Daily Rules, Proposed Rules, and Notices of the Federal Government


Generalized System of Preferences (GSP): Import Statistics Relating to Competitive Need Limitations; 2006 Annual GSP Review; Petitions Requesting CNL Waivers

AGENCY: Office of the United States Trade Representative.
ACTION: Notice.
SUMMARY: This notice is to inform the public of the availability of eight-month 2006 import statistics relating to competitive need limitations (CNLs) under the Generalized System of Preferences (GSP) program. The eight-month 2006 import statistics identify those articles for which the 2006 trade levels may exceed statutory CNLs. The interim trade data is available at:

As previously announced in theFederal Register(71 FR 37129 (June 29, 2006)), the deadline for submission of product petitions to waive the CNLs for individual beneficiary developing countries with respect to GSP-eligible articles is 5 p.m., November 17, 2006. Petitions must conform to the requirements as set forth in the June 29, 2006Federal Registernotice. Public comments regarding possiblede minimiswaivers and possible GSP redesignations will be requested in a subsequentFederal Registernotice.

FOR FURTHER INFORMATION CONTACT: Contact the GSP Subcommittee of the Trade Policy Staff Committee, Office of the United States Trade Representative, 1724 F Street, NW., Room F-220, Washington, DC 20508. The telephone number is (202) 395-6971.
SUPPLEMENTARY INFORMATION: I. Competitive Need Limitations

The GSP program provides for the duty-free importation of designated articles when imported from designated beneficiary developing countries (BDCs). The GSP program is authorized by title V of the Trade Act of 1974 (19 U.S.C. 2461,et seq.), as amended (the “1974 Act”), and is implemented in accordance with Executive Order 11888 of November 24, 1975, as modified by subsequent Executive Orders and Presidential Proclamations.

Section 503(c)(2)(A) of the 1974 Act sets out the two competitive need limitations (CNLs). When the President determines that a BDC exported to the United States during a calendar year either (1) a quantity of a GSP-eligible article having a value in excess of the applicable amount for that year ($125 million for 2006), or (2) a quantity of a GSP-eligible article having a value equal to or greater than 50 percent of the value of total U.S. imports of the article from all countries (the “50 percent CNL”), the President must terminate GSP duty-free treatment for that article from that BDC by no later than July 1 of the next calendar year.

Under section 503(c)(2)(F) of the 1974 Act, the President may also waive the 50 percent CNL with respect to an eligible article imported from a BDC if the value of total imports of that article from all countries during the calendar year did not exceed the applicablede minimisamount for that year ($18 million for 2006). Further, under section 503(c)(2)(C) of the 1974 Act, if imports of an eligible article from a BDC ceased to receive duty-free treatment due to exceeding a CNL in a prior year, the President may redesignate such an article for duty free treatment if imports in the most recently completed year did not exceed the CNLs. Comments onde minimiswaivers and redesignations will be requested after publication of a separateFederal Registernotice.

Section 505 of the 1974 Act states that duty-free treatment provided under the GSP shall not remain in effect after December 31, 2006. If the program expires without reauthorization on that date, the 2006 Annual GSP review will be conducted according to a schedule to be issued in theFederal Register, if and when the program is reauthorized.

II. Implementation of Competitive Need Limitations

Exclusions from GSP duty-free treatment where CNLs have been exceeded will be effective July 1, 2007, unless previously granted a waiver by the President. CNL exclusions will be based on full 2006 calendar year import statistics.

III. Interim 2006 Import Statistics

In order to provide advance notice of articles that may exceed the CNLs for 2006, “Interim 2006 Import Statistics Relating to Competitive Need Limitations” that cover the first eight months of 2006 can be viewed at: unable to access these statistics, contact the GSP Subcommittee of the Trade Policy Staff Committee, which will make alternate arrangements to provide the lists. Full calendar-year 2006 data for individual tariff subheadings will be available in February 2007 on the Web site of the U.S. International Trade Commission at

The Interim 2006 Statistics are organized to show, for each article, the Harmonized Tariff Schedule of the United States (HTSUS) subheading and BDC of origin, the value of imports of the article for the first eight months of 2006, and the percentage of total imports of that article from all countries. The list includes the GSP-eligible articles from BDCs that have already exceeded the CNLs by their import levels amounting to more than $125 million, or by an amount greater than 50% of the total value of U.S. imports of that product in 2006. The list also includes GSP-eligible articles that, based upon interim eight-month 2006 data, exceed $95 million dollars, or an amount greater than 42 percent of thetotal value of U.S. imports of that product. The “D” flag next to articles on the list indicates articles that, based on eight-month 2006 trade data, may be eligible for ade minimiswaiver because the total value of imports of that article from all countries is below $12 million.

The list published on the USTR Web site is provided for informational purposes only. The list is computer-generated and based on interim 2006 data, and may not include all articles that may be affected by the GSP CNLs. Regardless of whether or not an article is included on the list, all determinations and decisions regarding the CNLs of the GSP program will depend on full calendar year 2006 import data with respect to each GSP-eligible article. Each interested party is advised to conduct its own review of 2006 import data with regard to the possible application of GSP CNLs. Please see the notice announcing the 2006 GSP Review which was published in theFederal Registeron June 29, 2006 for further details on submitting a petition for a CNL waiver.

Marideth J. Sandler, Executive Director for the GSP Program, Chairman, GSP Subcommittee of the Trade Policy Staff Committee.