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THE WHITE HOUSE

Office of the Press Secretary

For Immediate Release November 12, 1999

FACT SHEET

Southeast Europe Trade Preference Act

Today, the Office of the United States Trade Representative transmitted to Congress the "Southeast Europe Trade Preference Act" (SETPA), which would implement, in part, the President's commitments to the countries of Southeast Europe pursuant to the Southeast Europe Trade Expansion Initiative announced at the Sarajevo Summit in July 1999.

The SETPA is patterned after the Andean Trade Preference Act of 1990. Just as the Andean Trade Preference Act did for the countries of the Andean region, the SETPA would provide the authority to establish duty-free treatment of certain imports from the countries and territories of Southeast Europe on the basis of specified criteria.

The SETPA would extend duty-free treatment to products that are currently not eligible under the GSP program, most notably certain iron and steel products, certain agricultural products, footwear, glassware, ceramics, automobiles, bicycles, and clocks and watches. Full utilization of the additional duty-free treatment under the SETPA will provide several of the countries of Southeast Europe with over 80% duty-free entry.

The proposed legislation also contains the following important provisions:

The President would be authorized to grant duty-free treatment to imports from the beneficiary countries or territories for five years.

The President would be authorized to designate Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Macedonia, Romania, Slovenia, Kosovo, and Montenegro as beneficiary countries or territories, based on mandatory and discretionary criteria detailed in the bill covering issues such as intellectual property, labor rights, local economic conditions, prohibitions on bribery and others.

The Republic of Yugoslavia would be eligible for designation as a beneficiary country only if the President determines that the governments of the Federal Republic of Yugoslavia and the Republic of Serbia have made significant progress on participation in a political process to determine Kosovo's future, compliance with the Dayton peace agreement, internal democratic reform, cooperation on succession issues, cooperation with the International Criminal Tribunal in the Hague, and peaceful resolution of differences between Serbia and Montenegro.

All textiles and apparel products which are not eligible for duty-free treatment under the Generalized System of Preferences would similarly be ineligible for duty-free treatment under the SETPA.

Articles would be eligible for duty-free entry if they are imported directly from a beneficiary country, consist of at least 35 percent value-added in a beneficiary country or countries, and are made of components originating in the beneficiary countries (to which 15 percent of the total value from U.S.-made components may be applied) or, if of foreign origin, have been substantially transformed in the beneficiary country or countries into new and different articles of commerce.

The U.S. International Trade Commission and the Department of Labor would be required to monitor and report on the impact of the SETPA on the U.S. economy and U.S. labor, respectively.

The full text of the transmitted proposal is available on the Office of the United States Trade Representative website at: www.ustr.gov.

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