CHAPTER 4

TEXTILE AND APPAREL GOODS

Article 4.1:  Definitions

For the purposes of this Chapter:

customs offence means any act committed for the purpose of, or having the effect of,  avoiding  a  Party’s  laws  or  regulations  pertaining  to  the  terms  of  this Agreement governing importations or exportations of textile or apparel goods between the Parties, specifically those that violate a customs law or regulation for restrictions or prohibitions on imports or exports, duty evasion, falsification of documents  relating  to  the  importation  or  exportation  of  goods,  fraud  or smuggling; and

transition period means the period beginning on the date of entry into force of this Agreement between the Parties concerned until five years after the date on which the importing Party eliminates duties on a good for the exporting Party pursuant to this Agreement.

Article 4.2:  Rules of Origin and Related Matters

Application of Chapter 3

1.        Except as provided in this Chapter, Chapter 3 (Rules of Origin and Origin

Procedures) shall apply to textile and apparel goods.

De Minimis

2.         A textile or apparel good classified outside of Chapters 61 through 63 of the Harmonized System that contains non-originating materials that do not satisfy the applicable change in tariff classification requirement specified in Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin), shall nonetheless be considered to be an originating good if the total weight of all those materials is not more than 10 per cent of the total weight of the good and the good meets all the other applicable requirements of this Chapter and Chapter 3 (Rules of Origin and Origin Procedures).

3.         A textile or apparel good classified in Chapters 61 through 63 of the Harmonized   System   that   contains   non-originating   fibres   or   yarns   in   the component of the good that determines the tariff classification of the good that do not satisfy the applicable change in tariff classification set out in Annex 4-A

(Textiles and Apparel Product-Specific Rules of Origin), shall nonetheless be considered to be an originating good if the total weight of all those fibres or yarns is not more than 10 per cent of the total weight of that component and the good meets all the other applicable requirements of this Chapter and Chapter 3 (Rules of Origin and Origin Procedures).

4.         Notwithstanding paragraphs 2 and 3, a good described in paragraph 2 containing elastomeric yarn or a good described in paragraph 3 containing elastomeric yarn in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of one or more of the Parties.1, 2

Treatment of Sets

5.         Notwithstanding the textile and apparel product-specific rules of origin set out in Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin), textile and apparel  goods put  up in sets for retail sale, classified  as a result  of the application  of  Rule  3  of  the  General  Rules  for  the  Interpretation  of  the Harmonized System, shall not be regarded as originating goods unless each of the goods in the set is an originating good or the total value of the non-originating goods in the set does not exceed 10 per cent of the value of the set.

6.         For the purposes of paragraph 5:

 (a)       the value of non-originating goods in the set shall be calculated in the same manner as the value of non-originating materials in Chapter 3 (Rules of Origin and Origin Procedures); and

 (b)       the value of the set shall be calculated in the same manner as the value of the good in Chapter 3 (Rules of Origin and Origin Procedures).

Treatment of Short Supply List Materials

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