I 

112TH CONGRESS 

1ST SESSION H. R. 2387 

To provide for preferential duty treatment to certain apparel articles of 

the Philippines. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 24, 2011 

Mr. MCDERMOTT (for himself, Mr. AUSTRIA, Mr. BILBRAY, Mr. FILNER, Ms. 

HIRONO, and Mr. SABLAN) introduced the following bill; which was referred to the Committee on Ways and Means 

A BILL 

To provide for preferential duty treatment to certain apparel 

articles of the Philippines. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Save Our Industries 

5 Act of 2011’’ or the ‘‘SAVE Act’’. 

6 SEC. 2. FINDINGS; PURPOSES. 

7 (a) FINDINGS.—Congress finds the following: 

8 (1) The United States and the Republic of the 

9 Philippines (in this Act referred to as the ‘‘Phil10 ippines’’), a former colony, share deep historical and 


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1 cultural ties. The Philippines holds enduring political 

2 and security significance to the United States. The 

3 2 countries have partnered very successfully in com4 bating terrorism in Southeast Asia. 

5 (2) The United States and the Philippines 

6 maintain a fair trading relationship that should be 

7 expanded to the mutual benefit of both countries. In 

8 2010, United States exports to the Philippines were 

9 valued at $7,375,000,000, and United States im10 ports from the Philippines were valued at 

11 $7,960,000,000. 

12 (3) United States textile exports to the Phil13 ippines were valued at just over $48,000,000 in 

14 2010, consisting mostly of industrial, specialty, 

15 broadwoven, and nonwoven fabrics. The potential for 

16 export growth in this area can sustain and create 

17 thousands of jobs. 

18 (4) The Philippines’ textile and apparel indus19 tries, like that of their counterparts in the United 

20 States, share the same challenges and risks stem21 ming from the end of the textile and apparel quota 

22 system and from the end of United States safe23 guards that continued to control apparel imports 

24 from the People’s Republic of China until January 

25 1, 2009. 


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1 (5) The United States apparel fabrics industry 

2 is heavily dependent on sewing outside the United 

3 States, and, for the first time, United States textile 

4 manufacturers would have a program that utilizes 

5 sewing done in an Asian country. In contrast, most 

6 sewing of United States fabric occurs in the Western 

7 Hemisphere, with about two-thirds of United States 

8 fabric exports presently going to countries that are 

9 parties to the North American Free Trade Agree10 ment and the Dominican Republic-Central America11 United States Free Trade Agreement. Increased de12 mand for United States fabric in Asia will increase 

13 opportunities for the United States industry. 

14 (6) Apparel producers in the Western Hemi15 sphere are excellent at making basic garments such 

16 as T-shirts and standard 5-pocket jeans. However, 

17 the needle capability does not exist to make high 

18 fashion, more sophisticated garments such as em19 broidered T-shirts and fashion jeans with embellish20 ments. Such apparel manufacturing is done almost 

21 exclusively in Asia. 

22 (7) A program that provides preferential duty 

23 treatment for certain apparel articles of the Phil24 ippines will provide a strong incentive for Philippine 

25 apparel manufacturers to use United States fabrics, 


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1 which will open new opportunities for the United 

2 States textile industry and increase opportunities for 

3 United States yarn manufacturers. At the same 

4 time, the United States would be provided a more 

5 diverse range of sourcing opportunities. 

6 (b) PURPOSES.—The purposes of this Act are— 

7 (1) to encourage higher levels of trade in tex8 tiles and apparel between the United States and the 

9 Philippines and enhance the commercial well-being 

10 of their respective industries in times of global eco11 nomic hardship; 

12 (2) to enhance and broaden the economic, secu13 rity, and political ties between the United States and 

14 the Philippines; 

15 (3) to stimulate economic activity and develop16 ment throughout the Philippines, including regions 

17 such as Manila and Mindanao; and 

18 (4) to provide a stepping stone to an eventual 

19 free trade agreement between the United States and 

20 the Philippines, either bilaterally or as part of a re21 gional agreement. 

