JAS USA COMPLIANCE

News & Insights from JAS Worldwide Compliance

JAS Forwarding (USA), Inc.

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COMPLIANCE SOLUTIONS

JAS USA Compliance Insights

Compliance Solutions

JAS USA Compliance Insights on the Impact of COVID-19

CBP HOLDS GREEN TRADE FORUM WITH ACTING COMMISSIONER MILLER DELIVERING ADDRESS

Customs and Border Protection (CBP) held its inaugural Green Trade Forum on July 11. Various strategies to incentivize green trade and encourage innovation were discussed. Several commentators mentioned the possibility of utilizing the Harmonized Tariff Schedule to promote green trade by adding tariff breakouts for goods made with environmentally preferred materials such as recycled or organically grown materials. CBP Acting Commissioner Troy A. Miller spoke at the event highlighting such CBP actions as a goal to have 50% of the CBP vehicle fleet consist of electric vehicles by 2030, CBP’s goal to digitize any remaining manual and paper-based processes, and their commitment to work with interagency partners, such as the Environmental Protection Agency (EPA) and the U.S. Fish and Wildlife Service (FWS), inter alia, to prevent natural resource crimes such as illegal deforestation and logging and illegal, unreported, and unregulated fishing. A recording of the forum will be made available soon on the Green Trade Innovation and Incentives Forum page on the CBP website.

Link to the Green Trade Innovation and Incentives Forum web pageLink to the text of the speech by Acting Commissioner Miller
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Cosmetic Registration Requirement

In a recent letter, the National Customs Brokers and Freight Forwarders Association of America (NCBFAA) asked the U.S. Food and Drug Administration (FDA) to delay for a year the requirement for cosmetic facility registration under the Modernization of Cosmetics Regulation Act of 2022 (MoCRA). MoCRA requires any establishment that manufacturers or processes cosmetic products that are distributed in the United States to assume various new responsibilities as follows:

  • Adverse event reporting
  • Facility registration
  • Product listing
  • Product safety substantiation
  • FDA Mandatory Recall authority

The present deadline for registration and product listing is December 31, 2023. FDA, however, has not outlined exactly how the registation process will work or what system will be utilized. Therefore, NCBFAA is requesting a year extension to allow the trade more time to prepare.

Link to details of MoCRA
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EU Flag

As the European Union’s Import Control System 2 (ICS2) second release deployment window comes to an end on July 1, requiring all airlines to submit detailed shipment information into a new centralized system known as the “Shared Trader Interface” before goods are loaded onto an aircraft, JAS USA is more than ready. Laurie Arnold, Vice President Compliance of JAS USA, stated:

“We're going to be ready. We know what we're doing. We're not going to have to try to figure out how we're going to transmit this data to the airlines or how the airlines are going to get it and transmit it to the government. We will be ahead of the game.”

Click for more information
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United States and Japan Launch Task Force to Promote Human Rights and International Labor Standards in Supply Chains

United States Trade Representative Katherine Tai and Japan's Minister for Economy, Trade, and Industry Nishimura Yasutoshi signed a Memorandum of Cooperation (MOC) to launch a Task Force on the Promotion of Human Rights and International Labor Standards in Supply Chains.

This task force established under the US-Japan Partnership on Trade program provides an opportunity for the US and Japan to work together to promote human rights and recognize international labor rights. The US and Japan will exchange information on relevant laws and policies to facilitate dialogues with business and worker organizations to promote best practices for human rights.

These areas of cooperation are designed to protect workers and enhance predictability and clarity for businesses as they seek to contribute to resilient and sustainable supply chains.

“From their leadership in the development of the Group of 7 Trade Ministers’ Statement on Forced Labor to their first-ever release of human rights due diligence guidelines for responsible supply chains to their commitment to carry out shared principles to combat forced labor.   “The launch of this Task Force is another example of how trade can be a force for good throughout the world.  Developing new tools that bring together the combined expertise of agencies across the Governments of the United States and Japan will help contribute to tackling worker exploitation in global supply chains.” said Ambassador Katherine Tai.

Read Full Article
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USITC Launch Database System

The US International Trade Commission (USITC) recently deployed the Investigations Database System (IDS). This new tool was designed to help users find data related to investigations on unfair imports in a more user-friendly manner.   A major new feature is the ability to conduct quick searches and advanced searches of the centralized investigation database that generate in-depth search results across multiple practice areas, providing new perspectives and value-added insights for users.

