Free Trade Agreements
Summary of the U.S.-Oman Free Trade Agreement
Status: Implemented on January 1, 2009
**The information presented on this website is meant to serve as a guide.
Only the agreement text and the customs regulations issued to implement the agreement
are definitive. For complex issues or where interpretation is required, U.S. exporters should seek legal assistance or an advanced ruling from the customs administration in the country to which they are exporting.**
If you have any questions about this Agreement, please contact Homer Boyer
at the U.S. Department of Commerce Office of Textiles and Apparel at 202-482-3400 or by email.
How U.S. Textile and Apparel Companies Benefit
The U.S.-Oman Free Trade Agreement is expected to create new exporting opportunities for U.S. textile and apparel businesses while at the same time promoting economic growth and democracy in the Middle East. The Agreement also will provide new opportunities for services, provide a secure and predictable legal framework for investment, provide for effective enforcement of labor and environmental laws, and protect intellectual property.
Under the FTA, all qualifying footwear and travel goods from the United States can enter Oman duty-free. Duties on the majority of qualifying U.S. textile and apparel products entering into Oman will be eliminated immediately or will be eliminated in equal annual stages within 10 years after the agreement enters into force. The duty-free status and/or staged tariff rates are listed by HS number in the Oman FTA tariff schedule. Each line item of the FTA tariff schedules is assigned a letter code that indicates the staging by which the duty for each product is reduced and ultimately eliminated. The staging categories listed below generally apply to textile and apparel products in HS chapters 50-63.
For importing textile and apparel product from Oman to the United States, see the U.S. FTA tariff schedule. All qualifying travel goods are duty-free and all qualifying footwear from Bahrain can enter the United States duty-free except for the following items, where duties will be phased-out in equal increments over a 10-year period: 6401.10.00, 6401.91.00, 6401.92.90, 6401.99.30, 6401.99.60, 6401.99.90, 6402.30.50, 6402.30.70, 6402.30.80, 6402.91.50, 6402.91.80, 6402.91.90, 6402.99.20, 6402.99.80, 6402.99.90, 6404.11.90 & 6404.19.20.
- Category A: Goods will be duty-free immediately upon entry into force of the agreement.
- Category B: Duties will be eliminated in 5 equal annual stages upon entry into force.
- Category C: Duties will be eliminated in 10 equal annual stages upon entry into force.
See Chapter 3 - Textiles and Apparel for more details on the tariff elimination, as well as the exception listed below.
Tariff Preference Levels (TPL)--The FTA allows for a certain quantity of apparel goods that do not meet the rules of origin to come in under a preferential tariff rate. These limited allowances for the use of yarn and fabric from a nonparty, referred to as TPL, allows U.S. apparel exporters some flexibility in their inputs. The TPL is set at an initial level of 50,000,000 square meters equivalent (sme) for cotton and man-made fiber apparel for the first ten years upon entry into force of this agreement. Any non-originating goods exceeding the quantity limits will be subject to the non-preferential (i.e., MFN) rate of duty. After the TPL expires, all trade under the FTA must adhere to the yarn-forward rule of origin. The TPL applies to both FTA partner countries and is set to expire on December 31, 2018.. (See Article 3.2, paras. 8-9 of the Textiles and Apparel Chapter for more details).
Also see ITA's FTA Tariff Tool to determine current and future tariffs for qualifying products, as well as the date on which products are duty-free.
Qualifying Products/Rules of Origin
In order to take advantage of the duty reduction/elimination, products must qualify as "originating" goods under the terms of the Agreement. In general, the product must have sufficient U.S. or Omani content or processing to meet the criteria. Goods containing only U.S. or Omani inputs qualify. Goods containing inputs from other countries still might qualify if they meet specific criteria.
Rule of Origin for Textile and Apparel Goods:
Textile and apparel products are subject to specific rules, based on tariff classification (see Annex 3-A - Rules of Origin for Textiles or Apparel Goods).
The rules for textile and apparel products are generally referred to as "yarn forward," which requires that the yarn production and all operation forward occur in either Oman or the United States, but the fiber may be from anywhere. There are some exceptions in the rules requiring "fiber forward," and some requiring "fabric forward".
If a good does not meet the rule of origin requirements as indicated above, a textile or apparel product might be considered originating if all non-originating fibers and yarns make up less than a "de minimis" seven percent of the total weight of the product. Special provisions also apply to textile and apparel goods put up in sets for retail sale. To see more details on these provisions, see Article 3.2 - Rules of Origin and Related Matters of the Textiles and Apparel Chapter.
