EU: May slash tariff hike on US premium women's jeans
A hike in tariffs imposed by the European Union (EU) last year on US-made high-end women's denim jeans could be about to be slashed, 12 months after they were introduced.
The hike imposed by the European Commission from 1 May last year saw tariffs on women's or girls' cotton denim trousers jump from the usual 12% duty to 38% - an additional 26%.
But the additional tariff could be about to drop back to just 0.35%, according to international trade law firm Sandler, Travis & Rosenberg. If approved, the change could take effect at the beginning of May, it says.
The tariff hike was authorised by the World Trade Organization (WTO) in retaliation against the US's continued distribution of antidumping duties collected on foreign-made goods to affected US producers.
The US law prescribing that system (the Continued Dumping and Subsidy Offset Act, more familiarly known as the Byrd Amendment) was repealed years ago, but duties already collected are still being handed out as requisite legal or administrative procedures are concluded.
When distributions spiked in 2012, so did the value of US exports the EU could target, prompting Brussels to add women's jeans to the retaliation list.
The distribution amount for 2013, however, appears to have fallen by about half. In response, the EU reportedly plans to lower its additional tariffs on all affected goods rather than removing some of those products from the list.
Sandler, Travis & Rosenberg has been actively working to obtain relief for affected US manufacturers.
For example, the UK's customs and tax department accepted a legal argument crafted by ST&R attorney Elise Shibles that certain jeans do not fall within the legal definition of denim with the Harmonized Tariff Schedule (and are thus not subject to the higher duties) because the dye used to make them is not colourfast.
The other 27 EU member states appear to be accepting this ruling and the alternative classification of the subject jeans as women's pants, which is only subject to the basic 12% tariff. Shibles has since been helping US jeans makers that had been paying the higher 38% duty to secure refunds.
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