Sunday, July 10, 2011

Vietnam clothing manufacturer with a concern called "rules of orgin" - yarn-forward rule

One of the rules of origin that each Vietnam clothing manufacturer should take into account before considering for exports opportunities is the "yarn-forward" rule which is listed as the basic origin rule for textile and apparel articles.
This means the yarn Vietnam clothing manufacturer used to form the fabric (which may later be used to produce wearing apparel or other textile products) must originate in a country which is on the list. In the circumstance of TPP Agreements, to apply "yarn-forward" rule, Vietnam clothing manufacturer has to make sure that the yarns are originated from those countries in the Partnership, i.e: USA, Australia, NZ...

To be more clear, assume that Vietnam is included in the TPP, a wool shirt made by Vietnam clothing manufacturer from fabric woven in Vietnam of wool yarn produced in China (not including in TPP) would not be considerer originating as the fact that the origin of the yarn is not within TPP countries.
In other case, if China wool fiber was imported by Vietnam clothing manufacturer and they spun it into wool yarn, which was then used to produce the wool fabric, the shirt would be considered originating.

In fact, Vietnam clothing manufacturer has no experience in dealing with "yarn-forward" rule of origin in any trade agreement before.

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