• Proposed Revocation of Three Ruling Letters and Proposed Revocation of Treatment Relating to the Tariff Classification of Wireless Headphone Sets from China and an Undisclosed Country
  • In NY N022195, NY N022204 and NY N240329, CBP classified wireless headphone sets in heading 8517, HTSUS, specifically in subheading 8517.62.00, HTSUS, which provides for “Other apparatus for transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network): Machines for the reception, conversion and transmission or regeneration of voice, images or other data, including switching and routing apparatus.” CBP has reviewed NY N022195, NY N022204 and NY N240329, and has determined the ruling letters to be in error.
  • It is now CBP’s position that the wireless headphone sets are properly classified in heading 8518, HTSUS, specifically in subheading 8518.30.20, HTSUS, which provides for “Microphones and stands therefor; loudspeakers, whether or not mounted in their enclosures; headphones and earphones, whether or not combined with a microphone, and sets consisting of a microphone and one or more loudspeakers; audio-frequency electric amplifiers; electric sound amplifier sets; parts thereof: Headphones and earphones, whether or not combined with a microphone, and sets consisting of a microphone and one or more loudspeakers: Other.”
• Country of Origin Marking Requirements for Containers or Holders
  • Section 304 of the Tariff Act of 1930, as amended, 19 U.S.C. 1304, requires each imported article of foreign origin, or its container, to be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article or container permits, with the English name of the country of origin. The marking informs the ultimate purchaser in the United States of the country of origin of the article or its container. The marking requirements for containers or holders of imported merchandise are provided for by 19 CFR 134.22(b).
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (Volume 87 FR Page 39108) on June 30, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Delivery Ticket
  • CBP Form 6043, Delivery Ticket, is used to document transfers of imported merchandise between parties. This form collects information such as the name and address of the consignee; the name of the importing carrier; lien information; the location of where the goods originated and where they were delivered; and information about the imported merchandise. CBP Form 6043 is completed by warehouse proprietors, carriers, Foreign Trade Zone operators and other trade entities involved in transfers of imported merchandise.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 36867) on June 21, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Customs and Border Protection Recordkeeping Requirements
  • The North American Free Trade Agreement Implementation Act, Title VI, known as the Customs Modernization Act (Mod Act) amended Title 19 U.S.C. 1508, 1509 and 1510 by revising Customs and Border Protection (CBP) laws related to recordkeeping, examination of books and witnesses, regulatory audit procedures and judicial enforcement. Specifically, the Mod Act expanded the list of parties subject to CBP recordkeeping requirements; distinguished between records which pertain to the entry of merchandise and financial records needed to substantiate the correctness of information contained in entry documentation; and identified a list of records which must be maintained and produced upon request by CBP.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 35565) on June 10, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Application-Permit-Special License Unlading-Lading-Overtime Services
  • The Application-Permit-Special License Unlading-Lading-Overtime Services (U.S. Customs and Border Protection (CBP) Form 3171) 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 re-laden.
  • This form is anticipated to be submitted electronically as part of the maritime forms automation project through the Vessel Entrance and Clearance System (VECS), which will eliminate the need for any paper submission of any vessel entrance or clearance requirements under the above referenced statutes and regulations. VECS will still collect and maintain the same data but will automate the capture of data to reduce or eliminate redundancy with other data collected by CBP.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 31252) on May 23, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Holders or Containers Which Enter the United States Duty Free
  • Subheading 9803.00.50 of the Harmonized Tariff Schedule of the United States (HTSUS), codified as 19 U.S.C. 1202, provide for the release without entry or the payment of duty of certain substantial holders or containers pursuant to the provisions of 19 CFR 10.41b. Section 19 CFR 10.41b eliminates the need for an importer to file entry documents by instead requiring, among other things, the marking of the containers or holders to indicate the HTSUS numbers that provide for duty-free treatment of the containers or holders.
  • For U.S. manufactured serially numbered holders or containers which may be released without entry or the payment of duty under 9801.00.10 HTSUS, 19 CFR 10.41b requires the owner to place the following markings on the holder or container: 9801.00.10, HTSUS (unless the holder or container has a permanently attached metal tag or plate showing, among other things, the name and address of the U.S. manufacturer); the name of the owner; and the serial number assigned by the owner.
  • For serially numbered holders or containers of foreign manufacture for which may be released without entry or payment of duty under 9803.00.50 HTSUS, 19 CFR 10.41b requires the owner to place markings containing the following information: 9803.00.50 HTSUS; the district and port code numbers of the port of entry; the entry number; the last two digits of the fiscal year of entry covering the importation of the holders and containers on which duty was paid; the name of the owner; and the serial number assigned by the owner.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 34283) on June 6, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Declaration for Free Entry of Unaccompanied Articles (CBP Form 3299)
  • 19 U.S.C. 1498 provides that when personal and household effects enter the United States but do not accompany the owner or importer on his/her arrival in the country, a declaration is made on CBP Form 3299, Declaration for Free Entry of Unaccompanied Articles. The information on this form is needed to support a claim for duty-free entry for these effects.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 37882) on June 24, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• User Fees (CBP Form 339A, 339C, and 339V)
  • The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) (Pub. L. 99–272, 100 Stat. 82; 19 U.S.C. 58c), as amended, authorizes the collection of user fees by U.S. Customs and Border Protection (CBP). The collection of these fees requires submission of information from the party remitting the fees to CBP. This collection of information is provided for by 19 CFR 24.22. In certain cases, this information is submitted on one of three forms including the CBP Form 339A for payment upon arrival or prepayment of the annual user fee for a private aircraft (19 CFR 24.22(e)(1) and (2)), CBP Form 339C for prepayment of the annual user fee for a commercial vehicle (19 CFR 24.22(c)(3)), and CBP Form 339V for payment upon arrival or prepayment of the annual user fee for a private vessel (19 CFR 24.22(e)(1) and (2)).
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 39105) on June 30, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Exportation of Used Self-Propelled Vehicles
  • U.S. Customs and Border Protection (CBP) regulations require a person attempting to export a used self-propelled vehicle to furnish documentation to CBP at the port of export. Exportation of a vehicle is permitted only upon compliance with these requirements. The required documentation includes, but is not limited to, a Certificate of Title or a Salvage Title, the Vehicle Identification Number (VIN), a Manufacturer’s Statement of Origin, etc. CBP will accept originals or certified copies of the Certificate of Title. The purpose of this information is to help ensure that stolen vehicles or vehicles associated with other criminal activity are not exported.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 39107) on June 30, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Canadian Border Boat Landing Permit (CBP Form I-68)
  • The Canadian Border Boat Landing Permit, U.S. Customs and Border Protection (CBP) Form I–68, generally allows select individuals entering the United States along the northern border by small1 pleasure boats to report their arrival and make entry without having to travel to a designated port of entry for an inspection by a CBP officer. The information collected on CBP Form I–68 allows eligible individuals to be inspected in person only once during the boating season, rather than each time they make an entry. United States citizens, Lawful Permanent Residents of the United States, Canadian citizens, and Landed Residents of Canada who are nationals of the Visa Waiver Program countries listed in 8 CFR 217.2(a) are eligible to apply for the permit.
  • CBP has developed a smart phone application known as ROAM that will in certain circumstances allow travelers participating in the I–68 program to report their arrival in the United States through the ROAM application, instead of by telephone. The ROAM app, implementing the I–68 program, will allow CBP officers to remotely conduct traveler interviews with a phone’s video chat capability, and replace other technologies used for remote inspections that are obsolete or inefficient.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 34282) on June 6, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Application to Establish a Centralized Examination Station
  • A Centralized Examination Station (CES) is a privately operated facility where merchandise is made available to CBP officers for physical examination. If a port director decides that a CES is needed, he or she solicits applications to operate a CES. The information contained in the application is used to determine the suitability of the applicant’s facility; the fairness of fee structure; and the knowledge of cargo handling operations and of CBP procedures and regulations. The names of all principals or corporate officers and all employees who will come in contact with uncleared cargo are also to be provided so that CBP may perform background investigations. The CES application is provided for by 19 CFR 118.11 and is authorized by 19 U.S.C. 1499, Tariff Act of 1930.
  • CBP invites the general public and other Federal agencies to comment on the proposed and/or continuing information collections pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). This proposed information collection was previously published in the Federal Register (87 FR 36867) on June 21, 2022, allowing for a 60-day comment period. This notice allows for an additional 30 days for public comments.
  • Written comments and suggestions from the public and affected agencies should address one or more of the following four points: (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) suggestions to enhance the quality, utility, and clarity of the information to be collected; and (4) suggestions to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
  • The comments that are submitted will be summarized and included in the request for approval. All comments will become a matter of public record.
• Oman Fasteners, LLC v. United States
  • Plaintiff Oman Fasteners, LLC seeks relief from defendants’ refusal to allow bonding in lieu of cash deposits for potential liability for duties under a Presidential Proclamation, Proclamation No. 9980, Adjusting Imports of Derivative Aluminum Articles and Derivative Steel Articles Into the United States, 85 Fed. Reg. 5,281 (Exec. Office of the President Jan. 29, 2020) (“Proclamation 9980”), which imposed duties on various imported products made of aluminum or steel, including steel fasteners.
  • Granting Oman Fasteners’ motion in part and denying it in part, we require defendants to exclude Oman Fasteners from a requirement to post cash deposits for potential duty liability under Proclamation 9980 until such time as defendants obtain a further order from this Court or Oman Fasteners voluntarily enters into an agreement with defendants that modifies the terms of this Opinion and Order.
• Garg Tube Export v. United States
  • Before the court is the U.S. Department of Commerce’s second redetermination on remand filed pursuant to the court’s order in Garg Tube Exp, LLP v. United States, 569 F. Supp. 3d 1202 (Ct. Int’l Trade 2022) (“Garg II”) in connection with Commerce’s 2017–2018 administrative review of the antidumping duty (“ADD”) order on welded carbon steel standard pipes and tubes (“CWP”) from India, covering the period of review from May 1, 2017 to April 30, 2018.
  • In Garg II, the court remanded Commerce’s first remand results to reconsider its determination that a particular market situation (“PMS”) existed in India for hot-rolled coil steel (“HRC”) and its regression methodology applying a PMS adjustment or explain its determinations and support them with substantial evidence. Garg II, 569 F. Supp. 3d at 1220–21. On remand, under respectful protest, Commerce no longer finds that a PMS existed, and accordingly no longer applies a PMS adjustment to the costs of production for sales based on constructed value. Pursuant to Ct. Remand, June 9, 2022, ECF No. 98 at 17–22 (“Second Remand Results”). Commerce’s redetermination is supported by substantial evidence and complies with the court’s remand instructions. Therefore, Commerce’s Second Remand Results are sustained.

