Memorandum on Modifications of the Generalized System of Preferences

Memorandum for the United States Trade Representative

Subject: Actions Concerning the Generalized System of Preferences

Pursuant to subsections 502(b)(4) and 502(b)(7) and section 504 of the Trade Act of 1974, as amended (the 1974 Act) (19 U.S.C. 2462(b)(4), 2462(b)(7), and 2464), the President is authorized to make determinations concerning the alleged expropriation without compensation by a beneficiary developing country, to make findings concerning whether steps have been taken or are being taken by certain beneficiary developing countries to afford internationally recognized worker rights to workers in such countries, and to modify the application of duty-free treatment under the Generalized System of Preferences (GSP) currently being afforded to such beneficiary developing countries as a result of my determinations.

Specifically, after considering private sector requests for a review of the alleged violation by Costa Rica and Uruguay of the expropriation provisions of subsection 502(b)(4) of the 1974 Act, I have decided to terminate the reviews of Costa Rica and Uruguay without prejudice, noting that modification of GSP eligibility is not warranted at this time.

Second, after considering various private sector requests for a review of whether or not certain beneficiary developing countries have taken or are taking steps to afford internationally recognized worker rights (as defined in subsection 502(a)(4) of the 1974 Act) to workers in such countries, and in accordance with subsection 502(b)(7) of the 1974 Act, I have determined that Indonesia and Thailand have taken or are taking steps to afford internationally recognized worker rights, and I have determined that Liberia has not taken and is not taking steps to afford such internationally recognized rights. Therefore, I am notifying the Congress of my intention to suspend the GSP eligibility of Liberia. Finally, I have determined to continue to review the status of such worker rights in Benin, the Dominican Republic, Haiti, Nepal, and Syria.

Further, pursuant to section 504 of the 1974 Act, after considering various requests for a waiver of the application of section 504(c) of the 1974 Act (19 U.S.C. 2464(c)) with respect to certain eligible articles, I have determined to modify the application of duty-free treatment under the GSP currently being afforded to certain articles and to certain beneficiary developing countries.

Specifically, I have determined, pursuant to subsection 504(d)(1) of the 1974 Act (19 U.S.C. 2464(d)(1)), that the limitation provided for in subsection 504(c)(1)(B) of the 1974 Act should not apply with respect to certain eligible articles because no like or directly competitive article was produced in the United States on January 3, 1985. Such articles are enumerated in the list of Harmonized Tariff Schedule of the United States (HTS) subheadings in Annex A.

Pursuant to subsection 504(c)(3) of the 1974 Act, I have also determined to: 1) waive the application of section 504(c) of the 1974 Act with respect to certain eligible articles from certain beneficiary developing countries; and 2) waive the application of subsection 504(c)(2)(B) of the 1974 Act with respect to certain eligible articles from certain beneficiary developing countries. I have received the advice of the United States International Trade Commission on whether any industries in the United States are likely to be adversely affected by such waivers, and I have determined, based on that advice and on the considerations described in sections 501 and 502(c) of the 1974 Act (19 U.S.C. 2461 and 2462(c)), that such waivers are in the national economic interest of the United States. The waivers of section 504(c) of the 1974 Act apply to the eligible articles in the HTS subheadings and the beneficiary developing countries opposite such HTS subheadings enumerated in Annex B. The waivers of subsection 504(c)(2)(B) of the 1974 Act apply to the eligible articles in the HTS subheadings and the beneficiary developing countries opposite such HTS subheadings enumerated in Annex C.

These determinations shall be published in the Federal Register.

George Bush

[Filed with the Office of the Federal Register, 12:19 p.m., April 30, 1990]