China Announces First Allocation of Textile Exports to U.S. in 2006

The HKTDC states that the quantity of China textiles exports allocated in 2006 to enterprises meeting specific export requirements account for 70% of the agreed quantity of exports for the year 2006, and the total amount available for the current allocation will be 50% of this quantity (i.e., 35% of the agreed quantity of exports for the year 2006).

HKTDC reports that the circular also states that the commerce departments should notify the local business operators as soon as possible to submit their applications together with their application letters and electronic data to MOFCOM before December 10, 2005. MOFCOM will then formally announce the allocation plan.

The HKTDC states that for details regarding this first allocation of quantity of textile exports to the U.S. in 2006 allowed for application, see MOFCOM's Chinese language notice, dated 12/02/05, available at: http://wms.mofcom.gov.cn/aarticle/ztxx/ac/al/200512/20051200935348.html

MOFCOM's Chinese language notice lists the following categories and associated quantities (these categories are the ones listed in the November 8, 2005 U.S. - China Textile Agreement. In addition, the listed quantities are 35% of the Agreement's agreed quantity of exports for 2006):

¹ Note that MOFCOM's notice does not list the "part category" (pt) information in their

table, but may do so elsewhere.

(See ITT's Online Archives or news, (Ref:) for BP summary of the November 8, 2005 U.S. - China Textile Agreement. Agreement text, available at )

HKTDC notice (dated 12/06/05) available at http://www.tdctrade.com/sme/newsflash/smeflash051206.htm

November 8, 2005 U.S. - China Textile Agreement available at http://www.ustr.gov/assets/World_Regions/North_Asia/China/asset_upload_file91_8344.pdf

BP Notes

According to an article posted on an attorney's web site that is dated October 17, 2005, China has developed a provisional system that will grant textile and apparel export licenses based on a pubic bidding process and past export performance. The quota will be calculated on a formula under which 70% of the exporter's allowed quantity will be based on shipments during the prior safeguard period and 30% will be based on shipments made during non-safeguard periods. Licenses will be valid for six months with one three month extension permitted. See http://www.gattiassociates.com/CM/ImportantDevelopments2005/ImportantDevelopments20053634.asp for article. The attorney's information source for its article was not noted.

An earlier HKTDC article previously summarized in Broker Power's International TradeToday, stated that on June 19, 2005 MOFCOM had announced that it was implementing "Interim Measures for the Administration of Textile Exports (Trial Implementation)," effective July 20, 2005.

HKTDC had stated that MOFCOM would compile a "Catalogue of Commodities Subject to Textile Export Interim Control," and that commodities under the following categories would be included in the catalogue:

• textile products subject to restrictions imposed against China by the countries or regions concerned, and
• textile products subject to temporary quantitative control under bilateral agreements

The HKTDC had stated that the quantity allowed to be exported under provisional export quotas would be based on the export value of the relevant products and would be calculated according to the following formula (See HKTDC notice for legend defining the variables in the formula):

S = T x [a1 x (70% x Q1/M1 30% x Q2/M2) a2 x Q3/M3]

In addition, the HKTDC had stated that one provisional export license would be issued for each batch of goods and each customs declaration, and would be valid for six months within each calendar year, after which it would no longer be valid. The HKTDC had also stated that the license was non-transferable, not for sale and could not be forged or altered.

(It is not known if the provisional licensing system summarized by the attorney in October 2005 is in effect now, or whether it is similar to the July 2005 system summarized by the HKTDC in June 2005.)

(See ITT's Online Archives or 06/22/05 news, 05062210 for BP summary of June HKTDC article. See ITT's Online Archives or 11/30/05 news, 05113015 for BP summary of HKTDC notice on China's first bidding for 2006 textile exports to U.S.)

June 6, 2005 HKTDC notice available at http://www.tdctrade.com/sme/newsflash/smeflash050620.htm?wt_source=tdc&wt_type=textlink&wt_placement=mainWN2&wt_jobid=0409tdc

Details of the July 20, 2005 measure, in the Chinese language, available at http://www.mofcom.gov.cn/aarticle/b/c/200506/20050600123519.html