Plan Details

The action plan will enable USDA to work closely with governors, state legislators, and federal partners to further integrate agriculture into the broader national security efforts over the coming months and years.

The USDA and its government partners will take “aggressive action” across seven critical areas:

1. Secure and Protect American Farmland – Address U.S. foreign farmland ownership from adversaries head-on. Total transparency. Tougher penalties.
2. Enhance Agricultural Supply Chain Resilience – Refocus domestic investment into key manufacturing sectors and identify non-adversarial partners to work with when domestic production is not available. Plan for contingencies.
3. Protect U.S. Nutrition Safety Net from Fraud and Foreign Exploitation – Billions have been stolen by foreign crime rings. That ends now.
4. Defend Agricultural Research and Innovation – No more sweetheart deals or secret pacts with hostile nations. American ideas stay in America.
5. Put America First in Every USDA Program – From farm loans to food safety, every program will reflect the America First agenda.
6. Safeguard Plant and Animal Health – Crack down on bio-threats before they ever reach our soil.
7. Protect Critical Infrastructure – Farms, food, and supply chains are national security assets and will be treated as such.

The action plan is the next pillar of the USDA “Make Agriculture Great Again” initiative and seeks to protect the country’s agricultural supply chains from security vulnerabilities. 

Increased Enforcement

Notably, the plan also states that the federal government is looking to increase enforcement on “logistics providers, customs brokers, and other trade intermediaries” that are responsible for importing “dangerous biochemicals and biological agents.” 

According to the plan, the USDA intends to review and modernize import restrictions to prevent the spread of dangerous chemicals and agents. USDA will work with federal partners, including CBP, “to strengthen our nation’s borders against entry of restricted goods that could carry animal disease, plant pests, and biological pathogens that can be weaponized against the American public.”

Response and Next Steps

Several members of Congress, governors, and state Agricultural Secretaries issued statements praising the plan, calling it critical to the agricultural economy and to the national security of the United States.

The action plan contains a lengthy list of action items for USDA to take, including an assessment of security risks in the agriculture infrastructure sector, modernizing import restrictions, and eliminating support programs to countries of concern.

Diaz Trade Law will continue to monitor developments as the USDA implements the plan.  

Read more:

• ICYMI: President Trump Signs America First Trade Policy
• USDA Proposes New “Made in the USA” Standard
• USDA Trade Matters

As a result of the U.S. President’s Action Plan for a Fairer, More Competitive, and More Resilient Meat and Poultry Supply Chain, the proposed rule allows a “Product of USA” or “Made in the USA” label claim to be used on meat, poultry and egg products only when they are derived from animals born, raised, slaughtered and processed in the United States.

Albeit, a very significant caveat accompanies the proposed rule, which is, that, labeling a food product in accordance with the latter is completely voluntary. The U.S. Federal Trade Commission (FTC) takes a similar course of action. While the FTC regulates U.S. origin claims under its authority to act against deceptive acts and practices, foreign-origin markings on products are regulated primarily by U.S. Customs under the Tariff Act of 1930. The similarity in the rules is that neither Customs nor the FTC requires that goods made partially or wholly in the U.S. be labeled with “Made in USA” or allude to any other indication of U.S. origin (but, if companies do choose to utilize the claim, the company must be prepared to defend it and ensure it uses it correctly). The exception to this is for textile, wool, and fur products as processing or manufacturing occurring in the U.S. must be disclosed.

In the context of the USDA, such labeling would also remain eligible for generic label approval, eliminating the need to be pre-approved by FSIS before it could be used on regulated products, and incorporates laxed auditing standards for supporting documentation.

Another effect of the proposed rule is forecasted to positively impact those involved with animal husbandry for commercial purposes.  The USDA’s proposed rule bolsters the Packers and Stockyards Act (P&S) of 1921 ‘“to safeguard farmers and ranchers… to protect consumers… and to protect members of the livestock, meat, and poultry industries from unfair, deceptive, unjustly discriminatory and monopolistic practices”’ This is reassuring when taking into account that:

• The global beef market is projected to grow from $414.98 billion to $604.34 billion by 2029, at a Compound Annual Growth Rate (CAGR) of 5.52% in forecast period, 2022-2029;
• The global poultry market is expected to grow at a CAGR of 7.2% to nearly $465.7 billion by 2025, and at a CAGR of 6.8% to $645.7 billion by 2030; and that,
• The global egg market is expected to grow annually by 7.70% (CAGR 2023-2027).

The USDA encourages stakeholders to publicly comment on the proposed rule for the 60-day window after publication of the same at www.regulations.gov. If you have questions or want to make your voice heard, contact info@diaztradelaw.com to discuss how Diaz Trade Law can assist you.

