Save Our Industries Act of 2009 or the SAVE Act - Grants duty-free treatment, subject to specified conditions, to certain apparel wholly assembled in the United States or the Philippines, or both, and components of such apparel consisting entirely of: (1) fabric components cut in the United States or the Philippines, or both, from fabric wholly formed in the United States from yarns wholly formed in the United States; (2) components knit-to-shape in the United States from yarns wholly formed in the United States; or (3) any combination of such components.
Grants: (1) a reduction of duty for such apparel, provided the same criteria are met; and (2) duty-free treatment to apparel that meet both the requirements for duty-free treatment and reduction of duty.
Requires the Comptroller General to evaluate the effectiveness of the preferential duty treatment afforded under this Act to apparel imported from the Philippines.
Prohibits preferential duty treatment of apparel imported from the Philippines unless the President certifies to Congress that it is meeting certain trade enforcement conditions with respect to such apparel.
Terminates preferential duty treatment under this Act: (1) 10 years after the effective date of this Act; and (2) when the Philippines becomes ineligible for designation as a beneficiary country under the Generalized System of Preferences.
[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3039 Introduced in House (IH)]
111th CONGRESS
1st Session
H. R. 3039
To provide for preferential duty treatment to certain apparel articles
of the Philippines.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 25, 2009
Mr. McDermott (for himself and Mr. Bilbray) introduced the following
bill; which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To provide for preferential duty treatment to certain apparel articles
of the Philippines.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Save Our Industries Act of 2009'' or
the ``SAVE Act''.
SEC. 2. FINDINGS; PURPOSES.
(a) Findings.--Congress finds the following:
(1) The United States and the Republic of the Philippines
(in this Act referred to as the ``Philippines''), a former
colony, share deep historical and cultural connections. The
United States has developed preferential trading relations with
former colonies such as the Marshall Islands, the Federated
States of Micronesia and the Republic of Palau.
(2) The Philippines represents a tremendous economic
potential and enduring political and security significance to
the United States.
(3) The United States and the Philippines maintain a fair
trading relationship that should be expanded to the mutual
benefit of both countries. In 2008, United States exports to
the Philippines were valued at $8,300,000,000, and United
States imports from the Philippines were valued at
$8,700,000,000.
(4) United States textile exports to the Philippines were
valued at nearly $20,000,000 in 2008, consisting mostly of
broadwoven, industrial or specialty, and nonwoven fabrics. The
potential for export growth in this area can sustain and create
thousands of jobs.
(5) The Philippines' textile and apparel industries, like
that of their counterparts in the United States, share the same
challenges and risks stemming from the end of the United States
quota system and from the end of safeguards that continued to
control apparel imports from the People's Republic of China
until January 1, 2009.
(6) The United States apparel fabrics industry is heavily
dependent on sewing outside the United States, and, for the
first time, United States textile manufacturers would have a
program that utilizes sewing done in an Asian country. In
contrast, most sewing of United States fabric occurs in the
Western Hemisphere, with about 75 percent of United States
fabric exports presently going to countries that are parties to
the North American Free Trade Agreement and the Dominican
Republic-Central America-United States Free Trade Agreement.
Increased demand for United States fabric in Asia will increase
opportunities for the United States industry.
(7) Apparel producers in the Western Hemisphere are
excellent at making basic garments such as T-shirts and
standard 5-pocket jeans. However, the needle capability does
not exist to make high-fashion, more sophisticated garments
such as embroidered T-shirts and fashion jeans with
embellishments. Such apparel manufacturing is done almost
exclusively in Asia.
(8) A program that provides preferential duty treatment for
certain apparel articles of the Philippines will provide a
strong incentive for Philippine apparel manufacturers to use
United States fabrics, which will open new opportunities for
the United States textile industry and increase opportunities
for United States yarn manufactures. At the same time, the
United States would be provided a more diverse range of
sourcing opportunities.
(b) Purposes.--The purposes of this Act are--
(1) to encourage higher levels of trade in textiles and
apparel between the United States and the Philippines and
enhance the commercial well-being of their respective
industries in times of global economic hardship;
(2) to enhance and broaden the economic, security, and
political ties between the United States and the Philippines;
(3) to stimulate economic activity and development
throughout the Philippines, including regions such as Manila
and Mindanao; and
(4) to provide a stepping stone to an eventual free trade
agreement between the United States and the Philippines, either
bilaterally or as part of a regional agreement.
