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March 6 2012 issue

Tuesday, March 06, 2012
Sandler, Travis & Rosenberg Trade Report

U.S., Mexico Pledge Regulatory Cooperation on Food and Truck Safety, Nanotechnology, Etc.

The U.S. and Mexico issued Feb. 28 the work plan for their High-Level Regulatory Cooperation Council over the next two years. The HLRCC was established to facilitate intra-North American commerce and enhance the competitiveness of North American producers in key export markets, and to that end the items set forth in this work plan aim to reduce administrative burdens, align regulations and create new opportunities for businesses.

Food Safety. The HLRCC will intensify the present bilateral dialogue aimed at implementing Food Safety Modernization Act provisions of common interest and facilitate Mexico’s participation on rulemaking. By December 2012 the two sides will hold consultations on a draft FSMA capacity building plan, complete at least two technical assistance activities for the Mexican private sector, and renew a bilateral food safety cooperative agreement.

E-Certification for Plants and Plant Products. The U.S. and Mexico will work together to develop by December compatible electronic certificate programs such that phytosanitary e-certificates for plants and plant products from one country will be accepted by authorities of the other. Once the plants and plant products phase is accomplished, both countries will assess next steps related to e-certification of live animals and animal products.

Truck Safety. Mexico is in the process of revising and implementing its safety standard NOM 068, which governs mechanical and safety conditions for operating trucks on national roads and bridges. The HLRCC will facilitate a bilateral dialogue so that this revision is in harmony with existing U.S. rules, standards and criteria in order to minimize costs and eliminate any duplication.

Nanotechnology. Mexico and the U.S. are in the process of developing principles and approaches to inform government oversight and regulation of nanotechnology applications and nanomaterials. They have already established a mechanism for exchanging information on related regulatory matters. By February 2013 they will engage in a dialogue to consider a possible model framework providing key elements and approaches to regulating nanotechnology applications and nanomaterials with respect to potential impacts on the environment, human health, labor, food or agriculture.

E-Health. The U.S. and Mexico will share best practices on electronic health record certification programs, discuss and analyze their interoperability standards portfolios, and seek to establish by October a core framework of vocabularies for use in EHR technology.

Oil and Gas Development. Because both countries border the Gulf of Mexico they have established a long-term goal of developing a set of harmonized standards related to the exploration and production of oil resources and well control and containment standards, including requirements for sharing worst-case discharge and spill response plans. The HLRCC will encourage consideration of a range of options, including performance-based standards, to move the agenda forward.

Accreditation by Conformity Assessment Bodies. While Mexico has already accredited three U.S. laboratories for purposes of performing safety testing of certain products sold or used in Mexico, no reciprocal authority has been granted to any Mexican laboratory. The U.S. will help interested Mexican labs understand the requirements for obtaining such recognition, and Mexico will do the same for U.S. labs.

Click here for regulatory work plan

Carriers Can Authorize Specific In-Bond Users with New Electronic Manifest System

U.S. Customs and Border Protection announced last week that with the upcoming deployment of electronic rail and sea manifest (M1), rail and sea carriers will have the ability to create a list of authorized type 2 in-bond users in their ACE Secure Data Portal accounts. This functionality will allow carriers to control who can obligate their type 2 custodial bonds. Although carriers are not required to utilize this functionality, those who do will have the ability to indicate the specific ports and lengths of time a carrier or broker is authorized to obligate their bond. If a rail or sea carrier elects not to utilize this functionality, ACE will not restrict the use of their bond by other parties.

CBP emphasizes that the in-bond authorization file is only applicable for in-bonds submitted via electronic data interchange to the ACE rail and sea manifest functionality. Air AMS manifest will not utilize the in-bond authorization functionality at this time. Also, during the time period when ACE rail and sea manifests and AMS rail and sea manifests will be operating simultaneously, in-bonds created via AMS legacy rail and sea manifest will not utilize the ACE in-bond authorization functionality. QP filers submitting in-bonds into the legacy AMS application during this timeframe will not utilize the ACE in-bond authorization functionality.

A CBP user guide ( provides more details on how to use this new functionality.

Canada to Begin Transition to Electronic Reporting by Marine Carriers on Sept. 1

The Canada Border Services Agency announced recently its plan for implementing mandatory electronic export reporting for marine carriers. Currently, under the Reporting of Exported Goods Regulations, marine carriers must report to the CBSA their conveyance (A6) prior to departure and cargo (A6A) within three working days after departure. To improve data quality and align Canada’s Export Program with the reporting processes in other countries, the CBSA will begin to mandate electronic export reporting for marine carriers exporting containerized cargo (but not bulk cargo).