• Elimination of Customs Broker District Permit Fee
  • Section 641 of the Tariff Act of 1930, as amended (19 U.S.C. 1641), provides that individuals and business entities must hold a valid customs broker’s license and permit to transact customs business on behalf of others. The statute also sets forth standards for the issuance of broker licenses and permits; provides for disciplinary action against brokers in the form of suspension or revocation of such licenses and permits or assessment of monetary penalties; and, provides for the assessment of monetary penalties against other persons for conducting customs business without the required broker’s license.
  • On June 5, 2020, U.S. Customs and Border Protection (CBP) published a notice of proposed rulemaking (NPRM) in the Federal Register (85 FR 34549), proposing the elimination of customs broker district permit fees in parts 24 and 111.
  • Consistent with the June 5, 2020, notice, CBP is publishing a final rule to, among other things, eliminate customs broker districts (see ‘‘Modernization of the Customs Broker Regulations’’ RIN 1651–AB16). Specifically, CBP is transitioning all brokers to national permits and expanding the scope of the national permit authority to allow national permit holders to conduct any type of customs business throughout the customs territory of the United States. As a result of the elimination of customs broker districts, CBP is amending in this document the regulations to eliminate customs broker district permit fees.
• Modernization of the Customs Broker Regulations
  • This document adopts as final, with changes, proposed amendments to the U.S. Customs and Border Protection (CBP) regulations modernizing the customs broker regulations. CBP is transitioning all customs brokers to a single national permit and expanding the scope of the national permit authority to allow national permit holders to conduct any type of customs business throughout the customs territory of the United States.
  • To accomplish this, CBP is eliminating broker districts and district permits, which in turn removes the need for the maintenance of district offices, and district permit waivers. CBP is also updating, among other changes, the responsible supervision and control oversight framework, ensuring that customs business is conducted within the United States, and requiring that a customs broker have direct communication with an importer. These changes are designed to enable customs brokers to meet the challenges of the modern operating environment while maintaining a high level of service in customs business.
  • Further, CBP is increasing fees for the broker license application to recover some of the costs associated with the review of customs broker license applications and the necessary vetting of individuals and business entities (i.e., partnerships, associations, and corporations).
  • Additionally, CBP is announcing the deployment of a new online system, the eCBP Portal, for processing broker submissions and electronic payments. Lastly, CBP is publishing a concurrent final rule document to eliminate all references to customs broker district permit user fees (see ‘‘Elimination of Customs Broker District Permit Fee’’ RIN 1515–AE43) to align with the changes made in this final rule document.
  • This final rule is effective December 19, 2022.
• BGH Edelstahl Siegen GmbH v. United States and Ellwood City Forge Company, et al.
  • Before the court was BGH Edelstahl Siegen GmbH’s (“BGH”) Rule 56.2 motion for judgment on the agency record challenging various aspects of the U.S. Department of Commerce’s (“Commerce”) final determination in its countervailing duty (“CVD”) investigation of forged steel fluid end blocks (“Fluid End Blocks”) from the Federal Republic of Germany (“FRG”).
  • BGH challenged Commerce’s Final Results on three grounds, arguing (1) that Commerce improperly initiated its CVD investigation and impermissibly expanded the CVD investigation to include new subsidy programs, (2) failed to include ex-parte communications in the record, and (3) incorrectly determined that seven programs used by BGH during the period of investigation were countervailable subsidies.
  • Defendants argued that Commerce’s decisions to initiate and expand its CVD investigations were in accordance with law because the petition to initiate the CVD investigation “included the relevant laws and policies that provided the countervailable subsidies, tied those facts to the legal framework, and established a reasoned basis to conclude that BGH received subsidy benefits[,]” and that Commerce may consider new subsidy programs uncovered during its investigation.
  • Defendants further argued that the record for the CVD investigation is complete because the ex parte communication that BGH asserts is missing from the record pertained to the antidumping investigation, not the CVD investigation, and therefore need not be included in the record. Finally, Defendants argued that Commerce correctly determined the Contested Programs are countervailable.
  • The CIT held:
    • 1. That Commerce’s Final Results are sustained with respect to the initiation of the CVD investigation, the determination that the administrative record is complete, the determination that the provisions of the Electricity Tax Act and the Energy Tax Act, the EEG and KWKG Reduced Surcharge Programs, the ETS Additional Free Emissions Allowances, and the CO2 Compensation Program are countervailable subsidies, and the determination that Commerce’s calculations for the EEG and KWKG Reduced Surcharge Programs, the ETS Additional Free Emissions Allowances, and the CO2 Compensation Program are supported by substantial evidence;
    • 2. That Commerce’s Final Results are remanded for further explanation or reconsideration consistent with this opinion with respect to its determination that the KAV Program is a specific subsidy;
    • 3. That Commerce’s Final Results are remanded for further explanation or reconsideration consistent with this opinion with respect to its calculations of the CVD rates for the Electricity Tax Act and the Energy Tax Act; and it is further ORDERED that Commerce shall file its remand redetermination with the court within 90 days of this date;
    • 4. That Commerce shall file the administrative record within 14 days of the date of filing of its remand redetermination;
    • 5. That the parties shall file any comments on the remand redetermination within 30 days of the date of filing of the remand determination;
    • 6.That the parties shall have 30 days to file their replies to the comments on the remand redetermination;
    • 7. That the parties shall file the joint appendix within 14 days of the date of filing of responses to the comments on the remand redetermination.
• Keirton USA v. United States
  • Before the court was Keirton USA, Inc.’s (“Keirton”) Rule 12(c) motion for judgment on the pleadings.
  • Keirton challenged CBP’s protest denial arguing possession and importation of the subject merchandise is permissible because Washington State law authorizes the possession and importation of marijuana paraphernalia.
    • Keirton sells Twisted Trimmers to companies in the State of Washington that process marijuana plants.
  • Defendant United States argued that, although Washington State repealed its laws criminalizing possession of marijuana paraphernalia like the Twisted Trimmer, that repeal does not explicitly authorize Keirton to use the subject merchandise to manufacture, possess, or distribute marijuana paraphernalia under Federal law.
  • The CIT held that it is lawful for Keirton to possess and import its merchandise into the state of Washington. Therefore, Keirton’s motion for judgment on the pleadings is granted, and Defendant’s cross-motion for judgment on the pleadings is denied.

