Administration Announces Import Control Initiatives

The Bush administration has announced two initiatives designed to control textile and apparel
import surges from China and to crack down on illegal imports from China and other nations.
Speaking at the 54th annual meeting of the American Textile Manufacturers Institute (ATMI),
Undersecretary of Commerce For International Trade Grant Aldonas said his department will, within
the next few days, publish in the Federal Register specific guidelines for dealing with import
surges from China. The guidelines are based on the so-called “safeguard mechanism” in China’s World
Trade Organization (WTO) accession agreement. Provisions in that agreement permit the United States
to impose unilateral quotas on imports if it can be shown that they cause or threaten to cause
market disruption.

Last August, ATMI filed a petition with the Committee for the Implementation of Textile
Agreements (CITA) asking the government to impose quotas on knit fabrics, work gloves, nightwear,
brassieres, luggage and filament yarn, where huge import surges occurred after import quotas were
removed from those product categories.

CITA had not acted on the ATMI petition, but Aldonas said the new criteria would be applied
to the ATMI petition. Importers had charged that ATMI does not have the “standing” necessary to
petition the government, but Aldonas indicated ATMI does in fact have the necessary standing. The
safeguard provisions require petitioners to provide specific information in support of their claims
of market disruption.

CITA will then evaluate the information and if it appears valid, it will seek public comment
on the request. CITA will make a determination within 60 days of the comment period as to whether
it will seek “consultations” with China. If the consultations do not prove satisfactory, the US
will impose unilateral quotas.

In announcing the safeguard mechanism, Aldonas said, “The procedures provide a clear road map
for firms, trade associations and workers who believe imports from China are disrupting their

Outgoing ATMI Chairman Van May and the incoming chairman Billie Moore gave the guidelines a
guarded endorsement, saying it is a “workable plan,” but emphasized that the various steps need to
be “expedited.”

In a move to find and eliminate illegal textile and apparel imports, Aldonas said the Energy
Department’s Oak National Laboratory has identified three technologies that may allow for a
cost-effective “marker” system to identify the true country of origin of imports that today are
often misidentified and circumvent quota controls.

While it will take some time for the government to determine which procedure will be most
effective, Aldonas said the proposed marker systems “show promise in the fight against fraudulent

April 2003