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December 31 2012 Issue

Monday, December 31, 2012
Sandler, Travis & Rosenberg Trade Report

USTR Lists Product Petitions, CNL Waivers Accepted for 2012 GSP Review

The Office of the U.S. Trade Representative has announced the petitions that have been accepted as part of the 2012 annual review of the Generalized System of Preferences. USTR has also denied a previously submitted petition seeking to add certain pinch-seal plastic bags (categorized under HTSUS 3923.21.0030) to the list of products eligible for duty-free treatment under GSP.

According to USTR, the GSP Subcommittee of the Trade Policy Staff Committee has reviewed the product and competitive need limitation waiver petitions submitted as part of the 2012 review and has decided to accept for review petitions to add four products to the list of those eligible for duty-free treatment under GSP and petitions to waive CNLs for 12 products from certain countries.

The accepted product addition petitions are for the following products, listed by HTSUS number.

0603.11.00 – fresh cut sweetheart and spray roses
0710.80.97 – frozen vegetables not otherwise listed, including frozen broccoli
2005.99.80 – artichokes, prepared or preserved otherwise than by vinegar or acetic acid
7408.19.0030 – refined copper wire with a maximum cross-sectional dimension of 6 mm or less

The accepted petitions to waive CNLs relate to the following products.

0410.00.00 – miscellaneous edible products of animal origin (Indonesia)
0603.13.00 – cut orchids (Thailand)
1102.90.25 – rice flour (Thailand)
2106.90.99 – miscellaneous prepared foods (Thailand)
6911.10.37 – porcelain or china table and kitchenware (Indonesia)
7202.21.50 – ferrosilicon with between 55% and 80% of silicon by weight (Russia)
7202.30.00 – ferrosilicon manganese (Georgia)
7202.99.20 – calcium silicon ferroalloys (Brazil)
7307.21.50 – certain stainless steel flanges for pipes (India)
7307.91.50 – certain iron or steel flanges for pipes (India)
7408.29.10 – copper plates, sheets and strip (Thailand)
9506.70.40 – ice skates (Thailand)

The schedule for USTR’s review of these petitions is as follows.

- comments, pre-hearing briefs and requests to appear at the public hearing are due no later than Feb. 14

- a public hearing will be held Feb. 28

- post-hearing comments or briefs are due no later than March 28

- the International Trade Commission is expected to release in April the public version of its report providing advice on the probable economic effect of granting these petitions

- any modifications that the president proclaims to the list of articles eligible for duty-free treatment under GSP resulting from the 2012 review and for determinations related to CNL waivers will take effect as of July 1, 2013 

CBP Commercial Operations Committee to Hold Call on Border Cooperation

The Advisory Committee on Commercial Operations of U.S. Customs and Border Protection will hold a teleconference Jan. 15 to review, discuss next steps and formulate recommendations on the master principles for a document on the “One U.S. Government at the Border” initiative. This call will be open to the public but participation in COAC deliberations is limited to committee members. Those planning on attending this teleconference should register online or by email.

Annual Report on Violations of Administrative Protective Orders in Trade Remedy Investigations

The International Trade Commission has issued its annual report on the status of its practice with respect to violations of administrative protective orders in certain investigations. This report is intended to inform representatives of parties to ITC proceedings as to some specific types of APO breaches encountered in 2011 and the corresponding types of actions that were taken. The report presents a number of case studies that provide the factual background, the actions taken by the ITC and the factors considered in determining the appropriate actions.

Those involved in ITC investigations or other proceedings under Title VII of the 1930 Tariff Act (antidumping and countervailing injury), safeguard-related provisions such as section 202 of the 1974 Trade Act, section 337 of the 1930 Tariff Act (intellectual property rights) and NAFTA article 1904.13 may enter into APOs that permit them, under strict conditions, to obtain access to the business proprietary information (Title VII) or confidential business information (all others) of other parties. The two types of breaches most frequently investigated involve the APO’s prohibition on the dissemination of BPI or CBI to unauthorized persons and the APO’s requirement that the materials received under the APO be returned or destroyed and that a certificate be filed within a specified period indicating which action was taken. Other breaches have included the failure to properly bracket BPI/CBI in proprietary documents filed with the ITC, the failure to immediately report known violations of an APO and the failure to adequately supervise non-lawyers in the handling of BPI/CBI.

Under Title VII, any breach of an APO may subject an applicant to various sanctions, including:

- disbarment from practice in any capacity before the ITC, along with the person’s partners, associates, employer and employees, for up to seven years;

- referral to the U.S. attorney;

- in the case of an attorney, accountant or other professional, referral to the ethics panel of the appropriate professional association;

- such other administrative sanctions as the ITC determines to be appropriate, including public release of or striking from the record any information or briefs submitted by or on behalf of such person or the party he represents, denial of further access to BPI in the current or any future investigations before the ITC, and issuance of a public or private letter of reprimand; and

- such other actions, such as a warning letter, as the ITC determines to be appropriate.

APOs in other trade remedy investigations contain similar, though not identical, provisions.

In determining the appropriate response to an APO breach, the ITC generally considers mitigating factors such as the unintentional nature of the breach, the lack of prior breaches committed by the breaching party, the corrective measures taken by the breaching party and the promptness with which the breaching party reported the violation. The ITC also considers aggravating circumstances, especially whether persons not under the APO actually read the BPI/CBI. The ITC also considers whether there are prior breaches by the same person in other investigations and multiple breaches by the same person in the same investigation. 

