Fashion Intel & Analysis

Today President Obama signed the Proclamation announcing changes in the duty-free benefits for AGOA beneficiary countries in 2010. As expected, Madagascar (along with Guinea and Niger) will lose eligibility for AGOA in 2010. The decision is based on the fact that Madagascar has not scheduled democratic elections, even after pressure from the State Department to act by mid-December. The effective date for the change is January 1, 2010.

           Pending a decision expected to be issued later today by the chief justice of Brazil’s Supreme Court, Sen. Frank Lautenberg (D-NJ) continues to have a hold on Senate consideration of a House-approved bill to extend the Andean trade preferences and Generalized System of Preferences programs for one more year. Both duty-free programs are set to expire December 31.  At issue for Lautenberg is a New Jersey father’s battle in Brazil for custody of his son.  Brazil is a beneficiary country under the GSP program, so Lautenberg believes the threat of allowing duty-free treatment to expire might influence the Brazilian Government.

      While there is some optimism that the Brazilian chief justice will rule in favor of the U.S. father, USA-ITA member companies, particularly those with operations in New Jersey, whose business with Colombia, Peru or Ecuador under the Andean Trade Promotion and Drug Eradication Act will be affected by the expiration of the Andean program can write to Lautenberg to impress upon him how his own state may be harmed by the hold.  Faxes can be sent to 202-228-4054; emails can be sent via http://lautenberg.senate.gov/contact/index1.cfm.  The Senate may recess for the year as soon as Thursday evening, Christmas Eve.

             The Consumer Product Safety Commission (CPSC) has posted on its website two draft federal register notices, one that provides additional guidance on how it will define “children’s products” for the purpose of requiring third-party testing for lead on these products, and another that reveals the filing of a petition to ease testing requirements for lead in paint.                                                                                                                                                                                                                                    

               The first draft FR notice, which generally explains the agency’s vote to extend the stay of enforcement for testing and certification requirements for lead content until February 10, 2011, notes that guidance on how “children’s products” will be defined can be found in a series of “frequently asked question” documents on the CPSC’s website. The FAQs indicate that the CPSC believes items such as stuffed animals, kids’ art materials, lunchboxes, strollers and other items are children’s products, as well as children’s-sized bicycles, mattresses, apparel and ATVs. In addition, the draft FR notice provides two new examples of products the Commission would not view as being intended primarily for children. These are car mats with cartoon themes, which the CPSC says are not intended for children despite the child theme of the product, and mulch advertised for use in gardens but bought by a school as playground surfacing. In each case, CPSC says, testing for lead content would not be required.

                The second draft FR notice indicates that the CPSC will soon seek public comment on a petition it received in July, to ease requirements on lead testing for paint. That petition asks the CPSC to permit companies to submit sample products for the testing of paint in a form that is not identical to products as they are found in the market, so that fewer products need to be submitted. The petition says that under the current interpretation of the law, when a product uses only a very small amount of a certain paint, several hundred products might need to be submitted for testing so the lab can get enough of a sample to test the paint. The petition suggests allowing the use of a product that includes a larger-than-normal paint sample, so that fewer samples are destroyed. The CPSC plans to allow a 60-day comment period, once the notice is published in the Federal Register.

Pending a decision expected to be issued later today by the chief justice of Brazil’s Supreme Court, Sen. Frank Lautenberg (D-NJ) continues to have a hold on Senate consideration of a House approved bill to extend the Andean trade preferences and Generalized System of Preferences programs for one more year. Both duty-free programs are set to expire December 31. At issue for Lautenberg is a New Jersey father’s battle in Brazil for custody of his son. Brazil is a beneficiary country under the GSP program, so Lautenberg believes the threat of allowing duty-free treatment to expire might influence the Brazilian Government.

While there is some optimism that the Brazilian chief justice will rule in favor of the U.S. father, USA-ITA member companies, particularly those with operations in New Jersey, whose business with Colombia, Peru or Ecuador under the Andean Trade Promotion and Drug Eradication Act will be affected by the expiration of the Andean program can write to Lautenberg to impress upon him how his own state may be harmed by the hold. Faxes can be sent to 202-228-4054; emails can be sent via 

http://lautenberg.senate.gov/contact/index1.cfm. The Senate may recess for the year as soon as Thursday evening, Christmas Eve.

The Office of the U.S. Trade Representative (USTR) announced today that there is an agreement that China will terminate the export subsidies covered by the "Famous Brands" dispute settlement case. The challenged subsidies included export subsidies for textiles and apparel products, as well as other consumer products. USTR brought the case in December 2008, and held numerous consultations with Chinese officials during the past year. USA-ITA will provide additional information when details are available.