March 9, 2005

Mr. James C. Leonard III, Chairman

Committee for the Implementation of Textile Agreements

Room 3100

U.S. Department of Commerce

14th Street and Constitution Avenue, N.W.

Washington, D.C. 20230

Subject: Comments regarding procedures published in the Federal Register on February 23, 2006, by CITA for considering commercial availability provision to the Dominican Republic-Central America-U.S. Free Trade Agreement.

Dear Mr. Leonard:

We write on behalf of our member companies who produce fiber, yarn, and fabric in the United States and who dye, print, or finish fabric in the United States. The Interim Procedures for Considering Requests Under the Commercial Availability Provision to the Dominican Republic-Central America-U.S. Free Trade Agreement ("CAFTA-DR short supply procedures") are of great interest to U.S. textile manufacturers.

While we appreciate the efforts made to improve the short supply process in the CAFTA-DR by allowing restricted approvals as well as clarifying that there exists the ability to remove items from the list, we find the interim procedures published at 71 FR 9315 to be confusing and to differ materially from the text of the CAFTA-DR and from the text of the implementing legislation (H.R. 3045) in certain key areas. Consequently, we have provided the following specific cites from the FR notice along with suggested revisions to the language:

FR Page 9315

Second column:

In Summary:

For: “The President has delegated to CITA the authority to determine whether fabrics, yarns, or fibers are not available in commercial quantities in a timely manner in CAFTA-DR countries and has directed CITA to establish procedures that govern the submission of a request and provide the opportunity for interested entities to submit comments and supporting evidence in any such determination pursuant to the CAFTA-DR Implementation Act.”

Substitute: “The President has delegated to CITA the authority to determine whether fabrics, yarns, or fibers are available or are not available in a timely manner in CAFTA-DR countries and has directed CITA to establish procedures that govern the submission of a request to (i) add a fabric, yarn, or fiber to the list in Annex 3.25; (ii) eliminate a restriction on a fabric, yarn, or fiber within six months after the item was added to the list in a restricted quantity; (iii) remove a fabric, yarn or fiber from the list; or (iv) restrict the quantity of a fabric, yarn or fiber that was added to the list in an unrestricted quantity or with respect to which CITA previously eliminated a restriction and provide the opportunity for interested entities to submit comments and supporting evidence in any such determination pursuant to the CAFTA-DR Implementation Act.”

Rational for Changes: Bolded, underlined words added to clarify that CITA also has the authority to determine that fabrics are available and to clearly outline up front the four circumstances in which these procedures apply (this language is taken directly from page 20 of the SAA).

Third column:

In Authority:

For: "204(o)(4)" Substitute:"203(o)(4)"

Rational for Change: To correct typographical error

Page 9316

First column:

In 2(b) Interested Entity:

For: "202(o)(4)" Substitute: "203(o)(4)"

Rational for change: To correct typographical error

In 2(c) Interested Party:

For: "means any interested entity that requests to be included on the e-mail notification"

Substitute: "means any interested entity, or law firm, consultant, trade association or other entity acting on behalf of any interested entity, that requests to be included on the e-mail notification"

Rational for Change: To clarify that law firms, consultants, trade associations, etc. may receive the notifications, notwithstanding that they are not interested entities within the definition in 203(o)(4)(B)(i)

Second column:

In 2(k) U.S. Business Day:

For: “202(o)(4)(B)(i)” Substitute: “203(o)(4)(B)(ii)”

Rational for Change: To correct typographical error

Third column:

In the fourth line:

For: "e-mail@ version" Substitute: "e-mail version"

Rational for Change: To correct typographical error

Page 9317

Second column:

In 5. Consideration and Acceptance of a Request:

For: “information specified section 4(b)(1)-(3)”

Substitute: “information specified in section 4(b)(1)-(3)”

Rational for Change: To correct typographical error

Third column:

In 6(a) Response Submission:

For: “official receipt of a request”

Substitute: “the accepted request is published for public notice”

Rational for Change: To give interested entities a full 10 days to respond regardless of how long it takes CITA to accept a request and notify the public. For example, in the case where CITA takes the full 2 days allowed to accept a request, interested entities would then have only 8 days to submit a detailed response with an offer.

