On the eve of the July 1 deadline, the United States Trade Representative (USTR) expanded duty-free status to sports bags and backpacks produced in least developed and AGOA countries. These countries are eligible for benefits under the Generalized System of Preferences (GSP) program. A decision on expansion to all GSP countries is pending (See chart on Page 33: https://fas.org/sgp/crs/misc/RL33663.pdf).
The GSP encourages investment in developing countries as a way of assisting those countries in transitioning to a manufacturing-based economy, say proponents of the measures. The new duty structure went into effect on July 1, 2016.
Backpacks and sports bags imported from GSP-eligible countries would avoid tariffs of up to 17.6 percent. In August 2015 the USTR announced that GSP-eligible products would be expanded to include travel goods for the first time. The granting of duty-free status to GSP-eligible products advances this year-long process.
The Sports & Fitness Industry Association (SFIA) seized the opportunity to organize petitions for their member companies who produce backpacks and sports bags. Petitions were filed in October and accepted for consideration in January. SFIA members testified before the ITC and USTR in March in support of GSP expansion.
“This is a positive step in the process in lowering costs for our members in the backpack and sports bag industry, but we remain focused on expansion to all GSP countries,” said Bill Sells, SFIA, Vice President Government Relations and Public Affairs. “We look forward to working with the USTR on GSP expansion and with the ITC for additional tariff relief via the Miscellaneous Tariff Bill (MTB).”
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