TPP to Include Yarn-Forward Rule of Origin, Fixed Short Supply Lists, Says Glas
NEW YORK --- U.S. negotiators are moving forward on their proposal for a yarn-forward rule of origin for textiles and apparel in the Trans-Pacific Partnership negotiations, but are also proposing two “short supply” lists to expand TPP coverage, said Kim Glas, Departmment of Commerce deputy assistant secretary for textiles & apparel, at the annual conference of the U.S. Association of Importers of Textiles and Apparel Jan. 9 in New York. One short supply list will be permanent, while the other will be in effect for three years after implementation of TPP, she said. Neither will include an ongoing process to add new fibers, yarns, and fabrics.
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The yarn-forward approach means all materials in an item must originate and be assembled in a TPP country in order to receive the preferential treatment. Textile importers have expressed opposition to the yarn-forward rule, but domestic industry has voiced support (see ITT’s Online Archives 11091213).
To ameliorate the restrictive rule of origin, the U.S. is proposing two short supply lists containing fibers, yarns, and fabrics that may be sourced from third countries and still receive TPP preferential treatment, Glas said. The first list would be permanent, and include geographically-limited fibers, yarns, and fabrics that will likely not be produced in TPP member countries. The second, temporary list, which will be of more interest to importers, would include fibers, yarns, and fibers agreed to during TPP negotiations between member countries, she said. The temporary list would be in effect for three years following implementation of the agreement, and will be complete from day one of TPP.
Unlike NAFTA and Dominican Republic-Central America Free Trade Agreement (DR-CAFTA) short supply provisions, however, there will be no procedure for adding and removing items from either short supply list, said Glas. Different positions among the 11 current TPP member countries made negotiation of such a procedure unworkable, she said. TPP member countries will negotiate on which fibers, yarns, and fabrics will be included in the short supply lists during TPP negotiating sessions. “I think our plan is to go into the next round in Singapore in March with some items to vet with other countries regarding short supply,” she said. Negotiators will try to wrap up the short supply lists at TPP negotiations in June, said Glas.
Glas asked textile importers to submit fibers, yarns, and fabrics they want to be included on the short supply lists to the Committee for Implementation of Textile Agreements, which she chairs. Unlike procedures for DR-CAFTA short supply items, the TPP procedure will be streamlined. After receiving suggestions, CITA will vet potential short supply items with industry, and then with the other TPP members. “There’s going to be a lot of back and forth on short supply vetting,” Glas said.