Apparel Finishing

CBERA Benefits

By: Laura Rodriguez & Kim Freund

      The United States-Caribbean Basin Trade Partnership Act (CBTPA), enacted as Title II of the Trade and Development Act of 2000, amended the Caribbean Basin Economic Recovery Act (CBERA) to authorize the president to extend additional trade benefits to eligible CBERA beneficiary countries. In part, the legislation grants duty-free and quota-free treatment to imports of qualifying apparel articles assembled in CBERA countries from “fabrics wholly formed in the United States ” of U.S. yarns, whether the fabrics were cut to shape in the United States or CBERA countries.

      The legislation does not define “fabrics wholly formed in the United States,” raising the question of whether the fabrics must be dyed and finished in the United States or whether they can also be dyed and finished in CBERA countries. The interim regulations issued by the U.S. Customs Service to implement the trade benefit provisions of the CBTPA do not specifically address the dyeing and finishing issue. In the absence of a specific statutory requirement or regulation, preferential treatment currently is being granted to imports of qualifying apparel articles assembled in CBERA countries from U.S.-formed fabrics, regardless of whether the fabrics were dyed or finished in the United States or CBERA countries.

U.S. textile industry concerns

      The U.S. textile industry has expressed concern that these interim regulations effectively grant preferential treatment to apparel assembled in CBERA countries from fabrics made in the United States , but dyed and finished in CBERA countries. According to the domestic industry, the apparel trade benefits for CBERA countries are for the assembly of ...

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