For: "CITA may, for good cause, extend the time limit"

Substitute: "If an interested entity wishes to file a response submission but is unable, within 10 days of the official receipt of a request [or alternately, “within 10 days of the publishing of a request” - see preceding comment], to comply with the requirements for the contents of a response with an offer as set forth in section 6(b), such interested entity may request five additional U.S. business days to file, which request CITA shall not unreasonably deny. In addition, CITA may, for good cause, extend the time"

Rational for Change: To allow flexibility when an interested entity cannot satisfy all the requirements of section 6(b) within the eight to ten day comment period, while still providing for timely response so CITA can make a determination in 30 days (or 44 days if CITA extends the deadline)

Page 3918

Second column:

In 8(c)(2) Approval in an Unrestricted Quantity:

For: “CITA will approve the request in an unrestricted quantity if CITA determines that no CAFTA-DR supplier(s) or manufacturer(s) could fulfill the request for the subject product”

Substitute: “CITA will approve the request in an unrestricted quantity if CITA determines that no CAFTA-DR supplier(s) or manufacturer(s) could fulfill any amount of the request for the subject product”

Rational for Change: To be consistent with 8(c)(3) in the circumstance that CAFTA-DR supplier(s) or manufacturer(s) could partially fulfill the request

In 8(c)(2)(i) Approval in Unrestricted Quantity:

For: "not later than 30 U.S. business days after the official receipt of a request"

Substitute: "not later than 30 U.S. business days after the official receipt of a request (or not more than 44 U.S. business days where an extension is provided pursuant to section 8(c)(4) of these procedures)"

Rational for Change: To conform to 203(o)(4)(C)(iv)

In 8(c)(3) Approval in Restricted Quantity:

For: “CITA may approve the request in a restricted quantity if CITA determines that a CAFTA-DR supplier(s) or manufacturer(s) could partially fulfill the request for the subject product”

Substitute: “CITA may approve the request in a restricted quantity if CITA determines that a CAFTA-DR supplier(s) or manufacturer(s) could partially fulfill the request for the subject product, and CITA may calculate the restricted quantity based on the portion of the order that could not be filled by CAFTA-DR supplier(s) or manufacturer(s)”

Rational for Change: To ensure that the restricted quantity has a market basis

In 8(c)(3)(i) Approval in Restricted Quantity:

For: "notice will be published in the Federal Register not later than the 30 U.S. business days after approval"

Substitute: "notice will be published in the Federal Register not later than 30 U.S. business days after the official receipt of a request (or not more than 44 U.S. business days where an extension is provided pursuant to section 8(c)(4) of these procedures)”

Rational for Change: To conform to 203(o)(4)(C)(iv)

Third column:

In 8(c)(3)(iii)(A) Elimination of the Restricted Quantity:

For: "CITA will determine"

Substitute: "CITA, upon receipt of a request from an interested entity, will determine"

Rational for Change: To conserve taxpayer resources by having CITA conduct such an investigation only when there is some interested entity requesting it. This change is consistent with both the text of the FTA and the text of HR 3045 which are permissive, not prescriptive on this point.

In 8(c)(3)(iii)(A)(1) Elimination of the Restricted Quantity:

For: “manufacture(s)r” Substitute: “manufacturer(s)”

Rational for Change: To correct typographical error

In 8(c)(3)(iii)(A)(3) Elimination of the Restricted Quantity:

For: “CITA will notify interested entities by e-mail”

Substitute: “CITA will notify interested parties by e-mail and the public on its website”

Rational for Change: To be consistent with 5(b), 8(a), 8(c)(4) etc.

In 8(c)(3)(iii)(B):

For: "published in the Federal Register"

Substitute: "published in the Federal Register. The elimination of the restricted quantity shall be effective for goods entered into the United States on or after six months (i.e., 180 calendar days) after the date of publication of the notice."

