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March 7 2012 issue

Wednesday, March 07, 2012
Sandler, Travis & Rosenberg Trade Report

Legislative Update: CV Duty Bill Moving Fast but Not Much Else

While there are a number of potential issues on the congressional trade agenda this year, lawmakers are getting a slow start in moving them forward.

Countervailing Duties. Legislation to explicitly allow the federal government to impose countervailing duties on goods imported from non-market economy countries like China is moving quickly through Congress. The bill must officially originate in the House, which approved it March 6, but the Senate gave its consent to an identical measure March 5. The bill will therefore be “deemed” passed by the Senate and sent to the White House, where President Obama is expected to sign it as soon as March 7.

The fast-moving bill ( is a response to a court ruling that the Department of Commerce does not have the authority to impose CV duties on goods imported from NME countries. In addition to pursuing legislation to negate that ruling, the Obama administration this week asked the Court of Appeals for the Federal Circuit for a rehearing.

China. China is never far from the minds of trade policymakers, particularly when congressional and presidential elections are on the horizon. One of their primary targets has been the alleged undervaluation of China’s currency, a topic that Obama administration officials reiterated in recent bilateral talks and that has seen some legislative action in recent years. However, there has been no real effort to move such a bill during this session of Congress, likely due in part to House Republican leaders’ position that a debate on U.S.-China trade relations needs to be broader in scope. In addition, the anticipated enactment of the CV duty bill (see above) and the president’s recent establishment of the Interagency Trade Enforcement Center, both of which are widely seen as aimed at China, could further lower any pressure there might be in favor of a currency bill.

Trade Agency Reorganization. President Obama sent to Congress Feb. 16 the Consolidating and Reforming Government Act, which would permit the creation, abolition, consolidation, transfer or renaming of an executive agency or department if doing so reduced the overall number of agencies or achieved cost savings. The president has said he would first use this authority to consolidate six federal trade agencies and some other related programs into one department whose function would be to promote competitiveness, exports and U.S. business. However, sources say lawmakers have reacted coolly to the president’s proposal.

Customs Reauthorization. Efforts to move a customs reauthorization bill (which could address a number of topics wti/wti.asp?pub=0&story=36992&date=&company=) appear to have slowed in both the House and Senate, though staff members are reportedly still working on them.

Dominican Rep. Loses DR-CAFTA Cumulation Eligibility on Materials Sourced from Mexico

U.S. Customs and Border Protection has announced that effective March 1 the Dominican Republic lost its eligibility for using the DR-CAFTA cumulation provisions under HTS 9822.05.11 or 9822.05.13 as the basis for preferential treatment. These provisions permit certain materials to be sourced from Mexico. A presidential proclamation to amend the HTS accordingly is forthcoming.

As a result of this change, claims for preference on goods from the DR based on these cumulation provisions that are filed on or after March 1 will be assessed duty as non-originating goods. Additionally, entries under HTS 9822.05.11 are subject to quota. Charges against the 2012 limit or sublimits for goods from the DR entered on or after March 1 will be credited back to the limit(s) once the HTS changes are in place and systems are updated to remove the DR from quota programming.

CBP notes that the duty and quota status of cumulation claims on goods from Costa Rica, El Salvador, Guatemala, Honduras or Nicaragua under HTS 9822.05.11 or 9822.05.13, which are not based on the DR’s cumulation eligibility, will not be affected.

Click here for CBP notice

New ITA Official for Europe and Eurasia Affairs

The International Trade Administration announced March 5 that Matthew Murray will take up the position of deputy assistant secretary for Europe and Eurasia on March 12. In this position Murray will be responsible for recommending, developing and implementing policies and programs that promote U.S. economic and commercial relations with 52 European countries. He will also lead the Department of Commerce’s efforts to help solve trade policy and market access issues facing U.S. firms engaged in commercial activity throughout this region.

