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December 10 2012 Issue

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

Only Four Weeks Left: Renew Food Facility Registrations with FDA or Face Suspension

Each foreign and domestic food facility must renew its food facility registration with the Food and Drug Administration before Dec. 31, 2012. The FDA may suspend the registration number of any facility that fails to comply, resulting in a prohibition on the importation, distribution or sale of food from the suspended facility. Food importers are urged to take immediate action to prevent import refusals or detentions come Jan. 1, 2013.

The 2002 Bioterrorism Act requires all facilities that manufacture, process, pack or hold food or beverages for consumption in the United States to register as a food facility with the FDA. Under the Food Safety Modernization Act enacted in 2011 those registrations must be updated before Dec. 31, 2012, and every two years thereafter. Facilities that fail to renew may have their registration number suspended.

Any doubts over the FDA’s intentions to exercise these suspension powers were dispelled last month when the agency suspended the registration of Sunland Inc., a producer of nuts and nut and seed spreads, after noting several deficiencies during a facility inspection. As a result of this suspension neither Sunland Inc. nor any other person can introduce into U.S. commerce, offer to import, or export any food made at the suspended facility. The warning was reiterated by Amy Barringer, a director in the FDA’s Office of Compliance, who asserted during a webcast sponsored by the United Fresh Produce Association that shipments may be refused if foreign food facilities do not submit their registration renewals by Dec. 31.

Barringer also emphasized the impact of the new financial responsibilities imposed on U.S. agents. The U.S. agent is a person or entity located within, or that maintains an office in, the United States who will be the domestic communications representative for a foreign food facility. Since many entities that previously served as a U.S. agent are no longer providing this service due to the increased liability imposed by FSMA, foreign food facilities are advised to immediately re-evaluate who to designate as their U.S. agent in order to renew their registration before the end of the year.

Many food facilities have trusted Sandler, Travis & Rosenberg P.A. to be their U.S. agent over the past eight years. However, the firm has decided to discontinue this service in light of the new financial responsibilities imposed by FSMA. Instead, ST&R has established FDA Solutions Group LLC, a separate consulting company dedicated to the registration and compliance needs of FDA regulated industry. FDA Solutions Group makes it easy for food facilities to protect against suspension and costly business interruptions through its turn-key registration and U.S. agent services. To learn more about these services or submit your registration renewal today, please visit the web site or send an e-mail

U.S. Working on Trade Facilitation, Investment, IT Pacts with Morocco

Deputy U.S. Trade Representative Miriam Sapiro told the U.S. Morocco Business Development Conference last week that the two countries, which already have a bilateral free trade agreement, are working to conclude three other initiatives to help further boost trade and investment. “Like the FTA itself,” Sapiro said, “these are tools that can facilitate greater trade and investment and boost job growth in both countries across many sectors, including aerospace, agriculture, automotive and renewable energy.”

- A trade facilitation agreement that will expand on the commitments in the U.S.-Morocco FTA to “set a new standard for transparency and predictability in customs matters that will make it easier for companies, large and small, to bring products into our markets.” Text already worked out includes new commitments reflecting innovations and practices developed since the FTA was signed in 2004, such as allowing the submission of information before goods arrive and the electronic payment of duties, taxes and fees to facilitate the prompt release of goods.

- A set of joint investment principles that “reaffirm our common commitment to open, transparent and non-discriminatory international investment policies” at a time of global uncertainty. These principles “reflect our shared and continuing commitment not only to ensure openness to foreign investment but also to ensure that all investors find a business environment characterized by transparency, the rule of law and a level playing field.”

- A set of joint principles for information and communication technology services that address issues such as the free flow of information across borders, facilitating the cross-border supply of services and foreign investment in ICT sectors. The two sides believe the adoption of these principles “will support the global development of ICT services, including Internet and other network-based applications that are critical to innovation and e-commerce.” 

CBP Clarifies Marking Requirements for Goods Imported from Burma

U.S. Customs and Border Protection officials have confirmed that previous rules concerning the marking of goods imported from Burma remain in effect. The U.S. recently lifted its ban on products of Burmese origin other than jadeite and rubies or jewelry containing those gems. CBP has indicated that the following provisions of a 1989 ruling remain valid with respect to those goods that may now be imported from Burma.

- For country of origin marking purposes the name “Burma” must appear on articles imported from Burma and on their containers as necessary.

- The markings “Myanmar (Burma)” and “Burma (Myanmar)” are acceptable.

- Goods cannot be marked “made in Myanmar” with no reference to “Burma.” 

