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U.S. House of Representatives Approves Trade Preferences Bill

The U.S. House of Representatives passed the non-controversial Trade Preferences Extension Act of 2015 Thursday, and the legislation, once adopted, is expected to immediately reduce costs for U.S. apparel and footwear businesses and consumers.

In a 397-32 vote, the House approved the trade preferences bill, which includes a 10-year renewal of the African Growth and Opportunity Act (AGOA), retroactive renewal and an update to the Generalized System of Preferences (GSP) program and an extension of the Haiti HELP/HOPE program.

The Senate passed a nearly identical bill last month, but because the House-approved bill included additional amendments, the Senate will re-review the bill, and its final Congressional approval is expected this month.

“Critical among this package is the renewal and update of the Generalized System of Preferences program,” American Apparel and Footwear Association president and CEO Juanita D. Duggan said of the program that expired in 2013. “Renewal of the program will end the $2 million a day companies are losing with the lapse in the program. With the update of GSP, we can now begin a process to get travel goods – such as backpacks, luggage, and phone cases – qualified for GSP benefits.”

The $2 million a day references the estimated total American companies paid in unnecessary duties without GSP in place.

“Extension of the AGOA and the Haiti preferences program allows clothing and shoe companies to maintain business in those regions without disruption and with certainty that these key trade platforms will not expire,” Duggan added.

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House Ways and Means Chairman Paul Ryan (R-WI) spoke on behalf of the bill saying, “This bill will strengthen America by promoting free enterprise all around the world,” according to a C-Span transcript of Thursday’s House session.

As part of the House-approved bill, a new tariff has been created for performance outerwear and duties on hiking and running shoes have been lowered.

Footwear Distributors and Retailers of America (FDRA) president Matt Priest said, “This bipartisan legislation is critical to U.S. footwear companies currently sourcing from Africa and those who are looking to source there in the years to come. We expect the Senate to move quickly to pass AGOA and the President to sign it in the coming days. As countries like Ethiopia are becoming increasingly important as a supplier of footwear to the U.S., the value of this vital trade program will only increase.”

The House will be voting on trade promotion authority Friday, the fast-track bill that would allow the president to present trade deals before Congress with an up or down vote and no amendments.