Other key functions and information across practice areas include:

  • Ability to access investigation information in all practice areas and see a wealth of information, including investigative staff, hearing witnesses, news releases, and other data
  • A new look for the “ongoing investigations” webpage for factfinding investigations
  • Centralized data across different phases of import injury and Section 337 investigations
  • A new module that lists all orders issued in a Section 337 investigation, the parties impacted, and the unfair act and intellectual property implicated in the order
  • Disposition information for individual respondents in investigations
  • Associated litigation information for specific import injury investigations
  • Links to external resources related to investigations (e.g., Department of Commerce AD/CVD information)
  • Integration with EDIS to share core investigation data across all practice areas

Users are encouraged to visit the USITC website at to explore this new tool.

Read the Press Release
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Advesaries Through Sanctions

U.S. Customs and Border Protection (CBP) began detaining merchandise produced or manufactured by Jingde Trading Ltd., Rixin Foods. Ltd., and Zhejiang Sunrise Garment Group Co. Ltd. at all U.S. ports of entry on Dec. 5, 2022. This enforcement action is the result of a CBP investigation indicating that these companies use North Korean labor in their supply chains in violation of the Countering America’s Adversaries Through Sanctions Act (CAATSA).

CAATSA prohibits the entry of goods, wares, and articles mined, produced, or manufactured wholly or in party by North Korean nationals or North Korean citizens anywhere in the world, unless clear and convincing evidence is provided that such goods were not made with convict labor, forced labor, or indentured labor under penal sanctions. Pursuant to CAATSA, CBP will detain merchandise from these entities at all U.S. ports of entry unless there is clear and convincing evidence that forced labor was not present at any stage of the production process. Evidence must be provided within 30 days of notice of detention. If the importer fails to provide clear and convincing evidence within this timeframe, the merchandise may be subject to seizure and forfeiture.

Click below for more information

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Supply Chain Visibility

U.S. Customs and Border Protection (CBP) will collaborate with 13 partner government agencies to deploy a Global Business Identifier (GBI) pilot program that will test the concept of a single business identifier solution to improve the US Government’s ability to efficiently identify high-risk shipments and facilitate legitimate trade.

Through the GBI Evaluative Proof of Concept (EPoC), volunteers from the trade community will provide CBP with entity identifier codes, used widely in various industries, to allow more comprehensive insight into shipper, seller, and manufacturer data.

Click the link below to read full article.

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Section 301 exclusion extension

The Office of the United States Trade Representative today announced a nine‑month extension of 352 product exclusions in the China Section 301 Investigation that had been scheduled to expire at the end of 2022.  These exclusions were initially reinstated on March 28, 2022 and the extension will help align further consideration of these exclusions with the ongoing comprehensive four-year review. 

Interested persons may submit comments on the tariff headings containing these exclusions through the USTR portal in the four-year review, which closes January 17,2023.  Additional information is set out in the following Federal Register Notice.

Click the link below to read more

Jas Forwarding USA Inc. issued a client advisory on December 16,2022 advising clients of the section 301 tariff exclusion extension.

See attached Client Advisory

Read MoreJAS Client Advisory
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Penalty for Failure

The Department of Justice, and Colorado United States Attorney’s office announced that a U.S company, and its Danish parent company, has paid settlement in the amount of $728,910 for failing to properly classify its imported products and declare their value, thereby failing to pay the full amount of customs duties owed to the United States on imported goods.

Under the Tariff Act of 1930, companies that import products into the United States are required to pay customs duties—typically calculated as a percentage of the value of the goods—on those products.  Importers must classify their imported products according to the Harmonized Tariff Schedule of the United States (HTSUS), and they owe different rates of duty depending on which HTSUS category the product properly falls into.  Importers are also required to properly declare the value of any goods they import, including products that have been exported, repaired abroad, and re-imported into the United States.

Click below to read more.

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CBP Acting Commissioner

Members of the 16th term Commercial Customs Operations Advisory Committee, known as COAC, were recognized for their meaningful contributions when they gathered Wednesday for their last public meeting of the year in College Park, Maryland. “The COAC advises U.S. Customs and Border Protection regarding regulations, policies or practices and provides critical feedback from the trade community on how these changes will impact the economy and global supply chain entities,” said CBP Acting Commissioner Troy A. Miller, who co-chaired the proceedings. “We understand that even small changes on our end can have a significant impact on trade. Millions of jobs rely on international trade, and we take both the health of the economy and economic security very seriously.”

Click link below for more information

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ACE is the U.S. electronic Single Window platform

ACE is the U.S. electronic Single Window platform for all trade processing, including all Manifest, Cargo Release, Post-release, Export and Partner Government Agency (PGA) data.  Trade users can access ACE via two channels: The ACE Secure Data Portal (ACE Portal) and electronic data interchange (EDI).  Deciding on which ACE access method is needed depends on the specific trade activity.  