22 SEC. 3. DEFINITIONS. 

23 In this Act: 

24 (1) CLASSIFICATION UNDER THE HTS.—The 

25 term ‘‘classification under the HTS’’ means, with reVerDate Mar 15 2010 04:09 Jul 01, 2011 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2387.IH H2387

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1 spect to an article, the 6-digit subheading or 10-digit 

2 statistical reporting number under which the article 

3 is classified in the HTS. 

4 (2) DOBBY WOVEN FABRIC.—The term ‘‘dobby 

5 woven fabric’’ means fabric, other than jacquard 

6 fabric, woven with the use of a dobby attachment 

7 that raises or lowers the warp threads during the 

8 weaving process to create patterns including, stripes, 

9 and checks and similar designs. 

10 (3) ENTERED.—The term ‘‘entered’’ means en11 tered, or withdrawn from warehouse for consump12 tion, in the customs territory of the United States. 

13 (4) HTS.—The term ‘‘HTS’’ means the Har14 monized Tariff Schedule of the United States. 

15 (5) KNIT-TO-SHAPE.—An article is ‘‘knit-to 

16 shape’’ if 50 percent or more of the exterior surface 

17 area of the article is formed by major parts that 

18 have been knitted or crocheted directly to the shape 

19 used in the article, with no consideration being given 

20 to patch pockets, applique ́s, or the like. Minor cut21 ting, trimming, or sewing of those major parts shall 

22 not affect the determination of whether an article is 

23 ‘‘knit-to-shape’’. 


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1 (6) WHOLLY ASSEMBLED.—An article is ‘‘whol2 ly assembled’’ in the Philippines or the United 

3 States if— 

4 (A) all components of the article pre-ex5 isted in essentially the same condition as the 

6 components exist in the finished article and the 

7 components were combined to form the finished 

8 article in the Philippines or the United States; 

9 and 

10 (B) the article is comprised of at least 2 

11 components. 

12 (7) WHOLLY FORMED.—A yarn is ‘‘wholly 

13 formed in the United States’’ if all of the yarn form14 ing and finishing operations, starting with the extru15 sion of filaments, strips, film, or sheet, and including 

16 slitting a film or sheet into strip, or the spinning of 

17 all fibers into yarn, or both, and ending with a fin18 ished yarn or plied yarn, takes place in the United 

19 States. 

20 SEC. 4. TRADE BENEFITS. 

21 (a) ELIGIBLE APPAREL ARTICLE.—For purposes of 

22 this section, an eligible apparel article is any one of the 

23 following: 

24 (1) Men’s and boys’ cotton shirts, T-shirts and 

25 tank tops (other than underwear T-shirts and tank 


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1 tops), pullovers, sweatshirts, tops, and similar arti2 cles classifiable under subheading 6105.10, 6105.90, 

3 6109.10, 6110.20, 6110.90, 6112.11, or 6114.20 of 

4 the HTS. 

5 (2) Women’s and girls’ cotton shirts, blouses, 

6 T-shirts and tank tops (other than underwear T7 shirts and tank tops), pullovers, sweatshirts, tops, 

8 and similar articles classifiable under subheading 

9 6106.10, 6106.90, 6109.10, 6110.20, 6110.90, 

10 6112.11, 6114.20, or 6117.90 of the HTS. 

11 (3) Men’s and boys’ cotton trousers, breeches, 

12 and shorts classifiable under subheading 6103.10, 

13 6103.42, 6103.49, 6112.11, 6113.00, 6203.19, 

14 6203.42, 6203.49, 6210.40, 6211.20, 6211.32 of the 

15 HTS. 

16 (4) Women’s and girls’ cotton trousers, breech17 es, and shorts classifiable under subheading 

18 6104.19, 6104.62, 6104.69, 6112.11, 6113.00, 

19 6117.90, 6204.12, 6204.19, 6204.62, 6204.69, 

20 6210.50, 6211.20, 6211.42, or 6217.90 of the HTS. 

