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February 4 2013 Issue

Monday, February 04, 2013
Sandler, Travis & Rosenberg Trade Report

USDA Says Efforts to Remove Foreign Trade Barriers Saves $4 Billion in Exports

Agriculture Secretary Tom Vilsack asserted Feb. 1 that USDA efforts to resolve export issues in 2012 freed up an estimated $4 billion in U.S. agricultural and forestry exports. These efforts include opening new markets, securing the release of U.S. shipments detained at foreign ports, and ensuring the safe movement of agricultural products in a manner consistent with science and international standards.

According to a USDA press release, in 2012 the Animal and Plant Health Inspection Service successfully negotiated and resolved 150 issues involving U.S. agricultural exports. Examples include:

- spearheading a six-month pilot program with China's animal and plant health authority that established the resumption of log exports from Virginia and South Carolina, resulting in more than $1.5 million in exports;

- supporting the shipment of U.S. cattle to new markets by engaging foreign counterparts in preparation for exports and approving seven temporary export inspection facilities to supplement the agency's permanent export facilities; and

- securing the release of 324 shipments of U.S. agricultural products detained at foreign ports valued at more than $41 million.

The approximately 170 Foreign Agricultural Service officers staffing 98 offices covering 162 countries enjoyed similar successes, including:

- negotiating expanded access for U.S. beef to the United Arab Emirates and El Salvador;

- engaging with China on a memorandum of understanding that prevented disruptions to over $12 billion in U.S. exports of soybeans;

- leading negotiations with Indonesia to exempt countries with food safety recognition, including the U.S., from new restrictions on a variety of imported fruit and vegetables;

- helping to negotiate the organic equivalence arrangement with the European Union; and

- expanding market access for U.S. potatoes in Asia. 

CDC Tightens Requirements for Imports of Infectious Biological Agents and Substances

The Centers for Disease Control and Prevention has issued a final rule that, effective April 5, will amend the regulations regarding the importation of infectious biological agents, infectious substances and vectors in order to improve CDC’s ability to prevent the introduction, transmission or spread of communicable diseases into the United States. The CDC states that this rule contains provisions that apply to a variety of entities, including academic institutions and biomedical centers, commercial manufacturing facilities, federal, state and local laboratories, research facilities, exhibition facilities and educational facilities.

Import Requirements. Under this final rule a person may not import into the U.S. any infectious biological agent, infectious substance or vector unless the following requirements are met.

- the shipment is accompanied by a CDC permit, which will only be valid for the time period and/or term indicated (and which will not satisfy any applicable permit requirements imposed by the Department of Agriculture)

- the importer is in compliance with all permit requirements and conditions

- the importer has implemented biosafety measures commensurate with the hazard posed by the item to be imported and the level of risk given its intended use

- the importer takes measures to help ensure that the shipper complies with all applicable legal requirements concerning the packaging, labeling and shipment of infectious substances

The issuance of a permit may be contingent upon an inspection of the importer’s facility by the CDC to evaluate whether the importer’s biosafety measures (e.g., physical structure and features of the facility and operational and procedural safeguards) are commensurate with the hazard posed by the item and the level of risk given its intended use.

If noted as a condition of the issued permit, subsequent transfers of any infectious biological agent, infectious substance or vector within the U.S. will require an additional permit issued by the CDC.

Permit Exceptions. A CDC permit is not required if any of the following conditions are met.

- the item is a biological agent listed in 42 CFR Part 73 as a select agent and its importation has been authorized in accordance with 42 CFR 73.16 or 9 CFR 121.16.

- with the exception of bat or non-human primate specimens, it is a diagnostic specimen not known by the importer to contain or suspected by the importer of containing an infectious biological agent and is accompanied by an importer certification statement to that effect

- with the exception of live bats or bat or non-human primate products, it is an animal or animal product being imported for educational, exhibition or scientific purposes and is accompanied by documentation confirming that it is not known to contain (or suspected of containing) an infectious biological agent or has been rendered noninfectious

- it consists only of nucleic acids that cannot produce infectious forms of any infectious biological agent and the specimen is accompanied by an importer certification statement confirming that the material is not known to contain or suspected of containing an infectious
biological agent

- it is a product that is cleared, approved, licensed or otherwise authorized under any of the Federal Food, Drug and Cosmetic Act, section 351 of the Public Health Service Act pertaining to biological products, or the Virus-Serum-Toxin Act

- it is an animal or animal product listed in 42 CFR Part 71 and its importation has been authorized in accordance with 42 CFR 71.52, 71.53, or 71.56

Changes and Clarifications. In response to comments on its proposed rule the CDC has provided the following information.

