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Washington Outlook Archive

Federal Court Overrules Injunction On Use Of Safeguards

James A. Morrissey, Washington Correspondent

 A US Court of Appeals has voided an injunction by the US Court of International Trade that blocked the US government from considering using a safeguard mechanism to impose quotas on Chinese imports of textiles and apparel based on a threat of market disruption. The action clears the way for US textile manufacturers to file more petitions seeking relief from imports based on both a threat and actual market disruption. More than two dozen petitions already are in various stages of consideration or approval by the interagency Committee for the Implementation of Textile Agreements (CITA).

Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition, said the appellate courts ruling was a smashing victory for the US government and vindicates the decisions by the US textile industry to file safeguard petitions on the basis of threat of market disruption.

The US Association of Importers of Textiles and Apparel had filed a suit against the US government to prevent it from considering threat-based petitions for relief from imports, and the court of international trade issued an injunction blocking action on 12 threat-based petitions that US textile manufacturers had filed. In overturning the injunction, the appeals court said the express purpose of CITA's procedures is to implement the safeguard language dealing with market disruption threatening to impede the orderly development of trade.

A coalition of textile manufacturer now is expected to file more threat-based petitions just as soon as it prepares documentation to support them. The industry's ultimate goal, in addition to using the safeguard mechanism to get temporary relief from imports, is to get a new long-term bi-lateral comprehensive agreement. In that regard, Secretary of Commerce Carlos Gutierrez says China may be willing to consider such an agreement during discussions between the US and Chinese governments next week. Up to this point, however, China has been highly critical of the US governments use of the safeguard mechanism and has not indicated any interest in a new bilateral agreement.

July 2005