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March 8 2012 issue

Thursday, March 08, 2012
Sandler, Travis & Rosenberg Trade Report

Two New Centers Opened to Improve Administration of Export Controls

The Obama administration announced March 7 the opening of two new multi-agency centers to improve the administration of U.S. export controls. A White House press release called the move “a significant step forward in the President’s Export Control Reform Initiative” and said it represents “a more fully coordinated and harmonized approach that facilitates secure trade.”

The Export Enforcement Coordination Center will be responsible for enhanced information sharing and coordination between law enforcement and intelligence officials regarding possible violations of U.S. export controls laws. The E2C2 will be administered by the Department of Homeland Security with a leadership team comprised of officials from DHS, the Federal Bureau of Investigation and the Department of Commerce. The White House states that the opening of the E2C2 “builds on the increased criminal penalties for export control violations and the provision of Commerce’s permanent law enforcement authorities implemented in partnership with Congress in the Comprehensive Iran Sanctions, Accountability, and Divestment Act.”

The Information Triage Unit, which will be housed at DOC, will be responsible for assembling and disseminating relevant information from which to base informed decisions on proposed exports requiring a U.S. government license. This multi-agency screening will coordinate the reviews of separate processes across the government to ensure that all departments and agencies have a full dataset, consistent with national security, from which to make decisions on export license applications. “Such screening contributes to more timely, predictable, and consistent processes that U.S. exporters engaged in global trade have confirmed are critical to their competitiveness,” the press release states.

Further, the Office of the National Counterintelligence Executive has been designated as the entity responsible for coordinating export control issues involving the intelligence community. According to the White House, this move represents “another significant process improvement for more seamless and comprehensive access to intelligence.”

President Issues Proclamation to Implement Korea FTA

President Obama issued March 6 a proclamation providing for the March 15 entry into force of the U.S.-Korea Free Trade Agreement. This proclamation amends the Harmonized Tariff Schedule of the U.S. to implement the preferential tariff treatment of goods imported from Korea under the terms of the FTA and specify rules of origin under which such treatment may be granted. It also authorizes the Committee for the Implementation of Textile Agreements to determine when fabrics, yarns or fibers are short supply (thus permitting preferential tariff treatment for imports of textile and apparel goods made with such inputs sourced other than in the U.S. or Korea) and to implement safeguards and enforcement actions on textile and apparel imports from Korea.

Click here for presidential proclamation

U.S. Files WTO Complaint on India’s Restrictions on Agricultural Imports

The Office of the U.S. Trade Representative announced March 6 that the U.S. has requested consultations with India at the World Trade Organization concerning its prohibitions on certain U.S. agricultural exports, including poultry meat and chicken eggs. “India’s ban on U.S. poultry is clearly a case of disguising trade restrictions by invoking unjustified animal health concerns,” said USTR Ron Kirk. “The United States is the world’s leader in agricultural safety and we are confident that the WTO will confirm that India’s ban is unjustified.” A press release from several U.S. agricultural trade groups cites “conservative estimates” that “if India’s trade barriers were eliminated the value of U.S. poultry exports to India each year would surpass $300 million.”

USTR states that since at least February 2007 India has formally banned imports of various agricultural products from the U.S., supposedly to prevent outbreaks of avian influenza even though the U.S. has not had an outbreak of highly pathogenic avian influenza since 2004. USTR adds that international standards for AI control do not support the imposition of import bans due to detections of low pathogenic AI, the only kind found in the U.S. since 2004. The U.S. has repeatedly asked India to justify its claim that a ban on products from the United States is necessary, but “to date India has not provided valid, scientifically-based justification.” If the forthcoming consultations do not resolve the dispute, the U.S. will be able to request the formation of a WTO dispute settlement panel.

Of Note: Bribery Report, GSP for Argentina, E-Waste Exports

Deterring and punishing corporate bribery: an evaluation of UK corporate plea agreements and civil recovery in overseas bribery cases

US eyes suspending trade benefits for Argentina

Groups Continue to Debate Electronic Export Ban

Wildlife Trade Regulations to be Revised for CITES Changes

The Fish and Wildlife Service is proposing to revise the regulations that implement the Convention on International Trade in Endangered Species of Wild Fauna and Flora by incorporating certain provisions adopted at the June 2007 and March 2010 conferences of CITES parties. Highlights of the proposed changes are set forth below. Comments on this proposed rule are due no later than May 7.

- clarification that the allowed use of a specimen after import into the U.S. is determined by the current status of the specimen under CITES and the Endangered Species Act, except for a specimen of an Appendix I species or an Appendix II species annotated for noncommercial purposes that was imported before such listing (thus avoiding the retroactive application of import/export restrictions to goods legally imported prior to the imposition of those restrictions)

- amended definition of “bred for noncommercial purposes” that removes the requirement that trade be conducted between facilities involved in a cooperative conservation program

- revised definitions of coral due to problems encountered in the implementation of the requirements for trade in stony corals

- clarification that violation of any of the provisions of 50 CFR part 23, including use of CITES specimens imported into the U.S. contrary to what is allowed under section 23.55, is unlawful

- elimination of requirement that commercial operations breeding Appendix I species be registered with the CITES secretariat to export specimens under any circumstances

- allowing CITES documents to be issued electronically (although the U.S. cannot currently issue or accept electronic permits)

- addition of three circumstances in which FWS may request verification of a CITES document: (1) the document is issued for a species with an annotated quota that raises concerns about the validity of the shipment, (2) a shipment of captive-bred Appendix I wildlife specimens did not originate from a registered breeding operation and FWS has reason to believe the import is for commercial purposes, and (3) the actual quantity exported has not been validated or certified at the time of export

