News
Print PDF

September 21 2012 Issue

Friday, September 21, 2012
Sandler, Travis & Rosenberg Trade Report

Oct. 1 Deadline for Switching to ACE for Rail and Sea Manifests     

There is now just over a week left until all rail and sea cargo information and ABI in-bond transactions must be submitted through the Automated Commercial Environment. Effective Oct. 1 these transactions will be processed by ACE and CBP will begin decommissioning the Automated Manifest System for rail and sea. CBP states that the small percentage of those who have not yet migrated to ACE will run the risk of having their ocean, rail and ABI in-bond transactions fail unless they have completed the transition by Sept. 29. 

ACE e-Manifest: Rail and Sea (also known as M1) provides a consolidated view of rail and sea shipment manifest and entry data at the bill of lading or container level to facilitate the identification of shipments that may pose a risk and will expedite the pre-arrival processing of legitimate cargo. New capabilities include enabling CBP to place and remove holds at the conveyance, container and master bill level, informing carriers which participating government agency has held their merchandise, allowing carriers to create through the ACE Portal a list of trade partners authorized to use their in-bond authorization, providing 12 new reports for rail and sea carriers along with seven new reports for brokers and two for importers, and allowing filers to create and maintain rail line release entry banks through the ACE Portal. 

E-manifest for trucks was deployed in February 2007 and is used to process an average of 190,000 trucks nationally per week. E-manifest for air and integration of the multimodal manifest is anticipated at some point in the future but has not yet been planned.

House Passes Bills on Promoting Foreign Investment, Labeling Imported Drywall     

The House of Representatives passed by voice vote Sept. 19 the following two bills. 

Attracting Foreign Investment. The Global Investment in American Jobs Act of 2012 (H.R. 5910) directs the Department of Commerce, in coordination with other federal agencies, to produce a report on enhancing the competitiveness of the United States in attracting foreign direct investment. Noting that the U.S. has seen its share of FDI decline from 41% to 18% in just ten years, the bill expresses the sense of Congress that lawmakers and federal agencies should be mindful of the potential impact on the ability to attract FDI when evaluating proposed legislation or regulatory policy. The bill also asserts that it should be a top national priority to remove unnecessary barriers to FDI and promote policies to ensure that the U.S. remains the premier destination for global companies to invest, hire, innovate and manufacture their products. 

To this end, the bill directs the Department of Commerce to coordinate with other relevant federal agencies to conduct a review of U.S. laws and policies on FDI and develop recommendations to make the U.S. more competitive in attracting and retaining such investment. Among other things, this review will include the following. 

- a review of the current economic impact of FDI in the U.S. and broader trends in global cross-border investment flows, including an assessment of the United States’ current competitive position as an investment location for companies headquartered abroad 

- a review of U.S. laws and policies that uniquely apply to FDI in the U.S., with particular focus on those that may have the effect of diminishing or promoting the ability to attract and retain FDI 

- a review of ongoing federal government efforts to improve the investment climate, reduce investment barriers and facilitate greater levels of FDI in the U.S. 

- recommendations based on the review specified above, including a comparative analysis of efforts of other competing countries, to make the U.S. more competitive in attracting global investment 

- the impact of FDI on innovation and national economic competitiveness 

- a review of state and local government initiatives to attract foreign investment 

Drywall. The Drywall Safety Act of 2012 (H.R. 4212) is designed to address problems associated with drywall imported from China in the mid- to late 2000s, primarily chemical emissions that cause copper components such as pipes and wiring to corrode as well as respiratory problems in homeowners. The bill includes the following provisions. 