Read More Here
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Contact Us Button

JAS Forwarding USA Inc. has been hard at work processing refund requests for the section 301 exclusion 9903.88.67 issued in March 2022 retroactive back to October 2021.  This exclusion is applicable to items falling within the descriptions of the HTS for each individual HTS.  Eligible items can receive a full refund plus interest of section 301 duties paid on entries from October 12, 2022.  The exclusion is valid through the end of this year.  So far JAS Forwarding USA Inc. has processed refund requests for clients totaling over $10 million dollars!  Do you have any entries that might be eligible?  Contact us today and let’s explore!

Email us at Compliance@jas.com

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(L to R) Leah Ellis, JAS Compliance Operations Manager, & Laurie Arnold, VP Compliance, stand in front of the World Trade Bridge on their trip to Laredo, Texas

Last month, Laurie Arnold, VP Compliance, and Leah Ellis, Compliance Operations Manager, went on a trip to Laredo, TX to visit our LRD branch. They spent part of their week in the Laredo office, discussing compliance topics and JAS policies on statements, training, auditing, and duty payments with branch Customs Broker Gustavo Aldrete and the import team.

On July 12th, Laurie and Leah braved the record-breaking high temperatures to visit the World Trade International bridge that spans Laredo, TX and Nuevo Laredo, Tamaulipas on the Northern Mexican border. Here they developed a better understanding of the border crossing process and got to watch the cargo trucks as they brought their shipments into and out of the country.

Towards the end of their trip, they celebrated Branch Manager Antonio Pastrana’s birthday and enjoyed some cake with the Laredo team. 

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CBP’s Office of Trade Relations are hosting webinars during the first few weeks of June.

CBP’s Office of Trade Relations are hosting webinars during the first few weeks of June. These webinars will provide an overview of the Uyghur Forced Labor Prevention Act (UFLPA), as well as strategies on implementation of the act before it goes into effect on June 21st.

The UFLPA establishes a rebuttable presumption that the importation of any goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of the People’s Republic of China, or produced by certain entities, is prohibited by Section 307 of the Tariff Act of 1930 and that such goods are not entitled to entry to the United States.

CBP is also urging all importers to do their due diligence and review their supply chains to ensure their goods are not being produced with forced labor before UFLPA is implemented.

  • Wednesday, June 1, 2022, 10:00 –11:00 a.m. EDT
  • Tuesday, June 7, 2022, 1:00 – 2:00p.m. EDT
  • Thursday, June 16, 2022, 2:00 –3:00 p.m. EDT
There are 3 webinars scheduled, follow to register
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The Office of the United States Trade Representative announced its determination to reinstate certain previously granted and extended product exclusions in the China section 301 Investigation

The Office of the United States Trade Representative announced its determination to reinstate certain previously granted product exclusions in the China section 301 Investigation. The determination reinstates 352 of the 549 eligible exclusions. The reinstated product exclusions will apply as of October 12, 2021 and extend through December 31, 2022.

The reinstated exclusions are set out in the Federal Register notice linked here.

Clients with products that qualify for reinstated exclusions should contact their local JAS Forwarding USA Inc. branch representative to discuss how to assess impact and define next steps to work towards any duty refunds.

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New CBP Website for UFLPA

The Uyghur Forced Labor Prevention Act (UFLPA) is scheduled to go into effect on June 21, 2022. In preparation for the implementation of this act, CBP has created a webpage as well as a new email for questions and information on the implementation of UFLPA. The website will be regularly updated with the most up to date information, and their inbox is open for inquiries and compliance advisement. The Forced Labor Enforcement Task Force (FLETF) will also be holding a public hearing on the methods used to prevent goods produced with forced labor from entering the US. The hearing is on April 8th, and members of the public can register on the CBP site if they wish to provide public testimony.

See the new website here
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ACH and the Benefits
November 1, 2021

U.S. CBP’s ACH (Automated Clearinghouse) is an electronic payment option that allows participants to pay customs fees, duties, and taxes electronically.  This program offers numerous benefits from automation of payables on duties to better accuracy of payments.  Additionally, once importers are signed up for ACH, the PMS (Periodic Monthly Statement) becomes an option which provides additional cash flow benefits.  To learn more, check out our ACH and PMS flyers linked below.

ACH Flyer DownloadPMS Flyer Download
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JAS USA Compliance
October 1, 2021

Did you know that the JAS Forwarding USA Inc. Compliance Team can partner with clients to consult on numerous issues?  Our team has well over 100 combined years of experience in regulatory trade compliance.  Check out our Compliance presentation and let’s connect and see how we can partner.

See the Presentation(PDF)
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The Manhattan U.S. attorney has announced criminal and civil charges against the CEO of an apparel company.  It is alleged that the CEO has engaged in Customs Fraud.  The CEO is suspected of misrepresenting value of imported goods in an attempt to avoid paying lawfully owed customs duties.