Phase 1 of this process, a voluntary transitional period, will be implemented Sept. 1 to provide shipping lines sufficient time to map and test their systems with the Electronic Commerce Unit. The reporting of the A6 and A6A for containerized cargo for all destinations will be completed using the existing CBSA Advanced Commercial Information conveyance and export cargo maps. Information on becoming an ACI participant may be obtained here (

Phase 2 will begin with the implementation of revised Reporting of Exported Goods Regulations, which will include the requirement to report electronically. These updated regulations are targeted to come into effect in December 2014, at which time noncompliance will result in the issuance of administrative monetary penalties.

Electronic reporting will not change the requirement to present a printout of the A6 to the CBSA at each port of exit where goods are loaded. In addition, shipping lines are required by international customs authorities to retain a stamped copy of the A6, which is presented upon arrival in the foreign port of entry.

Click here for CBSA notice

Of Note: India Bans Cotton Exports, India-Indonesia FTA

India bans cotton exports, global prices jump

India, Indonesia agree to fast track FTA talks

AD Notices: Shrimp, Mushrooms, Electrodes, Steel Bar

Agency: ITA.
Commodity: Frozen warmwater shrimp.
Country: India.
Nature of Notice: Preliminary results of administrative review of AD duty order for the period Feb. 1, 2010, through Jan. 31, 2011.
Details: One respondent had no shipments of subject merchandise to the U.S. during the period of review. The preliminary dumping margin for all other manufacturers/exporters with shipments is 2.51%.

Agency: ITA.
Commodity: Preserved mushrooms.
Country: China.
Nature of Notice: Preliminary results of administrative review of AD duty order for the period Feb. 1, 2010, through Jan. 31, 2011.
Details: Preliminary dumping margins range from 198.63% to 222.78%. Review rescinded with respect to 22 companies due to withdrawal of the petition.

Agency: ITA.
Commodity: Small diameter graphite electrodes.
Country: China.
Nature of Notice: Preliminary results of administrative review of AD duty order for the period Feb. 1, 2010, through Jan. 31, 2011.
Details: Preliminary dumping margins range from 36.87% to 159.64%. Review rescinded for 135 companies due to the withdrawal of the petition.

Agency: ITA.
Commodity: Stainless steel bar.
Country: India.
Nature of Notice: Preliminary results of administrative review of AD duty order for the period Feb. 1, 2010, through Jan . 31, 2011.
Details: Dumping margin for two named respondents is 30.92%. Review rescinded for third respondent due to revocation of the order with respect to that company as of Feb. 1, 2010.

FMC Rule Allows Service Contracts to Reference Freight Indices, Other Outside Terms

The Federal Maritime Commission has issued a final rule that, effective March 7, will amend its rules to clarify that service contracts and non-vessel-operating common carrier service arrangements can reference freight indices or other outside terms so long as they are readily available to the contracting parties and the FMC. This rule is intended to provide common carriers and their customers with certainty and flexibility if they decide to use long-term contracts that adjust based on a freight rate index that reflects changes in market conditions.

Click here for FMC final rule

Court Rules on Classification of Weather Measurement Devices

In a Feb. 29 decision in La Crosse Technology Ltd. v. U.S., the Court of International Trade ruled on the classification of imported weather measurement devices and clocks.

There are three categories of merchandise at issue in this case. The first, identified as “weather stations,” has an indoor display that typically shows time, date, temperature (indoor and/or outdoor), minimum and maximum temperature (indoor and/or outdoor), indoor humidity percentage, and weather forecast based on readings from an internal barometer. The second category includes the features of the weather stations but also includes wind and/or rain sensors as well as additional data storage and the ability to download weather data to a personal computer for analysis. Devices in both these categories also feature outdoor instruments to measure the corresponding data. The third category comprises digital clocks, some of which project the time and temperature on a wall or ceiling, and all of which include indoor/outdoor temperature displays and a weather forecast based on an internal barometer. All models include an LCD display and a microprocessor and display the time and date.