DOT Notes Hazmat Special Permit Applications, Decisions, Delays in Processing

The Department of Transportation’s Pipeline and Hazardous Materials Safety Administration has issued the following concerning exceptions from the Hazardous Materials Regulations.

- a list of applications for special permits for exceptions from the HMR, including for motor vehicles, rail freight, cargo vessels, cargo aircraft and passenger-carrying aircraft (comments due no later than Jan. 28)

- a list of applications to modify previously issued special permits; e.g., to provide for additional hazardous materials, packaging design changes, additional mode of transportation, etc. (comments due no later than Jan. 14)

- a list of actions taken on special permit applications, including modified, new and emergency permits granted or withdrawn and permits denied

- a list of special permit applications that have been in process for 180 days or more, including the reason(s) for delay and the expected completion date 

AD Notices: Lemon Juice, PET Film

Agency: International Trade Administration.
Commodity: Lemon juice.
Country: Mexico.
Nature of Notice: Preliminary sunset review determination that termination of suspended antidumping duty investigation would be likely to lead to continuation or recurrence of dumping at margins ranging from 146.10% to 205.37%.

Agency: International Trade Administration.
Commodity: Polyethylene terephthalate film, sheet and strip.
Country: Taiwan.
Nature of Notice: Rescission of administrative review of antidumping duty order for the period July 1, 2011, through June 30, 2012, with respect to Shinkong Materials Technology Corporation and Nan Ya Plastics Corporation. 

Potential IPR Probes of Mobile Handset Devices, Paper Shredders Evaluated for Public Interest Issues

The International Trade Commission is requesting comments no later than Jan. 8 on any public interest issues raised by two separate Section 337 intellectual property rights infringement complaints.

- complaint filed on behalf of Nuance Communications Inc. against certain mobile handset devices and related touch keyboard software technology

- complaint filed on behalf of Fellowes Inc. and Fellowes Office Products (Suzhou) Co. Ltd. against certain paper shredders, certain processes for manufacturing or relating to same, and certain products containing same and certain parts thereof

Comments should address whether the issuance of exclusion orders and/or cease and desist orders pursuant to these complaints 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. 

Ocean Transportation Intermediary License Revocations, Applicants

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

- license #18751N: World Commerce Services LLC d/b/a WLG USA LLC, Schaumburg, Ill.

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.

- A-1 Fargo Van and Storage Inc., Miami, Fla.
- Avantage Worldwide Company LLC d/b/a Avantage Worldwide Forwarding, Seattle, Wash.
- Barker International Inc., Naperville, Ill.
- Bruzzone Shipping Inc., Freeport, N.Y.
- Efrinsa Global Logistics Inc., Miami, Fla.
- Inter-Commerce Exports LLC d/b/a Ice Shipping Lines, Houston, Texas
- Lawrence Family Enterprises Inc. d/b/a A&A Transportation, Marietta, Ga.
- MMC Logistics LLC, Atlanta, Ga.
- NDA Worldwide Logistics Corp., Los Angeles, Calif.
- OTX Logistics Inc., Los Angeles, Calif.
- Stealth Logistics LLC, Dover, Del.
- Worldwide Shipping Corporation, Rowland Heights, Calif. 

New Southern Border Crossing Created in Big Bend National Park

U.S. Customs and Border Protection has issued a final rule that, effective Jan. 28, 2013, will establish a new border crossing on the U.S.-Mexico border. The new crossing is located in Big Bend National Park between Presidio and Del Rio, Texas, at the site of a previous crossing that was closed in 2002 due to post-9/11 security concerns. This crossing will be designated as a “Customs station” for customs purposes and a Class B port of entry for immigration purposes.

CBP states that the new Boquillas border crossing will only serve pedestrians visiting Big Bend National Park and Mexican protected areas directly across the border, not import business. CBP will therefore not process cargo, commercial entries or vehicles at this crossing. In addition, persons using the Boquillas crossing will only be permitted to bring limited merchandise into the U.S., and CBP will only process items exempt from duties and taxes under 19 CFR 10.151, which generally covers importations that do not exceed $200 in value. Such items must comply with all applicable regulations, including all relevant Animal and Plant Health Inspection Service restrictions. Persons using the Boquillas crossing will also have to comply with federal wildlife protection laws and U.S. Fish and Wildlife Service wildlife import/export regulations.

This rule also revises the definition of a Class B port of entry to make the admissibility documents allowed at a Class B port of entry consistent with the Western Hemisphere Travel Initiative. 

Foreign Regulatory Changes Could Affect Exports of Cosmetics, Leather, Chemicals

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.

China – cosmetics label instructions regulations (comments due by Feb. 21)

Italy – ministerial decree on leather, hide and fur and items manufactured therefrom (comments due by March 1)

Japan – partial revision of ordinance on fire hoses, couplings, electric leakage fire alarm devices, household fire alarms and disposable fire extinguishers (comments due by Feb. 21)

Korea – proposed amendment of regulation on standards and test methods for tar color in cosmetics (comments due by Feb. 21)

Korea – proposed regulation on functional cosmetics (comments due by Feb. 21)

Kuwait – draft technical regulation on molasses (comments due by Feb. 21)

Taiwan – draft amendment of Toxic Chemical Substances Control Act (comments due by Feb. 21)

Uganda – final draft standards on chemicals for water purification (comments due by Feb. 21) 

Amended Maritime Agreement Filed

The Federal Maritime Commission has issued notice that the following amended agreement has been filed. Interested parties may submit comments by Jan. 10, 2013.

Transpacific Stabilization Agreement – The amendment would expand the geographic scope of the agreement to include the full round trip trans-Pacific trade, adding the trade from the U.S. to the Far East. 

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