Details of the Senate-Passed Miscellaneous Trade and Technical Corrections Act

As the House and Senate have passed different versions of H.R. 1047, the next step is expected to be a House-Senate conference to resolve differences between the two versions of the bill. If the conference version of the bill is passed by both the House and Senate, it would then be sent to the President for enactment.

This is Part VI of a multi-part series of summaries on the Senate-passed version of H.R. 1047 (H.R. 1047) and highlights new temporary duty reductions for certain cotton shirting fabrics imported by or for the benefit of U.S. manufacturers of men's and boys' shirts, and a new Pima Cotton Trust Fund. See future issues for additional summaries.

Temporary Duty-Free TRQ for Certain Woven Cotton Shirting Fabrics

H.R. 1047 would establish a temporary (through December 31, 2006) duty-free tariff-rate quota (TRQ) under a new HTS 9902.52.08 for certain woven fabrics of cotton certified by the importer as (i) suitable for use in making men's and boys' shirts and (ii) imported by or for the benefit of a manufacturer of men's and boys' shirts. Such fabrics would be subject to the quantity limitations set out in a new U.S. Note 18 in Subchapter II of HTS Chapter 99.

U.S. government sources opine that eligible cotton woven fabrics would consist of certain short supply cotton woven shirting fabrics provided for in NAFTA Annex 401, as specified by U.S. Customs and Border Protection (CBP). (See ITT's Online Archives or 09/24/01 and 10/09/01 news, 01092458 and 01100957, for previous BP summaries on CBP's description of NAFTA Annex 401 short supply fabrics and yarns.

Commerce would issue licenses to manufacturers eligible for new TRQ. According toH.R. 1047, the Secretary of Commerce would accept applications and issue licenses designating eligible manufacturers, and the annual quantity allocations for each such license. A licensee would also be able to assign the authority (in whole or in part) to import subject fabrics under new HTS 9902.52.08.

Each manufacturer's TRQ level to be based on 2000 data. New U.S. Note 18 would set the aggregate quantity of subject fabrics that could be entered under new HTS 9902.52.08 for each calendar year, by or on behalf of each manufacturer of men's and boys' shirts, at 85% of the total square meter equivalents of all imported cotton woven fabric purchased by the manufacturer during calendar 2000 for use in the cutting and sewing of men's and boys' cotton shirts in the U.S.

Temporary Duty-Free Entry for Certain Pima Cotton Shirting Fabrics

H.R. 1047 would also establish a temporary (through December 31, 2006) duty-free provision under a new HTS 9902.52.09 for woven fabrics of cotton, certified by the importer as (i) containing 100% pima cotton grown in the U.S., (ii) suitable for use in making men's and boys' shirts, and (iii) imported by or for the benefit of a manufacturer of men's and boys' shirts.

U.S. government sources opine that eligible woven fabrics made from 100% pima cotton grown in the U.S. would also be provided for in NAFTA Annex 401, as specified by U.S. Customs and Border Protection (CBP). (See ITT's Online Archives or 09/24/01 and 10/09/01 news, 01092458 and 01100957, for previous BP summaries on CBP's description of NAFTA Annex 401 short supply fabrics and yarns.

HTS Chapter 99 Note 17 Would Define "Making" and "Manufacturer"

In addition, H.R. 1047 would amend HTS Chapter 99, Subchapter II by adding a new U.S. Note 17 to state that for purposes of these two new provisions (HTS 9902.52.08 and 9902.52.09), the term "making" means cutting and sewing in the U.S., and the term "manufacturer" means a person or entity that cuts and sews in the U.S.

Pima Cotton Trust Fund

H.R. 1047 would also establish a Pima Cotton Trust Fund of not more than $32 million to provide grants to spinners of U.S. grown pima cotton, manufacturers of men's and boys' cotton shirting, and a nationally recognized association that promotes the use of pima cotton grown in the U.S., to assist such spinners and manufacturers in maximizing U.S. employment in the production of textile or apparel products and to increase the promotion of the use of U.S. grown pima cotton respectively.

(See ITT's Online Archives or 03/11/04, 03/12/04, 03/18/04, 03/19/04, and 03/24/03 news, 04031105, 04031215, 04031820, 04031910, and (Ref:04032415 for Parts I-V of this series of summaries on the Senate-passed version of H.R. 1047.)

H.R. 1047 as passed by the Senate available at

http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=108_cong_bills&docid=f:h1047eas.txt.pdf.