The International Trade Administration’s acting deputy assistant secretary for textiles, consumer goods, and materials, Paul Morris, announced in the notices of the Federal Register last week that Haiti will benefit from a higher annual limit on duty-free apparel.
The news, effective from 20 December, means 367,770,223 square metres equivalent of apparel articles assembled in Haiti will be eligible for preferential treatment under the Haitian Hemispheric Opportunity Through Partnership for Encouragement (HOPE) Act until 19 December 2022. If an apparel article is entered in excess of this amount, it will still be subject to otherwise applicable tariffs.
The Federal Register explains that to qualify for duty-free treatment, apparel articles must be wholly assembled, or knit-to-shape in Haiti from any combination of fabrics, fabric components, knit-to-shape, and yarns, as long as the sum of the cost or value of materials produced in Haiti or one or more beneficiary countries, as described in the Caribbean Basin Economic Recovery Act (CBERA).
The direct costs of processing operations performed in Haiti or one or more beneficiary countries, as described in CBERA, cannot be less than an applicable percentage of the declared customs value of such apparel articles. The applicable percentage for the period 20 December 2021 to 19 December 2022 is 60%.
For every 12-month period, duty-free treatment under the value-added provision is subject to a quantitative limitation. For this 12-month period starting yesterday (20 December), the quantitative limitation for qualifying apparel imported from Haiti under the value-added provision will be an amount equivalent to 1.25% of the aggregate square metre equivalent of all apparel articles imported into the US in the most recent 12- month period.
The Agreement is part of the HOPE Act, which international trade law firm Sandler, Travis & Rosenberg (ST&R) describe as providing duty-free treatment for certain apparel articles imported directly from Haiti.
Earlier this month, Just Style reported US apparel and footwear brands welcomed legislation to extend the HOPE Act and the Haitian Economic Lift Program (HELP) Act trade preference schemes until 2035.