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September 20 2012 Issue

Thursday, September 20, 2012
Sandler, Travis & Rosenberg Trade Report

Legislative Update: No Moves on Trade Expected Until After Elections    

With just a few more legislative days before lawmakers break to focus on their campaigns, there is little expectation that any trade-related measures will be taken up until after the November elections. Unless Congress approves the following bills during such a “lame duck” session, efforts to enact them will have to begin again next January. 

PNTR for Russia. Repealing the Jackson-Vanik Amendment and extending permanent normal trade relations status to Russia is necessary to allow U.S. businesses to take advantage of the trade liberalization measures associated with Russia’s accession to the World Trade Organization, which became official Aug. 22. PNTR legislation was approved by the Senate Finance Committee July 18 and by the House Ways and Means Committee July 26, but despite widespread support from both lawmakers and the Obama administration neither chamber seems likely to vote on a PNTR bill before the upcoming recess. 

Lacey Act. The Retailers and Entertainers Lacey Implementation and Enforcement Fairness (RELIEF) Act (H.R. 3210) was reported by the House Natural Resources Committee and placed on the House calendar. This bill would exempt any plant product imported or manufactured before May 22, 2008, from the requirements of the Lacey Act amendments and limit the import declaration requirement to solid wood and items imported only for commerce. It would also clarify that the Lacey Act only prohibits the importation of wood products harvested in violation of foreign laws that pertain to plants. 

MTB. Both the House and Senate have been working to assemble a miscellaneous trade bill, which will remove or reduce import duties on hundreds of manufacturing inputs and other products. Some House Republicans are opposing the MTB as an earmark, which is prohibited under current House rules, but Republican leaders in that chamber have voiced support for it. There has also been an effort to streamline the process of assembling the MTB by allowing companies to submit their proposals directly to the International Trade Commission and retaining final approval authority for Congress. 

Supply Chain Security. The House approved June 28 two measures designed to further improve the security of U.S. ports and maritime supply chains. H.R. 4005, the Gauging American Port Security Act, directs the Department of Homeland Security to submit to Congress a report that identifies remaining gaps in port security in the U.S., prioritizes those gaps and creates a plan to address them. H.R. 4251, the Securing Maritime Activities through Risk-based Targeting for (SMART) Port Security Act (H.R. 4251), aims to improve cooperation and coordination among federal agencies with maritime security responsibilities, support and enhance risk-based supply chain programs, and reduce costs. 

Trade Remedy Enforcement. The Senate Finance Committee approved the Enforcing Orders and Reducing Customs Evasion (ENFORCE) Act (S. 1133), which would create a set of procedures for U.S. Customs and Border Protection to investigate allegations of evasion of antidumping and countervailing duty orders. 

Trust Funds. Another measure approved by Senate Finance would create a federal trust fund to support research on diseases affecting the citrus industry; reauthorize through 2015 the Cotton Trust Fund, which temporarily suspended duties on certain cotton shirting fabrics; and fully restore wool trust fund payment levels in calendar years 2010 through 2012 and ensure that the Wool Trust Fund is fully funded through 2014. 

Toxic Substances Reform. The Senate Committee on Environment and Public Works narrowly approved the Safe Chemicals Act of 2011 (S. 847), which would reform and modernize the Toxic Substances Control Act. Among other things, this bill would require chemical companies to demonstrate the safety of industrial chemicals and encourage the development of safer alternatives to existing chemicals. It would also direct the Environmental Protection Agency to evaluate the safety of chemicals based on the best available science. Companies would be able to bring new chemicals quickly into commerce through a process that is similar to existing TSCA requirements but with enhanced data and safety requirements.

FMC Notes Limits in Carriers’ Ability to Impose Port Congestion Surcharges    

The Federal Maritime Commission issued Sept. 18 an industry advisory responding to inquiries about certain congestion surcharges that recently have been announced in tariff rules published by ocean common carriers. The FMC states that unless it is done pursuant to a waiver or exemption, any tariff rule (including surcharges) of a common carrier that results in an increased cost to a shipper may not be effective earlier than 30 days after publication. A tariff rule that purports to have effect only at the time the cargo is unloaded does not alter the requirement that rules applicable to any given shipment are those in effect on the date the cargo is received by the common carrier or its agent. As a result, cargo received by the carrier prior to the publication or effectiveness of a new tariff surcharge would not be subject to that charge.

Freight Forwarder to Pay $2.3 Million Fine for Price Fixing    

The Department of Justice announced Sept. 19 that a Japanese freight forwarding company has agreed to plead guilty and pay a $2.3 million criminal fine for its role in a conspiracy to fix certain fees, including fuel surcharges and security fees, in connection with the provision of freight forwarding services for air cargo shipments from Japan to the U.S. As a result of the DOJ’s ongoing investigation into this industry, 14 companies have either pleaded guilty or agreed to plead guilty and will pay more than $100 million in criminal fines. A DOJ official said that “prosecuting these kinds of global price-fixing conspiracies continues to be a high priority of the [DOJ’s] Antitrust Division.”