An ITA press release indicates that part of the reason Murray was named to the post is his experience and expertise on Russia, whose pending accession to the World Trade Organization will give the U.S. an opportunity to deepen its commercial engagement with that country. Most recently Murray served as president of a risk management firm he founded to advise multinational corporations and multilateral institutions on how to reduce governance and corruption risk in Russia, Central Asia and Eastern Europe. He has also served as chair of the Center for Business Ethics and Corporate Governance in Moscow and co-chair of the U.S.-Russia Working Group on Anti-Corruption and Institutional Integrity. In 2004 he co-authored DOC’s Business Ethics: A Manual for Managing a Responsible Business Enterprise in Emerging Market Economies.

Of Note: Record Patent Filings, U.S.-China Trade, FCPA

International Patent Filings Set New Record in 2011

Trade Policy Priority One: Averting a U.S.-China "Trade War"

Arab Spring creates groundswell of potential FCPA action

AD/CV Notices: Sinks, Steel Rod, Shrimp, Folding Tables/Chairs, Silicon Metal, Clothes Washers, Valves

Agency: ITC.
Commodity: Drawn stainless steel sinks.
Country: China.
Nature of Notice: Institution and scheduling of preliminary phase of AD and CV injury investigations.

Agency: ITA.
Commodity: Carbon and certain alloy steel wire rod.
Country: Mexico.
Nature of Notice: Final results of administrative review of AD duty order for the period Oct. 1, 2009, through Sept. 30, 2010.
Details: Dumping margin for the reviewed company is 5.59%. This rate will be used to determine AD duties assessed on entries of subject merchandise from this company during the period of review and AD cash deposit rates for shipments entered or withdrawn from warehouse for consumption on and after March 7.

Agency: ITA.
Commodity: Frozen warmwater shrimp.
Country: Vietnam.
Nature of Notice: Preliminary results of administrative review of AD duty order for the period Feb. 1, 2010, through Jan. 31, 2011.
Details: Dumping margins range from zero to 25.76%.

Agency: ITA.
Commodity: Folding metal tables and chairs.
Country: China.
Nature of Notice: Preliminary results of administrative review of AD duty order for the period June 1, 2010, through May 31, 2011.
Details: Dumping margin for the reviewed exporter is 36.45%.

Agency: ITA.
Commodity: Silicon metal.
Country: China.
Nature of Notice: Preliminary results of administrative review of AD duty order for the period June 1, 2010, through May 31, 2011.
Details: Dumping margin for reviewed exporter is 5.5%.

Agency: ITA.
Commodity: Large residential washers.
Country: Korea.
Nature of Notice: Postponement until May 29 of time limit for preliminary CV duty determination.

Agency: ITA.
Commodity: Frontseating service valves.
Country: China.
Nature of Notice: Extension from March 30 to April 30 of time limit for preliminary results of administrative review of AD duty order for the period April 1, 2010, through March 31, 2011.

IPR Enforcement Actions on Consumer Electronics, Dental Device Models

New IPR Infringement Petition on Consumer Electronics. The International Trade Commission received March 5 a petition requesting that it institute a Section 337 investigation regarding certain consumer electronics and display devices and products containing same. The proposed respondents are located in Canada, Taiwan, Korea, Japan, Sweden and the U.S.

Section 337 investigations primarily involve claims regarding intellectual property rights violations by imported goods, including the infringement of patents, trademarks and copyrights. Other forms of unfair competition involving imported products, such as misappropriation of trade secrets or trade dress and false advertising, may also be asserted. The primary remedy available in Section 337 investigations is an exclusion order that directs U.S. Customs and Border Protection to stop infringing imports from entering the U.S. In addition, the ITC may issue cease and desist orders against named importers and other persons engaged in unfair acts that violate Section 337, including selling infringing imported articles out of U.S. inventory.

Potential IPR Probe of Digital Models for Dental Devices Evaluated for Public Interest Issues. The International Trade Commission is requesting comments no later than March 15 on any public interest issues raised by a Section 337 intellectual property rights infringement complaint against certain digital models, digital data and treatment plans for use in making incremental dental positioning adjustment appliances, appliances made therefrom and methods of making same. Comments should address whether the issuance of exclusion orders and/or cease and desist orders pursuant to this complaint would affect the public health and welfare in the U.S., competitive conditions in the U.S. economy, the production of like or directly competitive articles in the U.S., or U.S. consumers. In particular, the ITC is interested in comments that:

- explain how the articles potentially subject to the orders are used in the U.S.;

- identify any public health, safety or welfare concerns in the U.S. relating to the potential orders;

- identify like or directly competitive articles that the complainant, its licensees or third parties make in the U.S. that could replace the subject articles if they were to be excluded;

- indicate whether the complainant, the complainant’s licensees and/or third-party suppliers have the capacity to replace the volume of articles potentially subject to the requested orders within a commercially reasonable time; and

- explain how the requested orders would impact U.S. consumers.

