CNL Waiver Requests as Part of 2009 GSP Review Due November 17th

There are two types of CNLs² - the value CNL (which is $140 million for 2009) and the 50% CNL (equal to or greater than 50% of the 2009 value of total U.S. imports of the tariff number from all countries)³. Once either limit is reached, trade is considered "competitive" and imports of the article automatically become ineligible for GSP treatment, unless a waiver is granted.

Those Interested in Filing CNL Waivers Should Review Import Data

According to the Office of the U.S. Trade Representative, product petitions requesting CNL waivers are not due until November 17, 2009 in order to allow petitioners an opportunity to review available 2009 U.S. import data, which is obtained from the ITC's Web site at http://dataweb.usitc.gov.

The 2009 data prior to the November deadline (statistics from January - September 2009 are expected to be available by that date) should be reviewed to determine whether any country/tariff number pairs of interest already exceed, or are close to exceeding, the 2009 value CNL or 50% CNL, and therefore need a CNL waiver petition to be filed.

CNL Exclusions Will be Based on Full Calendar Year 2009 Data

USTR has previously stated that CNL exclusions will be based on full calendar year import data, which is usually available in February of the following year (i.e., 2009 data would be available in February 2010).

¹The USTR recently issued a notice announcing the opportunity to submit petitions for the 2009 Annual GSP Review. The deadline for submission of product petitions (other than those requesting CNL waivers or section 503(c)(1)(E) determinations) and country practice petitions for the 2009 Annual GSP Review is 5 p.m., June 24, 2009.

The deadline for submission of product petitions requesting CNL waivers and 503(c)(1)(E) determinations is 5 p.m., November 17, 2009.

(Under 19 USC 2463(c)(2)(E), the USTR determines, upon request, whether a like or directly competitive product was produced in the U.S. on January 1, 1995. If it was not so produced, that product is exempt from the 50% CNL and is added to USTR's list of such products. See the USTR's list of articles not produced in the U.S. as of January 1, 1995 in the February 2009 edition of the GSP Guidebook at http://www.ustr.gov/sites/default/files/U.S.-Generalized-System-of-Preferences-Guidebook.pdf.)

²CNLs do not apply to least-developed beneficiary developing GSP countries (LDBDCs) or beneficiary African Growth and Opportunity Act (AGOA) GSP countries.

³The "Tax Relief and Health Care Act of 2006" also allows the President to revoke a CNL waiver that has been in effect for at least five years for a GSP-eligible product from a specific country, if its annual trade level in the previous calendar year exceeds 150% of the annual monetary threshold (approximately $210 million in 2009) or comprises 75% of all U.S. imports of that product. (See ITT's Online Archives or 12/20/06 news, 06122005, for BP summary.)

(See ITT's Online Archives or 05/28/09 news, 09052820, for BP summary of the USTR announcing the 2009 annual GSP review and deadlines.)

USTR contact- Tameka Cooper (202) 395-6971

USTR Notice (FR Pub 05/278/09) available athttp://edocket.access.gpo.gov/2009/pdf/E9-12406.pdf

BP Note

The GSP program (A, A*, A), which provides duty-free treatment for certain products from beneficiary countries, other than those listed as AGOA beneficiary countries, expires on December 31, 2009.

For AGOA beneficiary countries, both the GSP program (A, A*, A) and the AGOA-GSP program (D) remain in effect through September 30, 2015.

(Note Congress also has an interest in reforming GSP.)