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New textile quota program to be introduced

Mar '07
The textile quota allocation plan, which was just drastically reformed last year, will face further major adjustment this year. After the uncovered incident of a large number of textile enterprises in Shenzhen to have obtained quotas by false export performance, the government has to make changes to the existing textile quota allocation system.

According to reliable sources, the Ministry of Commerce will announce a second tender program of the textile export quotas to EU and US next week. The second distribution will be officially launched by the end of March.

An enterprise disclosed that in view of Shenzhen incident, on the second tender, the Ministry would implement more stringent examination of qualifications for bidding enterprises.

China Chamber of Commerce for Import and Export of Textiles has also specially formulated a normal price range to regulate the qualifications of bidding enterprises. The companies who are beyond the price range must give proof within one week to testify the truth of their exports with higher prices, otherwise their eligibility would be denied.

It is reported that these enterprises need to provide export rebates proof, Customs declarations, trade contracts, production contracts, foreign exchange (canceled after verification) forms, and other materials.

It is worth noting that the price range is formulated in accordance with national export average price in various categories. If the commodity export price of an enterprise were twice higher than the national average price in same category, it would be regarded as abnormal.

In addition, the second tender price may also be adjusted. Many enterprises have urged the Commerce Ministry to lower the price by 20 percent from the current price basis.

Fibre2fashion, News Desk - China

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