Ever hear of U.S. goods returned and wondered what it really meant? The Harmonized Tariff Schedule of the United States (“HTSUS”) subheading 9801.00.10 is used for re-importing U.S. made products back into the United States, duty-free. Previously, this classification only covered merchandise originally made in the United States and now reentering the country (hence “US Goods Returned”). In order to qualify for classification under subheading 9801.00.10 and duty-free treatment, these products entering the United States had to be unimproved in condition or value. In other words, the products had to not be subject to further processing abroad. For example, subheading 9801.00.10 may be used when goods are being re-imported as returned product to the seller or for repair. Under subheading 9801.00.10, the importer has the burden to prove their claim for duty-free treatment.

CBP Issues Updated Guidance

On August 20, 2021, subheading 9801.00.10 was expanded to include products which originated from foreign countries. HTSUS subheading 9801.00.10 now states: “Products of the United States when returned after having been exported, or any other products when returned within 3 years after having been exported, without having been advanced in value or improved in condition by any process of manufacture or other means while abroad.” In other words, non-U.S. origin products that are returned to the United States will ALSO qualify for duty-free treatment under subheading 9801.00.10. However, the timing requirements for U.S.-origin and foreign-origin products are different. U.S.-origin products currently have no time limit to file a claim for duty-free treatment. However, claims for foreign-origin products must be filed within three years.

Duty-Free Treatment

To prove you are eligible to rightfully claim duty free treatment under subheading 9801 the foreign shipper/importer must declare that the products reentering the United States were not advanced in value or improved in condition by any manufacturing process or other means while abroad. However, if the customs broker obliges themselves as the importer, the customs broker will now have the legal responsibility to provide the required documents to substantiate the subheading 9801.00.10 claim (p.s. – if you are a broker, think 50 times, maybe 100, before taking on this responsibility).