U.S. Customs and Border Protection (CBP)

• In December 2022 alone, U.S. Customs and Border Protection (CBP) processed more than 2.5 million entry summaries valued at more than $260 billion, identifying estimated duties of nearly $6.8 billion to be collected by the U.S. government. In December, trade via the ocean environment accounted for more than 40 percent of the total import value, followed by air, truck, and rail.
• In December 2022, CBP identified 310 entries valued at more than $59 million for further examination based on the suspected use of forced labor, and which may be subject to a Withhold Release Order, Forced Labor Finding, or the Uyghur Forced Labor Prevention Act’s rebuttable presumption, and prohibited importation into the United States under 19 U.S.C. § 1307.
• CBP announced intellectual property rights violations continue to put America’s innovation economy at risk. Trade in counterfeit and pirated goods threaten the competitiveness of U.S. businesses, the livelihoods of American workers, and the health and safety of consumers.
• In December 2022, CBP seized 1,501 shipments that contained counterfeit goods valued at more than $178 million.
• CBP completed 26 audits that identified $86.9 million in duties and fees owed to the U.S. government, stemming from goods that had been improperly declared in accordance with U.S. trade laws and customs regulations. CBP collected over $25 million of this identified revenue and from previous fiscal years’ assignments.
• CBP announced new #quota updates on #brooms and #chocolate! For those similarly curious about the chocolate quota – check out more information here: https://www.cbp.gov/trade/quota/bulletins/qb-23-216“

U.S. Department of Agriculture (USDA)

• This rulemaking amends the United States Department of Agriculture (USDA) organic regulations to strengthen oversight and enforcement of the production, handling, and sale of organic agricultural products. The amendments protect integrity in the organic supply chain and build consumer and industry trust in the USDA organic label by strengthening organic control systems, improving farm to market traceability, and providing robust enforcement of the USDA organic regulations.
  • Topics addressed in this rulemaking include: applicability of the regulations and exemptions from organic certification; National Organic Program Import Certificates; recordkeeping and product traceability; certifying agent personnel qualifications and training; standardized certificates of organic operation; unannounced on-site inspections of certified operations; oversight of certification activities; foreign conformity assessment systems; certification of producer group operations; labeling of nonretail containers; annual update requirements for certified operations; compliance and appeals processes; and calculating organic content of multi-ingredient products.

Department of Homeland Security (DHS)

• In this final rule, the Department of Homeland Security (DHS) makes the 2023 annual inflation adjustment to its civil monetary penalties. On November 2, 2015, the President signed into law The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 Act).

Food and Drug Administration (FDA)

• The Food and Drug Administration (FDA) is essentially rejecting CBD in dietary supplements and conventional foods. The basic take-away is “Given the available evidence, it is not apparent how CBD products could meet safety standards for dietary supplements or food additives. For example, we have not found adequate evidence to determine how much CBD can be consumed, and for how long, before causing harm. Therefore, we do not intend to pursue rulemaking allowing the use of CBD in dietary supplements or conventional foods.”

If you have questions about these updates, contact our Diaz Trade Law attorneys at info@diaztradelaw.com or call us at 305-456-3830.

To receive an email notification whenever a new post is published, please subscribe to our weekly blog here.

U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC)

• The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is publishing the names of one or more persons that have been placed on OFAC’s List of Specially Designated Nationals and Blocked Persons (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied. 
• OFAC is publishing the names of one or more persons that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied. 
• OFAC is publishing the names of one or more persons that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied.
• OFAC is publishing the names of one or more persons that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied.
•  On November 26th, the Unitary Platform and the Maduro regime announced the resumption of talks in Mexico City; a humanitarian agreement focused on education, health, food security, flood response, and electricity programs that will benefit the Venezuelan people; and agreement on the continuation of talks focused on the 2024 elections. Following this announcement and consistent with U.S. government policy, OFAC issued Venezuela General License (GL) 41, authorizing Chevron Corporation to resume limited natural resource extraction operations in Venezuela.
• OFAC is issuing Venezuela-related General License 8K, “Authorizing Transactions Involving Petróleos de Venezuela, S.A. (PdVSA) Necessary for the Limited Maintenance of Essential Operations in Venezuela or the Wind Down of Operations in Venezuela for Certain Entities” and Venezuela-related General License 41, “Authorizing Certain Transactions Related to Chevron Corporation’s Joint Ventures in Venezuela”.  Additionally, OFAC is issuing two new Venezuela-related Frequently Asked Questions (FAQs 1098 and 1099).
• OFAC announced a settlement with Payward, Inc. d/b/a Kraken, a Delaware-incorporated virtual currency exchange with operations in the United States and elsewhere.  Kraken agreed to remit $362,158.70 to settle its potential civil liability for apparent violations of sanctions against Iran. 

U.S. International Trade Commission (USITC) 

• The U.S. International Trade Commission (USITC) has received a complaint entitled Certain Location-Sharing Systems, Related Software, Components Thereof, and Products Containing Same, DN 3655; the Commission is soliciting comments on any public interest issues raised by the complaint or complainant’s filing pursuant to the Commission’s Rules of Practice and Procedure.
• USITC has determined to review in part the final initial determination issued by the presiding chief administrative law judge  on September 9, 2022. The Commission requests briefing from the parties on certain issues under review, as indicated in this notice.
• USITC has determined to review in part the final initial determination issued by the presiding chief administrative law judge on September 9, 2022. The Commission requests briefing from the parties on certain issues under review, as indicated in this notice.
• USITC as received a complaint entitled Certain Cabinet X-ray and Optical Camera Systems and Components Thereof, DN 3656; the Commission is soliciting comments on any public interest issues raised by the complaint or complainant’s filing pursuant to the Commission’s Rules of Practice and Procedure.

