While the trade regulatory issues that may see emphasis under the Biden administration are as-yet unclear, importers, exporters, and others should anticipate a continuing effort to pursue enforcement as well as trade facilitation.
Lenny Feldman, a senior member of Sandler, Travis & Rosenberg and current co-chair of U.S. Customs and Border Protection’s Commercial Customs Operations Advisory Committee, said on a recent episode of ST&R’s “Two Minutes in Trade” podcast that federal agency regulations play a critical role by spelling out how laws enacted by Congress will be implemented. The Trump administration had sought to decrease the regulatory burden on businesses by requiring agencies to repeal, replace, or modify at least two regulations for every new regulation issued, including an offset of costs. Government and industry representatives responded by identifying hundreds of customs regulations that were obsolete, obstructive, or inoperable.
However, President Biden has revoked the executive order imposing this so-called “2-for-1” initiative, calling into question the future of regulatory reform efforts within CBP and other trade-regulating agencies. Instead, the new administration’s objective is to confront today’s issues by empowering agencies to use appropriate regulatory tools. Nevertheless, Feldman said, CBP seems committed to updating and streamlining its regulations to increase efficiencies and compliance.
The president has also imposed a freeze on pending regulations, meaning many important customs and trade rules will remain in limbo for the time being. According to Feldman, these include regulations on (1) the detention, disclosure, and mitigation processes for goods suspected of being made with forced labor, (2) the importing process and multimodal data requirements for section 321 de minimis shipments, (3) customs broker modernization and continuing education, (4) importer vetting, and (5) country of origin, verification, and auto rules under the U.S.-Mexico-Canada Agreement. These regulations are not political in nature, Feldman said, and the trade community needs them to conduct compliant day-to-day transactions.
It will therefore be important for traders to encourage leaders at CBP and the Department of Homeland Security to move these regulatory packages forward. Currently those leaders are Troy Miller, CBP’s director of field operations in New York, as acting CBP commissioner and David Pekoske, director of the Transportation Security Administration, as acting DHS secretary. Alejandro Mayorkas, former director of U.S. Citizenship and Immigration Services and deputy DHS secretary, has been nominated to lead DHS and is expected to be confirmed by the Senate on Feb. 2.
No nomination has yet been announced for CBP commissioner, but Feldman said someone with a strong enforcement background is likely to be named Of the last ten individuals to fill this role, two had worked at TSA, two at Border Patrol, two at the Department of Justice, two in a large municipal police department, one in the Secret Service, and one in the Federal Bureau of Investigation.
Whoever is ultimately confirmed in this position, regardless of their background, will be tasked with enforcing customs and trade laws passed by Congress and policies implemented by the White House. And so far, Feldman said, the Biden administration has signaled that it intends to take a tough line on issues such as detaining and excluding goods made with forced labor, collecting Section 301 and other tariffs, and verifying qualifications for preferences under the USMCA and other U.S. trade agreements.
For more information on customs and trade regulatory issues, please contact Lenny Feldman at (305) 894-1011.
Click here to register for ST&R’s Feb. 10 webinar reviewing customs and trade laws and the agencies that enforce them.
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