21 (5) Men’s and boys’ cotton underpants, briefs, 

22 underwear-type T-shirts and singlets, thermal under23 shirts, other undershirts, and similar articles classifi24 able under subheading 6107.11, 6109.10, 6207.11, 

25 or 6207.91 of the HTS. 


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1 (6) Men’s and boys’ manmade fiber underpants, 

2 briefs, underwear-type T-shirts and singlets, thermal 

3 undershirts, other undershirts, and similar articles 

4 classifiable under subheading 6107.12, 6109.90, 

5 6207.19, or 6207.99 of the HTS. 

6 (7) Men’s and boys’ manmade fiber shirts, T7 shirts and tank tops (other than underwear T-shirts 

8 and tank tops), pullovers, sweatshirts, tops, and 

9 similar articles classifiable under subheading 

10 6105.20, 6105.90, 6110.30, 6110.90, 6112.12, 

11 6112.19, or 6114.30 of the HTS. 

12 (8) Women’s and girls’ manmade fiber shirts, 

13 blouses, T-shirts and tank tops (other than under14 wear T-shirts and tank tops), pullovers, sweatshirts, 

15 tops, and similar articles classifiable under sub16 heading 6106.20, 6106.90, 6110.30, 6110.90, 

17 6112.12, 6112.19, 6114.30, or 6117.90 of the HTS. 

18 (9) Men’s and boys’ manmade fiber trousers, 

19 breeches, and shorts classifiable under subheading 

20 6103.43, 6103.49, 6112.12, 6112.19, 6112.20, 

21 6113.00, 6203.43, 6203.49, 6210.40, 6211.20, or 

22 6211.33 of the HTS. 

23 (10) Women’s and girls’ manmade fiber trou24 sers, breeches, and shorts classifiable under sub25 heading 6104.63, 6104.69, 6112.12, 6112.19, 


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1 6112.20, 6113.00, 6117.90, 6204.63, 6204.69, 

2 6210.50, 6211.20, 6211.43, or 6217.90 of the HTS. 

3 (11) Men’s and boys’ manmade fiber shirts 

4 classifiable under subheading 6205.30, 6205.90, or 

5 6211.33 of the HTS. 

6 (12) Cotton brassieres and other body support 

7 garments classifiable under subheading 6212.10, 

8 6212.20, or 6212.30 of the HTS. 

9 (13) Manmade fiber brassieres and other body 

10 support garments classifiable under subheading 

11 6212.10, 6212.20, or 6212.30 of the HTS. 

12 (14) Manmade fiber swimwear classifiable 

13 under subheading 6112.31, 6112.41, 6211.11, or 

14 6211.12 of the HTS. 

15 (15) Cotton swimwear classifiable under sub16 heading 6112.39, 6112.49, 6211.11, or 6211.12 of 

17 the HTS. 

18 (16) Men’s and boys’ manmade fiber coats, 

19 overcoats, carcoats, capes, cloaks, anoraks (including 

20 ski-jackets), windbreakers, padded sleeveless jackets 

21 with attachments for sleeves, and similar articles 

22 classifiable under subheading 6101.30, 6101.90, 

23 6112.12, 6112.19, 6112.20, or 6113.00 of the HTS. 

24 (17) Women’s and girls’ manmade fiber coats, 

25 overcoats, carcoats, capes, cloaks, anoraks (including 


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1 ski-jackets), windbreakers, padded sleeveless jackets 

2 with attachments for sleeves, and similar articles 

3 classifiable under subheading 6102.30, 6102.90, 

4 6104.33, 6104.39, 6112.12, 6112.19, 6112.20, 

5 6113.00, or 6117.90 of the HTS. 

6 (18) Gloves, mittens, and mitts of manmade fi7 bers classifiable under subheading 6116.10, 

8 6116.93, 6116.99, or 6216.00 of the HTS. 

