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February 1 2013 Issue

Friday, February 01, 2013
Sandler, Travis & Rosenberg Trade Report

Periodic Testing of Children’s Products Required as of Feb. 8; New Labeling Program Also Available

Regulations issued by the Consumer Product Safety Commission in November 2011 concerning the periodic testing of children’s products and compliance labeling for consumer products will take effect Feb. 8 and apply to products manufactured after that date. Children’s products include bicycles, books, furniture, apparel, jewelry, televisions, electronic games, toys, etc., if designed or intended primarily for a child 12 years of age or younger.

Periodic Testing. All importers, manufacturers and private labelers of children’s products must certify that such products comply with all rules, bans, standards or regulations applicable to the product under the Consumer Product Safety Act or any other law enforced by the CPSC. This certification must be based on passing test results obtained from a third-party conformity assessment body accredited by the CPSC to conduct such tests.

Beginning Feb. 8 children’s products will be subject to periodic testing after their initial certification. This testing must be conducted at least once a year for manufacturers who do not undertake other production testing (using a testing plan developed by the manufacturer), once every two years for manufacturers who implement a production testing plan (which can use first- or third-party testing), and once every three years for manufacturers who conduct testing to ensure continuing compliance using a test lab accredited to ISO/IEC 17025:2005 but whose accreditation has not been accepted by the CPSC (which will usually be in-house labs). The CPSC states that periodic testing should be conducted frequently enough to provide a high degree of assurance that continuing production of the children's product continues to comply with all applicable children's product safety rules. Manufacturers and importers are expected to know whether the facts and circumstances of manufacturing their product may warrant more frequent testing.

Importers and manufacturers may rely on testing obtained by or certifications made by another party (e.g., a foreign manufacturer) as the basis for their own certificates of conformity for either component parts or finished products, provided that the requirements of 16 CFR Part 1109 are met.

Material Changes. If a children’s product undergoes a material change in product design or manufacturing processes, including the sourcing of component parts that could affect the product’s ability to comply with the applicable safety rules, the manufacturer must submit samples of the materially changed product to a third-party conformity assessment body for testing. The testing can be limited to the portion or component part of the finished product that was changed and for compliance with those safety rules for which compliance might have been affected.

Undue Influence. Each manufacturer of children’s products must establish procedures to safeguard against the exercise of undue influence by a manufacturer on a third-party conformity assessment body. At a minimum, these procedures must include written policy statements from company officials that the exercise of undue influence is not acceptable and directing that every appropriate staff member receives training on avoiding undue influence and signs a statement attesting to their participation in the training. The training procedures must include a requirement to notify the CPSC immediately of any attempt by the manufacturer to hide or exert undue influence over test results and a requirement to inform employees that allegations of undue influence may be reported confidentially to the CPSC.

Labeling. The regulations establish a program under which a manufacturer or private labeler that has certified that a consumer product complies with all applicable safety rules it may affix to that product a label that is visible and legible and states “Meets CPSC Safety Requirements.” 

Harmonized System Committee to Consider Customs, Tariff Classification Issues

U.S. Customs and Border Protection has issued the draft agenda for the 51st session of the World Customs Organization’s Harmonized System Committee, which will be held in Brussels March 6-15. The HSC’s responsibilities include issuing classification decisions on the interpretation of the Harmonized Commodity Description and Coding System, which can take the form of published tariff classification opinions or amendments to the Explanatory Notes.

The HSC is slated to consider a number of different issues at its upcoming meeting, including the future of the Harmonized System and a new version of the HS Commodity Database. Also up for consideration is the classification of various products, including the following.

- sesame snacks with honey
- dog collars
- water bottles for bicycles
- terra-cotta cladding elements
- heat and sound insulation materials
- peelers and graters for vegetables and fruits
- tablet computers
- monitors
- motor homes
- roof-mounted cargo boxes for motor vehicles
- tripods
- xanthan gum
- portable floor air conditioning units
- jar of coffee, cup and saucer put up for retail sale in a paperboard box
- amplifiers combined in a single housing with loudspeakers
- LED backlights for liquid crystal displays
- peach pulp concentrate
- cabinets in unassembled form
- radiators
- touch-sensitive screens 

