Fashion Intel & Analysis
In addition to Shelby’s hold, Senator Olympia Snowe (R-ME) wants action on her proposal to create a new Assistant U.S. Trade Representative position for small business before she will vote for the extension. However so far Snowe does not have a “hold” on the bill.
The House of Representatives adjourned without taking action to extend the hundreds of duty suspension bills that are scheduled to expire on December 31, 2009. However, the House Ways and Means Trade Subcommittee leadership did introduce the Miscellaneous Tariff Bill of 2009. In a statement from Trade Subcommittee Chairman Sander Levin (D-MI) and Ranking Member Kevin Brady (R-TX), they say that they will work with the Senate to pass the legislation as soon as possible in 2010. The bill extends duty-free treatment or reduced duties for three years, until December 31, 2012. More than six hundred products are included in the bill.
The National Textile Association has posted a note on its website stating that NTA and NCTO have filed letters with the Senate Finance Committee identifying their objections to two dozen proposed miscellaneous tariff bills involving textile and apparel products. These include bills that would provide retroactive duty free treatment to products under DR-CAFTA and prospective duty reductions to certain knit to shape sweaters.
They argue that the items covered by those bills compete with products made in the United States or are not eligible for the FTA benefits. Other bills NTA objects to cover certain women's sports bras and tank tops made with fabrics NTA says its members make. The sweater bills were challenged on the grounds that they are made of yarns of a type made in the U.S. and duty reductions would “exert downward price pressure on competing products made in the U.S.”
The House and Senate will only include in their MTB packages those bills that are non-controversial (as well as reducing U.S. revenues by no more than $500,000 and being “administrable”).
We could know by late tomorrow whether the stay of enforcement of the new lead content standard is going to be continued after February 10, 2010, and for just how long. Two proposals are now being considered by the Consumer Product Safety Commission (CPSC). The Commission agreed this morning to conduct a “ballot vote” tomorrow on a proposal to lift the current stay of enforcement for lead content testing under the Consumer Product Safety Improvement Act (CPSIA) either 1) in August 2010, while providing some flexibility for products if the capacity to test for lead content is not adequate, or 2) the date that is six months after the CPSC issues rules addressing testing frequency, sampling methods and other required rules.
Tomorrow’s planned vote, which will be done by written ballot from each commissioner rather than in an open session, is effectively an ad hoc compromise reached by Democratic and Republican commissioners during the course of an open meeting today. At that meeting, Democratic commissioners, led by Chairwoman Inez Tenenbaum, initially appeared ready to accept a staff proposal to lift the stay on enforcement of the lead content testing requirement by August 2010. But this proposal led to counter-proposals from the two Republican commissioners – Anne Northup and Nancy Nord.
Northup argued that the CPSC should not be setting firm dates for lifting the stay of enforcement in light of its inability to finalize its “15 month” rules – so called because were required by mid-November (15 months after enactment of the CPSIA). In addition, the CPSC still needs to set out guidance on which products qualify as children’s products that will require third-party testing.
Northup described her proposal as a way to set a date certain, but one that occurs only after all necessary rules are in place. Tenenbaum agreed that the stay cannot be lifted until these other rules are in place, in particular the rule for testing component parts. However, she said she still prefers a final date certain, and said it is anticipated that all the required rules should be in place by August.
The CPSC also agreed to split off the delayed stay of enforcement of lead content testing from a larger proposal that identifies safety rules and products for which the stay will definitely be lifted after February 10, 2010. The CPSC voted that it will lift the stay of enforcement then for items like dive sticks and bicycle helmets, as well as furniture and paint in cans.
USA-ITA is among a coalition of companies and associations that sent a letter to the CPSC this week urging continuation of the stay of enforcement. A copy of that letter is on the USA-ITA website.
In a Federal Register notice to be published tomorrow, the Consumer Product Safety Commission (CPSC) is asking for a broad range of industry guidance on how importers and manufacturers should comply with the Consumer Product Safety Improvement Act of 2008 (CPSIA). The notice formally announced a December 10-11 "workshop" in Bethesda, Maryland, which will be used to gather information, as well as a written comment period.
This may be an important opportunity for the trade to help the CPSC shape its implementation of the law. Registration information for attending, and a link for viewing the workshop via webcast, can be found at: http://www.cpsc.gov/cgibin/cpsiatesting.aspx. Written industry comments will also be accepted until January 11, 2010).
The agenda for the workshop is extensive. For example, the CPSC is seeking input on the critical question of component testing. The CPSC has indicated it might allow manufacturers to rely on safety certificates from upstream component makers, which means components would not have to be re-tested by downstream users. This option would be desirable for apparel importers who need to ensure components like zippers and snaps comply with the law. On this issue, the CPSC is asking for input on how to determine that manufacturers are exercising "due care" to ensure the components are safe, and what reasonable steps they might take to determine if a certificate is false.
In addition, the Commission puts forward the idea that a manufacturer’s "reasonable testing program" to ensure products meet CPSC guidelines should include a product description, testing, the development of a full testing plan, plans for dealing with failed test results, and documentation of the testing program. But the CPSC is asking industry whether these elements are sufficient, or whether additional requirements should be added. CPSC also has several questions about how often manufacturers should test their products, and what sample sizes should be used.
CPSC also says it is considering requiring manufacturers of children’s products to come up with their own reasonable testing programs, even though they are already required to have products tested by a third party to ensure they meet strict new lead content guidelines. In the area of testing for children’s products, CPSC is asking how often tests should be performed, what product change might require new tests, and how verification and labeling should work to ensure compliance.
Among other things, the CPSC is also asking a range of questions about how compliance procedures might work for smaller companies, what the costs of compliance might be for those companies, and whether there are ways to minimize these costs.