WHAT ARE THE MAIN AGOA APPAREL RULES OF ORIGIN?
The Rules of Origin (RoO) for Apparel exports under AGOA require Apparel to be assembled in Eligible Sub-Saharan African Countries with Yarn and Fabric made either in the United States or in African Countries, with an exception made for the Least Developped Countries. This rule is very important because it promotes job creation, economic growth, women empowerment and poverty eradication in African Countries.
As the textile and apparel products must be wholly obtained or produced in the country of origin, any foreign material incorporated into a textile or apparel product must first undergo a requisite shift in tariff classification heading within the claimed country of origin.
– For Staple Yarn, the country of origin is the country in which staple fibers are spun into yarn;
– For Filament Yarn, the country of origin is the country in which filament is extruded;
– For Plied, Gimped & Cabled Yarns, the country of origin is the one in which the fibers or filaments in the yarn are spun or extruded;
– For items made from yarn, strips, twine, cordage, ropes or cables (i.e., HTS 5609), they originate in country where they are produced.
– The country of origin is where the fabric is formed (i.e., woven, knitted, needled, tufted, felted, entangled or created by any other fabric making process);
– For dyed & printed fabrics made of silk, cotton, man-made or vegetable fiber.
Up to 25 percent of the value of apparel may include non Sub-Saharan African Countries or US origin thread, hooks, eyes, snaps, buttons, trim zippers, labels.
Up to 25 percent of the value of apparel may contain non Sub-Saharan African Countries and US origin interlinings.
Foreign findings, trimmings and interlinings cannot have a combined total value exceeding 25 percent of the product. AGOA III expanded product eligibility to allow non-AGOA produced collars, cuffs, drawstrings, padding/shoulder pads, waistbands, belts attached to garments, straps with elastic, and elbow patches for all import categories to be eligible.
Up to 10 percent by weight of articles may be of foreign fiber or yarn.
WHAT IS THE SPECIAL RULE FOR APPAREL APPLYING TO LESSER DEVELOPPED AGOA COUNTRIES?
Also known as the Third-Country Fabric Rule or the Third-Country Fabric Provision, this special rule allows exports to the United States from Lesser-Developped beneficiaries Countries (LDC) in th form of duty-free / quota-free access for apparel made from fabric originating anywhere in the world (even if the yarns and fabrics used in the production of the apparel are imported from non-AGOA countries). This rule is in effect until September 30, 2025 and is subject to a cap. According to the World Bank, LDC are the countries with a per capita gross national product of less than $1500 a year. You can see the Apparel Status for each AGOA Eligible country as well as what they are able to export under Category 9 on this website here.