Specifically, the changes resulted in:

1. For either U.S. manufactured goods or foreign origin goods:
   •  A declaration by Foreign Shipper should be included as it will indicate that the goods were not advanced in value or improved in condition while outside the United States.
   • A certificate from the master of a vessel may be accepted with the Declaration by the Foreign Shipper if it states that the product have not been un-laden from the exporting vessel.
   • Declaration by the owner, importer, consignee, or agent indicating that they have knowledge of the facts regarding the duty-free claim.
2. For goods reentering the U.S. after three years and are valued over $2500, CBP may request additional documentations if the name and address of the U.S. manufacturer are not clearly stated. An example of the documentation is a statement from the U.S. manufacturer verifying that the articles were made in the United States.
3. The documents which are sufficient to establish proof of export are Electronic Export Information (EEI)/the Automated Export System (AES) filing exemption, copy of the entry into the foreign country, or U.S. export invoice or bill of lading/airway bill.
4. For aircrafts, aircraft parts and equipments reentering the U.S, a CBP Form 3311 or its equivalent as stated in 19 CFR 10.1 may be used. The entrants which should be included are:
   • The name of the importing vessel or conveyance
   • The date of its arrival
   • A description of the articles
   • The value of the articles, and
   • That the articles are intended for use by the aircraft owner or operator in his own aircraft operations
5. For U.S. origin goods reentering the U.S. that were originally exported under a Department of State license are required to be imported through formal entry and the value of the goods doesn’t matter.
6. For U.S. manufactured aircraft reentering the U.S which were sold t0 a foreign government under the Foreign Military Sales program, formal entry is required if any maintenance is being performed on the aircraft while in the United States. Also, at the time of export of the aircraft, the EEI has to be filed for the maintenance of the aircraft.
7. For U.S. manufactured aircraft reentering the U.S which were sold t0 a foreign government under the Foreign Military Sales program and modification or enhancement will occur, to be imported and exported formal entry is required and the EEI submission citing the Directorate of Defense Trade Controls export license (DSP-5) is required.

Below is your checklist of necessary documents when claiming 9801.00.100/duty-free treatment:

• Declaration by Foreign Shipper,
• Declaration by the Owner, importer, consignee or agent,
• Proof of export documentation, and
• A statement from the U.S. manufacturer verifying that the merchandise was made in the United States (for products valued over $2,500 USD).

What You Can Do

The HTSUS is the primary resource for determining tariff classifications and deciphering customs duties owed for goods imported into the United States. Experts use the HTS, in conjunction with explanatory notes, general notes, general rules of interpretation, and Customs Binding Rulings to help determine the correct HTS. Correct classification is a part of the importer of records “reasonable care” requirement. Penalties for non-compliance can be severe. 19 U.S.C. 1592 is the statute CBP references when issuing penalties for negligence, gross negligence or fraud – depending on the degree of culpability CBP believes you had at the time of your non-compliance.

Fortunately, there is a lot you can do to be proactive about your HTSUS classification:

CLASSIFICATION CHECKLIST

1. Obtain as much information about the product subject to classification PRIOR to importation (if you can, get a sample, if not, photographs of the item and its packaging (exactly as it will look when being imported) are essential).
2. Refer to brochures, catalogs, product datasheets, or websites, etc., to truly understand the products intended use.
3. Review HTSUS chapters and look for the most relevant chapter/heading (first four digits) that best describes your product (i.e., and apple is an apple).
4. Review the Chapter and Section Notes to ensure the product is not kicked out of the HTS.
5. Review the General Rules of Interpretations (GRI’s) in the order.
6. Read the Explanatory Notes for the relevant headings.
7. Check CBP CROSS Rulings for classification of items of the same class/kind.
8. Consult Internal and/or external experts such as trade lawyers or engineers.
9. Request a CBP Binding Ruling.
10. Consult CBP Informed Compliance Publications

Contact Us

If you have questions or require assistance on U.S. And Foreign Goods Returned, contact Diaz Trade Law today at info@diaztradelaw.com or 305-456-3830.

On September 10, 2021, U.S. Customs and Border Protection (“CBP”) published a Notice of Proposed Rulemaking regarding broker continuing education. In the proposed rule, CBP is proposing mandatory continuing education requirements for individual licensed brokers. CBP underscores the benefits of mandatory continuing education for customs brokers in its proposed rule:

“By requiring individual brokers to remain knowledgeable about recent developments in customs and related laws as well as international trade and supply chains, CBP’s proposed framework would enhance professionalism and competency within the customs broker community. CBP has determined that the proposed framework would contribute to increased trade compliance and better protection of the revenue of the United States.”

Specifically, the proposed rule requires:

• At least 36 continuing education credits per triennial period
• Individual brokers reentering the profession following a period of voluntary suspension would be subject to a prorated requirements on continuing education credit or each complete remaining month until the end of the triennial period
• Credits can be earned via a wide variety of training and education activities held in-person or online, including the completion of coursework, seminars, workshops, symposia, or conventions
• Disciplinary actions for failure to complete the required credits
• Methods for accreditation and selecting accreditors

Background on Broker Licensing & Education

Section 641 of the Tariff Act of 1930 provides that individuals and business entities must hold a valid customs broker’s license and permit to transact customs business on behalf of others. The statute also sets forth standards for the issuance of broker licenses and permits; provides for disciplinary action against brokers in the form of suspension or revocation of such licenses and permits; and provides for the assessment of monetary penalties against other persons for conducting customs business without the required broker’s license. Section 641 also authorized the Secretary of the Treasury to prescribe rules and regulations relating to the customs business of brokers as may be necessary to protect importers and the revenue of the United States.

Under 19 U.S.C. 1641(b)(4), a customs broker has the statutory duty to exercise responsible supervision and control over the customs business that he or she conducts. Maintaining current knowledge and competence is an inherent part of the statutory duty of the customs broker. A customs broker reasonably can be expected to uphold such responsible supervision over his or her employees and control over his or her customs business only by acquiring and maintaining the knowledge of customs and related laws.

The U.S. Customs and Border Protection (“CBP”) is responsible for administering licensing for customs brokers. All prospective customs brokers must pass a broker exam prepared by CBP, which is designed to determine the individual’s knowledge of customs and related laws, regulations and procedures, bookkeeping, accounting, and all other appropriate matters necessary to render valuable service to importers and exporters. After passing the customs broker exam, CBP investigates whether an applicant is qualified for a broker’s license, taking into account information provided by the applicant and other aspects pertaining to the applicant such as his or her business integrity. Following the issuance of a license, a broker administratively maintains a license primarily through the payment of fees and the submissions of reports and notifications required by 19 CFR 111.30.