Read more details from the U.S. Attorney's Notice
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There are new requirements for importing US and Foreign Goods Returned under HTSUS Chapter 98 (9801.00.10). Previous changes and history are found in the CSMS message linked below and summarized here. On April 25, 2016, a change to HTSUS Chapter 98 for U.S. goods returned went into effect. Specifically, section 904(b) of the Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA), “Modification of Provisions Relating to Returned Property,” amended HTSUS Subheading 9801.00.10.

The expansion of Subheading 9801.00.10 includes all products exported from and returned to the United States, regardless of country of origin. For U.S. origin products, there is no time limit on filing a claim. For foreign origin products, there is a 3-year time limit. The changes to 9801.00.10 apply to U.S. or foreign articles returned to the United States and entered, or withdrawn from warehouse, for consumption on or after April 25, 2016.

Read More Here
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U.S. Senators Rob Portman and Tom Carper, along with 38 other members of the Senate, sent a letter to U.S. Trade Representative Katherine C. Tai, asking her to restart the exclusion process for imports from China subject to tariffs under Section 301 of the Trade Act of 1974. The Trump administration set up an exclusion process to help U.S. manufacturers and businesses receive relief from the tariffs when an imported good was not available outside of China, or when the tariffs caused severe economic harm to U.S. industry. Unfortunately, those exclusions expired at the end of 2020, and the Biden administration has not restarted a process for businesses to apply for new exclusions.

Read the Full Article
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The mandate issued by the International Civil Aviation Organization (IACO) from Sept 2016, requires that all air cargo carried by commercial aircraft be screened or have commensurate security measures applied by June 30, 2021.  A 100% requirement for screening of cargo transported on passenger planes has been in effect since August 2010 with freight forwarders successfully meeting this mandate. JAS Forwarding (USA) has long been a member of TSAs Certified Cargo Screening Program and currently has CCSF (Certified Cargo Screening Facility) located in all major gateways

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The Office of the U.S. Trade Representative has announced that there are 100 products that were on the first Section 301 exclusion list and will expire today.  Among these products are electric motors, pump parts, construction equipment, agricultural vehicles, hubs, bearings, capacitors, switches, and dental x-ray equipment.  Please click below to access the list of tariffs that are due to expire.

EXCLUSIONS EXPIRING 07.09.20
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USMCA WEBINAR 06.23.20

(Presentation only file below)

CERTIFICATION FORM

There is no official certificate of origin form for USMCA; however, certification is required at the time of the claim.  Please find a template form that is available below if a form is preferred.

USMCA WEBINAR 06.23.20 - PRESENTATION ONLYUSMCA CERTIFICATION TEMPLATE FORM
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The following presentations are available for informational purposes only related to COVID-19.  Please be advised that the material provided is not legal binding and should not be considered legal advice.

Importing & Exporting PPE - Presentation OnlyImporting & Exporting PPE - Audio VersionPPE Products Export From China - Operation Manual
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TYPE 86 CHANGE

In a notice published in the Federal Register on January 16, Customs and Border Protection (CBP) announced that it is amending the ACE Entry Type 86 Test to require filing of these entries prior to or upon arrival of the cargo. The Entry Type 86 is a test allowing the electronic filing of entries for low-value shipments meeting the requirements for admission under the administrative exemption in 19 U.S.C. 1321(a)(2)(C). The traditional entry time frame of permitting filing of an entry up to 15 days after arrival of the cargo was used initially for the Entry Type 86 test. However, CBP has determined that that time frame “has proven to be inconsistent with the expedited process envisioned for the ACE Entry Type 86 Test”, and this has led to enforcement challenges and various violations such as entry by parties without the right to make entry, incorrect manifesting of cargo, misclassification, and delivery of goods prior to release from CBP custody. The requirement to file Type 86 entries prior to or upon arrival of the cargo will go into effect on February 15, 2024.

GUN TSA

The Transportation Security Administration (TSA) advised that 2023 was a record year for the interception of firearms at airport security checkpoints. A record 6,737 firearms were intercepted at airport checkpoints during 2023, with 93%, or close to 6,265 firearms, being loaded at the time of interception. Firearms are strictly prohibited in carry-on baggage. They are allowed in checked baggage, however, they must be unloaded and packed in a locked hard-sided case and the presence of the firearm must be declared at the check-in counter. Upon discovery of a firearm at a checkpoint, the TSA officer will contact local law enforcement, who will remove the passenger and the firearm from the checkpoint. The passenger involved could then be arrested or cited. In addition, the passenger will be liable for a fine of up to $15,000 for possesing the firearm at the checkpoint.

On a lighter note, or maybe not so lighter note, the TSA also published a list of the Top Ten prohibited items discovered in traveler’s carry-on baggage in Idaho airports in 2023. Among the top items were a hatchet, a Ninja throwing star, a crow bar, and a grenade-shaped bottle of hot sauce.. (pictures are below).