$725,000 Civil Penalty for Failure to Report Defective Children’s Beds

The Consumer Product Safety Commission announced Jan. 30 that a California company has agreed to pay a civil penalty of $725,000 to settle allegations that it knowingly failed to immediately report a defect involving two models of its boat-style children’s beds with toy chests. The lid supports on the toy chests fail to prevent the lid from closing too quickly, posing an entrapment and strangulation hazard to young children. The company learned of the death of a boy due to this defect in November 2007 but failed report the death or the associated hazard until March 2008 after being contacted by CPSC staff and directed to do so. Federal law requires manufacturers, distributors and retailers to report to CPSC within 24 hours after obtaining information reasonably supporting the conclusion that a product contains a defect that could create a substantial product hazard, creates an unreasonable risk of serious injury or death, or fails to comply with any consumer product safety rule or any other rule, regulation, standard or ban enforced by CPSC. 

Dates and Deadlines: Export Compliance, CBP Rulings, IPR Report

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

Feb. 4 – deadline for comments on potential IPR probe of sealing rings for utility meters

Feb. 4 – deadline for comments on proposed FTZ production activity at ATV facilities in Georgia

Feb. 5 – ST&R webinar on International Traffic in Arms Regulations

Feb. 6 – ST&R webinar on best practices for export compliance program

Feb. 7 – deadline for comments on CBP information collections on administrative rulings, goods transfers and IPR recordation

Feb. 7 – deadline for input on possible IPR infringement probe of wireless communications base stations

Feb. 7 – ST&R webinar on due diligence and export compliance

Feb. 8 – deadline for comments on proposed revocation of classification rulings on MP3 player docking stations with built-in radios

Feb. 8 – deadline for input for USTR annual Special 301 report on IPR

Feb. 8 – effective date of new USDA policy restricting distribution of imported meat and poultry pending test results 

AD/CV Notices: Request Reviews, Hangers, Steel, Shrimp, Carbon

Agency: International Trade Administration.
Nature of Notice: Opportunity to request no later than Feb. 28 administrative reviews of the antidumping and countervailing duty orders on the following products for the period Feb. 1, 2012, through Jan. 31, 2013 (AD) or Jan. 1 through Dec. 31, 2012 (CV).
- frozen warmwater shrimp from Brazil, China, India, Thailand and Vietnam (AD)
- stainless steel bar from Brazil, India, Japan (AD)
- uranium from France (AD)
- cut-to-length carbon-quality steel plate from India Indonesia, Korea (AD/CV)
- preserved mushrooms from China, India and Indonesia (AD)
- stainless steel butt-weld pipe fittings from Italy, Malaysia and the Philippines (AD)
- carbon steel butt-weld pipe fittings from Japan (AD)
- heavy forged hand tools, with or without handles, from China (AD)
- small diameter graphite electrodes from China (AD)
- uncovered innerspring units from China (AD)
- pre-stressed concrete steel wire strand from India (CV)

Agency: International Trade Commission.
Commodity: Steel wire garment hangers.
Country: Vietnam.
Nature of Notice: Affirmative final antidumping and countervailing injury determinations.
Details: The ITA will shortly issue AD and CV duty orders on this merchandise.

Agency: International Trade Administration.
Commodity: Stainless steel bar.
Country: India.
Nature of Notice: Preliminary results of administrative review of antidumping duty order for the period Feb. 1, 2011, through Jan. 31, 2012.
Details: Dumping margin of zero for Ambica Steels Limited. Review rescinded for Mukand Ltd. due to withdrawal of request for review.

Agency: International Trade Commission.
Commodity: Frozen warmwater shrimp.
Country: China, Ecuador, India, Indonesia, Malaysia, Thailand and Vietnam.
Nature of Notice: Feb. 7 open meeting for vote on preliminary countervailing injury determinations.

Agency: International Trade Commission.
Commodity: Activated carbon.
Country: China.
Nature of Notice: Feb. 8 open meeting for vote in sunset review of antidumping duty order.

Agency: International Trade Administration/International Trade Commission.
Commodity: Sodium hexametaphosphate.
Country: China.
Nature of Notice: Initiation of sunset review of antidumping duty order.

Agency: International Trade Commission.
Commodity: Clad steel plate.
Country: Japan.
Nature of Notice: Sunset review determination that revocation of antidumping duty order would be likely to lead to continuation or recurrence of material injury to an industry in the U.S. within a reasonably foreseeable time.
Details: This order will shortly be extended for another five years. 