U.S. Department of State (DOS)

• The Department of State (DOS) has submitted the information collection described below to the Office of Management and Budget (OMB) for approval. In accordance with the Paperwork Reduction Act of 1995 we are requesting comments on this collection from all interested individuals and organizations. The purpose of this Notice is to allow 30 days for public comment.

U.S. Consumer Product Safety Commission (CPSC)

• The U.S. Consumer Product Safety Commission (CPSC) has determined that there is an unreasonable risk of injury and death, particularly to children, associated with clothing storage units (CSUs) tipping over. To address this risk, the Commission is issuing a rule regarding the stability of CSUs. 

Department of Commerce (DOC)

• The Department of Commerce (DOC) updated two limits for the European Union Steel Tariff Rate Quota (TRQ) Program effective November 30, 2022 to align with production capabilities in Germany and Luxembourg. The effected steel HTS is 7301.10.0000 “Sheet Piling” under Chapter 99 HTS 9903.81.13. The quantity formerly listed for Country of Origin Germany has been reassigned to the quota limit for Country of Origin Luxembourg effective November 30, 2022.

United States Trade Representative (USTR)

• The U.S. Trade Representative  (USTR) modified the actions in the Section 301 investigation of China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation by excluding from additional duties certain medical-care products needed to address COVID, and subsequently extended certain of these exclusions. The current COVID exclusions — covering 81 medical-care products — are scheduled to expire on November 30, 2022. This notice announces the U.S. Trade Representative’s determination to further extend the 81 COVID exclusions for an additional three months.
•  USTR announced the United States and United Kingdom jointly hosted the 6^th U.S.-UK Small- and Medium-Sized (SME) Dialogue yesterday, bringing together business representatives from both sides of the Atlantic to identify ways to expand bilateral trade and investment and to enhance broad and inclusive SME participation in that trade and investment.

U.S. Customs and Border Protection (CBP) 

• U.S. Customs and Border Protection (CBP) personnel at all U.S. ports of entry will detain raw sugar and sugar-based products produced in the Dominican Republic by Central Romana Corporation Limited. CBP issued a Withhold Release Order (WRO) against Central Romana based on information that reasonably indicates the use of forced labor in its operations.
  • CBP identified five of the International Labour Organization’s 11 indicators of forced labor during its investigation:  abuse of vulnerability, isolation, withholding of wages, abusive working and living conditions, and excessive overtime.
• CBP released a reminder for transportation carrier companies that transact with CBP’s ACE systems to please pay the Annual SCAC Code Renewal fee for this year (2022) by Monday, December 5th, to the National Motor Freight Traffic Association (NMFTA) if you have not done so already.  The NMFTA SCAC Code Renewal web link is SCAC Renewal and Application Wizard (nmfta.org).  If you have any questions about the renewal, please email customerservice@nmfta.org

Ocean Energy Management Bureau 

• The Bureau of Ocean Energy Management (BOEM) will open and publicly announce bids received for blocks offered in the Cook Inlet Planning Area Outer Continental Shelf Oil and Gas Lease Sale 258 (Cook Inlet Sale 258), in accordance with the provisions of the Outer Continental Shelf Lands Act (OCSLA), as amended, and its implementing regulations.

U.S. Department of  Energy (DOE)

• The U.S. Department of Energy (DOE) announces the availability of the preliminary analysis it has conducted for purposes of evaluating the need for amended energy conservation standards for non-weatherized oil-fired furnaces (NWOFs), mobile home oil-fired furnaces (MHOFs‘), weatherized gas furnaces (WGFs), weatherized oil-fired furnaces (WOFs‘), and electric furnaces (EFs).

U.S. Department of Agriculture (USDA) 

• The United States Department of Agriculture’s (USDA) electronic system for propagative shipment processing will be offline for routine service maintenance, starting Friday, December 2, 2022, beginning at 6:00 p.m. EST, until Saturday, December 3, 2022, at 7:00 p.m. EST.
  • To ensure expedited agriculture clearance of propagative shipments during this time, we recommend the following:
    • For shipments requiring clearance on Saturday December 3, please contact the USDA plant inspection station that you currently work with regarding propagative shipments. This will avoid delays and ensure that all relevant information is available to conduct clearance activities. All shipments will be inspected per normal procedures; however, the document review, sample selection, and cargo release will take place outside of the system and will be processed electronically after the system is back online.

If you have questions about these updates, contact our Diaz Trade Law attorneys at info@diaztradelaw.com or call us at 305-456-3830.

To receive an email notification whenever a new post is published, please subscribe to our weekly blog here.

U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) 