- expresses the sense of Congress that the Department of Commerce should work to get the government of China to (a) provide remedies to U.S. homeowners that have problematic Chinese drywall in their homes and (b) subject the companies that manufactured and exported this drywall to jurisdiction in U.S. federal court 

- requires the Consumer Product Safety Commission to issue within one year a rule requiring each sheet of drywall manufactured or imported for use in the United States to be permanently marked with the name of the manufacturer and the month and year of manufacture, unless the Commission determines that a voluntary standard adequate to permit such identification is or will be in effect within two years of enactment 

- requires the CPSC to issue within one year a final rule that limits sulfur content in drywall manufactured or imported for use in the United States to a level not associated with elevated rates of corrosion in the home, unless the Commission determines that a voluntary standard prescribing such a limit is or will be in effect within two years of enactment 

Of Note: Brazil-Mexico Auto Pact, International Services Agreement, China Customs Fees     

Brazil mulls raising Mexico car trade quota 
 
U.S., Trade Allies Push for International Services Talks 
 
China to cut Customs fees by $556M to boost trade

Dates and Deadlines: Middle East Imports, Nutraceuticals, CBP Forms, Argentina, Jewelry     

Following are highlights of regulatory effective dates and deadlines and federal agency meetings coming up in the next week. 

Sept. 24 – comments on application to expand service area of Atlanta foreign-trade zone 

Sept. 24 – comments on proposed extension of information collections in Office of Foreign Assets Control’s reporting, procedures and penalties regulations 

Sept. 25 – ST&R webinar on duty-free claims on imports from the Middle East 

Sept. 25 – effective date of new import and export restrictions on two species of shark 

Sept. 25 – comments on possible IPR infringement investigation of nutraceutical products 

Sept. 27 – ST&R webinar on fines, penalties and forfeitures 

Sept. 27 – meeting of National Advisory Committee for Labor Provisions of U.S. Free Trade Agreements 

Sept. 27 – effective date of direct final rule amending energy conservation standards for residential dishwashers 

Sept. 28 – comments on issues raised in U.S. WTO complaint against Argentina’s import restrictions 

Sept. 28 – comments on proposed revocation or modification of classification rulings on chili powder blends, ball bearings and tobacco wrappers 

Sept. 28 – comments on FTC Jewelry Guides

AD/CV Notices: Honey, Corrosion-Resistant Steel Products     

Agency: International Trade Administration. 
Commodity: Honey. 
Country: Argentina. 
Nature of Notice: Revocation of antidumping and countervailing duty orders, effective Aug. 2, 2012. 
Details: The merchandise subject to these orders is natural honey, artificial honey containing more than 50% natural honey by weight, preparations of natural honey containing more than 50% natural honey by weight, and flavored honey. The subject merchandise includes all grades and colors of honey, whether in liquid, creamed, comb, cut comb or chunk form and whether packaged for retail or in bulk form. 

Agency: International Trade Administration. 
Commodity: Corrosion-resistant carbon steel flat products. 
Country: Korea. 
Nature of Notice: Preliminary results of administrative review of countervailing duty order for the period Jan. 1 through Dec. 31, 2010. 
Details: Net subsidy rates ranging from 0.08% to 0.16%, all of which are de minimis.

Applications Sought for 2013 Worsted Wool Fabric TRQ Allocations     

The International Trade Administration is soliciting applications by Oct. 22 for allocations of the 2013 tariff-rate quotas on certain worsted wool fabrics to persons who weave such fabrics in the U.S. and persons who cut and sew men’s and boys’ worsted wool suits, suit-type jackets and trousers in the U.S. 

Pursuant to the Trade and Development Act of 2000, as subsequently amended, the ITA oversees TRQs providing for temporary reductions (through 2014) of the import duties on specific quantities of two categories of worsted wool fabrics suitable for use in making suits, suit-type jackets or trousers: (a) fabric with average fiber diameters greater than 18.5 microns (HTSUS 9902.51.11; 5.5 million square meters) and (b) fabric with average fiber diameters of 18.5 microns or less (HTSUS 9902.51.15; 5 million square meters). These TRQs must be allocated to persons who cut and sew men’s and boys’ worsted wool suits, suit-type jackets and trousers in the U.S. The Miscellaneous Trade Act of 2004 created a third TRQ, which is also for worsted wool fabric with average fiber diameters of 18.5 microns or less (HTSUS 9902.51.16; 2 million square meters) but is only for use by persons who weave such fabric in the U.S. that is suitable for making men’s and boys’ suits. 