Rational for Change: To clarify the effective date, as the interim procedures fail to state the effective date for elimination of a restricted quantity. We have modeled the language on the parallel situation addressed in section 9(c)(3)(iii)(A).

Page 9319

First column:

In 8(c)(5) Deemed Approval:

For: "202(o)(4)(D)" Substitute: "203(o)(4)(D)"

Rational for Change: To correct typographical error

8(c)(6):

STRIKE ENTIRE SECTION.

Rational for Change: To the extent that section 8(c)(6) deals with procedures for considering a request from an interested entity to remove or restrict the quantity of a product which has been added to Annex 3.25 without restriction, it is duplicative and, as regard the 12 month waiting period, in conflict with, Section 9. If this section is retained, some explanation of how this process differs from the Six Month Procedures: Submitting a Request to Remove or Restrict would be helpful.

Second column:

In 9(a) Request to Remove or Restrict:

For: "introduced six months after a requested subject product has been added to Commercial Availability List in an unrestricted quantity pursuant to Section 203(o)"

Substitute: "introduced six months after a requested subject product has been added to the Commercial Availability List in an unrestricted quantity or after the President has eliminated a restriction pursuant to Section 203(o)"

Rational for Change: To conform to 203(o)(4)(E)(i)(II)

In 9(c)(2) Procedures:

Concerning: “CITA and any responding interested party shall follow procedures and contents set forth in subsections 6(a) and (c) (Response Submission) and section 7 (Submitting Rebuttal Evidence)”

Note: Portions of subsection 6(a) are not relevant to this situation. Subsection 6(a) outlines that “an interested entity may file a response submission to a request CITA accepted [in this case a request to remove or restrict] advising CITA of its objection to the request and its ability to supply the subject product by providing an offer to supply subject product as described in the request.” In the case of a response to a Request to Remove or Restrict, the contents of an objection would not be an offer to supply – that’s what the submission is asserting – but rather contradict some information contained in the offer to supply.

Third column:

In the top line:

For: "(e.g., 180 calendar days)" Substitute: "(i.e., 180 calendar days).

Rational for Change: To correct typographical error

Additional Concerns:

In addition to the specific changes suggested, we have some general concerns about the procedures. Overall, we feel that the procedures are unfairly weighted in favor of entities requesting additions to the Commercial Availability List. For example, if for some reason CITA does not make a decision in a request to add a product to Annex 3.25, the request is “deemed approved” regardless of whether the product is in fact commercially available or not. This may encourage interested entities to overwhelm CITA with numerous requests and provides a serious loophole in the system. At the very least, the same treatment should be given Requests to Remove or Restrict (i.e. “deemed approval” if CITA does not act).

Furthermore, the time frames are also severely weighted in favor of potential purchasers versus potential suppliers. While it takes just 30-44 business days to add to Annex 3.25, it takes over a year to remove or restrict a product once on the list. Furthermore, restricted levels cannot be amended. We recognize that many of these inequities are built into the CAFTA-DR agreement and implementing legislation and therefore cannot be remedied. However, we request that CITA take these inequities into consideration when making its decisions and work with both sides equally to come to a fair decision.

Finally, we are concerned with the limits outlined on what may and may not constitute business confidential material. The procedures indicate that names and locations of suppliers and manufactures must be made publicly available (see subsection 3(a)(4)). We request that CITA insert language allowing some discretion on their part as to what may constitute business confidential information in special circumstances. For example, a potential supplier or manufacturer who wishes to keep his or her company name confidential as part of an Offer to Sell or Request to Remove or Restrict for fear of retaliation should be allowed to do so if able to supply CITA with good cause.

Thank you for your consideration of these comments and suggested changes. If you have further questions, please contact the NTA office at (617) 542-8220 or the AMTAC office at (202) 452-0866.

Sincerely,

Karl Spilhaus Auggie Tantillo

President Executive Director

National Textile Association (NTA) American Manufacturing Trade Action Coalition (AMTAC)