• The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is publishing the names of one or more persons that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied. 
• OFAC is publishing the names of one or more Russian nationals that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied. 
• OFAC designated four members of an Islamic State of Iraq and Syria (ISIS) cell operating in South Africa who have provided technical, financial, or material support to the terrorist group. Treasury also designated eight companies owned, controlled, or directed by the individuals in this ISIS cell. Treasury remains committed to exposing and disrupting terrorist financing on the African continent. 
• OFAC designated pursuant to Executive Order (E.O.) 14014 one individual and one entity that facilitate weapons purchases for Burma’s military regime. This action, which is in conjunction with newly issued European Union sanctions, marks the second anniversary of the last general election in Burma on November 8, 2020, which was brutally overturned by a military coup on February 1, 2021. 
• OFAC is publishing the names of one or more persons that have been placed on OFAC’s List of Specially Designated Nationals and Blocked Persons (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied. 
• OFAC is publishing the names of one or more persons and vessels that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied. All property and interests in property subject to U.S. jurisdiction of these persons are blocked, and U.S. persons are generally prohibited from engaging in transactions 
• OFAC designated Alex Adrianus Martinus Peijnenburg (Peijnenburg), Martinus Pterus Henri De Koning (De Koning), Matthew Simon Grimm (Grimm), and nine entities pursuant to Executive Order (E.O.) 14059 for supplying illicit fentanyl, synthetic stimulants, cannabinoids, and opioids to U.S. markets through internet sales and a host of shell companies. 
• OFAC designated two business associates of a sanctioned al-Qa’ida financial facilitator and external operations plotter. The two individuals designated today are Mohamad Irshad Mohamad Haris Nizar and Musab Turkmen, who conducted businesses activities to assist Ahmed Luqman Talib (Talib), who was previously designated by OFAC for facilitating the international movement of individuals and finances in furtherance of al-Qa’ida’s objectives.
  • Australian authorities arrested Talib on March 25, 2021, and days later charged him with plotting incursions into foreign states for the purpose of engaging in hostile activities. 
• OFAC is designating two individuals for engaging in transportation and procurement activities on behalf of the Democratic People’s Republic of Korea (DPRK). These individuals have acted on behalf of Air Koryo, an entity previously designated by OFAC for operating in the transportation industry in the DPRK economy. 

United States Department of Commerce (DOC)

• The U.S. Department of Commerce (DOC) preliminarily determines that certain producers/exporters of certain hot-rolled steel flat products from the Republic of Korea received de minimis countervailable subsidies during the period of review. The DOC is rescinding this review with respect to 13 companies.  
• DOC preliminarily determines that the sole mandatory respondent, Habas Sinai ve Tibbi Gazlar Istihsal Endustrisi A.S., a producer and exporter of certain hot-rolled steel flat products from the Republic of Turkey, did not make sales of subject merchandise in the United States at prices below normal value during the period of review.  
• DOC preliminarily determines that Celik Halat ve Tel Sanayi A.S., a producer/exporter of prestressed concrete steel wire strand from the Republic of Turkey and sole respondent for this administrative review, received countervailable subsidies during the period of review.  
• DOC and the U.S. International Trade Commission (USITC) have determined that revocation of the antidumping duty and countervailing duty orders on stainless steel sheet and strip from the People’s Republic of China would be likely to lead to the continuation or recurrence of dumping, net countervailable subsidies, and material injury to an industry in the US. Therefore, DOC is publishing a notice of continuation of these AD and CVD orders. 
• DOC preliminarily finds that Soci Nouvelle des Couleurs Zinciques made sales of subject merchandise at less than normal value during the period of review. 
• DOC determines that countervailable subsidies are being provided to the producers and exporters subject to the administrative review of carbon and alloy steel threaded rod (threaded rod) from the People’s Republic of China during the period of review  July 29, 2019, through December 31, 2020. 
• DOC preliminarily determines that there were no shipments of merchandise subject to the antidumping duty order on stainless steel butt-weld pipe fittings from the Philippines during the period of review February 1, 2021, through January 31, 2022, from any of the companies under review. The DOC invites interested parties to comment on these preliminary results. 
• DOC and  International Trade Administration (ITA), is organizing an Executive-Led Clinical Waste Management Mission to Indonesia and Malaysia on September 11-15, 2023. Clinical Waste Management Trade Mission to Indonesia and Malaysia– originally scheduled for March 6-10, 2023, is now postponed to September 11-15, 2023. The application deadline is now June 30, 2023. 
• DOC determines that Jilin Bright Future Chemicals Co., Ltd. sold certain activated carbon from the People’s Republic of China at less than normal value during the period of review (POR), April 1, 2020, through March 31, 2021. Commerce also determines that Datong Juqiang Activated Carbon Co., Ltd. (Datong Juqiang) did not make sales of subject merchandise at less than normal value during the POR.  
• DOC is initiating a changed circumstances review to determine if Kader Exports Private Limited is the successor-in-interest to the Liberty Group in the context of the antidumping duty  order on certain frozen warmwater shrimp from India. DOC preliminarily determined that Kader Exports is the successor-in-interest to the Liberty Group. 
• DOC finds that Qufu Xinyu Furniture Co., Ltd. did not make sales of subject merchandise at less than normal value during the period of review October 9, 2019, through March 31, 2021; Shanghai Beautystar Cabinetry Co., Ltd. is part of the People’s Republic of China-wide entity; and Jiang Su Rongxin Wood Industry Co., Ltd. is the successor-in-interest to Jiangsu Rongxin Cabinets Co., Ltd.  