AD Notices: Silicon Metal, Stainless Steel Sinks    

Agency: International Trade Administration. 
Commodity: Silicon metal. 
Country: China. 
Nature of Notice: Amended final results of 2007-2008 administrative review of antidumping duty order pursuant to court decision. 
Details: Revised weighted average dumping margins of 21.97% to 48.64%. 

Agency: International Trade Administration. 
Commodity: Drawn stainless steel sinks. 
Country: China. 
Nature of Notice: Alignment of final antidumping and countervailing duty determinations, which are now both due Dec. 11.

ITC Considers Import Restrictions on Photographic Lighting Devices    

In patent infringement investigation 337-TA-804 of certain LED photographic lighting devices and components thereof, the presiding administrative law judge has recommended that the International Trade Commission issued a general exclusion order against infringing goods. Alternatively, the ALJ has recommended a limited exclusion order against certain subject goods manufactured or sold by the respondents found to be violating the patents at issue. 

The ITC is accepting through Oct. 17 comments on the public interest issues raised by the recommended relief. In particular, the Commission is interested in comments that: 

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

- identify any public health, safety or welfare concerns in the U.S. relating to the recommended 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, its licensees and/or third-party suppliers have the capacity to replace the volume of articles potentially subject to the recommended exclusion order and/or a cease and desist order within a commercially reasonable time; and 

- explain how the general exclusion order (or alternatively a limited exclusion order) would impact consumers in the U.S.

Ocean Transportation Intermediary License Revocations, Reissuances, Applicants    

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

- license #8893N: Sunway Line Inc., Buena Park, Calif. 
- license #18205NF: JAK Holding Inc. d/b/a Speedier Logistics, Brooklyn, N.Y. 
- license #020858F: Global Shipping Company LLC d/b/a GSC, Cincinnati, Ohio 
- license #022225NF: Trans Ocean Logistics Forwarding LLC, Linden, N.J. 

OTI Licenses Reissued. The Federal Maritime Commission has given notice that the following ocean transportation intermediary licenses have been reissued. 

- license #022710F: Route 809 Freight Forward LLC, Miami, Fla. 
- license #003550F: Seair Export Import Services Inc. d/b/a Seair Concord International Forwarding LC, Plantation, Fla. 

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

- Anchor Express Inc., Wood Dale, Ill. 
- Axima USA LLC, Los Angeles, Calif. 
- Cargozone Logistics Inc., Torrance, Calif. 
- Concert Group Logistics Inc., Downers Grove, Ill. 
- Global Logistic Partners Inc., Miami, Fla. 
- ICAT Logistics Inc., Elkridge, Md. 
- Jacobson Global Logistics Inc., Seattle, Wash. 
- Jade Sky Logistics Corp., Riverview, Fla. 
- KTL USA LLC, Edgewater, N.J. 
- Logistics Cargo Concept Inc., Inglewood, Calif. 
- T-Z Enterprises Inc., Cypress, Calif. 
- Welcome Freight Forwarding Inc., Miami, Fla. 
- World Trade Cargo & Logistics Inc., DFW Airport, Texas

FTZ Production Authority Sought for Construction Equipment Facility in Texas    

The Foreign-Trade Zones Board is accepting comments through Oct. 30 on a notification of proposed production activity at the Bauer Manufacturing Inc. facility located in FTZ 265 Site 1 in Conroe, Texas. This facility is used for the production of pile drivers and leads, boring machinery, foundation construction equipment, and related parts and sub-assemblies. 

Production under FTZ procedures could exempt Bauer from customs duty payments on the foreign status components used in export production. On its domestic sales, Bauer would be able to choose the duty rate that applies to the products listed above (zero) for foreign status inputs. Customs duties also could possibly be deferred or reduced on foreign status production equipment. 

The request indicates that all foreign steel products subject to an antidumping or countervailing duty order will be admitted to the zone in domestic (duty-paid) status.

Defense Export Information Collections Under Review    

The State Department’s Directorate of Defense Trade Controls is requesting public comments no later than Oct. 22 on the proposed extension of forms DS-6004, Request to Change End-User, End-Use and/or Destination of Hardware, and DS-6001, Request for Advisory Opinion. Any person who engages in the business of manufacturing or exporting defense articles, defense services and related technical data, or the brokering thereof, must register with the DDTC. Persons desiring to engage in brokering activities must submit an application or written request to conduct the transaction to the DDTC to obtain a decision as to whether it is in the interests of U.S. foreign policy and national security to approve the transaction.

Environmental Technologies Trade Advisory Committee to Meet Oct. 11    

The International Trade Administration’s Environmental Technologies Trade Advisory Committee will hold an open meeting Oct. 11 in Washington, D.C. Topics to be discussed include the harmonization of global environmental regulations, standards and certification programs; analysis of existing environmental goods and services data sources; development of trade promotion programs; and issues related to innovation in the environmental technology sector.

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