While the broker exam provides a good initial indication of an applicant’s knowledge, it is, by necessity, limited in scope. The broker exam only captures a state of customs and related laws at a certain point in time and a person’s knowledge of such laws at a single point in time. The broker exam also does not test for any of the requirements of the approximately 50 Partner Government Agencies (“PGAs”) involved in regulating imports and exports. The complex nature of trade and the ever-changing and expanding requirements to comply with U.S. and international law require that a customs broker maintain a high level of functional and accessible knowledge to stay efficient and compliant over time.

Comment Now

CBP encourages input from the trade community. Interested persons are invited to participate in this rulemaking by submitting written data, views, or arguments on all aspects of the proposed rule. CBP also invites comments that relate to the economic, environmental, or federalism effects that might result from this proposed rulemaking. Comments that will provide the most assistance to CBP will reference a specific portion of the proposed rulemaking, explain the reason for any recommended change, and include data, information, or authority that support such recommended change.

Specifically, CBP seeks comments on:

• The number of hours of continuing education that customs brokers should be required to complete;
• The customs broker license holders who should be required to complete continuing education (including license holders who should be exempt from the requirement or required to complete fewer hours of continuing education);
• The types of training, coursework, or other educational activities that should qualify for continuing education credit;
• The manner in which qualifying continuing broker education should be provided (online or in-person);
• Whether subject-matter-specific education requirements should be imposed;
• How compliance with the continuing broker education requirement should be reported to CBP;
• What recordkeeping obligations should exist for the purpose of the continuing broker education requirement;
• What disciplinary actions should be taken if customs brokers fail to report their compliance with the continuing broker education requirement to CBP, or, in the alternative, fail to satisfy the continuing broker education requirement;
• What disciplinary actions should result from the submission of false or misleading information in association with the continuing broker education requirement;
• Whether disciplinary actions should be taken immediately upon a customs broker’s failure to report compliance with the continuing broker education requirement, or whether customs brokers should be provided with an opportunity to take corrective actions, including the length of such period;
• Whether there should be an accreditation process to control the quality of the content of the various educational activities (including how such an accreditation process should be administered, how accreditors should be selected, and whether educational activities offered through certain content providers should automatically qualify for continuing education credit);
• The types of training, coursework, or educational activities that customs brokers already complete on a regular basis;
• How often customs brokers currently participate in continuing education;
• The costs customs brokers would anticipate to incur as a result of the implementation of a continuing broker education requirement; and
• The benefits customs brokers would anticipate as a result of the implementation of a continuing broker education requirement.

The comment period opens Friday, September 10, 2021 and ends Tuesday, November 9, 2021. Comments can be submitted via the Federal eRulemaking Portal at www.regulations.gov (docket number USCBP 2021-0030). Although CBP generally also receives public comments by mail, CBP will not accept comments via mail for this proposed rule due to COVID-19-related restrictions.

Contact Us

Diaz Trade Law has extensive expertise on customs broker licensing matters and in preparing and submitting comments for rulemaking. Please reach out to us if you would like to submit comments to CBP informing the agency of your business’ recommendations for continuing education for licensed customs brokers. Comments are due November 9, 2021. Diaz Trade Law can be reached at info@diaztradelaw.com and 305-456-3830.

Register today to to hear directly from Senior Trade Advisor, Don Woods, DTL’s president, Jennifer Diaz, and Associate Attorney, Denise Calle as they discuss real life stories, current trends/risks associated with the import process, proactive ways to stay compliant, and the importance of training to avoid costly encounters with CBP.

Why Should I Register for this Webinar?

CBP is actively enforcing its laws and regulations against non-compliant importers, as seen by the 70,683 seizure letters issued to importers in FY2021.  Importers are required to develop, maintain, and follow a compliant import plan. Importers must be aware of CBP’s various enforcement mechanisms, and more importantly,  how to avoid  such actions. CBP’s most common enforcement activities include seizures, detentions, and criminal prosecution.

In response to the increase in enforcement discussed below, Diaz Trade Law is hosting a NEI accredited webinar, Building & Maintaining an Effective Import Compliance Plan to train industry on top compliance tips to avoid enforcement, and best practices to maintain and effective and compliant import plan.

Seizures in FY21:

• With Fy21 yet to finish, the CBP has already had more than 70,000 trade seizures
• With Fy21 yet to finish, CBP has already had $2.5 billion worth of IPR Seizures – More than it has seized in each of the past 5 years!

Other Trade Enforcement Activities:

• 1,942 Trade Penalties Issued
• 16,302 Total Trade Liquidated Damages
• $16 million collected in Trade-related penalties and liquidated damages

In this webinar, you will learn the common risks associated with the import process and how to build and maintain an effective Import Compliance Plan . Presenters will discuss… The objective of the webinar is to teach participants how to create an effective import plan that allows importers to avoid CBP altogether.

Importers, Customs Brokers, Regulatory Affairs Professionals, and others engaged in the importation of goods into the United States are encouraged to attend either live on October 6, 2021 at 12:00 PM, or on demand thereafter. Register Here

All merchandise of foreign origin imported into the United States (U.S.) must generally be marked with its country of origin, and it is subject to a country of origin (COO) determination by CBP. The country of origin of imported goods may be used as a factor to determine eligibility for preferential trade treatment under a free trade agreement.

The country of origin of imported goods is also used to determine non-preferential trade treatment, such as admissibility, marking, and trade relief (310 duties, antidumping and countervailing duties (AD/CVD). CBP uses the “substantial transformation” standard to determine the COO of goods for non-preferential purposes. For a substantial transformation to occur, “a new and different article must emerge, `having a distinctive name, character or use.’” Anheuser-Busch Brewing Ass’n v. United States, 207 U.S. 556, 562 (1908) (quoting Hartranft v. Wiegmann, 121 U.S. 609, 615 (1887)).