United States International Trade Commission (USITC)

• The U.S. International Trade Commission (USITC) has received a complaint entitled Certain Automated Retractable Vehicle Steps and Components Thereof, DN 3653; the Commission is soliciting comments on any public interest issues raised by the complaint or complainant’s filing pursuant to the Commission’s Rules of Practice and Procedure. 
• The USITC has issued a limited exclusion order against infringing products manufactured and/or imported by or on behalf of Proton Sports Inc. of Scottsdale, Arizona, and a cease-and-desist order against Proton. The investigation is terminated. 
• The USITC has determined to issue a limited exclusion order barring entry of certain electrolyte containing beverages and labeling and packaging thereof that are imported by or on behalf of the following defaulting respondents: Carbonera Los Asadores de C.V.; Comercial Trevin˜o de Reynosa, S.A. de C.V.; Distribuidora Mercatto S.A. de C.V.; H & F Tech International S.A. de C.V.; Leticia Ange´lica Saenz Fernandez; Yoselen Susana Martinez Tirado; Grupo Comercial Lux del Norte S.A. de C.V.; and Caribe Agencia Express, S.A. de C.V. The investigation is terminated. 
• The United States Patent and Trademark Office (USPTO), DOC, in collaboration with the United States Food and Drug Administration (FDA) and the Department of Health and Human Services, is announcing a public listening session on January 19, 2023. The purpose of the listening session is to seek public comments on proposed initiatives for collaboration between the agencies to advance President Biden’s Executive Order on ‘‘Promoting Competition in the American Economy’’.  
  • To assist in gathering public input, the USPTO and the FDA are announcing the establishment of a docket to track feedback received through this notice and a request for comments on these collaborative efforts. 

• DOC received a countervailing duty petition concerning imports of paper file folders from India filed in proper form on behalf of the Coalition of Domestic Folder Manufacturers (the petitioner), the members of which are domestic producers of paper file folders. The Petition was accompanied by antidumping duty petitions concerning imports of paper file folders from the People’s Republic of China, India, and the Socialist Republic of Vietnam.  
  • DOC finds that the petitioner filed the Petition on behalf of the domestic industry because the petitioner is an interested party as defined in section 771(9)(F) of the Act. DOC also finds that the petitioner demonstrated sufficient industry support with respect to the initiation of the requested CVD investigation. 

United States Department of Agriculture (USDA)

• The United States Department of Agriculture (USDA) proposal invites comments on updates to the Harmonized Tariff Schedule numbers for paper and paper-based packaging products in the Paper and Paper-Based Packaging Promotion, Research, and Information Order. In addition, this action proposes new language that allows assessment collection to continue even if HTS numbers change in the future. Comments must be received by December 7, 2022. 

United States Customs and Border Protection (CBP)

• U.S. Customs and Border Protection (CBP) warns travelers to not bring counterfeit consumer goods back from overseas trips after officers last week seized more than $77,000 worth of clothing bearing unauthorized designer brand logos at Washington Dulles International Airport. 
• CBP’S Jones Act Division of Enforcement (JADE) held local training to raise awareness of the 102-year-old federal statute, officially known as the Merchant Marine Act of 1920. U.S. Coast Guard (USCG) officers, along with CBP import specialists and other personnel, were in attendance to learn the complexities of the act which governs U.S. maritime cabotage. 

The Maritime Administration  (MARAD)

• The Maritime Administration (MARAD) announced the renewal of the Voluntary Tanker Agreement Program and the publication of its revised Voluntary Tanker Agreement (VTA). The revised VTA replaces a prior version that was last published in September 4, 2008. After publishing the proposed text in the Federal Register in 2019 and hosting a public hearing in August 2020, MARAD has incorporated public input into the revised VTA. 

If you have questions about these updates, contact our Diaz Trade Law attorneys at info@diaztradelaw.com or call us at 305-456-3830.

To receive an email notification whenever a new post is published, please subscribe to our weekly blog here.

BIS 

• On January 14, 2022, the Bureau of Industry and Security (BIS) issued a notice of information collection regarding a Defense Production Act requirement for U.S. firms to furnish information to the agency regarding offset agreements exceeding $5,000,000 in value associated with sales of weapon systems or defense related items to foreign countries or foreign firms. BIS is soliciting public comments to help evaluate if the proposed information collection is necessary for the proper functions of the Commerce Department, evaluate the accuracy of their estimate of time and cost burden, evaluate ways to enhance the quality, utility, and clarity of the information to be collected, and to minimize the reporting burden.
  • Comments are due no later than March 15, 2022.

CBP 

• On January 18, 2022, CBP issued the largest agriculture seizures of 2021 with the top three seizures being 12,000+ pounds of marijuana, 750 unfertilized avian eggs, and 15 live giant land snails.
• On January 18, 2022, Customs and Border Protection issued Harmonized System Update (HSU) 2119 resolving issues related to the comingled data and/or missing information in previous HSUs.
• On January 22, 2022, CBP will deploy Phase 1 of the modernization of the ACE Secure Data Portal. These enhancements will include a new login screen, a new home page, and upgraded account information display and edit features.

DOT 

• On January 13, 2022, the Federal Motor Carrier Safety Administration detailed a pilot program that would allow for 18-to-20-year-old truckers drive big rigs from state to state in an effort to help ease the supply chain shortage.

OFAC 

• On January 18, 2022, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated three Hizballah-linked financial facilitators and their Lebanon-based travel company because of Hizballah’s efforts as part of the Lebanese government to block economic reform and inhibit much needed change for the Lebanese people.
• On January 20, 2022, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned four individuals engaged in Russian government-directed influence activities to destabilize Ukraine.

USDA 

• Recent USDA import statistics show a surge in U.S. organic fresh produce imports of bananas, blueberries, apples, and pears. Much of the surge originates in the Latin American countries of Mexico, Peru, Chile, Colombia, and Argentina with New Zealand also experiencing a surge of organic produce exports to the United States.

