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September 10 2012 Issue

Monday, September 10, 2012
Sandler, Travis & Rosenberg Trade Report

APEC Members to Cut Tariffs on Environmental Goods, Study Local Content Requirements  

In recent meetings in Vladivostok, Russia, the 21 member countries of the Asia-Pacific Economic Cooperation forum agreed on a list of 54 environmental goods on which tariffs will be cut to 5% or less by 2015. A press release from the Office of the U.S. Trade Representative states that this list includes a wide range of products, including renewable and clean energy technologies, wastewater treatment equipment, air pollution control technologies, and environmental monitoring and assessment equipment, and that tariffs on some of these products in the region are currently as high as 35%. Press sources added that specific products on the list, which had not been made publicly available at press time, include solar batteries, gas turbines, geothermal energy turbines, solar water heaters, bamboo floor panels and wind turbines. 

APEC member country trade ministers also took the following actions. 

- reaffirmed a commitment to extend through 2015 a pledge to refrain from raising new barriers to investment or trade in goods and services, imposing new export restrictions, or implementing WTO-inconsistent measures in all areas, including those that stimulate exports 

- called for a swift conclusion of negotiations to expand the product coverage and membership of the Information Technology Agreement 

- endorsed the updated APEC model chapter on transparency for regional trade agreements and free trade agreements as a significant contribution to the goal of improving the trading environment for companies and workers, addressing non-tariff barriers, and contributing to a Free Trade Area of the Asia-Pacific 

- instructed officials to further study in 2013 the impact of local content requirements on regional integration and economic growth and discuss possible ways members can promote job creation and competitiveness goals in ways that enhance, rather than distort, trade 

- reaffirmed the importance of achieving the goal of an APEC-wide 10% improvement in supply-chain performance by 2015 in terms of reducing time, cost and uncertainty of moving goods and services through the region and, toward that goal, supported recommendations to continue exploring opportunities for diversifying and optimizing transportation and supply chain routes across all modes, improving supply chain connectivity, establishing a logistic information service network, equipping all elements of supply chains with smart technologies, and expanding cooperation in the field of disaster prevention and management 

- committed to consider the impact of trade when developing regulations and instructed officials to make conformity assessment in regulation the focus of the 2013 Conference on Good Regulatory Practices 

U.S., EU Invite Public Comment on Ways to Reduce Regulatory Burdens  

The U.S. and the European Union are requesting public comments by Oct. 31 on ways to promote greater transatlantic regulatory compatibility. A joint solicitation issued Sept. 7 states that the two sides are seeking to reduce excessive regulatory costs, unjustified regulatory differences and unnecessary red tape while respecting each other's right to protect public health, safety, welfare and the environment. As authorities work on these issues within the High Level Regulatory Cooperation Forum, the Transatlantic Economic Council and the High Level Working Group on Jobs and Growth, they are also inviting from the private sector concrete ideas on how greater compatibility could be achieved in particular economic sectors. For each sector, commenters should provide the following information. 

- names of the relevant U.S. and EU regulatory agencies 

- citations to the relevant regulatory and/or statutory provisions for each jurisdiction (although this is not meant to exclude potential cooperation in areas where neither jurisdiction has yet adopted such provisions) 

- a description of the regulatory differences to be addressed (including any information on negative effects and the entities or stakeholders affected) 

- possible solutions for bridging these differences (including both the substance of the solution and the proposed procedure for reaching it) 

- any steps that the EU and/or U.S. should consider to address horizontal and/or sectoral differences that may be impeding deeper regulatory compatibility (e.g., differences with respect to technical regulations or in approaches to standards) 

- an assessment of the effects of enhanced regulatory compatibility (quantified benefits and costs, if possible, or else qualitative descriptions), the likelihood of these effects occurring and the time period over which they would occur 

The information gathered will be used when the two sides define priorities and explore next steps in the HLRCF this year and will contribute to the work of the HLWG by assisting in the identification of both immediate and longer-term goals and mechanisms to accomplish them. In addition, these and other issues will be discussed at a meeting later this fall involving EU and U.S. regulators, economic policy agencies and stakeholders, which could take place in the context of the HLRCF.

More Flexibility Proposed for Fur Product Labeling   

The Federal Trade Commission is seeking public comment by Nov. 16 on proposed changes to its Fur Labeling and Advertising Rules, which require fur manufacturers, dealers and retailers to label products made entirely or partly of fur. The FTC states that these changes would give companies that sell fur products more flexibility on labeling, update the Fur Products Name Guide that lists common animal names allowed on fur labels, and incorporate provisions of the Truth in Fur Labeling Act of 2010. Specific changes include the following. 