CBP applies two different methods to determine if goods have been substantially transformed – even though both are intended to produce the same origin determinations:

1. Case-by-case decision based on court decision and CBP rulings (often criticized because of the varied case-specific interpretations of the basic rule that has resulted in a lack of predictability and increased uncertainty both within CBP and in the trade community). Using this method, the effect of a particular type of processing could have on impact on  origin determination.
2. Rules of Origin in 19 CFR 102 – these rules are included in the Harmonized Tariff Schedule of the U.S. (HTSUS) under General Notes and are often referred to as the “change in tariff classification” or “tariff shift” method.

Prior to the USMCA, under the NAFTA, COO marking determinations were made using the NAFTA marking rules codified in 19 CFR 102, to determine if substantial transformation existed when a good imported from Canada or Mexico (was not entirely of Canadian or Mexican origin). The 102 rules helped determine whether or not goods were substantially transformed through processes that resulted in changes in the tariff classification (i.e., tariff shifts) in Canada or Mexico. To determine the country of origin of goods imported from Canada or Mexico for other non-preferential purposes (i.e., purposes other than marking), CBP employed case-by-case adjudication to determine whether such goods were substantially transformed in those NAFTA countries. These different non-preferential country of origin-determination methods required some importers to determine and declare two different countries of origin for the same imported good!

The Current Problem with COO Determinations Under USMCA

Importers from Canada and Mexico are subject to two different non-preferential origin determinations for imported merchandise:

• One for marking; and,
• Another for determining origin for other purposes (e.g., 310 duties, AD/CVD).

Consequently, these importers must also potentially comply with requirements to declare two different countries of origin for the same imported good (e.g., Canada and China, forcing the import to also tender the additional 301 duties, but, also take advantage of the FTA not having to pay regular duties). This is not only a burden, but, also quite confusing, creating inconsistency, and vastly reduces transparency.

CBP’s Proposed Solution

CBP is proposing to amend the scope provision in 19 CFR 102 by adding new language to apply the substantial transformation standard consistently across country-of-origin determinations CBP makes for imported goods from the USMCA countries of Canada and Mexico for non-preferential purposes. With this regulatory change, all non-preferential country of origin determinations by CBP for goods imported from Canada or Mexico would be based on the tariff shift rules in 19 CFR part 102.

Since importers must exercise reasonable care in determining the country of origin of their goods and may seek advice from CBP to determine the country of origin for their goods for preferential and/or non-preferential purposes; the proposed solution means CBP will no longer need to issue CBP rulings with non-preferential origin determinations for goods imported from Canada or Mexico, and there would no longer be rulings that conclude that a good imported from Canada or Mexico has two different origins under the USMCA (i.e., one for marking and one for other, customs non-preferential purposes).

CBP is proposing these changes to simplify and standardize country of origin determinations by CBP for all non-preferential purposes for goods imported from Canada or Mexico.

Comment Opportunity

Interested persons are invited to comment on the proposed rule by submitting written data, views, or arguments on all aspects of the proposed rule. CBP is seeking comments related to the economic, environmental, or federalism effects that might result from this proposed rule.

Deadline: Comments must be received on or before September 7, 2021 (extended from August 5, 2021).

Impacted Parties

Certain Canadian and Mexican importers are directly affected by the proposed change. In fiscal year (FY) 2019, 38,832 importers made 2.6 million non-NAFTA-preference entries. All of these entries were subject to non-preferential country of origin marking requirements, and some were also subject to trade remedies, that involve case-by-case adjudication. Around the same time, in FY 2020 and the start of FY 2021, CBP issued 52 rulings determining the origin of goods imported from Canada and Mexico for non-preferential purposes. These rulings, except for those involving the importation of certain textile and apparel products, were issued on a case-by-case basis to determine whether such goods were substantially transformed in Canada or Mexico or another country.

Impact on other Free Trade Agreements

While the Federal Register Notice (86 FR 35422) announcing the proposed rule and requesting comments from trade is focused on USMCA, this may be the future for all FTAs. The  Federal Register Notice makes clear that  19 CFR 102 was established to promulgate the U.S.’s responsibilities under the North American Free Trade Agreement (NAFTA); however, thereafter, 19 CFR 102 has been extended to apply to numerous other FTAs as CBP has found them to be reliable, simplified, and standardized method to determining the COO of a good. Specifically, 19 CFR §§ 102.21 through 102.25, are also to be used by CBP to determine the COO of textile and apparel products (imported from all countries except Israel).

As we learn more, we will keep you up to date on whether this change will also be adopted for FTAs that are silent as to how the country of origin should be determined for marking and other non-preferential purposes.

Contact Us

Jennifer Diaz and Denise Calle have extensive expertise on FTA’s and in preparing and submitting comments for federal rulemaking. Please reach out to our trade attorneys to prepare and submit your comments to CBP. If you would like more information on this issue, contact Diaz Trade Law at info@diaztradelaw.com and 305-456-3830.

Co-Authored by Jen Diaz & Denise Calle

The Florida Customs Brokers & Forwarders Association (FCBF) encourages all custom brokers, patent, trademark and all international trade professional to join its Intellectual Property Rights (IPR) with U.S. Customs and Border Protection (CBP) and UL. This one-hour webinar will give custom brokers, importers, and all other international trade professionals the ability to learn and understand CBP’s IPR customs and enforcement. 

This webinar will be Friday, September 3, 2021 at 11:30 AM EST.  

Register Now! 

Importers, Manufacturers and Customs Brokers, and others interested in CBP and IPR matters, regardless of affiliation or membership, are invited and encouraged to attend. Learn what customs brokers and importers need to know about UL and the increased safety risk associated with counterfeit products. The webinar will cover: 

• Overview of CBP’s IPR enforcement regime
• Timeframes followed by CBP in suspected IPR violations
• Information CBP is authorized to share with the broker
• Examples of notices and most pertinent information therein
• CBP’s perspective on gray market shipments
• How brokers can be proactive to limit the time flagged shipments are detained
• Best contacts at CBP for any IPR-related inquiries
• Programs available to the trade community

Learn more about our speakers:

President and Founder of Diaz Trade Law, Jennifer (Jen) Diaz is a Chambers ranked, Board Certified International Attorney specializing in customs and international trade. For more than 15 years, Jen has provided legal advice and customized training on import and export compliance to industry, with a strong record of success in mitigating federal administrative enforcement actions. 

Jen has received many accolades from the legal community, including being recognized by “Super Lawyers” as a Top International Attorney, having an AV rating of “Superb,” and serving as President of the Organization of Women in International Trade (2018-2019). 

