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August 14 2012 Issue

Tuesday, August 14, 2012
Sandler, Travis & Rosenberg Trade Report

Legislation with DR-CAFTA Technical Fixes and AGOA Third-Country Fabric Extension Enacted into Law

On Aug. 10, President Obama signed into law legislation to (1) enact the technical fixes approved by the DR-CAFTA trade ministers 18 months ago, (2) extend through Sept. 2015 the third-country fabric provision under the African Growth and Opportunity Act, (3) add South Sudan to the AGOA, and (4) reauthorize import sanctions against Burma for three years and provide that these sanctions remain in place until at least July 2013. 

The AGOA amendments became effective on the date of enactment of the legislation (Aug. 10) while the Burma provision was implemented retroactive to July 26. By contrast, the DR-CAFTA technical fixes will apply to goods of a DR-CAFTA country that are entered, or withdrawn from warehouse for consumption, on or after the date that the U.S. Trade Representative determines is the first date on which the equivalent amendments to the DR-CAFTA rules of origin have entered into force in all DR-CAFTA countries. At this point it is difficult to estimate when the technical fixes may be implemented, however.

Notorious Markets for IPR Infringement Subject of USTR Comment Request

The Office of the U.S. Trade Representative is requesting written submissions by Sept. 14 to aid in the preparation of its 2012 Notorious Market List. Notorious markets are Internet and physical markets outside the U.S. where counterfeit or pirated products are prevalent to such a degree that they exemplify the problem of marketplaces that deal in infringing goods and help sustain global piracy and counterfeiting. The Notorious Markets List gives examples of markets that have been the subject of enforcement action or may merit further investigation for possible intellectual property infringements. The list does not represent a finding of violation of law but rather is a summary of information that serves to highlight the problem. The 2011 Notorious Markets List identified 34 markets. 

According to USTR, written comments should be as detailed as possible and clearly identify the reason or reasons why the nature or scope of activity associated with the identified market or markets exemplify the problem of marketplaces that deal in infringing goods and help sustain global piracy and counterfeiting. Information that would be particularly helpful includes location; principal owners/operators (if known); types of products sold, distributed or otherwise made available; volume of Internet traffic associated with the Web site, such as the Alexa ranking; any known civil or criminal enforcement activity against the market; any other efforts to remove/limit infringing materials, including the Web site’s responsiveness to notices of infringement and requests to remove or disable access to allegedly infringing material; and any other relevant information, including any other positive progress made by the operators of the market in addressing infringing activity.

CPSC to Discuss Safety Requirements for Consumer Products at Sept. 20 Event

The Consumer Product Safety Commission will hold in about a month a one-day “Safety Academy” at its headquarters in Bethesda, Maryland, to discuss current requirements for consumer products including testing and certification of children’s products, the mandatory toy standard and compliance issues. This event will bring together CPSC staff, manufacturers, consumer advocates, academic researchers and others to disseminate and share information on areas of particular interest to stakeholders. The discussions will be held in a panel format, with a brief question and answer session at the end of each panel. Participants may choose from one of three panels in the morning session: “F963 Toy Standards”; “Testing-Mandatory Testing, Component Parts Testing, Certificates of Conformity”; or “Flammable Fabrics, Drawstrings, and Sleepwear.” In the afternoon session, participants may choose from three panels that will be repeated: “Navigating the CPSC Import Process”; “The Nuances of 6b”; or “Fast-Track Process—Compliance.” An official of China’s General Administration of Quality Supervision, Inspection, and Quarantine has also been invited to speak and the schedule will be adjusted if the invitation is accepted. 

This event will be held Sept. 20 from 8:00 a.m. to 4:00 p.m. EST. Individuals interested in serving on panels or presenting information should register by Sept. 4. All other individuals who wish to attend in person should register by Sept. 14.

Multi-Sector Trade Mission to South India and Sri Lanka Set for Feb. 2013; Changes Made to Israel and South Africa/Zambia Trade Missions

The Department of Commerce is organizing a multi-sector trade mission to south India and Sri Lanka Feb. 3-8, 2013 intended to introduce U.S. firms to the rapidly expanding markets for infrastructure, hospitality, health care, and environmental and information technologies. The mission will tour three cities - Chennai, Cochin (Kochi) and Colombo - where participants will receive market briefings and participate in customized meetings with key officials and potential partners. Trade mission participants will also have the option to participate in additional stops in Bangalore and Hyderabad (both in south India) where U.S. officers can arrange meetings with private sector developers/partners and state/local government officials. 