Potential IPR Probe of Reflector Lamps Evaluated for Public Interest Issues

The International Trade Commission is requesting comments no later than Feb. 11 on any public interest issues raised by a Section 337 intellectual property rights infringement complaint filed on behalf of Andrzej Bobel and Neptun Light Inc. against certain compact fluorescent reflector lamps and products and components containing 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. 

Monthly Surface Trade with Canada and Mexico Fell in November

U.S. monthly surface transportation trade in goods with NAFTA partners Canada and Mexico fell 4.4% in November, according to statistics released by the Department of Transportation. However, the $81.5 billion total was up 6.2% from a year before.

Surface transportation includes freight movements by truck, rail, pipeline, mail and other modes, as well as goods moving into foreign-trade zones. In November surface transportation trade with Canada and Mexico accounted for 21% of total U.S. foreign trade and primarily consisted of goods moved by truck ($56.2 billion), followed by rail ($14.9 billion) and pipeline ($5.9 billion).

Surface trade between the U.S. and Canada totaled $46.7 billion in November, down 3.5% from October, and was led by shipments of vehicles and parts ($9.6 billion). U.S.-Mexico surface transportation trade totaled $34.8 billion, down 5.7% from the previous month, and was led by shipments of electrical machinery ($7.9 billion). 

Ex-Im Bank Considers Backing Exports to Aluminum Smelter in UAE

The Export-Import Bank of the United States is inviting comments through Feb. 13 on a request for a $225 million direct loan to support the export of approximately $173 million in U.S. aluminum manufacturing equipment and services to a smelter in the United Arab Emirates. This request was first notified last November but has been increased from the original amounts of $135 million for the loan and $103 million in equipment. The U.S. exports will enable the foreign buyer to increase its production capacity of aluminum by about 574,000 metric tons per year. Available information indicates that the majority of this new foreign production will be sold in the Netherlands, Japan, the UAE, the U.S., South Korea and Thailand, with the balance sold to China, Cyprus, Egypt, France, Germany, Greece, Hungary, Indonesia, Italy, Kenya, Malaysia, the Philippines, Poland, Romania, Slovakia, South Africa, Spain, Sri Lanka, Taiwan, Turkey and the United Kingdom. 

New and Amended Maritime Agreements Filed

The Federal Maritime Commission has issued notice that the following new or amended agreements have been filed. Interested parties may submit comments by Feb. 11.

Consolidated Chassis Management Pool Agreement – The amendment would revise the agreement to expand participation on the CCMP Governing Board and pool boards and clarify that a majority of members on such boards shall be OCEMA members. The amendment would also delete Crowley Maritime Corporation, Crowley Latin America Services LLC and Crowley Caribbean Services LLC as parties and change the name of CCM affiliate CCM Holdings LLC to Consolidated Chassis Enterprises LLC.

Siem Car Carrier Pacific AS/Compania Sud Americana de Vapores S.A. Space Charter Agreement – The agreement authorizes the parties to engage in a limited range of cooperative activities, including vessel space chartering in the trade between the U.S. West Coast and China, Japan and Korea. 

Commercial Labs and Gaugers Approved

U.S. Customs and Border Protection has announced that the following companies have been accredited as commercial laboratories and/or approved as commercial gaugers for three years.

- effective June 21, 2012, R. Markey & Sons Inc., Markan Laboratories, of New York, N.Y., has been accredited as a commercial laboratory to analyze sugar, sugar syrups and confectionary products under HTSUS Chapter 17 for customs purposes

- effective July 24, 2012, Petrospect Inc. of Honolulu, Hawaii, has been approved to gauge petroleum, petroleum products, organic chemicals and vegetable oils for customs purposes

- effective Aug. 20, 2012, AmSpec Services LLC of Long Beach, Calif. has been approved to gauge and accredited to test petroleum and petroleum products, organic chemicals and vegetable oils for customs purposes

- effective June 13, 2012, King Laboratories Inc. of Carson, Calif., has been approved to gauge and accredited to test petroleum and petroleum products, organic chemicals and vegetable oils for customs purposes

- effective Sept. 12, 2012, Saybolt LP of Carson, Calif., has been approved to gauge and accredited to test petroleum and petroleum products, organic chemicals and vegetable oils for customs purposes

- effective Aug. 7, 2012, AmSpec Services LLC of Sulphur, La., has been approved to gauge petroleum and petroleum products, organic chemicals and vegetable oils for customs purposes 

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