The court finds that the weather stations are properly classified as combination devices under HTSUS 9025.80.10 (1.7% duty) and can be classified as GRI 3(b) composite goods despite the inclusion of wireless components that do not attach to the base unit because those components constitute accessories to the base unit. However, the “Professional” series models in the second category are classified as other meteorological instruments under HTSUS 9015.80.80 (duty-free) and the clocks are classified as other electric clocks with opto-electronic display under HTSUS 9105.91.40 (3.9% duty on the movement and case and 5.3% on the battery). These models cannot be analyzed as composite goods but instead are classified as retail sets. The court further states that the essential character of the first two categories is given by their meteorological functions but that the third category is distinguished by its numerous and predominant clock-related functions and marketing.

Click here for CIT decision

IPR Enforcement Actions on Ink Application Devices, GPS Systems

New Patent Infringement Investigation of Ink Application Devices. The International Trade Commission has instituted investigation 337-TA-832 to determine whether imports of certain ink application devices and components thereof and methods of using the same are violating Section 337 of the 1930 Tariff Act by reason of patent infringement. The complainant requests that after this investigation the ITC issue an exclusion order, which would direct U.S. Customs and Border Protection to prohibit the entry of the infringing products into the U.S., and cease and desist orders, which would require the named respondents to cease actions that violate Section 337, including selling infringing imported articles out of U.S. inventory. The respondents in this investigation are located in Canada and China.

Click here for ITC notice

Investigation of Automotive GPS Navigation Systems Amended. The ITC has amended patent infringement investigation 337-TA-814 of certain automotive GPS navigation systems, components thereof and products containing same pursuant to a request by the petitioner to more accurately identify the respondent.

Click here for ITC notice

Updated Request to FTZ Board on Manufacture of Athletic Tape

The Foreign-Trade Zones Board received in July 2011 an application from the Jefferson County Industrial Development Authority requesting authority to manufacture athletic tape under FTZ procedures at the North American Tapes facility within FTZ 109 in Watertown, N.Y. This facility is used to produce pressure-sensitive adhesive athletic tape with textile fabric backing material for the U.S. market and export. The application has now been amended to provide updated and corrected information regarding the domestic availability and technical specifications of the textile fabric that would be used as an input to NAT’s manufacturing process. Comments on the amended application are due no later than April 5.

Click here for FTZB notice

USDA Considers Allowing Imports of Litchi, Longan and Rambutan from Philippines

The Department of Agriculture’s Animal and Plant Health Inspection Service is accepting comments through May 7 on a pest risk analysis that evaluates the risks associated with the importation into the continental United States of fresh litchi, longan and rambutan fruit from the Philippines. Based on that analysis, APHIS believes that the application of one or more of the following phytosanitary measures will be sufficient to mitigate the risks of introducing or disseminating plant pests or noxious weeds via such imports.

- the fruit may be imported in commercial consignments only

- the fruit must be irradiated in accordance with 7 CFR part 305 with a minimum absorbed dose of 400 Gy

- if the irradiation treatment is applied outside the U.S., each consignment must be jointly inspected by APHIS and the national plant protection organization of the Philippines and accompanied by a phytosanitary certificate attesting that the fruit received the required irradiation treatment (in the case of fresh rambutan, the certificate must include an additional declaration stating that the consignment was inspected and found free of the powdery mildew Oidium nephelii)

- if irradiation is applied upon arrival in the U.S., each consignment must be inspected by the NPPO of the Philippines prior to departure (in the case of fresh rambutan, the phytosanitary certificate must include an additional declaration stating that the consignment was inspected and found free of the powdery mildew Oidium nephelii)

- the fruit is are subject to inspection upon arrival at the U.S. port of entry

If the overall conclusions of the analysis and APHIS’ determination of risk remain unchanged following its consideration of any comments received, APHIS will authorize the importation of fresh fruit of litchi, longan and rambutan from the Philippines into the continental U.S. subject to the requirements specified in the risk management document.

Click here for APHIS notice

Commercial Labs and Gaugers Approved

U.S. Customs and Border Protection has announced that the following companies have been accredited as commercial laboratories and/or approved as commercial gaugers.

- effective June 22, 2011, Thionville Surveying Company Inc. of Harahan, La., has been approved to gauge and accredited to test petroleum and petroleum products, organic chemicals and vegetable oils for customs purposes

- effective June 16, 2011, VIP Chemical Inc. of Robstown, Texas, has been approved to gauge petroleum and petroleum products, organic chemicals and vegetable oils for customs purposes

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