WASHINGTON — The European Union’s chief negotiator said Friday a trade dispute involving certain exports of U.S. denim to the EU will not be addressed in the context of the negotiations over a U.S. and EU free-trade deal, which was disappointing news for apparel trade groups pressing for an immediate resolution.

The top negotiators for the U.S. and EU held a news conference here Friday as the two sides wrapped up the third round of negotiations on the Transatlantic Trade and Investment Partnership deal, which could have major implications for fashion and cosmetics companies.

Ignacio Garcia Bercero, the EU’s chief negotiator, addressed a question at a news conference here Friday on the EU’s imposition of punitive tariffs on U.S. exports of women’s and girls’ cotton denim jeans to Europe at the end of April.

The EU more than tripled the tariff on those categories to 38 percent in retaliation for not resolving a World Trade Organization case that the EU won against the U.S. in 2005. The EU’s action has heavily impacted U.S. jeansmakers, now facing a 38 percent tariff on the jeans they export to the European market.

 

“We have not discussed that issue in this context,” said Garcia Bercero. “This is not the forum to discuss this specific trade concern.”

But Stephen Lamar, executive vice president of the American Apparel & Footwear Association, who raised the issue at a T-TIP stakeholder meeting on Wednesday, told WWD on Friday that “the T-TIP is about eliminating barriers and fostering trade.

“This is exactly the right forum,” Lamar said of the T-TIP negotiating rounds.

Lamar called on negotiators at the stakeholder meeting to resolve the dispute immediately.

“We remain deeply concerned that the EU continues to maintain a punitive 26 percent tariff on top of an existing 12 percent duty on certain women’s jeans made in the United States and exported to Europe that they imposed before this,” he said at that meeting. “We urge that these duties be eliminated immediately.”

Dan Mullaney, chief negotiator for the U.S., did not address the question of the punitive tariffs at the news conference.

Both chief negotiators said they advanced talks in other areas relating to textiles, particularly in the area of regulatory issues, which typically range from labeling requirements to product safety and chemical use.
“The discussion on textiles are mostly focusing on regulatory issues in the textile sector,” Garcia Bercero said.

As for a rule of origin, which governs how apparel and textiles qualify for duty-free treatment, both negotiators said they are still in the early stages of talks.

“We haven’t yet gotten to the stage of where we have exchanged offers [on a rule of origin],” Garcia Bercero said. “That is one if the things we will be able to do early next year in all sectors, not just textiles.”
Mullaney said, “I think it’s fair to say that on textiles — market access and rules of origin — we began our conversations this week. Those conversations will be continuing into 2014 as we move forward to an exchange in offers.”

The AAFA and Euratex sent a letter to U.S. Trade Representative Michael Froman and EU Trade Commissioner Karel De Gucht last week, urging them to “bring about harmonization and/or mutual recognition for a variety of regulatory challenges affecting our industry.”

They pointed to regulatory burdens in the area of labeling requirements for textile and apparel, particularly care labels, which are mandatory in the U.S. but voluntary in the EU, and diverse product safety requirements, specifically in the area of flammability, that result in “differing standards with respect to test methods, fabrics [and] product coverage.”