CBP Reviewing Declaration for Free Entry of Returned Products     

U.S. Customs and Border Protection is seeking comments no later than Nov. 20 on the proposed extension without change of CBP Form 3311, Declaration for Free Entry of Returned American Products. This form serves as a declaration that goods being returned to the U.S. are American-made, have not been advanced in value or improved in condition while abroad, were not previously entered under a temporary importation under bond provision, and were never the subject of a drawback claim or payment. 

IPR Enforcement Actions on Computer Chips, Video Game Systems, Secure Comm Devices     

New IPR Infringement Petition on Integrated Circuit Chips. The International Trade Commission received Sept. 19 on behalf of Realtek Semiconductor Corporation a petition requesting that it institute a Section 337 investigation regarding certain integrated circuit chips and products containing the same. 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. 

Import Restrictions Recommended for Video Game Systems. In patent infringement investigation 337-TA-770 of certain video game systems and wireless controllers and components thereof, the presiding administrative law judge has recommended the issuance of a limited exclusion order and a cease and desist order against respondent Nintendo. The International Trade Commission is therefore accepting through Oct. 10 public 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 orders within a commercially reasonable time; and 

- explain how the limited exclusion order would impact consumers in the U.S. 

Potential IPR Probe of Secure Communications Devices Evaluated for Public Interest Issues. The International Trade Commission is requesting comments no later than Oct. 1 on any public interest issues raised by a Section 337 intellectual property rights infringement complaint filed on behalf of VirnetX Inc. and Science Applications International Corporation against certain devices with secure communications capabilities, components thereof and products containing the 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.

Foreign Regulatory Changes Could Affect Exports of Appliances, Phones, Tobacco     

According to the National Institute of Standards and Technology, the World Trade Organization has been notified of regulatory changes that may affect exports of specific products to the following countries. For information on how these restrictions may affect your business, contact ST&R. 

Israel – revised mandatory standards on vacuum cleaners and water-suction cleaning appliances, domestic electrical cooking appliances, aluminum profiles, domestic electrical microwave ovens, and domestic electric heaters (comments due by Nov. 18) 

Korea – regulation on review of technical documents for, and approval of, veterinary medical devices (comments due by Nov. 18) 

Korea – acceptable standards on sale and use of kitchen disposals (comments due by Oct. 8) 

Korea – proposed amended rules on agricultural machinery (comments due by Nov. 18) 

Korea – proposed enactment of rating classification of electromagnetic waves for mobile phones and radio stations (comments due by Nov. 18) 

Korea – required information on tobacco packages (comments due by Nov. 18) 

New Zealand – draft standard on power distribution and generation transformers (comments due by Nov. 18)

New Foreign-Trade Zone Established in Maine     

The Foreign-Trade Zones Board has granted authority for the establishment of FTZ 282 in Brunswick, Maine. This zone will be the second general-purpose FTZ for the Portland U. S. Customs and Border Protection port of entry and will consist of one site within the 3,200-acre Brunswick Landing Airport complex. Several firms have indicated an interest in using zone procedures for warehousing/distribution activities for a variety of products.

Advance Notice Required for Imports of 107 Chemical Substances     

The Environmental Protection Agency has issued a direct final ruleimposing new import restrictions on 107 chemical substances that were the subject of premanufacture notices. Under this rule, persons who intend to import, manufacture or process any of these substances for an activity that is designated as a significant new use by this rule must notify EPA at least 90 days before commencing that activity. This notification will provide EPA with the opportunity to evaluate the intended use and, if necessary, to prohibit or limit that activity before it occurs. 

This rule will be effective as of Nov. 20. Written adverse or critical comments, or notice of intent to submit adverse or critical comments, must be received on or before Oct. 22. 

To get news like this in your inbox daily, subscribe to the Sandler, Travis & Rosenberg Trade Report.

Customs & International Headlines