$3 Million in Fines on Chinese Entity for Illegal Exports to Pakistan

The Bureau of Industry and Security announced this week that a Chinese corporate entity will pay a combined $3 million in criminal and administrative fines after pleading guilty to federal charges in connect with the illegal export of high-performance epoxy coatings to a nuclear power plant in Pakistan. Following the Bureau’s denial of an export license application for such shipments, the Chinese entity agreed to accept the coatings as part of a scheme in which BIS was falsely told that the coatings were to be used at a nuclear power plant in China.

According to a BIS press release, it is believed that this is the first time that a Chinese corporate entity has entered a guilty plea in a U.S. criminal export matter. BIS notes that as part of a plea agreement $1 million of the criminal fine will be stayed pending the entity’s successful completion of five years of corporate probation. The terms of this probation will require the entity to implement an export compliance and training program that recognizes its obligation to comply with U.S. export laws. The entity will also be subject to multiple third-party audits over the next five years to ensure the efficacy of its compliance with U.S. export laws. 

AD Notices: PET Film, Sodium Hexametaphosphate, Steel Plate, Lemon Juice

Agency: International Trade Administration.
Commodity: Polyethylene terephthalate film, sheet and strip.
Country: United Arab Emirates.
Nature of Notice: Preliminary results of administrative review of antidumping duty order for the period Nov. 1, 2010, through Oct. 31, 2011.
Details: Dumping margins of zero for one reviewed manufacturer/exporter and 5.31% for the other.

Agency: International Trade Administration.
Commodity: Sodium hexametaphosphate.
Country: China.
Nature of Notice: Preliminary results of administrative review of antidumping duty order for the period March 1, 2011, through Feb. 29, 2012.
Details: Dumping margin of 188.05% for the China-wide entity.

Agency: International Trade Administration.
Commodity: Stainless steel plate in coils.
Country: Belgium.
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 0.82% for Aperam Stainless Belgium N.V. AD duties based on this rate will be assessed on entries of subject merchandise made during the period of review, and AD cash deposits at this rate will be required for shipments of subject merchandise entered or withdrawn from warehouse for consumption on or after Dec. 7.

Agency: International Trade Administration.
Commodity: Lemon juice.
Country: Argentina.
Nature of Notice: Sunset review determination that termination of suspended antidumping duty investigation would be likely to lead to continuation or recurrence of dumping at rates ranging from 85.64% to 128.5%. 

Proposed Safety Standards for Bedside Sleepers, Infant Carriers

The Consumer Product Safety Commission is accepting comments through Feb. 25, 2013, on separate proposed safety standards for bedside sleepers and handheld infant carriers. The CPSC proposes that these standards would become effective six months after publication of a final rule in the Federal Register and is inviting comments how long it would take manufacturers to come into compliance.

Bedside Sleepers. The proposed standard is based on voluntary standard ASTM F2906-12, “Standard Consumer Safety Specification for Bedside Sleepers,” with additions to make it more stringent. This proposed rule would amend the Safety Standard for Play Yards by adopting many of the requirements in the proposed rule for bassinets as well as addressing the hazards associated with the use of bassinet play yard accessories that can be assembled with missing key structural requirements for bedside sleeper play yard accessories.

A bedside sleeper is intended to be secured to an adult bed to permit newborns and infants to sleep close by an adult without being in the adult bed. The side of the bedside sleeper that is adjacent to the adult bed can usually be lowered, thereby differentiating bedside sleepers from bassinets, where all four sides of a bassinet are the same height. Bedside sleepers may have rigid sides but are most commonly constructed with a tube frame covered by mesh or fabric. Most bedside sleeper products can be converted into a bassinet by raising the lowered side to have four equal-height sides, and a few also convert into a bassinet and play yard. In addition, some play yards and bassinets can convert into bedside sleepers. A bedside sleeper that can be used in additional modes would need to meet each applicable standard.

Infant Carriers. The proposed standard is based on the voluntary standard ASTM F2050-12, “Standard Consumer Safety Specification for Hand-Held Infant Carriers,” with two modifications. ASTM F2050-12 defines a handheld infant carrier as a freestanding, rigid-sided product intended to carry an occupant whose torso is completely supported by the product to facilitate transportation by a caregiver by means of hand-holds or handles. This standard references two types of such carriers: handheld bassinets/cradles that incline 10 degrees or less from horizontal and sit directly on the floor, and handheld carrier seats that incline more than 10 degrees from horizontal and are often also used as attachments to serve as infant car seats, strollers or high chairs.