Click here for ITC notice

Ocean Transportation Intermediary License Revocations, Reissuances, Applicants

OTI License Revoked. The Federal Maritime Commission has given notice that the following ocean transportation intermediary license has been revoked. A revocation may occur after a license is surrendered voluntarily by the OTI or for failure to maintain a valid bond.

- license #020852N: OTS Int’l Inc. d/b/a OTS Logistics, Rancho Dominguez, Calif.

Click here for FMC revocation notice

OTI Licenses Reissued. The FMC has given notice that the following OTI licenses have been reissued.

- license #020479F: Karon Jones d/b/a Keen Machinery and Export, Dublin, Texas
- license #022258F: Platinum Moving Services Inc., Gaithersburg, Md.

In addition, the FMC has rescinded its order revoking the following OTI license.

- license # 021014N: Magic Transport Inc., Toa Baja, Puerto Rico

Click here for FMC reissuance notice
Click here for FMC rescission notice

OTI License Applicants. The FMC has provided notice that the following applicants have filed applications for licenses as non-vessel-operating common carrier and/or ocean freight forwarder OTIs. Persons knowing of any reason why any of these applicants should not receive a license are requested to contact the FMC.

- Asecomer International Corporation d/b/a Interworld Freight Inc. d/b/a Junior Cargo Inc. d/b/a Intercontinental Lines Corp., Miami, Fla.
- Aslo USA Corp., Miami, Fla.
- Caribbean Forwarding LLC, Medley, Fla.
- Clover Systems LLC d/b/a Clover Marine, Miami, Fla.
- De Well Container Shipping Corp., Rosedale, N.Y.
- Gwinnett Shipping & Receiving LLC d/b/a Korea Intermodal USA, Norcross, Ga.
- King Solomon Logistics Inc., South Richmond Hill, N.Y.
- Kokusai Soko America Inc. d/b/a KSAI, Los Angeles, Calif.
- KY Logistics Inc., Jamaica, N.Y.
- Master Logistics Inc., Roslyn, N.Y.
- MNS International Inc., Ridgewood, N.J.
- New Marine Consolidator Inc., City of Industry, Calif.
- Optima Cargo & Logistics Inc., Miami, Fla.
- OTX Logistics Inc., Miami, Fla.
- Prolog Services Inc. d/b/a PSI Ocean Freight Systems, Houston, Texas
- Rapidex USA LLC, Somerset, N.J.
- Reece Ventures LLC d/b/a I love Moving, Los Angeles, Calif.
- Rescigno Logistics Group LLC, Columbia, S.C.
- Rhino Moving Inc., Deerfield Beach, Fla.
- Sealand Freight LLC, Houston, Texas
- Straight Forwarding Inc., City of Industry, Calif.
- Superior Freight Services Inc., Eagan, Minn.
- Trade Logistics Corp., Weston, Fla.
- Transmark Logistics Inc. d/b/a Transmark Logistics, Kent, Wash.
- Tri-Crown Shipping LLC, Douglasville, Ga.
- We International Inc., Dublin, Calif.
- World Logistics LLC, Redford, Mich.

Click here for FMC applicants notice

CBP Reviewing Mod Act/DR-CAFTA Recordkeeping Requirements, General Declaration

U.S. Customs and Border Protection is seeking public comments no later than May 7 on the following information collections.