A frequent media commentator, Jen has authored book chapters, journal articles, and other articles for The Florida Bar, the American Bar Association, Bloomberg Law, and others. Jen is Editor of “Customs & International Trade Law,” a blog recognized by the U.S. Library of Congress as being an important part of the legal historical record. 

Alaina van Horn currently serves as the Chief of the Intellectual Property Rights Branch of U.S. Customs and Border Protection, Office of Trade, where she supervises a team of attorneys and paralegals specializing in border enforcement of intellectual property rights. Prior to this position she served a one year detail in the Office of the U.S. Intellectual Property Enforcement Coordinator (IPEC) in the Executive Office of the President, as a Policy Advisor specializing in customs law. Prior to joining the IPEC she was a Senior Attorney-Advisor in the Intellectual Property Rights Branch of CBP’s Office of Trade for over a decade, where she provided legal support to all ports of entry on border enforcement of trademarks and copyrights, adjudicated administrative petition for relief from seizure, issued binding rulings and infringement determinations, and administered patent and trade secrets based exclusion orders issued by the U.S. International Trade Commission. Ms. van Horn has conducted numerous capacity building trainings on border enforcement of intellectual property rights to foreign governments, international organizations, and domestic audiences in both the public and private sectors.

Lisa Deere has over 20 years’ experience in Intellectual Property, Anti-Counterfeiting, and prosecution. In late 2017 Lisa joined the Global Security and Brand Protection team of UL LLC (Underwriters Laboratories) as a Brand Protection Manager overseeing the United States and Canada.

Prior to joining UL, Lisa was responsible for the enforcement program at Conair Corporation where she launched the Anti-Counterfeiting program, initially with just

the US market, and eventually expanded the program globally.

Lisa’s IP career began while working for a major US charity. During her tenure with the charity, she worked closely with in-house counsel to build an international trademark portfolio, aggressively protected the brand through online enforcement, and assisted in defending against misuse of the charity’s well-respected name.

Lisa is actively involved in several Anti-Counterfeiting organization, including the International Anticounterfeiting Coalition (IACC), the International Trademark Association (INTA), and the Canadian Anti-Counterfeiting Network (CACN). She has served two terms as a member of INTA’s Anti-Counterfeiting committee, numerous terms on the INTA Round Table Subcommittee, and is currently serving as Vice Chair of the CACN Steering Committee. Lisa is a frequent moderator and roundtable host, and often speaks on the topic of health & safety issues related to counterfeit electronics.

REGISTER TODAY!

Join us IN PERSON in Baltimore, MD, July 26-27, 2021. NCBFAA NEI and hotel staff will be complying with all state and venue COVID-19 protocols so you can feel safe attending the event! Virtual attendance is available, so you can gain knowledge from anywhere!

REGISTER TODAY!

All trade professionals, regardless of membership or affiliation, are invited to join to:

• Learn from industry subject matter experts on today’s pressing matters
• Get an opportunity to voice your questions to federal, state and industry experts about the latest issues affecting your business
• Acquire fresh ideas by networking with business colleagues while meeting new people

Diaz Trade Law is enthusiastic to announce that our President, Jennifer Diaz will be a featured speaker alongside Adrienne Braumiller on the topic “Update on CBP Enforcement Efforts: IPR, Section 301, 232, AD/CVD” taking place on July 27th from 9:00 am to 10:30 am EST.

As we all know, Intellectual Property Rights, AD/CVD, Section 301 and 232 are all things on CBP’s priority list for enforcement. What do you have in place to make sure you are complying with the regulations? What have you done to assure yourself that your imports are not affected by the rules, and if they are, how you are managing the additional complexity of these movements?

Learn More About Jen Diaz!

President and Founder of Diaz Trade Law, Jennifer (Jen) Diaz is a Chambers ranked, Board Certified International Attorney specializing in customs and international trade. For more than 15 years, Jen has provided legal advice and customized training on import and export compliance to industry, with a strong record of success in mitigating federal administrative enforcement actions.

Jen has received many accolades from the legal community, including being recognized by “Super Lawyers” as a Top International Attorney, having an AV rating of “Superb,” and serving as President of the Organization of Women in International Trade (2018-2019).

A frequent media commentator, Jen has authored book chapters, journal articles, and other articles for The Florida Bar, the American Bar Association, Bloomberg Law, and others. Jen is Editor of “Customs & International Trade Law,” a blog recognized by the U.S. Library of Congress as being an important part of the legal historical record.

REGISTER TODAY!

Whether you are new to importing or seasoned, this one-hour webinar is a must attend. Register today to hear directly from this specialized, expert trio on the “Top 10 Tips When Importing to Ensure Compliance” with real case studies:

• President and Founder of Diaz Trade Law, Jennifer (Jen) Diaz is a Chambers ranked, Board Certified International Attorney specializing in customs and international trade,
• Trade Advisor at Diaz Trade Law, Donald Woods has worked in the express delivery, freight forwarding, and logistics industries for 34 years in both imports and exports. He retired from UPS after 34 years of service as the VP, Customs & Trade Compliance for the Customs Brokerage business unit.
• Associate Attorney of Diaz Trade Law, Denise Calle assists U.S. and foreign manufacturers, distributors, and importers, with a range of import compliance, regulatory compliance, and enforcement matters involving U.S. Customs.

This one-hour webinar describes the importer’s role as the responsible party for an import transaction. Our speakers will discuss how to comply with U.S. Customs and Border Protection’s (CBP) vast laws and regulations. By the end of the webinar, you will know and understand the importance of tariff classification, customs valuation, country of origin marking, intellectual property rights and free trade agreements.

You will also learn basic customs concepts and terms like CBP Form 7501, CBP 28, CBP 29, protests, detention and seizure cases, liquidated damage claims, penalties/fines, prior disclosures, and the FP&F process. Additionally, you will learn the top 10 tips when importing to ensure compliance. This webinar will provide valuable assistance to all importers, customs brokers, and all trade professionals.

In This Webinar You Will Learn:

• Importance of CBP Rulings for Classification, Valuation and Country of Origin.
• Cost Savings practices like utilizing Free Trade Agreements.
• Importance of protecting intellectual property rights.
• Basic customs concepts and terms.
• Top tips to proactively work with your Customs Broker.
• What to do if you encounter a CBP detention and/or seizure case Learn when to submit a prior disclosure to CBP Top 10 tips when importing to ensure compliance.
• Learn key best practices and hear real life case studies.
• Learn what to do, and more importantly, what NOT to do, and what the consequences are for non-compliance.

