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AAFA Newsbreaker
March 24, 2009
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In this issue...
Legislative, Trade & Regulatory News
  • CPSC Spells Out CPSIA Problems
  • Senate Republicans Hold Hearing on Card Check as Some Major Companies Propose Compromise
  • Senate Confirms Ron Kirk as New US Trade Representative; Locke Nomination Advances
  • Climate Change Issue Gathers Steam
  • ATA Wins Appeal on Ports of LA/Long Beach Clean Trucks Program
  • AAFA Urges US Government to Pursue Ambitious Trans-Pacific Partnership (TPP) Agreement
  • CPSC Initiates Recall on Girl's Shoes
  • TPI Report On ICANN Ignores Registrants
  • Retail Prices for Apparel & Footwear Visibly Higher in February
    AAFA Member News
  • Kids Headquarters/Wear Me Apparel LLC Joins AAFA
    In the Press
  • Executives Detail Labor Bill Compromise
  • U.S.-Mexico Relationship Hits Some Bumps
  • Rapid Declines in Manufacturing Spreads Global Anxiety
  • Trade Barriers Could Threaten Global Economy
  • Legislative, Trade & Regulatory News

    Consumer Product Safety Commission (CPSC) Chair Nancy Nord issued a statement March 20 providing a very frank overview of the problems the CPSC has had in implementing the Consumer Product Safety Improvement Act (CPSIA). The letter illustrates the CPSC's argument that the CPSIA itself (and not those in charge of implementing the legislation), is unpractical and has resulted in serious problems for the CPSC, industry and consumers, but has not improved product safety. In fact, the letter goes so far as to say the CPSIA has "jeopardized [the CPSC's] ability to meet Commission priorities." The letter includes proposed practical solutions from CPSC staff that ultimately would allow greater Commission discretion and, therefore, would result in more practical implementation of the law. As the CPSC staff states, "The CPSIA forsakes the core strengths of the CPSC's original statutory framework which has from the beginning allowed the Commission to prioritize its regulation of consumer products by an overall assessment of all the risks at stake, the magnitude of those risks and the actual consequences of the hazard." The letter was in response to a letter sent March 4 to the CPSC by former House Energy and Commerce Chairman John Dingell (D-MI) asking a series of questions on the implementation of the CPSIA. Commissioner Thomas Moore also released a statement in response to the Dingell letter on March 20. Moore's statement echoed the stance of the Democratic Congressional leadership that Congress hold off on any legislative fixes of the CPSIA until a third "Democratic" Commissioner is appointed. (Rebecca Mond)

    Looking to find middle ground between business and labor, three major companies, Costco, Starbucks and Whole Foods, proposed their own compromise on the AAFA-opposed card check legislation, the so-called Employee Free Choice Act, on March 21 (Refer to Wash Post article below “Executives Detail Labor Bill Compromise”). The proposal was immediately rejected, however, by the business community as well as organized labor. Meanwhile, the Senate Republican Conference and the Republican Policy Committee held a hearing on the card check legislation March 23 to highlight the many burdens this legislation would place upon businesses and their employees. Senior Republican Senators heard from witnesses who presented an overview of the bill and perspectives from employers, small businesses and employees. AAFA continues to strongly oppose the bill and encourages member companies to write their members of Congress to urge them to vote against the legislation when it is considered later this year. (Kurt Courtney)

    The US Senate confirmed former Dallas Mayor Ron Kirk to be US Trade Representative on March 18 by a vote of 92 to 5. Just hours after the confirmation vote, Kirk met with European Union (EU) Trade Commissioner Catherine Ashton to discuss key trade matters, such as an on-going bilateral beef dispute and the Doha Round of global trade negotiations. Separately, the Senate Commerce Committee unanimously approved former Washington State Governor Gary Locke on March 19 for the position of Secretary of Commerce. Locke is expected to be confirmed by the full US Senate shortly. With the top political appointees in position at each agency, efforts will now accelerate to fill out sub-cabinet level staff positions. Already, President Barack Obama has nominated Senate Finance Committee Chief Trade Counsel Demetrios Marantis for the position of Deputy US Trade Representative (USTR). (Nate Herman)

    Product Showcase:
    STR Apparel & Footwear Testing

    Substantiating the quality, safety and responsible sourcing of apparel and footwear. STR delivers comprehensive services for the apparel & footwear industry including physical, chemical, biomechanical and field testing, flammability, fiber content, colorfastness, dimensional stability, strength, performance, construction, aging, care label verification, and fiber identification and analysis. Our responsible sourcing audits and training services are internationally recognized and offer a thorough and objective analysis of labor conditions at factories. Starting right at the source, we work with our clients to secure quality, conformity and social responsibility of products at every stage of manufacture. More info