SEC. 3. DEFINITIONS.
In this Act:
(1) Classification under the hts.--The term
``classification under the HTS'' means, with respect to an
article, the 10-digit subheading under which the article is
classified in the HTS.
(2) HTS.--The term ``HTS'' means the Harmonized Tariff
Schedule of the United States.
(3) Entered.--The term ``entered'' means entered, or
withdrawn from warehouse for consumption, in the customs
territory of the United States.
(4) Knit-to-shape.--An article is ``knit-to-shape'' if 50
percent or more of the exterior surface area of the article is
formed by major parts that have been knitted or crocheted
directly to the shape used in the article, with no
consideration being given to patch pockets, appliques, or the
like. Minor cutting, trimming, or sewing of those major parts
shall not affect the determination of whether an article is
``knit-to-shape''.
(5) Wholly assembled.--An article is ``wholly assembled in
the Philippines or the United States'' if--
(A) all components of the article pre-existed in
essentially the same condition as found in the finished
article and were combined to form the finished article
in the Philippines or the United States; and
(B) the article is comprised of at least 2
components.
(6) Wholly formed.--A yarn is ``wholly formed in the United
States'' if all of the production processes and finishing
operations, starting with the extrusion of filaments, strips,
film, or sheet, and including slitting a film or sheet into
strip, or the spinning of all fibers into yarn, or both, and
ending with a finished yarn or plied yarn, takes place in the
United States.
SEC. 4. TRADE BENEFITS.
(a) Articles Covered.--For purposes of this section, an eligible
apparel article is any of the following:
(1) Men's and boys' cotton knit shirts.
(2) Women's and girls' cotton knit shirts and blouses.
(3) Men's and boys' cotton trousers, breeches, and shorts.
(4) Women's and girls' cotton trousers, slacks, and shorts.
(5) Men's and boys' cotton underwear.
(6) Men's and boys' manmade fiber underwear.
(7) Men's and boys' manmade fiber knit shirts.
(8) Women's and girls' manmade fiber knit shirts and
blouses.
(9) Men's and boys' manmade fiber trousers, breeches, and
shorts.
(10) Women's and girls' manmade fiber slacks, breeches, and
shorts.
(11) Men's and boys' non-knit manmade fiber shirts.
(12) Brassieres and other body support garments.
(13) Manmade fiber brassieres and other body support
garments.
(14) Manmade fiber swimwear.
(15) Cotton swimwear.
(b) Duty-free Treatment for Certain Eligible Apparel Articles.--
(1) Duty-free treatment.--Subject to paragraphs (2) and
(3), an eligible apparel article shall enter the United States
free of duty if the article is wholly assembled in the United
States or the Philippines, or both, and if the component
determining the article's classification under the HTS consists
entirely of--
(A) fabric components cut in the United States or
the Philippines, or both, from fabric wholly formed in
the United States from yarns wholly formed in the
United States;
(B) components knit-to-shape in the United States
from yarns wholly formed in the United States; or
(C) any combination of the fabric components or
components knit-to-shape described in subparagraphs (A)
and (B).
(2) Dyeing, printing, or finishing.--An apparel article
described in paragraph (1) shall be ineligible for duty-free
treatment under such paragraph if the component determining the
article's classification under the HTS comprises any fabric,
fabric component, or component knit-to-shape in the United
States that was dyed, printed, or finished at any place other
than in the United States.
(3) Other processes.--An apparel article described in
paragraph (1) shall not be disqualified from eligibility for
duty-free treatment under such paragraph because it undergoes
stone-washing, enzyme-washing, acid-washing, permapressing,
oven-baking, bleaching, garment-dyeing, screen printing, or
other similar processes in either the United States or the
Philippines.