- clarification that authorized inspecting officials for imports into the U.S. of CITES-listed plants are responsible for the cancellation and collection of original documents for submission to the U.S. management authority

- incorporation of a definition of “ranched specimen” that will cover many of the specimens FWS previously considered “wild”

- clarification that an individual unable to clearly demonstrate that a wildlife specimen meets the criteria for an exempt hybrid must obtain a CITES document

- replacement of the annual reporting requirement for registered commercial breeding operations with a process for registration renewal

- clarification of procedures and amended criteria for issuance and acceptance of replacement CITES documents, including requirements that specimens are presented to the appropriate official at the time of import

- clarification that FWS may issue or accept a retrospective document in circumstances where a technical error was made by the issuing management authority at the time the original document was issued

Click here for FWS proposed rule

AD/CV Notices: Orange Juice, Uranium, Garment Hangers, Pipe Fittings

Agency: ITC.
Commodity: Orange juice.
Country: Brazil.
Nature of Notice: March 14 open meeting for vote in sunset review of AD duty order.

Agency: ITA.
Commodity: Uranium.
Country: Russia.
Nature of Notice: Continuation of suspended AD duty investigation for five years.

Agency: ITA.
Commodity: Steel wire garment hangers.
Country: Vietnam.
Nature of Notice: Postponement from March 23 to May 29 of preliminary CV duty determination.

Agency: ITA.
Commodity: Stainless steel butt-weld pipe fittings.
Country: Italy, Malaysia and the Philippines.
Nature of Notice: Final results of sunset reviews of AD duty orders.
Details: Revocation of these orders would be likely to lead to continuation of recurrence of dumping at the following levels: Italy, 26.59%, Malaysia, 7.51%, Philippines, 7.59% to 33.81%. Link:

Foreign-Trade Zones Board Asked to Expand Michigan Zone, Add Authority in Nevada

The Foreign-Trade Zones Board has received the following applications.

- The Kent-Ottawa-Muskegon Foreign-Trade Zone Authority, grantee of FTZ 189, is requesting authority to reorganize this zone under the alternative site framework. The proposed service area under the ASF would be Kent, Ottawa and Muskegon counties in Michigan, within and adjacent to the Grand Rapids U.S. Customs and Border Protection port of entry. Comments on this request are due no later than May 7. (click here for notice

- The Economic Development Authority of Western Nevada, grantee of FTZ 126, is requesting temporary/interim manufacturing authority to produce cell phone kits at the Brightpoint North America L.P. facility in Reno. FTZ procedures could exempt Brightpoint from customs duty payments on the foreign components used in export production, and the company anticipates that up to 10% of the plant's shipments could be exported. Comments on this request are due no later than April 9. (click here for notice

IPR Enforcement Actions on Kitchenware, Mobile Devices, Program Guide Products

New IPR Infringement Petition on Kitchenware. The International Trade Commission received March 6 a petition requesting that it institute a Section 337 investigation regarding certain food containers, cups, plates, cutlery and related items and packaging thereof. The proposed respondents are located in 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.

Violation Found in Mobile Device Probe, Input Sought on Remedy. The ITC will review the presiding administrative law judge’s determination that the importation, sale for importation or sale within the U.S. after importation of certain mobile devices, associated software and components thereof is infringing specified patents.

The ITC is also requesting comments no later than March 19 on the form of remedy, if any, that should be ordered in this investigation (i.e., an exclusion order and/or cease and desist orders); the effects of that remedy on the public health and welfare, competitive conditions in the U.S. economy, U.S. production of articles that are like or directly competitive with those that are subject to investigation, and U.S. consumers; and the amount of the bond under which the subject articles could enter the U.S. during the 60-day period in which the president may review any ITC remedy recommendation.

Click here for ITC notice

Program Guide Investigation Terminated. The ITC has terminated patent infringement investigation 337-TA-801 of certain products containing interactive program guide and parental controls technology based on a settlement agreement between the complainants and the respondents.

Click here for ITC notice

USDA Proposes to Require Weekly Export Sales Reports on Pork, Distillers Dried Grain

The Department of Agriculture is inviting public comments through May 7 on a proposed rule that would require all exporters of U.S. pork (fresh, chilled and frozen box/primal cuts) and distillers dried grain to report information on export sales of those products to USDA’s Foreign Agricultural Service on a weekly basis. Required reportable information would include the quantity, destination and marketing year of all pork and DDG export sales, changes in sales, and shipments per identified parameters. USDA states that this rule would allow for information on the total volume of sales and shipments to be available within two weeks of the export sale and shipment rather than the nearly two-month delay experienced under the current system operated by the Census Bureau.

Click here for USDA proposed rule

New Advisory Committee on Appliance Standards and Rulemaking

The Department of Energy has announced the creation of a new Appliance Standards and Rulemaking Federal Advisory Committee and is soliciting nominations for membership. The ASRAC will provide advice and recommendations on the development of minimum efficiency standards for residential appliances and commercial equipment, development of product test procedures, certification and enforcement of standards, labeling for various residential products and commercial equipment, and specific issues of concern to DOE.

Nominations for ASRAC members are due no later than April 2. DOE will appoint approximately 25 members with a view toward achieving a balanced committee of experts in fields relevant to energy efficiency and appliance and commercial equipment standards, to include DOE as well as representatives of industry (including manufacturers and trade associations representing manufacturers, component manufacturers and related suppliers, and retailers), utilities, energy efficiency/environmental advocacy groups and consumers.

Click here for DOE notice

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