USTR 

• On January 19, 2022, the United States and United Kingdom issued a joint statement announcing the start of bilateral discussions to address global steel and aluminum excess capacity, including the United States’ application of tariffs on imports from the United Kingdom under Section 232 and the UK’s retaliatory tariffs on certain U.S. exports to the UK.

If you have questions about these updates, contact our Customs and International trade law attorneys at info@diaztradelaw.com or call us at 305-456-3830.

To receive an email notification whenever a new post is published, please subscribe to our weekly blog here.

BIS

• BIS Publishes Report on Effect of Uranium Imports on National Security
• BIS Publishes First Military End User List

Bloomberg

• Bloomberg Law – Introduction to U.S. Export Controls: Part 2
• Protecting Intellectual Property Rights in China
• Incoterms 2020
• Submitting Voluntary Self-Disclosures to Bureau of Industry & Security
• Submitting a Voluntary Self-Disclosure to Census
• Submitting a Voluntary Self-Disclosure to OFAC
• U.S. Customs Targets Use of Forced Labor

Customs and International Trade Bar Association 

• New CITBA Article – An Overview of China’s New Export Controls Regime
• COVID-19’s Impact on 2020 Trade Flows

China

• OFAC Issues Clarifying Guidance on Communist Chinese Military Companies Sanctions
• Hong Kong’s Initiates Dispute Regarding U.S.-Origin Marking Requirement
• CBP Issues WRO on Cotton, Tomato, & Downstream Products Made in Xinjiang
• Future of First Sale Rule in Question

Crypto

• OFAC Targets Russian Crypto Platform
• Why China’s Cryptocurrency Miners are Moving to Texas

Covid-19

• Recent Government Data Indicates that Florida Trade is Rebounding Fast Despite Pandemic Hit

Export

• What are Routed Export Transactions?
• Understanding the Computer Export License Exception (APP)
• Understanding the GOV Export License Exception
• Vegas Woman Charged with Iran Sanctions Violations
• Do’s and Don’ts of Filing a Commodity Jurisdiction Request
• Understanding Strategic Trade Authorization
• Building a Strong Export Compliance Plan
• Commerce Department Issues Rule Securing Digital Supply Chains Against Foreign Adversaries

Import/CBP

• UK Joins Kimberley Diamond-Trading Process
• FTC issues a Record Breaking $1.2 Million Penalty
• Customs Issues Notice of Proposed Rulemaking on Broker Continuing Education – Comments Open
• Comment Now – CBP Proposed Rule on Country of Origin Determination for Imports under USMCA
• 9801.00.10: Updated Requirements for Returned Goods
• Customs Valuation 101
• Breaking News – New Federal Law Expands Furniture Flammability Testing Standard

AD/CVD

• New Antidumping Petition Against Imports of Certain Honey Products
• New AD/CVD Petition Against Imports of Certain Chinese Mobile Access Equipment

Buy America

• Biden Executive Order Strengthens Buy American Government Procurement Laws

U.S. Fish and Wildlife Service

• Trading in Wildlife? You May Need a License

U.S. Food and Drug Administration

• FDA Seeks Public Comments on Proposed Final Order for OTC Sunscreen Safety
• FDA OPENS NEW FSVP PORTAL FOR IMPORTERS
• FDA Further Extends UFI Flexibility For Food Facility Registrations
• OTC Drug Manufacturers are Required to Pay FDA Facility User Fees by May 10, 2021
• FDA Import Alert on Mexican Hand Sanitizer
• Comment on FDA’s Proposed Rule – French Dressing

USITC

• An Introduction to Safeguard Investigations

OFAC 

• Between a Rock and a Hard Place – Conflicting U.S. & EU Sanctions Policies Towards Iran
• OFAC Sanctions & Licensing
• The CAPTA List – An Introduction
• Treasury Imposes Further Sanctions on Iran
• Trump Administration Designates Cuba State Sponsor of Terrorism

Section 301

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The NOP’s Compliance & Enforcement Division (“C&E”) is involved in enforcement organic standards. C&E enforces rules by working with independent certifying agencies. Independent certifying agencies accredited by the USDA conduct periodic inspections or audits.

What is Organic Equivalency?

Like the U.S., many countries have their own organic standards and certification programs. For organic businesses operating in multiple countries, this can mean they must maintain different organic certifications in each country where they operate.

Organic equivalency is when two countries recognize each other’s organic program as being equivalent. If two countries are equivalent, organic products can be sold in either country with just one organic certification.  For U.S. exporters, this reduces the number of certifications they must maintain.

The Agricultural Marketing Service (“AMS”) works with the Foreign Agricultural Service (“FAS”) and Office of the United States Trade Representative (“USTR”) to establish equivalency arrangements. Equivalence means that the U.S. has determined that a foreign government’s standards, organic control system oversight, and enforcement programs meet or exceed the requirements of the Organic Foods Production Act (“OFPA”) and the USDA organic regulations.

If USDA determines that the foreign government’s organic system is equivalent, the two governments exchange official letters and the terms of equivalency arrangement, including any product exception if the systems are not equivalent in specific areas.  Once this process is complete, AMS will publicly disclose on its website the terms of the determination and the final resolution of differences between the U.S. and foreign government’s system.