Rules of Origin for Non-Textile Footwear and Travel Goods:
For non-textile footwear and travel goods, the good will qualify under the FTA if it is a new or different article of commerce that has been grown, produced, or manufactured in the territory of one or both of the Parties; and the sum of (i) the value of materials produced in the territory of one or both of the Parties, plus (ii) the direct costs of processing operations performed in the territory of one or both of the Parties is not less than 35 percent of the appraised value of the good at the time it is imported into the territory of a Party.
For more information, see the U.S. Customs and Border Protection presentation--How do I Read Tariff Shift Rules.
Qualifying goods for which FTA duty benefits are requested, the importer must make a claim of preference. The Agreement does not require that the importer provide a certificate of origin in support of the claim of preference. However, both the importer and the exporter have obligations to generate supporting documentation to back-up any claims of preferential treatment under the FTA.
To make a claim for preferential tariff treatment for a good, the importer must submit to the customs authority of the importing Party, on request, a signed declaration setting forth all pertinent information concerning the growth, production, or manufacture of the good. A requested declaration may require the following details:
- a description of the good, quantity, numbers, and invoice numbers and bills of lading
- a description of the operations performed in the production of the good in the territory of one or both of the Parties
- a reference to the specific provision that forms the basis for the claim for preferential tariff treatment
- a statement as to any fiber, yarn, or fabric of a non-Party and the origin of such material used in the production of the good
- a description of the operations performed on, and a statement as to the origin and value of, any foreign materials used in the good that are claimed to have been sufficiently processed in the territory of one or both of the Parties so as to be materials produced in the territory of one or both of the Parties, or are claimed to have undergone an applicable change in tariff classification specified in Annex 3-A (Rules of Origin for Textile or Apparel Goods) or Annex 4-A; and
- (v) a description of the origin and value of any foreign materials used in the good that are not claimed to have been substantially transformed in the territory of one or both of the Parties, or are not claimed to have undergone an applicable change in tariff classification specified in Annex 3-A (Rules of Origin for Textile or Apparel Goods) or Annex 4-A.
Omani Customs officials may verify a claim of preferential treatment up to five years after the date of importation. Therefore, it is recommended that importers and exporters maintain documents relating to the importation of the good and all supporting documents for at least five years.
For information on common export documents, such as transportation documents, export compliance documents, certificates of origin, certificates for shipments of specific goods, temporary shipment documents, and other export-related documents, see the Export.gov webpage on Common Export Documents.
Measures to Prevent Circumvention of the Agreement’s Rule of Origin
The FTA contains additional measures to ensure that textile and apparel goods are not subject to fraud, such as transshipment. The parties agree that the exporting Party, at the request of the importer Party, shall conduct verification procedures to determine that a claim for origin of a textile and apparel good is accurate, allows the exchange of information between parties when suspicion occurs, and permits the importing party to suspend preferential tariff treatment to the textile and apparel good under suspicion or any textile and apparel good produced or exported by a specific company. (For further information, please see Article 3.3 - Customs Cooperation for Textile and Apparel Goods of the Textiles and Apparel Chapter for more details).
Measures to Prevent Serious Damage, or Actual Threat Thereof, to the Domestic Industry
The FTA allows either party to re-impose MFN tariffs if imports from the other party damage domestic products. If there is serious damage, or threat thereof, to the domestic textile and apparel industry due to an increase of imports from the FTA partner country, the importing Party may increase the preferential tariff rate on an originating good. The Safeguard can only be invoked after investigation by competent authorities, and can only be implemented for 3 years. The importing Party shall provide to the exporting Party mutually agreed trade liberalizing compensation in the form of concessions having substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the safeguard action. Such concessions shall be limited to textile and apparel goods, unless the Parties agree otherwise. (For more information, please see Article 3.1 - Bilateral Emergency Actions of the Textiles and Apparel Chapter for more details).
Intellectual Property Rights:
The FTA commits Oman to provide and enforce world-class IPR protection. Under its FTA obligations, Oman will provide increased IPR protection for copyrights, trademarks, geographical indications, and patents. Oman will also improve enforcement and protection of undisclosed test data from unfair commercial use. In addition, Oman acceded to the World Intellectual Property Organization (WIPO) Copyright Treaty.
Oman is required to conduct procurement covered by the FTA in a fair, transparent, and non-discriminatory manner. As part of its WTO accession, Oman committed to begin negotiations to join the WTO Agreement on Government Procurement.