JAS KNOW

This month we launch a new feature of our monthly newsletter – JAS WANTS TO KNOW! - A short one question poll to receive our readers’ input and advice. Our poll this month is concerning compliance challenges. Click below to let us know!

NCBFAA PORT

Laurie Arnold, JAS Vice President of Compliance, and Leah Ellis, JAS Compliance Operations Manager, were on the move this month attending the National Customs Brokers and Forwarders Association’s (NCBFAA) quarterly board meeting held in Los Angeles. Laurie serves as the Treasurer of the NCBFAA and Leah is the Legislative Committee Chair. During their time in Los Angeles, Laurie and Leah were also given an extensive tour of the Port of Los Angeles by invitation of the Los Angeles Customs Brokers and Freight Forwarders Association.

See below for pictures of the tour.

TARIFF DIFFICULT

While regular practitioners of tariff classification well know this, the World Customs Organization (WCO) recently issued a 30 page report, The Exploratory Study on a Possible Strategic Review of The Harmonized System, which concluded that the tariff classification process is a very complex system which requires a high level of skill to use appropriately. The purpose of the report was to explore the feasibility of possible structural changes to the system to improve the accuracy and consistency of the process and make it more “user-friendly”. One of the issues noted was that key words are often not defined in the tariff schedule or, if defined, the location of definitions can be hard to find. The complex nature of the process was illustrated by a discussion on how to classify a plastic covered textile, a truly difficult proposition. One interesting note was that the WCO did a survey and found that a majority of respondents do not really use or do not really understand how to use the General Rules of Interpretation, which are supposed to explain how to classify. Lets hope the report leads to some improvements.

301 CHINA

In a Federal Register notice, the United States Trade Representative (USTR) announced that 77 COVID-related and 352 other Section 301 duty exclusions that were set to expire on December 31, 2023, will be extended for an additional 5 months through May 31, 2024. The Section 301 duties were imposed on various products from China to counter certain acts, policies and practices related to technology transfer, intellectual property and innovation. The USTR stated that the extension of the exclusions “will enable the orderly review of the exclusions consistent with statutory factors and objectives to identify in which cases additional time would enable shifts in sourcing to the United States or third countries”. The statutorily required four-year review of the Section 301 duties themselves is currently in process and the USTR further stated that this extension “will also facilitate the alignment of further decisions on these exclusions with the ongoing four-year review”.

CBP LOGO GBI

Customs and Border Protection (CBP) is still welcoming importers of record and licensed customs brokers to participate in the Global Business Identifier (GBI) Evaluative Proof of Concept (EPoC). The GBI is a test to determine a potential replacement for the Manufacturer or Shipper Identification code (MID) currently required to be provided on entries filed with CBP. This new identifier could also be used for other entities involved in the entry process to obtain a “deeper insight into the legal structure of “who is who” across the spectrum of trade entities, and to understand more clearly ownership, affiliation, and parent-subsidiary relationship”. Participants in the EPoC can provide, at the time of entry filing, any of three entity identifiers associated with manufacturers, shippers, and sellers of merchandise covered by the entries. These identifiers are the nine (9) digit Data Universal Numbering System (D–U–N–S®), thirteen (13) digit Global Location Number (GLN), and twenty (20) digit Legal Entity Identifier (LEI). The test is limited to entry types 01 and 11, and to certain commodities and countries of origin. The limitations of the MID are well known in trade circles. Therefore, CBP is encouraging participation in this EPoC to facilitate the determination of a more robust replacement. If you would like to participate in this EPoC, contact compliance@jas.com.

VIOLATION FCA

A recent series of settlements in False Claims Act (FCA) cases and a large fine imposed by a California District court demonstrate the importance of complying with the Customs and Border Protection (CBP) importation regulations. FCA cases are filed by “whistleblowers”, on behalf of the United States, charging any person with making a false claim to the federal government. The whistleblower, called the relator, receives a portion of any agreed settlement.

In Georgia, an importer of tools will pay $1.9 million to settle FCA allegations that it was falsely labelling its tools as “made in Germany” when, in fact, the tools were made in China. The settlement states that tools manufactured in China were sent to Germany for some additional processing and were then commingled with tools that had no additional processing done in Germany. All the items were then claimed to be of German origin upon importation into the U.S., thus avoiding the payment of Section 301 duties of 25%  assessed on certain imports of Chinese origin.

