Until the end of the Uruguay Round, textile and clothing quotas were the subject of bilateral negotiations and were governed according to the rules of the Multifibre Agreement (MFA). This is the application of selective quantitative restrictions when an increase in imports of certain products causes or threatens to cause serious harm to the industry of the importing country. The multi-fibre regime was a significant departure from the basic rules of the GATT and, in particular, the principle of non-discrimination. On 1 January 1995, it was replaced by the WTO agreement on textiles and clothing, which provides for a transition process for the final abolition of these quotas. In early 2004, MSN helped create the MFA Forum, a multi-party learning forum to identify and promote collaborative strategies to support vulnerable national apparel industries and strengthen respect for workers` rights after the quota. The AMF forum brought together international apparel companies, national and multilateral public institutions, as well as trade union and non-governmental organizations to find solutions to the problems caused by the end of quotas, including factory closures. The Multifibre Agreement (MFA) was an international trade agreement on textiles and clothing that was in force from 1974 to 2004. It imposed quotas on the volume of clothing and textile exports from developing countries to industrialized countries. Textile and clothing products were returned to GATT rules over a ten-year period. This was gradually done in four stages to give importers and exporters time to adjust to the new situation. Some of these products were previously under quota. All quotas introduced on 31 December 1994 were transferred to the new agreement.
With regard to quota products, the integration into the GATT was the result of the abolition of these quotas. Since 1995, the WTOs agreement on the textile and clothing industry (ATC) has taken over the mulltifibre agreement. Until January 1, 2005, the sector was fully integrated with the normal GATT rules. In particular, quotas have ended and importing countries are no longer able to distinguish between exporters. The agreement on textiles and clothing no longer exists: it is the only WTO agreement in which self-destruction has been incorporated. In any quota-setting system for individual exporting countries, exporters could attempt to circumvent quotas by shipping products through third countries or making false statements about the country of origin of the products. The agreement contained provisions to deal with these cases. Products imported in each of the first three stages under GATT rules were to cover the four main types of textiles and clothing: yarns and yarns; Substances; Elaborate textile products; and clothes. All other restrictions that are not covered by the multifibre agreement and do not comply with the regular WTO agreements until 1996 were to be met or expire until 2005. If further losses were to occur during the transition period for the sector, the agreement allowed for the temporary imposing of additional restrictions under strict conditions. These transitional guarantees were not in line with the usual GATT safeguards, as they can be applied to imports from certain exporting countries.
But the importing country had to prove that its domestic industry had suffered serious damage or that it was at risk of serious damage. It also had to show that the damage was the result of two factors: an increase in imports of the affected product from all sources and a significant and significant increase from the exporting country concerned. The limitation of protection could be implemented either by mutual agreement, after consultation or unilaterally. It was inspected by the textile watchdog.