9 (b) DUTY-FREE TREATMENT FOR CERTAIN ELIGI10 BLE APPAREL ARTICLES.— 

11 (1) DUTY-FREE TREATMENT.—Subject to para12 graphs (2) and (3), an eligible apparel article shall 

13 enter the United States free of duty if the article is 

14 wholly assembled in the United States or the Phil15 ippines, or both, and if the component determining 

16 the article’s classification under the HTS consists 

17 entirely of— 

18 (A) fabric cut in the United States or the 

19 Philippines, or both, from fabric wholly formed 

20 in the United States from yarns wholly formed 

21 in the United States; 

22 (B) components knit-to-shape in the 

23 United States from yarns wholly formed in the 

24 United States; or 


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1 (C) any combination of fabric or compo2 nents knit-to-shape described in subparagraphs 

3 (A) and (B). 

4 (2) DYEING, PRINTING, OR FINISHING.—An ap5 parel article described in paragraph (1) shall be in6 eligible for duty-free treatment under such para7 graph if any component determining the article’s 

8 classification under the HTS comprises any fabric, 

9 fabric component, or component knit-to-shape in the 

10 United States that was dyed, printed, or finished at 

11 any place other than in the United States. 

12 (3) OTHER PROCESSES.—An apparel article de13 scribed in paragraph (1) shall not be disqualified 

14 from eligibility for duty-free treatment under such 

15 paragraph because it undergoes stone-washing, en16 zyme-washing, acid-washing, permapressing, oven 

17 baking, bleaching, garment-dyeing, screen printing, 

18 or other similar processes in either the United 

19 States or the Philippines. 

20 (c) KNIT-TO-SHAPE APPAREL ARTICLES.—A knit-to21 shape apparel article shall enter the United States free 

22 of duty if it is wholly assembled in the Philippines and 

23 if the component determining the article’s classification 

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1 shape in the Philippines from yarns wholly formed in the 

2 United States. 

3 (d) DE MINIMIS RULES.— 

4 (1) IN GENERAL.—An article that would other5 wise be ineligible for preferential treatment under 

6 this section because the article contains fibers or 

7 yarns not wholly formed in the United States or in 

8 the Philippines shall not be ineligible for such treat9 ment if the total weight of all such fibers or yarns 

10 is not more than 10 percent of the total weight of 

11 the article. 

12 (2) ELASTOMERIC YARNS.—Notwithstanding 

13 paragraph (1), an article described in subsection (b) 

14 or (c) that contains elastomeric yarns in the compo15 nent of the article that determines the article’s clas16 sification under the HTS shall be eligible for duty17 free treatment under this section only if such elas18 tomeric yarns are wholly formed in the United 

19 States or the Philippines. 

20 (3) DIRECT SHIPMENT.—Any apparel article 

21 described in subsection (b) or (c) is an eligible arti22 cle only if it is imported directly into the United 

23 States from the Philippines. 

24 (e) SINGLE TRANSFORMATION RULES.—Any of the 

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1 bled, or knit-to-shape, in the Philippines from any com2 bination of fabrics, fabric components, components knit3 to-shape, or yarns and are imported directly into the 

4 United States from the Philippines shall enter the United 

5 States free of duty, without regard to the source of the 

6 fabric, fabric components, components knit-to-shape, or 

7 yarns from which the articles are made: 

8 (1) Except for brassieres classified in sub9 heading 6212.10 of the HTS, any apparel article 

10 that is of a type listed in chapter rule 3(a), 4(a), or 

11 5(a) for chapter 62 of the HTS, as such chapter 

12 rule is contained in paragraph 9 of section A of the 

13 Annex to Proclamation 8213 of the President of De14 cember 20, 2007, (as amended by Proclamation 

15 8272 of June 30, 2008, or any subsequent procla16 mation by the President). 

17 (2) Any article not described in paragraph (1) 

18 that is any of the following: 

19 (A) Baby garments, clothing accessories, 

20 and headwear classifiable under subheading 

21 6111.20, 6111.30, 6111.90, 6209.20, 6209.30, 

22 6209.90, or 6505.90 of the HTS. 

