As you know, the GSP program provides for the duty-free importation of designated articles when imported from designated beneficiary developing countries (BDCs). The Trade Act of 1974 sets out the two competitive need limitations (CNLs). When the President determines that a BDC exported to the United States during a calendar year either (1) a quantity of a GSP-eligible article having a value in excess of the applicable amount for that year ($120 million for 2005), or (2) a quantity of a GSP-eligible article having a value equal to or greater than 50 percent of the value of total U.S. imports of the article from all countries (the “50 percent CNL”), the President must terminate GSP duty-free treatment for that article from that BDC by no later than July 1 of the next calendar year.

Under the 1974 Act, the President may waive the 50 percent CNL with respect to an eligible article imported from a BDC if the value of total imports of that article from all countries during the calendar year did not exceed the applicable de minimis amount for that year ($17.5 million for 2005).

If imports of an eligible article from a BDC ceased to receive duty-free treatment due to exceeding a CNL in a prior year, the President may redesignate such an article for duty-free treatment if imports in the most recently completed calendar year did not exceed the CNLs.

Exclusions from GSP duty-free treatment where CNLs have been exceeded will be effective July 1, 2006, unless previously granted a waiver by the President. CNL exclusions, as well as decisions with respect to de minimis waivers and redesignations, will be based on full 2005 calendar year import statistics.

List II identifies GSP-eligible articles from BCs that (1) have not yet exceeded, but are approaching, the $120 million CNL for the period January-October, 2005, or (2) are close to or above the 50 percent CNL. Depending on final calendar year 2005 import data, these articles stand to lose GSP duty-free treatment on July 1, 2006, unless a waiver is granted. Such waivers are required to have been previously requested in the 2005 GSP Annual Review.

List III is a subset of List II. List III identifies GSP-eligible articles from BDCs that are close to or above the 50 percent CNL, but that may be eligible for a de minimis waiver of the 50 percent CNL.

List IV shows GSP-eligible articles from certain BDCs that are currently not receiving GSP duty-free treatment, but that have import levels (based on interim 2005 data) below the CNLs and thus may be eligible to be considered for redesignation, depending on final calendar year 2005 import data.

Actual eligibility for de minimis waivers will depend on final calendar year 2005 import data. Each year, de minimis waivers are considered automatically without a petition, and public comments are invited.

The products appearing in the attached lists may be of interest to AFI members. (Click the link below to view the lists.) Comments may be submitted to FR0441@USTR.GOV by January 27 regarding possible de minimis CNL waivers with respect to particular articles, and possible redesignations under the GSP program of articles currently not eligible for GSP benefits because they previously exceeded the CNLs. address. The e-mail address for these submissions is FR0441@USTR.GOV.