CITA Issues Interim Procedures for CAFTA-DR Commercial Availability Requests

Under the interim procedures, CITA will consider requests to allow non-originating fabrics, yarns, or fibers to be treated as if they are originating goods if they are not available in commercial quantities in a timely manner in the U.S. or the other CAFTA-DR countries.

According to CITA, the goods considered under these interim procedures would be in addition to the goods listed in Annex 3.25 of CAFTA-DR.

Annex 3.25 is a "short supply list" of fabrics, yarns, and fibers that the CAFTA-DR Parties have determined are not available in commercial quantities in a timely manner from producers in the U.S. or other CAFTA-DR countries. According to government sources, this Annex 3.25 list generally consists of all the textile products determined to be in short supply/not available in commercial quantities under AGOA, CBTPA, and/or ATPDEA, etc., as of December 2003 (the timeframe that negotiations concluded on the CAFTA-DR).¹

Annex 3.25 goods, as well as those added to the annex under these interim procedures, will be treated as if they are originating goods for purposes of the specific rules of origin in Annex 4.1 of CAFTA-DR, regardless of the actual origin of those inputs. However, all other fabrics, yarns, or fibers of the component that determines the classification of the good must meet the specific rules of origin in Annex 4.1of CAFTA-DR.

Highlights of Interim Procedures on Commercial Availability Requests

CITA's notice on its interim procedures contains a detailed description of the process through which it will consider commercial availability requests to have fibers, yarns, or fabrics placed on the short supply list in CAFTA-DR Annex 3.25 because such goods are not available in commercial quantities in a timely manner from a producer in the territory of any Party to the CAFTA-DR. Of note are the following features of this process:

CITA can restrict the quantity of a short supply product if partially available, etc. Under these interim guidelines, CITA may respond to a commercial availability request with the following types of determinations (partial list):

Approval in unrestricted quantity - Such an approval means that CITA has determined the subject product is not available in commercial quantities in a timely manner in the CAFTA-DR area or that no interested entity has objected to the request. CITA will then approve the request in an unrestricted quantity if it determines that no CAFTA-DR supplier(s) or manufacturer(s) could fulfill the request for the subject product.

Approval in restricted quantity - CITA may approve the request in a restricted quantity if it determines that a CAFTA-DR supplier(s) or manufacturer(s) could partially fulfill the request for the subject product.

CITA also states that not later than six months after adding a product to the commercial availability list with a restricted quantity, CITA may eliminate the restriction if it determines that the subject product is not available in commercial quantities in a timely manner in the CAFTA-DR area.

Deemed approval - In the unlikely event that CITA does not make a determination in response to a request, not later than 45 U.S. business days after the official receipt of the request or not later than 60 U.S. business days after the official receipt of the request that was determined to lack sufficient information, the requested subject product will be added to the Commercial Availability list, in accordance with the requirements of 202(o)(4)(D) of the CAFTA-DR.

Denial - CITA may determine that the subject product is available in commercial quantities in a timely manner in the CAFTA-DR area.

Requests to remove item or restrict a quantity six months after listed. According to CITA, an interested entity may request that a product be either removed or that a quantity restriction be introduced six months after a requested subject product has been added to Commercial Availability List in an unrestricted quantity.

If CITA determines that the product is available in commercial quantities in a timely manner in the CAFTA-DR area, e.g., that a CAFTA-DR supplier(s) or manufacturer(s) is capable to supply all of the subject product requested originally, then that product will be removed from the Commercial Availability List.

If CITA determines that the product is available in commercial quantities in a timely manner in the CAFTA-DR area, e.g., that a CAFTA-DR supplier(s) or manufacturer(s) is capable to supply part of the subject product requested originally, then a restricted quantity will be introduced for that product.

Due Diligence Certification required for each factual submission. CITA's interim guidelines also require that an interested entity file a Due Diligence Certification with each submission containing factual information. If the interested entity has legal counsel or other representative, the legal counsel or other representative must file a Due Diligence Certification with each submission containing factual information. In the case of commercial availability requests, CITA notes that due diligence means the requestor has made reasonable efforts to obtain subject products from CAFTA-DR manufacturers. Requestors must provide certain specified documentation in order to demonstrate this requirement.

(See CITA's notice for description of the commercial availability request and determination process including: requirements for filing requests and submissions, CITA's consideration and acceptance of a commercial availability request, etc.)

- written comments due by March 9, 2006

CITA contact: Richard Stetson (202) 482-3400

CITA Interim Guidelines notice (FR Pub 02/23/06) available at http://a257.g.akamaitech.net/7/257/2422/01jan20061800/edocket.access.gpo.gov/2006/pdf/06-1734.pdf

CAFTA-DR Short Supply List available at http://www.ustr.gov/assets/Trade_Agreements/Bilateral/CAFTA/CAFTA-DR_Final_Texts/asset_upload_file721_3920.pdf (Annex 3.25 is located at pp. 67-70)

BP Note

The CAFTA-DR is also referred to as the DR-CAFTA.