TEXTILE INTERESTS MAKE PROGRESS IN CONGRESS

Byline: Joyce Barrett

WASHINGTON — While the House moved Thursday toward imposing a sweeping moratorium on government regulations for the rest of 1995, textile-industry backers succeeded in moving ahead proposals to protect a rule of origin change for apparel imports, toughen transshipping rules and modernize the Customs Service.
Rep. Dan Burton (R.,Ind.) — who has no textile manufacturers in his heavily industrialized district, but has seen hometown industries harmed by unfair trade practices from the Far East — sponsored a measure approved in a voice vote to preserve the controversial rule of origin change that was included in the GATT Uruguay Round implementing bill.
Immediately following that, Rep. John Spratt (D., S.C.), chairman of the House Textile Caucus, and Rep. L.F. Payne (D., Va.) introduced a broader bill that would protect the rule of origin change as well as allow the Customs Service to toughen transshipment regulations particularly aimed at an estimated $4 billion in illicitly shipped textile products. It would also allow Customs to pursue its modernization program included in the implementing bill for the North American Free Trade Agreement and further permit the administration to levy sanctions against China in retaliation for pirating patented and copyrighted U.S. products.
The Spratt/Payne bill passed in a 235-189 vote.
Burlington Industries lobbyists were instrumental in attaining Burton’s sponsorship. During floor debate on the measure, Burton said it “probably was not absolutely necessary” because the moratorium includes exemptions for regulations needed to implement trade agreements, but that it was needed to reassure the domestic textile industry.
Under the rule of origin provision, the country of origin for apparel will be determined by where it is assembled instead of where it is sewn. It will change a decades-old law and was sought by domestic manufacturers who saw countries like Hong Kong use their quotas to ship apparel actually made in China. Retailers have staunchly opposed the rule of origin change on the grounds it would upset sourcing patterns and add sharply to the cost of imports. The retail and importing industry was blindsided by Thursday’s action, however, because it had relied on objections to any exemptions relating to trade agreements made several days ago by Rep. Bill Archer (R., Tex.), chairman of the House Ways and Means Committee. In a letter to Rep. William Clinger (R., Pa.), chairman of the House Government Operations Committee, Archer said he opposed any exceptions to regulations affecting trade agreements.
Archer, however, agreed just minutes before Burton offered his amendment, not to oppose it, and so paved the way for it to be accepted.
“Regrettably, today’s action shows that protectionism is not confined to one political party,” said Robert Hall, vice president and government affairs counsel for the National Retail Federation. “The rule of origin [change] was not necessary.” Hall also expressed regret that the exemption precluded retailers from challenging implementation of the rule of origin.
The regulatory moratorium, part of the Republican Party’s Contract with America, would suspend government rule-making retroactively from Nov. 20, 1994, through the end of 1995 to give Congress time to review existing regulations with the intent of streamlining government regulatory activity. If it passes the House today as expected, it still facesaction in the Senate as well as a possible veto from President Clinton.
— Fairchild News Service

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