Import Statistics Highlight Goods that May Become Ineligible for GSP

Excerpt from: Sandler, Travis & Rosenberg Trade | February 29, 2016

The Office of the U.S. Trade Representative has made available full calendar year 2015 import statistics showing products that could be excluded from or reinstated to the duty-free treatment available under the Generalized System of Preferences based on competitive need limitations. However, USTR states that its lists may not include all articles to which the CNLs may apply and that each interested party should conduct its own review of 2015 import data.

USTR is accepting public comments through April 1 on the following issues.

De minimis CNL waivers. When the president determines that a GSP beneficiary developing country exported to the U.S. during a calendar year either (1) a quantity of a GSP-eligible article having a value in excess of the applicable amount for that year ($170 million for 2015) or (2) a quantity of a GSP-eligible article having a value equal to or greater than 50 percent of the value of total U.S. imports of the article from all countries, the president must terminate GSP duty-free treatment for that article from that BDC no later than July 1 of the next calendar year unless a waiver is granted.

USTR has previously accepted petitions to waive the CNLs and continue GSP eligibility for dates from Tunisia, dead single-cell micro-organisms from Brazil, non-alcoholic beverages from Thailand, and auto parts from India. USTR notes that petitions to waive the CNLs with respect to the following goods have been withdrawn because the CNLs were not exceeded: virgin olive oil from Tunisia, rare gases other than argon from Ukraine, insulated beverage bags with textile outer surfaces from the Philippines, and porcelain or china household tableware and kitchenware in sets from Indonesia.

The president may also waive the 50 percent CNL with respect to an eligible article imported from a BDC if the value of total imports of that article from all countries during the calendar year did not exceed the applicable de minimis amount for that year ($22.5 million for 2015). USTR has listed more than 100 products that qualify for such a waiver.

Exclusions from GSP duty-free treatment where CNLs have been exceeded and no waivers are granted will be effective July 1, 2016.

Redesignation of goods as GSP-eligible. If imports of an eligible article from a BDC ceased to receive duty-free treatment due to exceeding a CNL in a prior year, the president may redesignate such an article for duty-free treatment if imports in the most recently completed calendar year did not exceed the CNLs. USTR’s statistics include approximately 150 products that could be reinstated to GSP eligibility based on this criterion.

Revocation of CNL waivers. A CNL waiver remains in effect until the president determines that it is no longer warranted due to changed circumstances. In addition, not later than July 1 of each year the president should revoke any CNL waiver that has then been in effect with respect to an article for five years or more if the BDC has exported to the U.S. (directly or indirectly) during the preceding calendar year a quantity of the article (1) having an appraised value in excess of 1.5 times the applicable amount for that calendar year ($255 million in 2015) or (2) exceeding 75 percent of the appraised value of total imports of that article into the U.S. during that calendar year. USTR states that there are no articles subject to CNL waiver revocation for 2015.