In Texas, in another FCA settlement, an importer of industrial products, along with two Chinese companies and two individuals, agreed to pay $2.5 million to resolve allegations that they were undervaluing imported goods. Commercial invoices were submitted to CBP at time of entry for the items in question showing values that were lower than the actual values and agreed prices. Invoices showing the true higher values were then sent by the Chinese suppliers to the importer at a later time. This resulted in the loss of revenue for CBP in the form of underpaid customs duties and other fees.

Finally, in California, in another double-invoicing scheme, a clothing wholesale company was fined $4 million, ordered to pay $6,390,781 in restitution, and placed on probation for five years for undervaluing imported garments in a scheme to avoid paying millions of dollars in customs duties. In this case as well, a false lower valued commercial invoice was submitted to CBP at time of entry, and a true higher value invoice was then sent later to the importer by the Chinese supplier resulting in the underpayment of duties and fees.

COSMETICS DIRECT

On December 18, the U.S. Food and Drug Administration (FDA) announced the launch of the Cosmetics Direct electronic submission portal for registration and listing of cosmetic product facilities and products. Cosmetics Direct is dedicated exclusively to cosmetic product facility registration and cosmetic product listing electronic submissions mandated by the Modernization of Cosmetics Regulation Act of 2022 (MoCRA). FDA had advised previously that enforcement of these new requirements would be delayed to provide industry with sufficent time to submit the facility registration and product listing information. FDA will not be enforcing the requirements until July 1, 2024. However, the law is now in effect, and all facilities required to register and submit product listings should do so as soon as possible and well before the July 1 deadline.

CAPITOL LAW

Senators Bill Cassidy of Louisiana and Sheldon Whitehouse of Rhode Island introduced the bipartisan Customs Modernization Act of 2023 which would make significant changes to laws administered by Customs and Border Protection (CBP).

Some of the key sections of the proposed bill include:

• Allowing CBP to access data prior to entry from parties throughout the supply chain. The importer of record could convert this pre-entry information into a certified entry filing. For any violation relating to the filing of the required pre-entry information by any party, CBP may impose a penalty of $5,000 for the first violation of these regulations and $10,000 for subsequent violations.

• At present, only ocean vessel manifest information must be publicly disclosed. The proposal would make it mandatory to also publicly disclose aircraft, truck and rail manifest information for the purpose, inter alia, of monitoring supply chains for illegal goods like fentanyl and those made with forced labor, combatting trade-based money laundering, and identifying unfair trade practices like dumping.

• Relaxing the seizure and forfeiture rules to allow for the summary forfeiture of certain IPR-infringing goods by CBP without having to go through the formal seizure/forfeiture process. This is to allow CBP the ability to seize and forfeit articles found violative in the de minimis realm in an expedited fashion.

• Specific penalties are enumerated for violations of the Section 321 de minimis provisions of up to $1,000 for the first violation and $2,000 for each subsequent violation.

• Under current law, CBP can penalize vessel masters, aircraft pilots, and persons in charge of a vehicle for failing to comply with reporting requirements like providing manifest information. However, much of this data is now transmitted electronically by other parties such as the air carrier. A new provision would clarify that “any person” reporting such information who knowingly provides incorrect information is liable for a civil penalty.

Senator Cassidy also advised that a bipartisan Trade Facilitation measure will be introduced in 2024 as well.

EXPORT CONTROL DOC

The Departments of the Treasury, Commerce, Justice, State and Homeland Security jointly published a Quint-Seal Compliance Note entitled “Know Your Cargo: Reinforcing Best Practices to Ensure the Safe and Compliant Transport of Goods in Maritime and Other Forms of Transportation”. The document provides information on potential indicators of efforts to evade sanctions and export controls, emphasizing the need to “know your cargo”. Also included are various examples of recent criminal and civil enforcement actions taken for violations of sanctions and export controls. With six government agencies being involved in the publication of this compliance note, all participants in the global transport of goods should review it in detail.

CO2

The United Kingdom (UK) announced that it will be implementing a Carbon Border Adjustment Mechanism (CBAM) by 2027, joining, among others, the European Union whose own CBAM entered its transitional phase in October with the first reporting period set to end on January 1, 2024. The UK CBAM will place a carbon price on some of the most emissions-intensive industrial goods imported to the UK from the aluminum, cement, ceramics, fertilizer, glass, hydrogen, iron and steel sectors, with the precise list to be provided sometime in 2024 after additional consultations. The liability applied by the CBAM will depend on the greenhouse gas emissions intensity of the imported good and the gap between the carbon price applied in the country of origin (if any) and the carbon price that would have been applied had the good been produced in the UK. CBAM liability will lie directly with the importer of imported products within the scope of the UK CBAM on the basis of emissions embodied in those goods. Further details will be provided in 2024 also after additional consultations. Exporters of products to the U.K., and to the European Union as well, will need to become familiar with these mechanisms, as their customers in these countries will be needing detailed information on the greenhouse gas emissions intensity of the products they import.

