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Duty-Free Import Opportunity for Handbag, Luggage Importers

Wednesday, July 08, 2015
Sandler, Travis & Rosenberg Trade Report

Beginning this month, importers of handbags, backpacks, suitcases and similar items will have a narrow window of opportunity to request duty-free treatment of these products, which currently carry duty rates that range from 5.3 to 20 percent.

Legislation recently signed into law by President Obama reinstated the Generalized System of Preferences after a nearly two-year lapse. For more than 40 years GSP has helped U.S. importers realize substantial cost savings through duty-free treatment of thousands of qualifying goods from more than one hundred developing countries. The new law expands the potential coverage of this program to include textile and leather travel goods such as handbags and luggage.

However, duty-free treatment for these products under GSP is not automatic, and importers and others interested in obtaining this treatment should act quickly to begin the lengthy process required to do so.

To qualify for GSP treatment these items must meet strict manufacturing and/or in-country value-added criteria and be added to the list of GSP-eligible items. Those interested in adding a product to this list must first submit a petition to the Office of the U.S. Trade Representative. If the petition is accepted, the petitioner must follow a year-long process that includes the drafting and submission of comments and briefs as well as advocacy during hearings designed to gauge the economic impact of the product’s inclusion. A strong economic case will have to be made during this process if the petition is to be successful. Optimally, the process will end with the issuance of a presidential proclamation granting GSP eligibility to the covered product beginning July 1, 2016.

For more information about, or assistance getting started with, the process of obtaining GSP treatment for your products, contact Sandler, Travis & Rosenberg’s Nicole Bivens Collinson via email or at (202) 730-4956.

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