23 (B) Women’s and girls’ cotton coats, over 

24 coats, carcoats, capes, cloaks, anoraks (includ25 ing ski-jackets), windbreakers, padded sleeveless 


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1 jackets with attachments for sleeves, and simi2 lar articles classifiable under subheading 

3 6102.20, 6102.90, 6104.19, 6104.32, 6104.39, 

4 6112.11, 6113.00, 6117.90, 6202.12, 6202.19, 

5 6202.92, 6202.99, 6204.12, 6204.19, 6204.32, 

6 6204.39, 6210.30, 6210.50, 6211.20, 6211.42, 

7 or 6217.90 of the HTS. 

8 (C) Cotton dresses classifiable under sub9 heading 6104.42, 6104.49, 6204.42, or 6204.49 

10 of the HTS. 

11 (D) Manmade fiber dresses classifiable 

12 under subheading 6104.43, 6104.44, 6104.49, 

13 6204.43, 6204.44, or 6204.49 of the HTS. 

14 (E) Men’s and boys’ cotton shirts classifi15 able under statistical reporting number 

16 6205.20.1000, 6205.20.2021, 6205.20.2026, 

17 6205.20.2031, 6205.20.2061, 6205.20.2076, 

18 6205.90, or 6211.32 of the HTS. 

19 (F) Men’s and boys’ cotton shirts not con20 taining dobby woven fabric classifiable under 

21 statistical reporting number 6205.20.2003, 

22 6205.20.2016, 6205.20.2051, 6205.20.2066 of 

23 the HTS. 

24 (G) Manmade fiber pajamas and sleepwear 

25 classifiable under subheading 6107.22, 6107.99, 


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1 6108.32, 6207.22, 6207.99, or 6208.22 of the 

2 HTS. 

3 (H) Women’s and girls’ wool coats, over4 coats, carcoats, capes, cloaks, anoraks (includ5 ing ski-jackets), windbreakers, padded sleeveless 

6 jackets with attachments for sleeves, and simi7 lar articles classifiable under subheading 

8 6102.10, 6102.30, 6102.90, 6104.31, 6104.33, 

9 6104.39, 6117.90, 6202.11, 6202.13, 6202.19, 

10 6202.91, 6202.93, 6202.99, 6204.31, 6204.33, 

11 6204.39, 6211.20, 6211.41, or 6117.90 of the 

12 HTS. 

13 (I) Women’s and girls’ wool trousers, 

14 breeches, and shorts classifiable under sub15 heading 6104.61, 6104.63, 6104.69, 6117.90, 

16 6204.61, 6204.63, 6204.69, 6211.20, 6211.41, 

17 or 6217.90 of the HTS. 

18 (J) Women’s and girls’ cotton shirts and 

19 blouses classifiable under subheading 6206.10, 

20 6206.30, 6206.90, 6211.42, or 6217.90 of the 

21 HTS. 

22 (K) Women’s and girls’ manmade fiber 

23 shirts, blouses, shirt-blouses, sleeveless tank 

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1 fiable under subheading 6206.10, 6206.40, 

2 6206.90, 6211.43, or 6217.90 of the HTS. 

3 (L) Women’s and girls’ manmade fiber 

4 coats, jackets, carcoats, capes, cloaks, anoraks 

5 (including ski-jackets), windbreakers, padded 

6 sleeveless jackets with attachments for sleeves, 

7 and similar articles classifiable under sub8 heading 6202.13, 6202.19, 6202.93, 6202.99, 

9 6204.33, 6204.39, 6210.30, 6210.50, 6211.20, 

10 6211.43, or 6217.90 of the HTS. 

11 (M) Cotton skirts classifiable under sub12 heading 6104.19, 6104.52, 6104.59, 6204.12, 

13 6204.19, 6204.52, or 6204.59 of the HTS. 

