fiber content disclosure in response to the comments from USA-ITA/USFIA and others. The proposed update also includes revisions to Section 303.45, which describes the coverage of and exclusions and specifically excludes second-hand clothing from household textile products.
On July 8, 2013, USA-ITA, now USFIA, filed comments in response to the FTC’s request. On the first point, we suggested that the FTC eliminate the disclosure requirement in the first point unless there is a demonstrable danger of deception. On the second point, we suggested that the Section 303.45(b)(4) be revised by adding “, including articles or wearing apparel”, so as to read: “Secondhand household articles, including articles of wearing apparel [ ].”
On October 21, 2011, President Obama signed the implementing legislation for the long-awaited Free Trade Agreement (FTA) with Panama, along with the South Korea and Colombia FTAs and a host of other trade legislation. On October 31, 2012, the FTA went into effect.
The United States Fashion Industry Association (USFIA) is a strong supporter of removing barriers to trade with Panama, and welcomes the passage and implementation of the U.S.-Panama FTA.
On October 21, 2011, President Obama signed the implementing legislation for the long-awaited Free Trade Agreement (FTA) with Colombia, along with the South Korea and Panama FTAs and a host of other trade legislation.
After meetings between the U.S. and Colombian governments, as well as work by the Colombian government on issues including intellectual property, international arbitration, etc., the U.S.-Colombia FTA went into effect on May 15, 2012. It is important to note that there are quite a few changes between the U.S.-Colombia FTA and the Andean Trade Promotion and Drug Eradication Act (ATPDEA), under which companies imported textile and apparel products from Colombia prior to the passage of the FTA. (These differences were outlined in a May 3rd webinar hosted by USFIA.)
The United States Fashion Industry Association (USFIA) is a strong supporter of removing barriers to trade with Colombia, and welcomes the passage and implementation of the U.S.-Colombia FTA. Now that the FTA is in effect, USFIA, formerly the United States Association of Importers of Textiles & Apparel (USA-ITA), encourages the Office of the U.S. Trade Representative and the U.S. Department of Commerce to develop a cumulation program for Colombia and the United States' other trading partners in the Western Hemisphere.
On September 13, 2011, USA-ITA (now USFIA) joined a number of textile, apparel, and retail associations in signing a letter to President Barack Obama and the Congressional leadership urging the passage of the then-pending U.S.-Colombia Free Trade Agreement (FTA). The delays in Congressional action and continuing uncertainty, combined with the expiration of ATPDEA, hurt USA-ITA member companies as well as their suppliers.
On May 25, 2012, ten days after the FTA went into effect, USA-ITA (now USFIA) sent a letter to the Office of the U.S. Trade Representative and the U.S. Department of Commerce calling for cumulation between the Colombia FTA and other Western Hemisphere trade agreements. Both Colombia and the countries of the Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) have free trade agreements with the United States. However, if an apparel item is produced combining inputs from both Colombia and the CAFTA-DR region, it would not qualify for any duty benefits. The U.S. retailer or brand would be forced to pay full duty, which makes the production and finished products more expensive and is detrimental to the expansion of textile and apparel supply chain jobs in the United States. USFIA encourages the Administration to develop a plan for cumulation of regional inputs for the purpose of meeting the agreement’s apparel rule of origin requirements. Cumulation would have a tremendously beneficial effect on job creation throughout the textile and apparel supply chain in the United States.
In December 2011, U.S. Customs & Border Protection (CBP) proposed to revoke NY N084077 (April 12, 2010). The New York ruling held that a man’s vest constructed of bonded fabric consist of an outer layer of MMF woven fabric, a polyurethane membrane, and an inner layer of MMF knit pile fabric. The ruling is based on Note 1(c), Chapter 60, which states that laminated knit pile fabric is classified as knit, regardless of the construction of the outer layer. The ruling is consistent with CBP’s longstanding interpretation of Note 1(c), which is that garments similar in construction to the subject merchandise is classified as knit, even when the outer surface is woven fabric.
In December, CBP proposed to reclassify the vest as a woven garment in subheading 6211.33.00 (16%), based on the essential character principle. The proposal does not mention Note 1(c), and does not describe the interior layer as knit pile, but merely a knit fabric. It may be that the inner layer is not pile, in which case Note 1(c) is not applicable.
On May 16, 2012, CBP published a final ruling, HQ H136897, 46:21 Cust. Bull & Decs. 164. The published ruling is clear that the inner layer of the bonded fabric was not a knit pile. Accordingly, the ruling does not represent a change in the interpretation of Note 1(c).
The United States Fashion Industry Association (USFIA), formerly the United States Association of Importers of Textiles & Apparel (USA-ITA), believes that the ruling should make the distinction between knit pile and knit fabric, and that the final ruling should be clear on which of the two descriptions is correct. If the ruling’s intent is to alter the interpretation of Note 1 (c), the ruling should be clear on that point. This is an important distinction. If CBP intends to change the interpretation of Chapter Note 1(c), USA-ITA requested the opportunity to address that issue in greater detail. As such, USA-ITA/USFIA was pleased with the final ruling.
On January 25, 2012, USA-ITA, now USFIA, submitted comments to CBP expressing our opinion that the ruling should be clear on the distinction of knit pile vs. knit fabric, and that if CBP intends to change the interpretation of Note 1(c), USA-ITA/USFIA requests the opportunity to address that issue in greater detail.
On October 21, 2011, President Obama signed the implementing legislation for the long-awaited Free Trade Agreement (FTA) with South Korea, along with the Colombia and Panama FTAs and a host of other trade legislation. It may be many months, however, until the U.S.-Korea FTA goes into effect.
On November 22, the Korean National Assembly ratified the U.S.-Korea FTA by 151 to 7, even though some Korean lawmakers were calling for renegotiation. With fears of physical altercations in the Assembly, members of President Lee Myung-bak’s Grand National Party called a snap plenary session in hopes of avoiding trouble. The FTA passed by a vote of 151 to 7, with 12 abstaining and 129 lawmakers missing. The opposition members voted against the bill, abstained, or were not present for the vote.
In a statement, U.S. Trade Representative Ambassador Ron Kirk said, “The United States welcomes the Korean National Assembly’s approval of the KORUS FTA. This is a win-win agreement that will provide significant economic and strategic benefits to both countries.”
On March 15, 2012, the U.S.-Korea FTA went into effect. For more information on how to take advantage of the duty-free benefits in the agreement, we encourage you to purchase our recent webinar series.
The United States Fashion Industry Association (USFIA) is a strong supporter of removing barriers to trade with South Korea, and welcomes the passage and implementation on March 15th of the U.S.-Korea FTA.
Throughout March 2012, USFIA, formerly the United States Association of Importers of Textiles & Apparel (USA-ITA), hosted a series of webinars outlining the textile, apparel, and footwear provisions of the agreement. The presentations from these webinars are available for purchase here.