- eliminating the requirement in 16 CFR 301.20(a) that where fur products, or fur mats and plates, are composed in whole or in substantial part of paws, tails, bellies, sides, flanks, gills, ears, throats, heads, scrap pieces or waste fur, that fact shall be disclosed as a part of the required information in labeling, invoicing and advertising 

- eliminating the current requirement for labels to measure 1.75 inches by 2.75 inches and instead, consistent with the Textile Rules, requiring labels to be conspicuous and of such durability as to remain attached to the product throughout any distribution, sale or resale and until sold and delivered to the ultimate consumer 

- replacing the 12-point type font-size requirement for the label with a requirement to disclose information in such a manner as to be clearly legible, conspicuous, and readily accessible to the prospective purchaser 

- removing limits on information appearing on the front of the label, thereby allowing entities to include true and non-deceptive information on either side 

- deleting 16 CFR 301.30, which specifies a particular order for FTC disclosures 

- incorporating the Textile Rules’ provision allowing a single label for items “marketed or handled in pairs or ensembles,” regardless of whether they are attached at the point of sale; i.e., if the items are sold as pairs or ensembles and each item contains the same fur with the same country of origin, retailers can use a single label for all items 

- replacing the exemption for fur products of relatively low value (which the Fur Rules currently set at $150) with the TFLA’s more limited exemption for fur products (a) the fur of which was obtained from an animal through trapping or hunting and (2) when sold in a face-to-face transaction at a place such as a residence, craft fair or other location used on a temporary or short term basis by the person who trapped or hunted the animal, where the revenue from the sale of apparel or fur products is not the primary source of income of such person. 

- eliminating 16 CFR 301.19(l)(1) through (7), which provide a suggested, but not required, method for determining whether a fur has been treated with iron or copper and thus requires a “color altered” or “color added” disclosure, because this section already requires that an entity coloring furs must disclose the treatment on an invoice 

- deleting 16 CFR 301.28, which provides further guidance on attaching labels and is now redundant because the proposed new § 301.27 clarifies the method for attaching labels 

- eliminating 16 CFR 301.40, which requires entities to assign an “item number or mark” to furs and disclose it on invoices and labels, because FTC experience has shown that this information is not needed to enforce the Fur Rules 

- updating the Name Guide for the first time since 1967 to correct typographical errors and species misidentifications

CBP Opens Auto and Aerospace Center of Excellence and Expertise   

U.S. Customs and Border Protection opened its Automotive and Aerospace Center of Excellence and Expertise in Detroit Sept. 4. CBP states that this CEE has begun centralized processing for all trusted partners in the automotive and aerospace industry, which among other things will provide uniformity for importers. CBP already has CEEs operating for pharmaceuticals, health and chemicals in New York and electronics in Los Angeles and expects to launch a CEE for petroleum, natural gas and minerals in Houston by the end of September. CBP officials have said they plan to have CEEs for several other sectors – base metals and machinery, consumer products and mass merchandising, industrial and manufacturing materials, and textiles, wearing apparel and footwear – up and running by the end of 2013. 

A CBP press release states that by focusing on industry-specific issues each CEE offers one-stop processing in an effort to lower the trade’s cost of business, provide greater consistency and predictability, and enhance CBP enforcement efforts. The centers are coordinated from strategic locations but are manned by CBP personnel across the country. CEE personnel answer questions, provide information and develop trade facilitation strategies to address uniformity and compliance concerns. They also serve as a single point of processing for businesses enrolled in the Customs-Trade Partnership Against Terrorism and Importer Self-Assessment programs.

Court Rules on Classification of Pedicure Item   

The Court of International Trade ruled Sept. 6 in Telebrands Corporation v. U.S. that the PedEgg is properly classified as a pedicure cutlery item under HTSUS 8214.90.90. The PedEgg is a plastic egg-shaped object that contains a small metal file and flexible emery pads used to remove calluses. The plaintiff had argued for classification as other manicure and pedicure sets in containers of types ordinarily sold therewith in retail sales under HTSUS 8214.20.90. However, the court found that the PedEgg, despite being comprised of various parts, is one instrument and not a set.

AD Notice: Light-Walled Pipe and Tube from Turkey   

Agency: International Trade Administration. 
Commodity: Light-walled rectangular pipe and tube. 
Country: Turkey. 
Nature of Notice: Final results of administrative review of antidumping duty order for the period May 1, 2010, through April 30, 2011. 
Details: Weighted average dumping margin of zero for reviewed producer/exporter. Importer-specific AD duties based on this rate will be assessed on entries of subject merchandise during the period of review, and AD cash deposits will be suspended for shipments of subject merchandise entered or withdrawn from warehouse for consumption on or after Sept. 10. 

Importer ID Input Record Under Review by CBP   

U.S. Customs and Border Protection has reopened through Oct. 10 the period for public comment on the proposed extension of CBP Form 5106, the Importer ID Input Record. This form is used to identify entities who wish to import merchandise into the U.S., act as consignee on an importation when not the importer of record, or otherwise do business with CBP that would involve the payment of duties, taxes, fees or other monies or the refund of same. Each person, business firm, government agency or other organization that intends to file an import entry must file CBP Form 5106 with the first formal entry or request for services that will result in the issuance of a bill or a refund check upon adjustment of a cash collection. This form must also be filed by or on behalf of the ultimate consignee at the first importation in which the party acting as ultimate consignee is so named.

