AGOA apparel trade quotas

22 Nov '06

3 min read

According to AGOA's 'Wearing Apparel Provisions' and associated Rules of Origin, apparel qualifies for duty-free access to the U.S. market subject to a number of conditions. These are outlined in the Apparel Rules of Origin Section.

Essentially, countries qualifying for the trade benefits of AGOA and having met the 'Wearing Apparel' provisions may export apparel (and certain textiles) into the U.S. duty-free, subject to an annual limit. Such limit is measured in Square Meter Equivalent (SME), and is set as a fixed percentage of all U.S. imports of apparel in the preceding 12-month period for which data is available.

This annual limit was initially set at 1.5 percent of total U.S. textile and apparel imports, and was due to increase in equal annual increments to 3.5 percent by the end of AGOA, September 30, 2008. AGOA II doubled the applicable quotas to7 percent in year 8.

AGOA III extended normal apparel benefits to 2015, without changing the applicable quota limits. This means that from 2008 to 2015, the annual quota limit will be set at 7 percent based on total imports of apparel into the US (from all sources) during the previous year.

While the special dispensation for lesser developed countries was extended by three years from September 2004 to September 2007, the final year of this extension (i.e. the 2006/2007 quota period, beginning October 2006) will see quotas (i.e. the applicable percentage) for apparel shipped under the waiver reduced by half.

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