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April 04, 2005 

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.



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