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On July 22 the US Committee for the Implementation of Textile Agreements (CITA) issued a notice to solicit public input on requests for textile and apparel safeguard action on imports from China.
The notice was made in the wake of requests by four US business organizations for a limit on imports of cotton, wool and man-made fibre socks from China.
This is the second case by the United States against Chinese textiles since China's entry into the World Trade Organization (WTO). In the first, launched on July 24 last year, the United States established twelve-month quota limits on knit fabric, brassieres and robes imported from China.
There are three alternative means for the US textile petitioners to safeguard their interests: The textile and apparel safeguard action as provided for in the Report of the Working Party on the Accession of China to the WTO; the transitional product-specific safeguard mechanism as provided for in the Protocol on the Accession of the People's Republic of China; and the safeguard mechanism as provided for in the Safeguards Agreement under the WTO Agreement structure.
In both actual cases, the US petitioners requested a textile and apparel safeguard action as provided for in the accession report.
Among the three possible means, the safeguard action of the accession report is the most convenient weapon to barricade imports.
In a textile and apparel safeguard case, the CITA makes decisions basically by soliciting public comments on such injury factors as domestic production and price. On the other hand, the International Trade Commission of the United States has to analyze the evidence on an array of injury factors such as shipment, sales, employment, revenues and operation losses when handling a product-specific safeguard investigation under the accession protocol, or a safeguard investigation under the safeguards agreement.
We have some obsessions concerning the public comments procedure in a textile and apparel safeguard action. Public comments received by the CITA are not available online, and have to be read in the Department of Commerce's Trade Reference Room.
We wonder whether the Chinese manufacturers or exporters could have easy and prompt access to such public comments, and whether Chinese officials could command enough information on public comments in advance for a meaningful consultation with their US counterparts.
The weight the CITA accords to the comments greatly influences its final decision. Unfortunately, the CITA gives particular attention to comments representing the views of actual producers in the United States, especially when some of the comments solicited allege to the disadvantage of the US petitioners that there is no market disruption or that the subject imports are not the cause of market disruption.
It is questionable that a fair decision will finally pan out after such a review process.
As a restrictive measure is effective on the date of the request by the United States for consultations with China, it remains to be seen what role such consultations can really play and how much difference such consultations can make.
As the CITA has 60 days from the close of the commendation period to make a determination as to whether the United States will request consultations with China, we can reasonably predict for the current case that starts at the end of the coming October, China's socks exported to the United States will be susceptible to the risk of a quota arrangement if CITA decides the subject imports have led to market disruption.
And both the loose legal structure of the textile safeguard action and the proceedings of the first textile case convince the high likelihood of a decision on market disruption caused by the subject imports.
Last but not the least, the US-China Textile Visa Arrangement provides that if the subject imports from China are subject to import quotas, shipments exported from China must be accompanied by an export visa and Electronic Visa Information System transmission issued by the Chinese Government in order to enter the United States.
Thus a textile safeguard measure, already restrictive in terms of import volume, further harries the disputed products by delaying their entry into the US market.
The author is from the Legal Affairs Division of Beijing WTO Affairs Centre.
(China Daily August 3, 2004)
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