WOMEN APPAREL

The New Democrat Coalition (NDC), a caucus of nearly 100 members of the House of Representatives, recently issued a letter to the President outlining a list of their  legislative priorities, one of which stated “Advance equity in trade policy by considering solutions to reduce gender bias and regressivity of the tariff system, in consultation with Congress”. Now, it may seem a stretch to claim that something like the Harmonized Tariff Schedule, a legalistic, inanimate document for the classification of imported products, could be biased towards a particular gender. However, after further examination, it seems that the NDC is correct, and the tariff may be somewhat biased towards women. A study performed by the International Trade Commission entitled “Gender and Income Inequality in United States Tariff Burden” discovered, “Across genders, we find large differences in tariff burden…The gender gap exists because spending on women’s apparel is higher than on men’s and because the average applied tariff rate on women’s clothing is higher than on men’s”. The study found “the average applied tariff rate for women’s apparel was 14.9%, but it was only 12.0% on men’s apparel. It was also noted that “the gender difference in applied tariff rates is mostly attributed to the sourcing of imports as a much greater share of men’s apparel than women’s apparel comes from U.S. Free Trade Agreement partners”. Perhaps some adjustments in the tariff are in order.

CHEMICAL

In a recent Federal Register notice, the Environmental Protection Agency (EPA) is proposing the prohibition of the manufacture, importation, processing, or distribution in commerce of Trichloroethylene (TCE). TCE is widely used as a solvent in a variety of industrial, commercial and consumer applications including for hydrofluorocarbon (HFC) production, vapor and aerosol degreasing, and in lubricants, greases, adhesives, and sealants. In the proposed rule, EPA lists numerous and diverse industries that would be affected by this proposal. Comments on the proposal are due by December 15, 2023. Importers of products containing TCE should review this proposal and submit any comments deemed necessary.

AGOA

The annual eligibility review for the African Growth and Opportunity Act (AGOA), in accordance with Section 506A(a)(3)(B) of the Trade Act of 1974, has resulted in the termination of eligibility for the Central African Republic, Gabon, Niger, and Uganda. The White House and the Office of the United States Trade Representative announced that recent unconstitutional changes in government in Gabon and Niger, and the resultant threat to political pluralism and the rule of law, led to their termination. The termination of the eligibility of the Central African Republic and Uganda was a result of gross violations of internationally recognized human and worker rights. On a positive note, the country of Mauritania had its eligibility reinstated based on progress it has made with respect to worker rights and eliminating forced labor across the country. Ethiopia, however, did not have its eligibility reinstated at this time. Recently, there have been a lot of discussions in Congress about the need to renew AGOA well in advance of its current September 2025 expiration date, to ensure the continuity of the program and encourage long term investment in the region.

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Customs and Border Protection (CBP) published a new guide entitled “TIPS FOR FILING AN HFC IMPORT IN ACE” to assist the import community with filing obligations related to imports of bulk hydrofluorocarbons (HFCs) under the American Innovation and Manufacturing (AIM) Act. The Environmental Protection Agency (EPA) also announced in November that allocations for the import of HFC’s will be reduced to 60% of the stipulated baseline levels in January 2024. Importers of HFCs should consult this new guide as filing requirements for HFC’s can be complicated. CBP will advise in early January via the Cargo Systems Messaging Service (CSMS) when the new requirements will be operative in ACE.

EXAM

The protracted quest of Mr. Byungmin Chae to have his 2018 Customs Broker License Examination results changed to a passing grade came to an end when the Supreme Court denied his petition for a writ of certiorari in October. Mr. Chae’s case, if nothing else, proved he possesses ample persistence and determination. The court filing states that his original score on the April 2018 exam was 65%, with 75% or higher being needed for a passing grade. He filed a timely appeal to Customs and Border Protection (CBP) requesting that his answers to 13 of the questions originally marked wrong be deemed correct. Subsequent to his appeal, CBP announced that all test takers would be given credit for 3 particular questions, 2 of which Mr. Chae had been marked wrong on originally. This raised his score to 67.5%. CBP then denied his appeal request for the other 11 questions. Mr. Chae then appealed this decision to the Office of Trade. The Office of Trade granted his appeal for 3 of the questions, raising his score to 71.25%, but still short of a passing grade. Undaunted, Mr. Chae proceeded to file a petition with the Court of International Trade (CIT) as allowed by the regulations.

The CIT gave him credit for one more of the contested questions, raising his total of correct answers to 58 of the 60 he would need for a passing grade. Still undaunted, Mr. Chae filed an appeal of the CIT decision to the Court of Appeals for the Federal Circuit asking for 3 questions to be further reviewed. The Appeals Court gave him credit for one of the questions, raising his correct answer total to 59 of the 60 needed. However, the Supreme Court denial of his certiorari request ended the appeals process, terminating his case and giving new meaning to the phrase “so close, yet so far…”.

