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Clarification of THA Knit-to-Shape proposal for TPP

Sep '12
Sally Kay, President and Rich Stober, CEO of The Hosiery Association (THA) issued the letter to United States Trade Representative (USTR) concerning our proposal clarification and response to a letter from an opposing group.

The letter expresses opposition to a proposal that submitted during the 14th round of the Trans-Pacific Partnership (TPP) negotiations in Leesburg, Virginia.

THA has spent the last 107 years representing the American legwear industry. Its members produce and sell over 90% of legwear sold in the United States. As the voice of the legwear industry in the U.S., THA should be consulted when new rules are being developed which will affect the legwear industry.
The letter states  - “We propose that legwear (socks and hosiery) under Tariff Heading 6115 be allowed preferential treatment into TPP countries based on a “knit-to-shape” rule, i.e. that origin is conferred based on converting yarns into a legwear component in any one of the TPP countries. Additionally, our proposal expressly states that a yarn forward rule would apply to hosiery made of cotton yarns – open end spun both 100% cotton yarns and yarns classified as cotton (or chief weight cotton) when blended with polyester products.
While we welcome a debate on our proposal – the benefits of our proposal are numerous and we would be pleased to discuss them with you in detail – we are concerned by what are clear mischaracterizations and distortions of fact in the letter referenced above. We therefore wish to clarify our position and refute some of the claims made by our opponents.”
NCTO/AMTAC/AFMA Statement: “Yarn forward is the long-established rule of origin for our industry, incorporated into U.S. trade and preference agreements dating back to NAFTA. It encompasses all stages of production from yarn spinning to fabric formation and final garment assembly, all of which must be done either in the United States or in an FTA partner country to qualify for duty-free treatment.”
FACT: There is no consistent U.S. position on “yarn forward.” Yarn forward is constructed differently in each of the FTAs that the U.S. has negotiated. This diversity is partly because supply is different depending on with whom the U.S. is negotiating. Moreover, the current “yarn forward” rule as proposed for the TPP is significantly different from the one in all other agreements, specifically as it relates to legwear products.
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The Hosiery Association (THA)

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