Customs Modernization Act Recordkeeping Requirements. The Mod Act revised the customs laws related to recordkeeping, examination of books and witnesses, regulatory audit procedures and judicial enforcement. Specifically, the Mod Act expanded the list of parties subject to CBP recordkeeping requirements, distinguished between records that pertain to the entry of merchandise and financial records needed to substantiate the correctness of information contained in entry documentation, and identified a list of records that must be maintained and produced upon request by CBP. The information and records are used by CBP to verify the accuracy of claims made on entry documents regarding the tariff status of imported merchandise, admissibility, classification/nomenclature, and value and rate of duty applicable to the entered goods. (click here for CBP notice

DR-CAFTA. To ascertain if DR-CAFTA imported goods are eligible for preferential tariff treatment, a certification and supporting documents may be requested by CBP. Guidance on filing DR-CAFTA claims may be found at:
minican_republic/ (click here for CBP notice

General Declaration. CBP Form 7507, General Declaration (Outward/Inward), must be filed for all aircraft entering under the provisions of 19 CFR 122.41. This form is used to document clearance by the arriving aircraft at the required inspectional facilities and inspections by appropriate regulatory agency staffs. CBP Form 7507 collects information about the flight routing, the numbers of passengers embarking and disembarking, a declaration of health for the persons on board, details about disinfecting and sanitizing treatments during the flight, and a declaration attesting to the accuracy and completeness and truthfulness of all other documents that make up the manifest. (click here for CBP notice

New and Amended Maritime Agreements Filed

The Federal Maritime Commission has issued notice that the following new or amended agreements have been filed. Interested parties may submit comments by March 19.

- The Credit Agreement: The amendment would add Crowley Latin American Services LLC as a party to the agreement.

- U.S. Supplemental Agreement to HLC Agreement: The amendment adds Hansa Heavy Lift GmbH as party to the HLC agreement.

- NYK/Hanjin/Hyundai/Evergreen-Americas North-South Service Agreement: The amendment renames the agreement, adds Evergreen Line Joint Services Agreement as a party, and updates some of the service references in the agreement.

- GWF/AGRIEX Space Charter Agreement: The amendment changes the name of Great White Fleet (US) Ltd. to Great White Fleet Liner Services Ltd.

- Altex Chartered/Great White Fleet Slot Charter Agreement: The agreement authorizes Altex Chartered to charter space to Great White Fleet on Altex Chartered’s vessels in the trade between South America, Central America and the U.S. East Coast.

- Maersk Line/New World Alliance Slot Exchange Agreement: The agreement authorizes the parties to exchange space on their respective services in the trade between the U.S. Atlantic Coast and ports in Panama, the United Kingdom, Germany, the Netherlands and Mediterranean ports in France, Italy and Spain.

- Lease and Operating Agreement between PRPA and Growmark Inc.: The amendment provides for an acknowledgement statement that the parties must sign to continue the terms and conditions of the lease.

Click here for FMC agreement notice

Education Mission to Brazil Set for Late Summer

The Department of Commerce is organizing an education mission to Brazil Aug. 30 through Sept. 6. The emphasis of this mission will be on U.S. higher education, focusing on (in order of importance) intensive English language programs, undergraduate and graduate programs, and community college programs. DOC states that there are several types of opportunities for U.S. universities and institutions of higher learning in Brazil: attracting Brazilian students to the U.S., establishing a campus in Brazil to offer courses and programs, and online training programs.

This mission will be open to a minimum of 50 and a maximum of 60 institutions. Interested parties must submit by Aug. 15 a timely, completed and signed mission application and supplemental application materials, including adequate information on course offerings, primary market objectives and goals for participation. Applicants must also submit the online application for consideration by the EducationUSA South America Fair, and participating institutions must be represented at the fair by an employee. Each applicant must certify that the services it seeks to export through the mission are either produced in the U.S. or, if not, marketed under the name of a U.S. firm and have at least 51% U.S. content of the value of the service.

Click here for DOC notice

Duty Exemption Allocations for Virgin Islands Watch Producers

The International Trade Administration and the Department of the Interior have issued a notice allocating the calendar year 2012 duty exemptions for watch assembly producers located in the U.S. Virgin Islands. The total quantity of duty-free insular watches and watch movements allocated for 2012 is 1,866,000 units, the same as in 2011. Currently there is only one producer receiving an allocation of 500,000 units; the remainder is available for new entrants into the program or the existing producer if it requests a supplemental allocation. However, in 2011 USVI program producers shipped only 53,744 watches and watch movements to the U.S. (down from 63,990 in 2010).

Click here for ITA/DOI notice

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