14 (N) Manmade fiber skirts classifiable 

15 under subheading 6104.53, 6104.59, 6204.53, 

16 or 6204.59 of the HTS. 

17 (O) Men’s and boys’ manmade fiber coats, 

18 overcoats, carcoats, capes, cloaks, anoraks (in19 cluding ski-jackets), windbreakers, padded 

20 sleeveless jackets with attachments for sleeves, 

21 and similar articles classifiable under sub22 heading 6201.13, 6201.19, 6201.93, 6201.99, 

23 6210.20, 6210.40, 6211.20, or 6211.33 of the 

24 HTS. 


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1 (P) Women’s and girls’ manmade fiber 

2 slips, petticoats, briefs, panties, and underwear 

3 classifiable under subheading 6108.11, 6108.22, 

4 6108.92, 6109.90, 6208.11, or 6208.92 of the 

5 HTS. 

6 (Q) Gloves, mittens, and mitts of cotton 

7 classifiable under subheading 6116.10, 6116.92, 

8 6116.99, or 6216.00 of the HTS. 

9 (R) Other men’s or boys’ garments classifi10 able under statistical reporting number 

11 6211.32.0081 of the HTS. 

12 (f) REVIEW AND REPORT.— 

13 (1) IN GENERAL.—The Comptroller General of 

14 the United States shall, not later than 3 years after 

15 the date of the enactment of this Act, and every 3 

16 years thereafter, review the effectiveness of this sec17 tion in supporting the use of United States fabrics 

18 and make recommendations necessary to improve or 

19 expand the provisions of this section to ensure sup20 port for the use of United States fabrics. 

21 (2) RECOMMENDATIONS.—After the second re22 view required under paragraph (1), the Comptroller 

23 General shall make a determination regarding 

24 whether this section is effective in supporting the 


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1 use of United States fabrics and recommend to Con2 gress whether or not this section should be renewed. 

3 (g) ENFORCEMENT.—Preferential treatment under 

4 this section shall not be provided to textile and apparel 

5 articles that are imported from the Philippines unless the 

6 President certifies to Congress that the Philippines is 

7 meeting the following conditions: 

8 (1) A valid original textile visa issued by the 

9 Philippines is provided to U.S. Customs and Border 

10 Protection with respect to any article for which pref11 erential treatment is claimed. The visa issued is in 

12 the standard 9-digit format required under the Elec13 tronic Visa Information System (ELVIS) and meets 

14 all reporting requirements of ELVIS. 

15 (2) The Philippines is implementing the Elec16 tronic Visa Information System (ELVIS) to assist in 

17 the prevention of transshipment of apparel articles 

18 and the use of counterfeit documents relating to the 

19 importation of apparel articles into the United 

20 States. 

21 (3) The Philippines is enforcing the Memo22 randum of Understanding between the United States 

23 of America and the Republic of the Philippines Con24 cerning Cooperation in Trade in Textile and Apparel 

25 Goods, signed on August 23, 2006. 


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1 (4) The Philippines agrees to provide, on a 

2 timely basis at the request of U.S. Customs and 

3 Border Protection, and consistently with the manner 

4 in which the records are kept in the Philippines, a 

5 report on exports from the Philippines of apparel ar6 ticles eligible for preferential treatment under this 

7 section, and on imports into the Philippines of 

8 yarns, fabrics, fabric components, or components 

9 knit-to-shape that are wholly formed in the United 

10 States. 

11 (5) The Philippines agrees to cooperate fully 

12 with the United States to address and take action 

13 necessary to prevent circumvention as provided in 

14 Article 5 of the Agreement on Textiles and Clothing 

15 referred to in section 101(d)(4) of the Uruguay 

16 Round Agreements Act (19 U.S.C. 3511(d)(4)). 

17 (6) The Philippines agrees to require Phil18 ippines producers and exporters of articles eligible 

19 for preferential treatment under this section to 

20 maintain, for at least 5 years after the date of ex21 port, complete records of the production and the ex22 port of such articles, including records of yarns, fab23 rics, fabric components, and components knit-to24 shape and used in the production of such articles. 