- CDC’s statement that it is willing to work with an entity whose biosafety measures are found to be inadequate was neither an offer to provide financial assistance nor a distinctive part of the permit issuance process. Instead it indicates that rather than simply deny a permit CDC will be willing to assist an applicant to achieve compliance with the import regulations. If an importer is unable to address the inadequate biosafety measures identified it will not receive an import permit.

- The importer, as the initiator of the import permit request, must implement measures to ensure that the shipper will package, label and ship the requested item in a manner that is safe and in compliance with all applicable legal requirements.

- Guidance on the CDC’s expectations regarding the packaging and shipping of infectious substances has been posted here (

- An importer may still seek authorization for subsequent transfers of items within the United States in the initial permit application.

- CDC will be contacting those import facilities that received a permit in 2012 and would meet the criteria for requiring an inspection three months prior to the expiration of the facility’s import permit to initiate the renewal process. CDC plans to inspect these facilities once in a two-year timeframe, assuming that no significant biosafety problems are identified.

Alleged Transshipment of Oil Rig Parts to Iran Nets OFAC Penalty

The Treasury Department’s Office of Foreign Assets Control reports that a California company has agreed to pay $97,695 to settle potential civil liability for alleged violations of the Iranian Transactions Regulations. The alleged violations occurred when the company exported to the United Arab Emirates eight shipments of spare parts and supplies intended for supply to an offshore oil drilling rig located in Iranian waters. Both the rig owner and operator were located in Iran, and five of the shipments occurred after the rig owner’s property and interests in property were blocked.

The base penalty amount for the alleged violations was $167,000. On the one hand, the matter was not voluntarily disclosed to OFAC, the company harmed sanctions program objectives because the transactions aided the development of Iranian petroleum resources, and the company had no OFAC compliance program in place at the time of the alleged violations. On the other hand, this is considered a non-egregious case and the company has no history of prior OFAC violations, demonstrated substantial cooperation with OFAC throughout its investigation and took remedial measures by implementing an OFAC compliance program. 

Fleece Fabric Added to DR-CAFTA Short Supply List

The Committee for the Implementation of Textile Agreements has determined to add certain cotton/polyester three thread circular knit fleece fabric, classified under HTSUS 6001.21, to the short supply list in Annex 3.25 of DR-CAFTA in unrestricted quantities. CITA found that this product is not available in commercial quantities in a timely manner from a supplier in the DR-CAFTA countries. 

FTZ Actions on Facilities Manufacturing Drugs, Tractors, Water Heaters, Eyeglasses

The Foreign-Trade Zones Board has recently approved the production under zone procedures at the Albany Molecular Research Inc. facility in Rensselaer, N.Y., of an active pharmaceutical ingredient, dexpramipexole dihydrochloride monohydrate, that AMRI plans to transfer to another FTZ facility for processing into a finished dosage pharmaceutical product.

Separately, the FTZ Board is accepting comments through March 13 on the following.

- a notification of proposed production activity on behalf of CNH America LLC, operator of subzone 41I, at its facilities in Racine, Wis., which are used for the production of tractors and tractor/combine components

- a notification of proposed production activity at the GE Appliances facility within subzone 29C in Louisville, Ky., which currently has authority to produce household appliances including dishwashers, refrigerator-freezers, freezers, apparel washing machines and dryers, electric ranges, and air conditioners, to add the production of electric water heaters

- a notification of proposed production activity at the T.C. Trading Company Inc. facility in Blaine, Wash., within FTZ 129, which is used for the assembly and kitting of eyeglasses and eyeglass products 

IPR Enforcement Actions on Wireless Devices, Omega-3 Extracts

New IPR Infringement Investigation of Wireless Devices. The International Trade Commission has instituted investigation 337-TA-868 to determine whether imports of certain wireless devices with 3G and/or 4G capabilities and components thereof are violating Section 337 of the 1930 Tariff Act by reason of patent infringement. The products at issue are cellular mobile telephones including smartphones, cellular PC cards, cellular USB dongles or sticks, personal computers such as laptops, notebooks, netbooks, tablets and other mobile Internet devices with cellular capabilities, cellular access points (hotspots) and cellular modems.

Complainants InterDigital Communications Inc., InterDigital Technology Corporation and InterDigital Holdings Inc. request that after this investigation the ITC issue an exclusion order, which would direct U.S. Customs and Border Protection to prohibit the entry of the infringing products into the U.S., and cease and desist orders, which would require the named respondents to cease actions that violate Section 337, including selling infringing imported articles out of U.S. inventory. The respondents in this investigation are located in Korea, Finland, China and the U.S.

