BREAUX PLANS TO PASS RULE-OF-ORIGIN BUCK TO WHITE HOUSE

Byline: Joyce Barrett

WASHINGTON — Sen. John Breaux (D., La.), sponsor of a plan to change the rule of origin for apparel imports, still could not predict Wednesday whether he had enough votes on the Senate Finance Committee to win approval for his proposal.
However, in view of staunch opposition from importers and retailers, Breaux said he plans to alter his proposal so that it would be written by the administration rather than legislated by Congress. The proposal would still shift the rule so that place of assembly rather than of fabric-cutting would be designated country of origin for quota purposes. But Breaux said he feels having the administration detail the controversial change would be “less onerous” to members of Congress.
The domestic textile and apparel industries have been pushing for this rule change to be amended to the implementing legislation for the GATT Uruguay Round liberalizing global trade. The Senate Finance Committee had been expected to vote on amendments to its version of this legislation on Wednesday, but did not. It may do so on Thursday. The House Ways and Means Committee has already approved a rule change amendment for its version of GATT legislation.
A congressional staffer close to the trade debate said Breaux’s change meant a “defeat” for U.S. manufacturers because the Treasury Department is not likely to write as stiff a rule as textile-state legislators would. “This could water it down,” the staffer said. “Who knows what Treasury will come up with.”
However, Ron Sorini, senior vice president of government relations and international development with Fruit of the Loom and a former U.S. textile negotiator, said in a telephone interview from his Chicago office that the domestic industry would agree to Breaux’s change.
“The end result is what counts,” Sorini said. “There’s no critical difference.”
Breaux’s support of the rule change reflects the major presence in Louisiana of FTL, which is the state’s biggest private industrial employer with more than 7,000 employees.
Robert Hall, vice president and government affairs counsel, National Retail Federation, said the retail industry still would oppose the amendment, even though the White House would write the change and not Congress.
“It’s not a win at all,” Hall said.
Breaux said he also is considering another alteration of his proposal — delaying the effective date until mid-1996. The House Ways and Means Committee set the effective date at the beginning of 1996.
Sorini said it would not be as effective to wait until two years after GATT takes effect to change the rule of origin and said the industry prefers implementation no later than 1996. If Congress votes to approve GATT this year, the agreement could take effect Jan. 1, 1995.
— Fairchild News Service

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