    Members of Congress from both chambers continue to work on climate change legislation aimed at curbing greenhouse gas emissions and encouraging alternative and cleaner energy. Already, the issue has provoked sharp debates as serious budgetary, procedural and economic issues have emerged. In his FY 2010 budget, President Barack Obama proposed raising $646 billion through a new "cap and trade" plan. Initial discussions aimed at fast-tracking these proposals through the Congress, by including them in the budget reconciliation legislation to be considered this spring, have run into stiff resistance from both Democrats and Republicans. House Energy and Committee Chair Henry Waxman (D-CA) is preparing a bill that he hopes to report out of his Committee by Memorial Day. His Senate counterpart, Senator Barbara Boxer (D-CA), chair of the Senate Environment and Public Works Committee, is also working on a version for later this year. Both the House Ways and Means and Senate Finance Committee are also hoping to tackle this issue. In fact, the House Ways and Means Committee is exploring trade related aspects of climate change and has scheduled two hearings for this week. Separately, Obama's Energy Secretary Steven Chu told a House Commerce Committee hearing last week that the Administration is exploring imposing import taxes on US imports from countries that do not curb carbon emissions. Chu's comments drew an angry response from Chinese government officials who warned such a plan would be found illegal under global trading rules. (Steve Lamar)

    The American Trucking Associations (ATA) won a major victory on March 20 when the US 9th Circuit Court of Appeals ruled that part of the Clean Trucks Programs put in place by the Ports of Los Angeles and Long Beach violate federal law. A unanimous decision by a three-judge panel sends the matter back to the US District Court, which last summer denied a preliminary injunction sought by ATA to block a portion of the Clean Trucks Program requiring truckers to be enrolled in a concession program that governs certain aspects of their operations. On February 19, the ports began collecting the $70 fee per forty-foot container (FEU) from beneficial cargo owners under the Clean Trucks Programs to replace older trucks with more environmentally friendly vehicles. The Appeals Court decision does not block the ports from continuing to collect the container fee. (Kurt Courtney)

    AAFA submitted comments March 20 urging the US government to pursue negotiations towards an ambitious Trans-Pacific Partnership (TPP). The United States has proposed negotiating a free trade agreement with the so-called TPP countries, which includes the countries of Australia, Brunei Darussalam, Chile, New Zealand, Peru, Singapore and Vietnam. In its comments, AAFA argues that any agreement must be commercially-meaningful for the US apparel and footwear industries. AAFA also joined with a broad swath of the US business and agricultural community in sending a March 20 letter to President Barack Obama urging Obama to aggressively negotiate an ambitious TPP FTA. The US government plans to formally begin negotiations with the TPP countries sometime this spring. (Nate Herman)


    Tuesday, April 21-7:30 am-10:00 am - Breakfast Headliner Event - AAFA Presents: Leading Out Loud: Today’s Association Leaders Talk About the Future

    Wednesday, April 22-9:00 am-10:30 am - AAFA Presents: STOP! Your Business Depends on Understanding the New Consumer Product Safety Information Act

    The Consumer Product Safety Commission (CPSC), in conjunction with Nordstrom, issued a voluntary recall March 17 of approximately 31,000 girl's shoes. The shoes were recalled due to violation of the federal lead paint standard. They were sold at Nordstrom stores nationwide from September 2006 - February 2009. There have been no injuries reported with regard to this product. (Rebecca Mond)

    The Technology Policy Institute (TPI) published a report last week calling for International Corporation for Assigned Names & Numbers (ICANN) to be accountable solely with their contracted domain name registrars and registries, as they serve as ICANN's primary "users," and provide for most of its funding. However, the report ignores that the fact that Internet registrants -- the millions of businesses, people and organizations who own Internet domains -- are the primary supporters of ICANN. Registrars and registries may collect fees, but registrants pay them and have a vested interest in ICANN's policy-development process. ICANN stakeholders do not have a consistent means to challenge adverse decisions and hold ICANN accountable for its actions. Making ICANN solely accountable to only registries and registrars would only partially solve the weakness of ICANN's accountability mechanism because it would disenfranchise a massive and critical block of ICANN's constituents. (Kurt Courtney)


