June 23, 2018
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Snowe, Michaud applaud modification to tariff loophole exploited by foreign shoe manufacturers

Ryan McLaughlin | BDN
Ryan McLaughlin | BDN
U.S. Sen. Olympia Snowe holds a New Balance shoe as she talks with an employee during a tour of the New Balance factory in Norridgewock in August, 2011.
By Alex Barber, BDN Staff

Sen. Olympia Snowe and Rep. Mike Michaud are hailing the closing of a tariff loophole they say foreign footwear manufacturers had been exploiting.

The International Trade Commission concluded an investigation of foreign shoe manufacturers who had been adding a small amount of textile material onto the sole of certain rubber footwear in order to get the shoes reclassified as a textile product and therefore subject to a much lower duty rate.

The ITC concluded its investigation on Aug. 9 and recommended that the U.S. Treasury Department modify the Harmonized Tariff Schedule of the U.S. to close the loophole. President Barack Obama signed the proclamation on Oct. 31.

“Increasingly, foreign footwear manufacturers are looking for ways to circumvent trade rules and gain an unfair advantage over our remaining producers here at home,” Snowe, R-Maine, said in a press release. “The investigation into these practices was vital to supporting the continued viability of workers in Maine and the resultant decision to close this loophole couldn’t come soon enough. Footwear production, which despite increased foreign competition still employs nearly 1,000 workers in our state, has served as a cornerstone of Maine and New England’s manufacturing base and I am dedicated to ensuring these lines remain Made-in-the-USA.”

Michaud echoed Snowe’s statement.

“The president’s announcement is good news for footwear jobs here in Maine. This is another example of how our nation’s trade policies impact the ability of our businesses to grow and create jobs,” the 2nd District Democrat said in a press release. “This smart, no cost policy change will help ensure that we have a more level playing field for an industry that still has a significant presence in our state. During a time of economic uncertainty, job growth here at home must be our number one priority. Closing this loophole represents a positive step forward.”

Snowe raised the issue with the Treasury Department on Jan. 15, 2010, and asked the ITC to investigate.

A letter by Snowe was sent to the ITC on July 2, 2010, requesting the investigation by ITC. It was also signed by Sen. Susan Collins and Rep. Chellie Pingree of Maine, along with five other senators and representatives.

Matt LeBretton, director of public affairs at New Balance Athletic Shoes Inc., was pleased to hear the news.

“We would like to extend our thanks to Senator Snowe for her continued support of footwear manufacturing in Maine,” LeBretton said in a press release. “As the last athletic footwear manufacturer in the United States, New Balance is proud of its heritage in Maine and grateful for the almost one thousand Mainers that make our shoes in Norridgewock, Skowhegan and Norway.”

Shoe manufacturer Genfoot Inc., which has a facility in Littleton, N.H., employs 150 workers and was also mentioned in the July 2 letter to the ITC.

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