Potential IPR Probe of Omega-3 Extracts Evaluated for Public Interest Issues. The International Trade Commission is requesting comments no later than Feb. 12 on any public interest issues raised by a Section 337 intellectual property rights infringement complaint filed on behalf of Neptune Technologies & Bioresources Inc. and Acasti Pharma Inc. against certain omega-3 extracts from marine or aquatic biomass 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. 

AD/CV Notice: Magnesia Carbon Bricks from China

Agency: International Trade Administration.
Commodity: Magnesia carbon bricks.
Country: China.
Nature of Notice: Rescission of administrative review of countervailing duty order for the period Jan. 1 through Dec. 31, 2011, due to the withdrawal of the request for review.
Details: The ITA will instruct U.S. Customs and Border Protection to assess CV duties on all appropriate entries at rates equal to the CV cash deposit required at the time of entry or withdrawal from warehouse for consumption. 

Information Collections on Duty Allowances, Chemical Exports, Agriculture Under Review

U.S. Customs and Border Protection is extending through March 6 the public comment period on 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 made in the liquidation of the entry.

CBP has also extended through March 6 the period for comments on CBP Form 3171, Application-Permit-Special License Unlading-Lading-Overtime Services. This form is used by commercial carriers and importers as a request for permission to unlade imported merchandise, baggage or passengers. It is also used to request overtime services from CBP officers in connection with lading or unlading of merchandise or the entry or clearance of a vessel, including the boarding of a vessel for preliminary supplies, ship's stores, sea stores or equipment not to be reladen.

The Environmental Protection Agency is requesting no later than March 6 comments on an information collection entitled “Notification of Chemical Exports - TSCA Section 12(b).” Section 12(b)(2) requires any person who exports or intends to export to a foreign country a chemical substance or mixture that is regulated under TSCA sections 4, 5, 6 and/or 7 to submit to the EPA notification of such export or intent to export. Upon receipt of this notification the EPA advises the government of the importing country of the U.S. regulatory action with respect to that substance.

The Department of Agriculture’s Animal and Plant Health Inspection Service is accepting through April 5 comments on the proposed extension of an information collection associated with the regulations for a certification program for imported articles of Pelargonium spp. and Solanum spp. to prevent the introduction of potato brown rot into the United States. This certification program requires a phytosanitary certificate and additional declaration, trust fund, compliance agreement, and production site registration.

Comments may address whether these information collections are necessary for each agency’s proper performance of its functions, including whether the information has practical utility; ways to enhance the quality, utility and clarity of the information collected; and the accuracy of the estimate of the burden of the collections and ways to minimize that burden through the use of automated, electronic, mechanical and other collection technologies. 

Foreign Regulatory Changes Could Affect Exports of Drugs, Foods, Elevators

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.

Brazil – draft resolution on registration of medicines with synthetic and semi-synthetic active ingredients classified as new, generic and similar (comments due by April 15)

Brazil – draft resolution on certificate of good manufacturing practices for medicines, health products, cosmetics, perfumes, personal care products, and pharmaceutical active ingredients (comments due by March 18)

Chile – proposed amendment to Food Health Regulations on nutritional composition of food and food advertising (comments due by March 16)

Colombia – Dec. 17, 2012, effective date of resolution authorizing imports of agricultural inputs for direct use

Mexico – Jan. 4, 2013, effective date of official standard on dough, tortillas and tostadas and flour prepared for their production 

United Arab Emirates – draft technical regulation on monitoring and control of electrical elevators (comments due by March 29

International Standards on Food Additives to be Discussed at Feb. 11 Meeting

The Department of Agriculture’s Food Safety and Inspection Service and the Food and Drug Administration are sponsoring a public meeting Feb. 11 in College Park, Md., to provide information and receive public comments on agenda items and draft U.S. positions that will be discussed at the 45th Session of the Codex Committee on Food Additives, which will be held in China March 18–22. The CCFA establishes or endorses acceptable maximum levels for individual food additives, prepares priority lists of food additives for risk assessment by the Joint FAO/WHO Expert Committee on Food Additives, recommends specifications of identity and purity for food additives for adoption by Codex, considers methods of analysis for the determination of additives in food, and considers and elaborates standards or codes for related subjects such as labeling of food additives when sold as such. Interested persons who are not able to attend the meeting in person may participate by phone and should request the call-in number and conference code when they register.

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