DOC notes that the mission will help participating firms gain market insights, make industry contacts, solidify business strategies and advance specific projects with the goal of increasing U.S. exports of services to India and Sri Lanka. The mission will include one-on-one business appointments with pre-screened potential buyers, agents, distributors and joint venture partners; meetings with state and local government officials and industry leaders; and networking events. 

Separately, DOC has amended the timeline and agenda for its upcoming oil and gas trade mission to Israel. This mission is intended to include representatives from leading U.S. companies that provide services to oil and gas facilities, from design and construction through to project implementation, maintenance of facilities and environmental protection. To accommodate schedules and traditions, the dates of the trade mission have been changed from Oct. 27-31 to Oct 28-Nov. 1. 

DOC has also made certain changes to its Nov. 26-30 executive-led trade mission to South Africa and Zambia by adding to the list of targeted sectors the water sector (i.e., water supply, sanitation and drainage systems) and architecture, construction and technical assistance services related to the development of water sector infrastructure. Because of this change, DOC will not start market selection decisions on a rolling basis until Aug. 24.

U.S. Applies Iran Sanctions to Syrian Oil Company

The State Department announced Aug. 10 the imposition of sanctions on the Syrian state-run oil company Sytrol under the Iran Sanctions Act for conducting business with Iran’s energy sector. State indicates that last April Syria and Iran engaged in two-way trade in the energy sector in which Syria sent 33,000 metric tons of gasoline to Iran. The U.S. has determined that the value of the gasoline delivered by Sytrol to Iran was over $36 million, significantly exceeding the monetary thresholds for triggering sanctions under this law (i.e., the $1 million threshold for individual transactions and the $5 million threshold for multiple transactions within a twelve-month period). A State Dept. official indicated that the U.S. has blocked all banking and property transactions subject to U.S. jurisdiction that have any Sytrol interest in them as well as any procurement by the U.S. government of anything from Sytrol.

CPSC Requests Extension of Information Collection Requirements on Carpets and Coal/Woodburning Appliances

The CPSC has submitted to the Office of Management and Budget separate requests for the extension of (1) the testing and recordkeeping requirements for manufacturers and importers who furnish guaranties or certificates for products subject to the carpet flammability standards, and (2) certain information collection requirements for manufacturers and importers of coal and woodburning appliances. 

Information Collection Requirements for Carpets and Rugs. These items must meet the requirements of the applicable flammability standards prior to distribution in commerce and firms must issue a General Certification of Conformity or Children’s Product Certificate certifying that the products meet all applicable product safety regulations. In addition, under the Consumer Product Safety Improvement Act there is a third-party testing requirement for all consumer products, including carpets and rugs, subject to a consumer product safety rule or similar rule, ban, standard or regulation under any other act enforced by the Commission that are primarily intended for children 12 years of age or younger. Every manufacturer (including an importer) or private labeler of a children’s carpet or rug must have its product tested for compliance to parts 1630 and 1631 and other applicable product safety rules by an accredited, CPSC-accepted third-party laboratory. Finally, there are enforcement regulations that specify the frequency of testing necessary to support the issuance of a guaranty of compliance under the Flammable Fabrics Act and the types of records that must be maintained to document this activity. Beginning in 2013, firms must also employ reasonable and representative testing programs in accordance with the CPSIA. 

Information Collection Requirements for Coal and Woodburning Appliances. Manufacturers and importers of certain coal and woodburning appliances are required to provide safety information to consumers on labels and instructions and an explanation of how certain clearance distances in those labels and instructions were determined. The requirements to provide copies of labels and instructions to the CPSC have been in effect for stoves manufactured or imported since Oct. 17, 1983, or May 16, 1984 for stoves introduced into U.S. commerce after May 16, 1984, regardless of the date of manufacture. For this reason, the information burden imposed by this rule is limited to manufacturers and importers introducing new products or models or making changes to labels, instructions or information previously provided to the Commission. The objectives of these reporting requirements are to reduce the risk of injuries from fires associated with the installation, operation and maintenance of the appliances that are subject to the rule, and to assist the CPSC in determining the extent to which manufacturers and importers comply with the requirements.

BIS Makes Further Correction to Commerce Control List

The Bureau of Industry and Security on July 27 issued a notice making certain corrections to the Commerce Control List. One of the corrections removed the entry for EI in the table for “License Requirements” of ECCN 5A003 and placed it below the table as an indented paragraph. However, BIS has issued an additional correction because it inadvertently referenced “5A003” in that correction when it should have cited “5A002.”

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