(c) Duty Reduction for Certain Eligible Apparel Articles.--
(1) Duty reduction.--An eligible apparel article shall
enter the United States at a reduced rate of duty specified in
paragraph (2) if it is wholly assembled in the United States or
the Philippines, or both, and if the component determining the
article's classification under the HTS consists entirely of--
(A) fabric components cut in the United States or
the Philippines, or both, from fabric wholly formed in
the United States or the Philippines, or both, from
yarns wholly formed in the United States;
(B) components knit-to-shape in the United States
or the Philippines, or both, from yarns wholly formed
in the United States; or
(C) any combination of fabric components or
components knit-to-shape that are described in
subparagraphs (A) and (B).
(2) Reduced tariff rate.--An eligible apparel article
described in paragraph (1) shall be dutiable at the lesser of--
(A) 50 percent of the column 1 rate of duty that
applies to the apparel article under its classification
under the HTS; or
(B) the column 1 rate of duty under the HTS that
applies to the article, assessed upon the value of the
article, less the cost or value of yarns in the article
that are wholly formed in the United States.
(d) Articles Eligible Under Both Categories.--An eligible apparel
article that meets the requirements of both subsections (b) and (c)
shall be eligible for duty-free treatment under subsection (b).
(e) De Minimis.--
(1) In general.--An otherwise eligible apparel article
shall not be ineligible for preferential treatment because
fibers or yarns used in the production of the component that
determines the article's classification under the HTS do not
meet the requirements of subsection (b) or (c), if the total
weight of all such fibers or yarns in the component that
determines the article's classification under the HTS is not
more than 10 percent of the total weight of that component.
(2) Elastomeric yarns.--Notwithstanding paragraph (1), an
article described in subsection (b) or (c) that contains
elastomeric yarns in the component of the article that
determines the article's classification under the HTS shall be
eligible for duty-free treatment under this section only if
such elastomeric yarns are wholly formed in the United States
or the Philippines.
(3) Direct shipment.--Any apparel article described in
subsection (b) or (c) is an eligible article only if it is
imported directly into the United States from the Philippines.
(f) Single Transformation Rules.--Any of the following apparel
articles that are wholly assembled, or knit-to-shape, in the
Philippines from any combination of fabrics, fabric components,
components knit-to-shape, or yarns and are imported directly into the
United States from the Philippines shall enter the United States free
of duty, without regard to the source of the fabric, fabric components,
components knit-to-shape, or yarns from which the articles are made:
(1) Any apparel article that is of a type listed in chapter
rule 3, 4, or 5 for chapter 61 of the HTS (as such chapter
rules are contained in paragraph 1 of section A of the Annex to
Proclamation 8213 of the President of December 20, 2007) as
being excluded from the scope of such chapter rule, when such
chapter rule is applied to determine whether an apparel article
is an originating good for purposes of general note 29(n) to
the HTS, except that, for purposes of this paragraph, reference
in such chapter rule to ``6104.12.00'' shall be deemed to be
reference to ``6104.19.60''.
(2) Any apparel article that is of a type listed in chapter
rule 3(a), 4(a), or 5(a) for chapter 62 of HTS, as such chapter
rules are contained in paragraph 9 of section A of the Annex to
Proclamation 8213 of the President of December 20, 2007.
(3) Any article not described in paragraph (1) or (2) that
is any of the following:
(A) Playsuits and sunsuits.
(B) Babies' garments and clothing accessories.
(C) Women's and girls' cotton coats.
(D) Cotton dresses.
(E) Manmade fiber dresses.
(F) Men's and boys' cotton, non-knit, shirts.
(G) Cotton nightwear and pajamas.
(H) Manmade fiber nightwear and pajamas.
(I) Women's and girls' wool coats.
(J) Wool dresses.
(K) Wool skirts.
(L) Women's and girls' wool suits.
(M) Women's and girls' wool slacks, breeches, and
shorts.
(N) Women's and girls' cotton, non-knit, shirts and
blouses.
(O) Women's and girls' non-knit, manmade fiber
shirts and blouses.
(P) Women's and girls' manmade fiber suits.
(Q) Men's and boys' wool coats.
(R) Cotton dressing gowns and robes.
(S) Manmade fiber robes and dressing gowns.
(T) Women's and girls' manmade fiber coats.
(U) Cotton skirts.
(V) Manmade fiber skirts.
(W) Men's and boys' manmade fiber coats.