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1 (7) The Philippines agrees to provide, on a 

2 timely basis, at the request of U.S. Customs and 

3 Border Protection, documentation establishing the 

4 country of origin of articles eligible for preferential 

5 treatment under this section, as used by that coun6 try in implementing an effective visa system. 

7 (8) The Philippines is to establish, within 60 

8 days after the date of the President’s certification 

9 under this paragraph, procedures that allow the Of10 fice of Textiles and Apparel of the Department of 

11 Commerce (OTEXA) to obtain information when 

12 fabric wholly formed in the United States is ex13 ported to the Philippines to allow for monitoring and 

14 verification before the imports of apparel articles 

15 containing the fabric for which preferential treat16 ment is sought under this section reach the United 

17 States. The information provided upon export of the 

18 fabrics shall include, among other things, the name 

19 of the importer of the fabric in the Philippines, the 

20 8-digit HTS subheading covering the apparel articles 

21 to be made from the fabric, and the quantity of the 

22 apparel articles to be made from the fabric for im23 portation into the United States. 

24 (9) The Philippines has enacted legislation or 

25 promulgated regulations to allow for the seizure of 


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1 merchandise physically transiting the territory of the 

2 Philippines and that appears to be destined for the 

3 United States in circumvention of the provisions of 

4 this Act. 

5 (h) CUSTOMS PROCEDURES.— 

6 (1) IN GENERAL.— 

7 (A) PENALTIES FOR EXPORTERS.—If the 

8 President determines, based on sufficient evi9 dence, that an exporter has engaged in trans10 shipments as defined in paragraph (2), then the 

11 President shall deny for a period of 5 years all 

12 benefits under this section to such exporter, any 

13 successor of such exporter, and any other entity 

14 owned or operated by the principal of the ex15 porter. 

16 (B) PENALTIES FOR IMPORTERS.—If the 

17 President determines, based on sufficient evi18 dence, that an importer has engaged in trans19 shipments as defined in paragraph (2), then the 

20 President shall deny for a period of 5 years all 

21 benefits under this section to such importer, 

22 any successor of such importer, or any entity 

23 owned or operated by the principal of the im24 porter. 


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1 (2) DEFINITION OF TRANSHIPMENT.—For pur2 poses of paragraph (1) and subsection (g), trans3 shipment has occurred when preferential treatment 

4 for an apparel article under this section has been 

5 claimed on the basis of material false information 

6 concerning the country of origin, manufacture, proc7 essing, cutting, or assembly of the article or of any 

8 fabric, fabric component, or component knit-to-shape 

9 from which the apparel article was cut and assem10 bled. For purposes of this paragraph, false informa11 tion is material if disclosure of the true information 

12 would have meant that the article is or was ineligible 

13 for preferential treatment under this section. 

14 (i) PROCLAMATION AUTHORITY.—The President 

15 shall issue a proclamation to carry out this section not 

16 later than 60 days after the date of the enactment of this 

17 Act. The President shall consult with the Committee on 

18 Finance of the Senate and the Committee on Ways and 

19 Means of the House of Representatives in preparing such 

20 proclamation. 

21 SEC. 5. EFFECTIVE DATE. 

22 This Act shall apply to articles entered, or withdrawn 

23 from warehouse for consumption, on or after the 15th day 

24 after the date on which the President issues the proclama25 tion required by section 4(i). 


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1 SEC. 6. TERMINATION. 

2 (a) IN GENERAL.—The preferential duty treatment 

3 provided under this Act shall remain in effect for a period 

4 of 7 years beginning on the effective date provided for in 

5 section 5. 

6 (b) GSP ELIGIBILITY.—The preferential duty treat7 ment provided under this Act shall terminate if and when 

8 the Philippines becomes ineligible for designation as a ben9 eficiary developing country under title V of the Trade Act 

10 of 1974 (19 U.S.C. 2461 et seq.). 

Æ 


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