Letter to the Honorable Susan Schwab, United States Trade Representative

Letter

Today U.S. Senators Charles E. Schumer and Hillary Rodham Clinton urged the Office of the United States Trade Representative to reject a petition that would eliminate preferential benefits for Brazilian exports of polyethylene terephthalate film (PET film), a material used in packaging and insulation. If upheld, this petition would unfairly threaten the only US-owned commercial company left in the industry—Terphane Holding Corporation located in Bloomfield, NY.

With a second facility located in Brazil, Terphane relies heavily on Brazilian products. By eliminating Brazil's export eligibility, the petition will give the company's growing Asian competitors an unfair edge in the market, increasing their threat to Terphane's operations and livelihood. In a letter today to Ambassador Susan Schwab, Schumer and Clinton urged her to reject the petition, as it would have devastating effects on production and jobs in the Rochester area.

"This is a clear manipulation of US trade laws and, if not stopped immediately, will cut the legs out from under Terphane, a company that has become a vital employer in the Rochester region," said Schumer. "I will continue to press the Trade Representative's office to reject this unfair proposal and protect a critical industry asset to both Upstate New York and the entire country."

"This proposal has the potential to undercut a company that is proud of its partnership in the community, and that is continuing to boost the economic growth and vitality of the Rochester area," said Senator Clinton. "It is critical that the Trade Representative's office reject this petition that would threaten the Terphane Holding Corporation by providing an unfair advantage to foreign competition."

Terphane's domestic operations have been located in Bloomfield, New York since the early 1980s. It has just recently increased its payroll by nearly 40 percent, but just as this small company is starting to grow, it faces a major challenge from aggressive foreign-owned multinational companies - mostly in Asia - seeking to manipulate U.S. trade laws to gain unfair advantage in the U.S. market.

Terphane produces PET film at its New York facility, and also at a facility located in the Brazilian state of Pernambuco. U.S. imports from Brazil are sent to Terphane's New York operations for further processing and value-added work to meet customer needs. According to Terphane, eliminating Brazil's eligibility on PET film would seriously harm Terphane's U.S. production and the related jobs because such elimination will have the effect of benefiting imports from Asia.

In a letter today to Ambassador Schwab, Schumer and Clinton urged her to reject this unfair petition and stand up for the sole remaining US-owned producer of PET film.

Full text of the letter is below:

The Honorable Susan Schwab
United States Trade Representative
Executive Office of the President
600 17th Street, NW
Washington, D.C. 20508

Dear Ambassador Schwab,

We understand your staff and an inter-agency committee are currently considering a petition to eliminate preferential benefits for Brazilian exports of polyethylene terephthalate film (PET film) under the Generalized System of Preferences (GSP). Eliminating GSP benefits for PET film from Brazil would seriously threaten Terphane Holding Corporation (Terphane), the only U.S.-owned commercial company left in the industry, which is located in our state. We urge you to reject the petition.

Terphane's domestic operations are located in Bloomfield, New York. The company has been in Bloomfield since the early 1980s. It has been a small, but understandably proud, manufacturer in the region, and just recently it has increased its payroll by nearly 40 percent. Just as this small company is starting to grow, however, it faces a major challenge from aggressive foreign-owned multinational companies - mostly in Asia - seeking to manipulate U.S. trade laws to gain unfair advantage in the U.S. market.

Terphane produces PET film at its New York facility, and also at a facility located in a very poor area of the Brazilian state of Pernambuco. U.S. imports from Brazil are sent to Terphane's New York operations for further processing and value-added work to meet customer needs. According to Terphane, eliminating Brazil's GSP eligibility on PET film would seriously harm Terphane's U.S. production and the related jobs because such elimination will have the effect of benefiting imports from Asia. These imports include those from the affiliates of the petitioners in this GSP case: U.S. subsidiaries or joint venture partners of Japanese and Korean-based companies.

The GSP program should not be manipulated to damage U.S. producers. If the petitioner's request is granted to remove Brazil's GSP eligibility on PET film, Terphane has told us that the subsequent impact will harm the sole remaining U.S.-owned producer of PET film. In our view it would represent a blatant misuse of U.S. trade laws. We urge you to turn down the request to remove Brazil's GSP eligibility for PET film.

Sincerely,

Charles E. Schumer
United States Senator

Hillary Rodham Clinton
United States Senator

cc: Marideth Sandler; Members of the GSP Subcommittee

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