Currently, the NOP maintains equivalency arrangements with the following countries/international organizations:

• Canada
• European Union
• Taiwan
• Japan
• South Korea
• Switzerland
• United Kingdom

Additionally, the NOP has limited engagements with and specialized guidance for:

• India
• Israel
• New Zealand
• Mexico

The Impact of Equivalency Arrangements

The Organic Trade Association, a business association for organic agriculture and products in North America, has found that organic equivalency policies positively affect the level of trade, especially with U.S. organic exports. In fact, the Canada organic equivalency arrangement, the oldest of the equivalency arrangements, has the strongest effect on U.S. organic exports.

NOP Resources

The NOP offers helpful resources for the benefit of organic producers, distributors, and consumers. These resources help ensure that organic producers and distributors are proactive about their NOP compliance. These resources include:

• Organic Integrity Database
  • NOP’s Organic Integrity Databaselets interested parties and the public alike research the organic status of organic farms and businesses. These listings are provided to NOP from accredited certifying agents.
• Organic Integrity Learning Center
  • Through its Organic Integrity Learning Center, NOP provides a wide range of free training and outreach materials for organic farms, businesses, and organic certification agencies. The Learning Center supports the professional development and continuing education of professionals working to protect organic integrity including certifiers, inspectors, reviewers and compliance specialists in organic businesses.
• National Organic Program Handbook
  • NOP’s handbook provides those who own, manage, or certify organic operations with guidance and instructions that can assist them in complying with the USDA organic regulations. Although the handbook is non-binding guidance, it provides critical insight into NOP’s procedures and expectations of industry.

What You Should Do

Diaz Trade Law has significant experience on NOP matters. We recommend you consider the following actions to proactively strengthen your organic trade program:

• Develop an organic compliance program – A key foundation of proactive and effective organic compliance requires the development of an organic compliance plan. An organic compliance plan establishes a set of procedures for your organization to ensure that everyone is on the same page about how standard processes work, who is responsible for what, how to identify violations, what to do when violations occur, etc. An organic compliance plan helps build consciousness in your organization that compliance is critical – both to avoid costly penalties and preserve your certified status. Diaz Trade Law helps businesses create organic compliance manuals that help prove you have a process in place to ensure you can take compliance seriously. Additionally, Diaz Trade Law can assist your business in auditing and improving your current plan so that it is in its best shape.
• Ensure you have the proper certifications – NOP enforces rules by working with independent certifying agencies. Independent certifying agencies accredited by the USDA conduct periodic inspections or audits. It is important that you have an open and positive working relationship with your organic certifier, and that you have the appropriate certification for your business operations.
• Audit your operations and potentially disclose violations – If your business believes it may have violated the OFPA or the USDA organic regulations, contact us immediately. It may be in your business’ strategic interest to disclose the violations to NOP as part of a settlement discussion.
• Perform organic compliance training – A foundation of a strong organic compliance program is organic compliance training.
  • Training is important because it:
    • (1) ensures that all employees understand the OFPA and NOP organic standard requirements and reinforces internal policies and procedures,
    • (2) demonstrates to the USDA that your business is proactive about organic compliance, and
    • (3) potentially avoids your business from being subject to costly penalties and even criminal liability.
  • Fortunately, through its Organic Integrity Learning Center, NOP provides a wide range of free training and outreach materials for organic farms, businesses, and organic certification agencies. The Learning Center supports the professional development and continuing education of professionals working to protect organic integrity including certifiers, inspectors, reviewers and compliance specialists in organic businesses. Diaz Trade Law can assist you in determining what training programs are appropriate for you.
• Have a process in place for correction action when necessary – If your business has violated U.S. organic compliance laws, there is a lot you should do to get back into compliance, including ensuring you work to prevent future violations, training your employees, and updating your manuals. Diaz Trade Law has significant experience representing businesses in dealing with the USDA’s NOP program. Specifically, Diaz Trade Law has successfully assisted clients in
  • (1) disclosing violations,
  • (2) negotiating settlement agreements,
  • (3) building corrective action systems to help ensure that your business does not make the same violation again, and
  • (4) updating and enhancing your current organic compliance plan.

Contact Us

If you have questions or require assistance on organic trade matters, contact Diaz Trade Law today at info@diaztradelaw.com or 305-456-3830.

Co-Authored by Jen Diaz & Sharath Patil

What’s the National Organic Program?

Established by Congress and announced in 2000, the U.S. Department of Agriculture’s (“USDA”) National Organic Program (“NOP”) is a federal regulatory program which develops and enforces uniform national standards for organically-produced agricultural products sold in the United States. NOP operates as a public-private partnership which accredits third-party organizations to certify that farms and businesses meet the national organic standards. By enforcing its standards, NOP ensures a level playing field for producers while protecting consumer confidence in the integrity of the USDA organic seal.

How does NOP Enforcement Work?

The NOP’s Compliance & Enforcement Division (“C&E”) is involved in enforcement organic standards. C&E enforces rules by working with independent certifying agencies. Independent certifying agencies accredited by the USDA conduct periodic inspections or audits. If a certifying agency finds a violation, it can issue one of the following notices:

• Conditions for a new/continued certification (for minor issues)
• Notice of noncompliance
• Denial or proposed suspension of certification (for major non-compliances)
• Denial or proposed revocation of certification (for major non-compliances)

When a certifier proposes to suspend or revoke an operation’s organic certification, it must provide the operation with the right to request mediation. The goal of the mediation process is to engage in alternative dispute resolution to lead to a settlement agreement between the operator and the certifier. The certifier may accept or reject the mediation request.