(X) Women's and girls' cotton underwear.
(Y) Women's and girls' manmade fiber underwear.
(Z) Women's and girls' coats of silk and vegetable
blends.
(AA) Skirts made of silk and vegetable blends.
(g) Review and Report.--The Comptroller General shall, at the end
of the 2-year period beginning on the effective date under section 5,
review the program established under this section for the purpose of
evaluating the effectiveness of, and making recommendations to Congress
for improvements in, the program.
(h) Enforcement.--
(1) Presidential certification of conditions.--No apparel
article shall be afforded the preferential treatment under this
section unless the President certifies to Congress that the
Philippines is meeting the following conditions:
(A) The Philippines reestablishes the Electronic
Visa Information System (ELVIS) to further assist with
prevention of transshipment of apparel articles and the
use of counterfeit documents relating to the
importation of apparel articles into the United States.
(B) The Philippines continues to enforce the
Memorandum of Understanding between the United States
of America and the Republic of the Philippines
Concerning Cooperation in Trade in Textile and Apparel
Goods, signed on August 23, 2006.
(C) The Philippines agrees to provide, on a timely
basis at the request of U.S. Customs and Border
Protection, and consistently with the manner in which
the records are kept in the Philippines, a report on
exports from the Philippines of apparel articles
eligible for preferential treatment under this section,
and on imports into the Philippines of yarns, fabrics,
fabric components, or components knit-to-shape that are
wholly formed in the United States.
(D) The Philippines agrees to cooperate fully with
the United States to address and take action necessary
to prevent circumvention as provided in Article 5 of
the Agreement on Textiles and Clothing referred to in
section 101(d)(4) of the Uruguay Round Agreements Act
(19 U.S.C. 3511(d)(4)).
(E) The Philippines agrees to require its producers
and exporters of articles eligible for preferential
treatment under this section to maintain, for at least
3 years after export, complete records of the
production and the export of such articles, including
records of yarns, fabrics, fabric components, and
components knit-to-shape and used in the production of
such articles.
(F) The Philippines agrees to report, on a timely
basis, at the request of U.S. Customs and Border
Protection, documentation establishing the country of
origin of articles eligible for preferential treatment
under this section, as used by that country in
reimplementing an effective visa system.
(G) The Philippines is to establish, within 60 days
after the date of the President's certification under
this paragraph, procedures that allow the Office of
Textiles and Apparel of the Department of Commerce
(OTEXA) to obtain information when fabric wholly formed
in the United States is exported to the Philippines to
allow for monitoring and verification before the
imports of apparel articles containing the fabric for
which preferential treatment is sought under this
section reach the United States. The information
provided upon export of the fabrics shall include,
among other things, the name of the importer of the
fabric in the Philippines, the 10-digit HTS subheading
of the apparel articles to be made from the fabric, and
the quantity of the apparel articles to be made from
the fabric for importation into the United States.
(2) Definition of transhipment.--As used in paragraph (1),
transshipment has occurred when preferential treatment for an
apparel article under this section has been claimed on the
basis of material false information concerning the country of
origin, manufacture, processing, or assembly of the article or
of any fabric, fabric component, or component knit-to-shape
from which the apparel article was assembled. For purposes of
this paragraph, false information is material if disclosure of
the true information would have meant that the article is or
was ineligible for preferential treatment under this section.
(i) Proclamation Authority.--The President shall issue a
proclamation to carry out this section not later than 60 days after the
date of the enactment of this Act. The President shall consult with the
Committee on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate in preparing such proclamation.
SEC. 5. EFFECTIVE DATE.
This Act shall apply to articles entered, or withdrawn from
warehouse for consumption, on or after the 15th day after the date on
which the President issues the proclamation under section 4(i).
SEC. 6. TERMINATION.
(a) In General.--The preferential duty treatment provided under
this Act shall remain in effect for a period of 10 years beginning on
the effective date provided in section 5.
(b) GSP Eligibility.--The preferential duty treatment provided
under this Act shall terminate if and when the Philippines becomes
ineligible for designation as a beneficiary developing country under
title V of the Trade Act of 1974 (19 U.S.C. 2461 et seq.).
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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