FMC to Meet Sept. 12 on Container Freight Rate Indices, Pacific Charges   

The Federal Maritime Commission will hold a partially open meeting Sept. 12 in Washington, D.C. The open session of this meeting will include discussion of the following. 

- requests to develop and release container freight rate indices for U.S. agricultural exports based on a sampling of service contracts filed with the FMC 

- the Logistic De Las Americas Conference 

- passenger vessel operator financial responsibility requirements for nonperformance of transportation 

- possible changes to the FMC’s rules of practice and procedure 

The closed session will review rate and surcharge trends in the trans-Pacific trade.

FTZ Board Approves New Activities in Indiana, New Jersey Zones   

The Foreign-Trade Zones Board has recently approved the following. 

- an application from the Indianapolis Airport Authority, grantee of FTZ 72, requesting authority to manufacture wind turbine gear boxes under FTZ procedures at the Brevini Wind USA Inc. facility within FTZ 72 

- production activity for Cosmetic Essence Innovations LLC’s fragrance blending and bottling facility within FTZ 235 in Holmdel, N.J.

No IPR Import Restrictions on Light-Emitting Diodes   

The International Trade Commission has terminated without the imposition of import restrictions patent infringement investigation 337-TA-798 of certain light-emitting diodes and products containing same. The ITC is taking this action on the basis of a settlement agreement between complainants Samsung LED Co. Ltd. and Samsung LED America Inc. and the respondents, which are located in Germany and the U.S.

New Restrictions on Imports and Exports of Two Shark Species   

The Fish and Wildlife Service has announced that effective Sept. 25 imports and exports of porbeagle sharks (Lamna nasus) and scalloped hammerhead sharks (Sphyrna lewini) will require the appropriate documents given the recent listing of these species on Appendix III of the Convention on International Trade in Endangered Species of Wild Fauna and Flora. Appendix III includes species protected by a country that has requested assistance from other CITES parties to control and monitor international trade in that species. 

As a result of the listing of the above species on Appendix III the following requirements will take effect Sept. 25. 

- the species must be declared to and receive clearance from the FWS prior to release by U.S. Customs and Border Protection upon import or prior to consignment for export 

- to export or reexport a specimen of one of these species a CITES document must be issued by the exporting or reexporting country’s CITES management authority 

- if the country that included the species in Appendix III is the country of export it must issue a CITES export permit (Belgium, Cyprus, Denmark, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Malta, Netherlands, Poland, Portugal, Slovenia, Spain, Sweden and the United Kingdom requested the listing of porbeagle sharks, and Costa Rica requested the listing of scalloped hammerhead sharks) 

- if a non-listing country wishes to export specimens of these species it must issue a CITES certificate of origin stating that the specimen originated from its country 

- in the case of a reexport of a specimen of the above species a CITES reexport certificate issued by the country of reexport is required 

Sugar Tariff-Rate Quotas for FY 2013 Announced   

The Department of Agriculture has established the amounts of raw cane sugar and certain sugars, syrups and molasses (collectively referred to as refined sugar) that may be imported under the lower tier of duties provided by the tariff-rate quotas for these products during fiscal year 2013. Specifically, aggregate quantities of up to 1,117,195 metric tons raw value of raw cane sugar and 117,254 MTRV of sugars, syrups and molasses may be entered or withdrawn from warehouse for consumption during this period. 

Of the latter quantity, 96,910 MTRV is reserved for the importation of specialty sugars. The FY 2013 specialty sugar TRQ will be opened in five tranches. The first, totaling 1,656 MTRV, will open Oct. 12, and all specialty sugars will be eligible for entry. The second tranche will open Oct. 26 and be equal to 35,245 MTRV. The remaining tranches will each be equal to 20,003 MTRV, with the third opening on Jan. 11, 2013, the fourth on April 11, 2013, and the fifth on July 11, 2013. The second, third, fourth and fifth tranches will be reserved for organic sugar and other specialty sugars not currently produced commercially in the U.S. or reasonably available from domestic sources. 

DEA Amends 2012 Import Limits for Three List I Chemicals   

The Justice Department’s Drug Enforcement Administration has increased the quantity of ephedrine, pseudoephedrine and phenylpropanolamine that can be imported into or produced in the U.S. in 2012. Pursuant to the Combat Methamphetamine Epidemic Act of 2005, this notice sets forth the DEA’s final adjusted assessment of the quantities of these three List I chemicals that are needed for medical, scientific, research and industrial needs; for lawful export requirements; and for the establishment and maintenance of reserve stocks. Specifically, the quantities of these chemicals needed for sale are increased from 4,000 kg to 4,300 kg for ephedrine, from 5,200 kg to 5,800 kg for phenylpropanolamine, and from 258,000 kg to 278,000 kg for pseudoephedrine.

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