SIMP

A rule proposed December 28, 2022, by the National Marine Fisheries Service (NMFS) to significantly expand the species covered under the Seafood Import Monitoring Program (SIMP) was withdrawn on November 16. The additional species to be added to the SIMP, along with a change stating that the importer of record on the customs filing must also be the party that holds the required  International Fisheries Trade Permit, had caused concern in the trade community leading to a significant number of comments being filed with NMFS concerning the proposed rule. The NMFS advised that they will now conduct a comprehensive SIMP review to determine any future action to be taken in order to strengthen the impact and effectiveness of SIMP.

EURO NOTE

In a recent Cargo Systems Messaging Service message, CBP provided a list of the countries that are members of the European Union and who, therefore, use the Euro as their domestic and international trade currency. It was further stated, “Therefore, all invoices, other documents, and entry transmissions from these countries must show EUR for the foreign value or as their currency code”. CBP is updating its records to reflect the Euro as the appropriate currency for all countries listed.

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Customs and Border Protection (CBP) will hold an important webinar on December 15, 2023, from 2PM to 3PM on the topic of the 2024 Permit Annual User Fee and Triennial Status Report Filing. The webinar will explain the process for paying the Permit fee and filing a Triennial Status Report via the e.CBP online portal. A link to register for the webinar is below.

CRACKERS

Christmas crackers are a festive holiday tradition in the United Kingdom, Australia, Canada, New Zealand and South Africa. They consist of a decoratively wrapped tube with a prize, a paper hat and a joke card inside. The wrapping on the tube is extended outwards on both sides and twisted around a shock sensitive card strip similar to what is used for cap gun shot caps. A person at each end will then pull on the wrapping simultaneously, generating a bang or cracking sound and causing the tube to open and reveal the prizes. It is believed that Christmas Crackers were invented in London around 1847 by a confectioner named Tom Smith who was looking for a way to repackage the candies he sold to increase sales. The hats and prizes were added by his son Walter Smith to further increase sales as other competitors began selling crackers as well. If you are planning on visiting the United Kingdom and are thinking of bringing back any Christmas Crackers, kindly note that the Transportation Security Administration does not allow crackers in carry-on bags or checked luggage on flights to the U.S.

ALUMINUM EX

A petition was filed on October 4, 2023, and an investigation instituted on October 13, 2023, by the Commerce Department and the International Trade Commission to greatly expand the antidumping and countervailing duty orders in effect on aluminum extrusions from China to cover products that are now exempt and to add 14 additional countries. The petition was filed by the United Steelworkers Union and the U.S. Aluminum Extruders Coalition. The requested scope of the order is five pages long and covers aluminum extrusions for a wide variety of applications. The list of countries to be included are Colombia, the Dominican Republic, Ecuador, India, Indonesia, Italy, Malaysia, Mexico, the People's Republic of China ("China"), South Korea, Taiwan, Thailand, Turkey, the United Arab Emirates and Vietnam. Importers of aluminum extrusions from the listed countries should follow the progress of this investigation and possibly pursue legal involvement in the proceedings if appropriate.

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The Internal Market and International Trade committees of the European Parliament adopted a draft regulation that would ban the importation and exportation of goods proven to be made with the use of forced labor. Items suspected of being made with forced labor would be halted at the border. If forced labor use is proven, the items would have to be donated, recycled, or destroyed. Any related goods that had already reached the European Union (EU) market would have to be withdrawn from the marketplace. The regulation would also create a list of geographical areas and economic sectors at high risk of using forced labor. For goods from these areas and sectors, there would be a presumption that forced labor was involved and the company attempting to import or export such goods would have the burden of proof to show otherwise. The EU council will review the proposed regulation next and then talks will start over the final shape of the regulation.

SEMICONDUCTOR

On October 25, the Bureau of Industry and Security (BIS) published in the Federal Register several updates to its comprehensive interim final rule of October 7, 2022, which amended the Export Administration Regulations (EAR) to implement controls on advanced computing integrated circuits (ICs), computer commodities that contain such ICs, and certain semiconductor manufacturing items exported to China. The updates, inter alia, adjust the thresholds for which chips are covered by the regulations, expand licensing requirements to an additional 43 countries included in the D:5 Country Group of the EAR, and add several dozen items to the list of controlled semiconductor manufacturing equipment. Exporters of ICs and semiconductor manufacturing items should thoroughly review the notice and submit any comments to BIS by the December 18, 2023, deadline. The Center for Strategic & International Studies has published a concise summary and commentary on these updates prepared by Emily Benson. A link to this commentary is below.

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