After imposing a retaliatory duty of 26% additional duty on women’s jeans to be imported from US last year taking the total duty to 38% on such imports, EU decided to revoke the same few days back and bring the duty levels to 12.5%.
This decrease of import tax wil great news for the Californian garment industry, which produces roughly 75 percent of premium made in the US denim. The tariff hike was previously introduced in retaliation for the Byrd Amendment (a law which allowed the US to impose additional duties on undervalued imports), despite the World Trade Organization ruling against it in 2002. The duties previously collected are still being handed out as precondition legal procedures are completed.
In response the WTO has allowed each country to be affected to raise its tariff on items imported from the US in direct relation to the amount of AD or CV duties on the items from said country which were distributed over the previous year. This led EU to announce additional duties of 26% on the women’s denim jeans as a retaliation.
Since the adding premium womens denim to the list back in 2013, the distribution amount for 2013 has reduced by nearly 50 percent, which led the EU to lower its additional tariffs on women’s jeans and other affected items. However , EU still has the option to impose 26 percent tariff next year.
Various exporting companies from US have been hiring legal firms to claim refunds on various grounds including the arguments that “jeans do not fall under the definition of denim!!”.
Did the duties made an impact on imports of women jeans into EU?
It would be interesting to understand whether the imposition of duties affected the imports of women jeans into EU from US. Absolutely YES!!
The imports in 2013 fell by over 31% as compared to those in 2012. This was a drastic fall and should hve affected the Californian jeans industry in not a small way. Lets take a look at the chart below to understand the actual figures of imports in 2012 and 2013 including volumes, prices , values etc.
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