    According to the US Department of Labor's Bureau of Labor Statistics March 18 release of the Consumer Price Index (CPI), seasonally-adjusted retail prices for all types of apparel grew by 1.3 percent in February after increasing by 0.3 percent in January. The February increase, the largest on a month-on-month basis since the early 1990s, was partly the result of substantially higher average prices for women's dresses (+7.8 percent), men's shirts and sweaters (+5.2 percent), women's underwear, nightwear, sportswear and accessories (+3.8 percent), men's suits, sport coats and outerwear (+3.3 percent) and men's furnishings (+2.8 percent). On the other hand, prices for women's outerwear (-1.6 percent), women's suits and separates (-1.5 percent), and infants' and toddlers' apparel (-1.1 percent) experienced significant deflation in February. Overall footwear prices advanced 0.7 percent in February from the previous month, with prices for women's footwear 2.0 percent higher, prices for men's footwear 0.7 percent higher and prices for juvenile shoes 1.8 percent lower. Overall prices for apparel and footwear were 0.8 percent higher in February than in February 2008. February prices for men's and boys' apparel (+2.0 percent) and footwear (+1.6 percent) were higher than in February 2008, while prices for women's and girls' apparel (-0.5 percent) and infants' and toddlers' apparel (-1.9 percent) were lower. February overall retail prices for men's shoes were 3.3 percent above year-ago levels, while prices for juvenile shoes were 3.2 percent higher and prices for women's footwear were 0.3 percent lower. Overall retail prices increased for the second straight month in February, up by 0.4 percent on a seasonally-adjusted basis from the previous month, spurred by higher prices for energy, transportation and apparel. February retail prices were essentially unchanged from February 2008, however, up by only 0.2 percent. (Nate Herman)

    The law firm of Steptoe & Johnson LLP invites you to subscribe to our free newsletters: Customs Law Advisory, Apparel Industry Alert, and Upcoming Events. These periodic newsletters provide legal insight that may be crucial to your business. Subscribe today

    AAFA Member News

    Kids Headquarters / Wear Me Apparel LLC
    Robert Giordano, VP Compliance & Sourcing
    31 West 34th Street
    New York, NY 10001
    Phone: 212.736.9266

    Kids Headquarters / Wear Me Apparel LLC, is a leading diversified children’s wholesale apparel designer and marketer importer. The company’s portfolio consists of brands such as Calvin Klein, Coogi, Disney, Ecko, Hasbro, Hurley, Kenneth Cole, Rocawear, US Polo, KHQ brands, and private label programs.

    In the Press

    Executives Detail Labor Bill Compromise
    from The Washington Post
    As business and labor gird for battle over legislation that would make it easier for workers to organize, the debate could be transformed by a "third way" proposed by three companies that like to project a progressive image: Costco, Starbucks and Whole Foods. More

    U.S.-Mexico Relationship Hits Some Bumps
    from The Los Angeles Times
    Secretary of State Hillary Rodham Clinton ventures south of the border this week at a moment when the tricky dynamics of the U.S.-Mexico relationship are on full display. It's too soon to call it a rough patch, but a flap over cross-border trucking and unwelcome words about the drug war have led Mexico to push back against its powerful neighbor recently. More

    Rapid Declines in Manufacturing Spreads Global Anxiety
    from The New York Times
    That manufacturing is in decline is hardly surprising, but the depth and speed of the plunge are striking and, most worrisome for economists, a self-reinforcing trend not unlike the cascading bust that led to the Great Depression. More

    Trade Barriers Could Threaten Global Economy
    from The Washington Post
    At least 17 of the 20 major nations that vowed at a November summit to avoid protectionist steps that could spark a global trade war have violated that promise, with countries from Russia to the United States to China enacting measures aimed at limiting the flow of imported goods, according to a recent World Bank report. More

    AAFA Events & Educational Programs

    Mar. 26-27, 2009
    China Product Safety Conference


    Mar. 30-31, 2009
    China Product Safety Conference


    Complete schedule of events

    AAFA Member Partners & Programs

    By AAFA partner,
    Boxwood Technology, Inc.
    Employer and employee
    job services.

    Freight Savings Plan
    By AAFA partner, Siriani & Associates, Inc.
    Save on shipping costs.

    Footwear Testing Services
    By AAFA partner, Intertek
    Expert resource and discount technical testing

    RFID Savings Program
    By AAFA partner, Avery Dennison
    Negotiated below-market priced labels

    XRF Analyzers
    By new AAFA partners,
    Innov-x and Thermo Scientific.
    Identification and quantification of toxic metals in products.

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