A Moses basket is considered to be a freestanding product with a rest/support surface to facilitate sleep that typically has semi-rigid sides and handholds or handles intended to allow carrying an occupant. The Commission is interested in comments on (a) whether the definition of handheld bassinet/cradle in ASTM F2050-12 includes Moses baskets and (b) if Moses baskets are not covered by the safety standard but should be, how the present definition should be amended to more clearly cover them.

Infant carriers are one of the products specifically defined in the Consumer Product Safety Improvement Act of 2008 as durable infant or toddler products for which safety standards must be issued. Handheld infant carriers are one of four types of products that could fall within this category, along with frame backpack carriers, soft infant and toddler carriers, and slings. The CPSC intends to address hazards associated with these other types of carriers in separate rulemaking proceedings. 

U.S. Assembly Operations Substantially Transform Electric Vehicles, CBP Says

U.S. Customs and Border Protection has issued a final determination concerning the country of origin of certain low-speed electric trucks and vans that may be offered to the U.S. government under an undesignated government procurement contract. These vehicles are assembled in the U.S. from rolling chassis manufactured in China, a charger from Canada and dozens of other components and miscellaneous items made in the U.S. CBP finds that these operations are more than mere assembly and result in the Chinese and Canadian goods losing their individual identities and becoming integral parts of new articles possessing new names, characters and uses. Further, components crucial to the making of the finished vehicles are of U.S. origin.

CBP issues country of origin advisory rulings and final determinations as to whether an article is or would be a product of a designated country or instrumentality for the purposes of granting waivers of certain “Buy American” restrictions in U.S. law or practice for products offered for sale to the U.S. government.

CBP’s final determination was issued Nov. 16. Any party-at-interest may seek judicial review of this determination by Jan. 7, 2013. 

Foreign-Trade Zones: Diesel Engine Fuel Line Plant, Michigan Zone Reorganization

The Foreign-Trade Zones Board has approved the production of diesel engine fuel lines at the Usui International Corporation facility in Chesapeake, Va., within site 9 of FTZ 20. Production under FTZ procedures will exempt Usui from customs duty payments on foreign status components used in export production. On its domestic sales, Usui will be able to choose the duty rate during customs entry procedures that applies to diesel engine fuel lines (2.5%) for foreign status inputs, which include plastic caps and clips, paper labels, adhesive tape, tubes/pipes/profiles, fasteners, springs, tags, brackets, engine parts, plates, fixtures, alarm tanks and caps (duty rate ranges from free to 8.5%).

The FTZ Board has also approved the reorganization of FTZ 43 under the alternative site framework to include a service area of Allegan, Barry, Berrien, Branch, Calhoun, Cass, Clinton, Eaton, Ingham, Ionia, Jackson, Kalamazoo, St. Joseph and Van Buren counties in Michigan, adjacent to the Battle Creek U.S. Customs and Border Protection port of entry. 

CBP Reviewing Application for Allowance in Duties, Foreign Assembler’s Declaration

U.S. Customs and Border Protection is accepting comments through Feb. 5 on the proposed extension of the following information collections.

CBP Form 4315, Application for Allowance in Duties: This form is submitted in instances of claims of damaged or defective imported merchandise on which an allowance in duty is claimed in the liquidation of the entry.

Foreign Assembler’s Declaration (with Endorsement by Importer): This declaration must be made in connection with the entry of articles assembled abroad under HTSUS 9802.00.80 and is used to determine whether the operations performed are within the purview of this subheading and therefore eligible for preferential tariff treatment. The declaration includes information such as the quantity, value and description of the imported merchandise and is made by the person who performed the assembly operations, with an endorsement by the importer. 

Foreign Regulatory Changes Could Affect Exports of Foods, Steel, Smoke Detectors, Doors

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.

El Salvador – technical regulations on pasteurized milk and dairy terms (comments due by Jan. 23, 2013)

Hong Kong – consultation document on infant formula, follow-up formula, and food products for infants and young children (comments due by Jan. 21)

Korea – ban on import and sale of hygiene products not compliant with standards set by Korea Food and Drug Administration (comments due by Feb. 3)

New Zealand – technical regulation on foods carrying nutrition content, health and related claims expected to enter into force in January 2013

Nicaragua – technical standard on dairy terms (comments due by Jan. 26)

Saudi Arabia – regulations on hot-rolled steel bars, structural steels and concrete structures (comments due by Jan. 30)

Saudi Arabia – regulations on tin-clad fire doors, smoke detectors, pre-cast concrete barriers, and exterior windows, doors and storm shutters (comments due by Feb. 3)

Taiwan – draft standard on nutrition labeling of pre-packaged foods (comments due by Dec. 22) 

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