NOP Penalties

Organic producers and distributors who violate national organic standards are subject to potentially severe civil and criminal penalties by the NOP. These penalties include civil fines, civil sanctions in the form of organic status suspensions or revocations, and even referral to law enforcement agencies for criminal proceedings.

For example, an organic producer or distributor’s mislabeling actions can result in penalties as high as $18,370 per violation. The term ‘violation’ here has been interpreted broadly and could sometimes mean per order or entry. In Re Xochitl, below, is an example of penalties compounding quickly because violations were interpreted by the number of orders/entries.

The following are NOP enforcement statistics in recent years:

Below are some case summaries explaining to NOP has penalized organic businesses for repeat noncompliance:

In Re Xochitl, Inc.

In a July 2017 USDA administrative law proceeding, In Re Xochitl, Inc., the respondent Xochitl, Inc. (“Xochitl”), a Texas corporation, was found by an independent accredited agency to be using nonorganic cottonseed oil in the production of corn chips sold as organic during an unannounced inspection. The independent agency issued Xochitl a Combined Notice of Noncompliance and Proposed Revocation, and Xochitl soon after admitted to the use of nonorganic cottonseed oil. Two months later, Xochitl filed a timely appeal of the Combined Notice of Noncompliance and Proposed Revocation with the USDA’s Agricultural Marketing Service (“AMS”) Administrator. A few months later, Xochitl signed a settlement agreement under which Xochitl agreed to withdraw its appeals, waive further proceedings, pay a civil penalty of $31,135, and have its organic certification suspended.

However, only three months after signing the settlement agreement, Xochitl was again investigated by AMS for selling products as organic without certification, which resulted in further violations. As a result of Xochitl’s further violations during suspension, the AMS Administrator upheld the independent agency’s revocation for five years and imposed a civil penalty of $1,826,000. The civil penalty amount was calculated by multiplying the $11,000 penalty (at the time) by 166 for each unique order of product sold by Xochitl as organic without certification during the suspension period. Ultimately, Xochitl only had to pay $475,000 and was even allowed to seek reinstatement in the organic program.

In Re Yorgo Foods, Inc.

Respondent, Yorgo Foods, Inc., produced agricultural products certified as organic. During an inspection by an accredited certifying agency, the agency found several (unpublished) noncompliances. This resulted in respondent being suspended (time period unspecified). Respondent asked to be reinstated, but NOP denied reinstatement. Respondent appealed NOP’s denial, but AMS Administrator denied appeal. Then, in a settlement agreement, respondent’s suspension was reduced to six months. However, a month later, the certifying agency found that respondent was selling organic products during suspension period. Because respondent had broken the settlement agreement, respondent and NOP signed a second settlement agreement in which respondent waived its right to an appeal and had to pay a civil penalty of $33,000.

However, even after signing the second settlement agreement, respondent was found to sell organic products while suspended in willful violation of the USDA. As a result, the AMS Administrator assessed a civil penalty of $880,000 with $540,000 held in abeyance, and respondent’s organic certification was suspended for three years. The remaining $340,000 was allowed to be paid in quarterly installments over a period of five years.

Settlement

Fortunately, NOP provides settlement opportunities to businesses who may have violated national organic standards but are willing to proactively cooperate to ensure past harms are mitigated and future violations are avoided. Typically, these settlements are executed as alternatives to administrative proceedings that may result in suspension or revocation of certification or accreditation, as well as civil penalties for the knowing sale of products in violation of the USDA organic regulations. Settlement always requires operations to comply with USDA organic regulations and, sometimes, includes specific compliance requirements and/or reduced civil penalties. NOP publishes details on some settlement proceedings on its website.

NOP Resources

The NOP offers helpful resources for the benefit of organic producers, distributors, and consumers. These resources help ensure that organic producers and distributors are proactive about their NOP compliance. These resources include:

• Organic Integrity Database
  • NOP’s Organic Integrity Database lets interested parties and the public alike research the organic status of organic farms and businesses. These listings are provided to NOP from accredited certifying agents.

• Organic Integrity Learning Center
  • Through its Organic Integrity Learning Center, NOP provides a wide range of free training and outreach materials for organic farms, businesses, and organic certification agencies. The Learning Center supports the professional development and continuing education of professionals working to protect organic integrity including certifiers, inspectors, reviewers and compliance specialists in organic businesses. Courses include

• National Organic Program Handbook
  • NOP’s handbook provides those who own, manage, or certify organic operations with guidance and instructions that can assist them in complying with the USDA organic regulations. Although the handbook is non-binding guidance, it provides critical insight into NOP’s procedures and expectations of industry.

Contact Us

Diaz Trade Law has assisted clients with understanding national organic standards, developing corrective action plans, and navigating settlement discussions with NOP. If you’re an organic producer or distributor and seek to build a proactive organic compliance program or successfully mitigate organic standards violations, reach out to us at 305-456-3830 or info@diaztradelaw.com.