Who should attend:

• Importers
• Customs Brokers
• Regulatory Affairs Professionals
• In-house Legal Counsel
• Product Development Managers
• Other Trade Members

This webinar is eligible for continuing education credit from the NCBFAA Educational Institute. Space is limited, registration required! Access instructions will be provided after your registration is complete. Don’t just take our word for how awesome Diaz Trade Law webinars are. Click here to see what our past attendees had to say. Be sure to join us on May 5, 2021!

Importers not adequately auditing their supply chains for use of forced labor are at risk of administrative and criminal enforcement. Imported merchandise produced with forced labor is subject to the Department of Homeland Security (DHS) enforcement. Such enforcement includes U.S. Customs and Border Protection’s (CBP) right to detain, exclude, and/or seize imported goods and Homeland Security Investigation’s potential criminal investigation. China is not only the United States’ number one trading partner but also happens to be the world’s biggest forced labor violator.

Background

In May 2014, China initiated the campaign  “Strike Hard against Violent Extremism”, claiming to combat the “three evils” of “ethnic separatism, religious extremism, and violent terrorism.” The Chinese Communist Party (CCP) used this justification to impose restrictions on members of the ethnic minority communities of the Xinjiang Uighur Autonomous Region. These efforts dramatically increased in August 2016, when Communist Party Secretary Chen Quanguo, known as the architect of China’s Muslim camps, assumed leadership of Xinjiang. According to Human Rights Watch:

• Xinjiang authorities conduct a compulsory mass collection of biometric data, such as voice samples and DNA, and use artificial intelligence and big data to identify, profile, and track everyone in Xinjiang. The authorities have envisioned these systems as a series of “filters,” picking out people with certain behavior or characteristics that they believe indicate a threat to the Communist Party’s rule in Xinjiang.

This dystopian system has progressed into the rapid establishment of “re-education” camps. In these camps, guards force the Muslim detainees to break Halal, mandating they drink alcohol, and only serving pork at meals. China reportedly takes DNA samples from Uighur camp prisoners and uses them as human test subjects in gang rapes and medical experiments.

Since 2014, the situation in Xinjiang, China has progressed from the simple collecting of Biometric data from a subsect of the population, to full-blown extrajudicial internment, re-education camps, forced sterilization, and organ harvesting. According to a 2015 report, China’s illegal organ transplant industry is valued at over $1 billion each year. The labor from these camps is the life-blood of the campaign. The interred individuals are essentially paying for their treatment in that they generate revenue that the government subsequently pumps back into the system of abuse.

Dr. Adrian Zenz, a Senior Fellow in China Studies at the Victims of Communism Memorial Foundation in Washington has authored various books regarding China’s policies towards ethnic minorities, and has played a leading role in the analysis of leaked Chinese government documents, including the “China Cables” and the “Karakax List.” Dr. Zenz has been integral in enlightening the world on the situation in China. In a recent Washington International Trade Association (WITA) webinar regarding the scope and scale of forced labor in Xinjiang, Dr. Zenz stated that the current crisis is worse than anything we have witnessed since the Holocaust. According to Dr. Zenz, whereas the Nazis sent Jews to concentration camps and death camps; the Chinese send Uighurs to concentration camps, re-education camps, or demoralization camps, instead. Despite the differences, the systematic nature and end goal of the Chinese government’s policy towards the Uighurs is emblematic of the Nazi’s policy towards the Jew’s: forced assimilation and or eradication of the culture and prevention of its proliferation.

• “[T]he Chinese government has placed vast numbers of Turkic minorities into internment camps, which it refers to as “reeducation camps,”… it claimed that these supposed students would gradually be released into work placements. Data such as this supports this claim, but not in the way that the government is trying to sell it. Rather, it is part of a rapidly growing set of evidence for how Beijing’s long-term strategy to subdue its northwestern minorities is predicated upon a perverse and intrusive combination of coercive labor, intergenerational separation, and complete social control.” Dr. Zenz, Xinjiang’s New Slavery

Dr. Zenz explicitly stated that while the Chinese are not (yet) committing mass extermination, the abuses against its Uighur population definitively constitutes a genocide. From religious oppression, to forced sterilization, to internment, to forced labor or slavery, to re-education — the CCP has been deliberate in its attempt to eliminate the Uighur ethnicity. Dr. Zenz articulated that the Chinese are engaging in a slow-rolling genocide, also known as an “ethnocide”.

Despite the overwhelming evidence supporting claims of systematic abuses such as coercive population control through forced abortion, forced sterilization, and involuntary implantation of birth control;  Chinese officials continue to defend the supposedly legitimate purpose of these camps.

Combating Chinese Concentration Camps – Forced labor Angle

In its 2019 Annual Report, the Congressional-Executive Commission on China found that products reportedly produced with forced labor by current and former mass internment camp detainees included textiles, electronics, food products, shoes, tea, and handicrafts.

Since the publication of the September 2018 Human Rights Watch report, news of these concentration camps started garnering international recognition. Congress began introducing bills, like the UIGHUR Act of 2019, which aimed at addressing the “human rights violations and abuses, including gross violations of human rights, by the People’s Republic of China’s mass surveillance and internment of [Millions of] Uighurs and other predominantly Turkic Muslim ethnic minorities in China’s Xinjiang Uighur Autonomous Region.”.

These efforts increased when President Trump signed the Uyghur Human Rights Policy Act of 2020 into law on June 17, 2020. Under the UHRA, the President may impose property-blocking or visa-blocking sanctions on the identified foreign individuals and entities responsible for human rights abuses in China’s Xinjiang Uyghur Autonomous Region. The UHRPA also requires the Executive branch to periodically report to Congress a list identifying foreign individuals and entities responsible for such human rights abuses. Furthermore, although it has not yet been signed into law, bills such as the Uyghur Forced Labor Prevention Act, which was introduced on March 12, 2020, signify that Congress understands the gravity of the situation. Some of the key findings included in the Bill are as follows:

• There is a very high risk that many factories and other suppliers in the Xinjiang Uyghur Autonomous Region are exploiting forced labor, according to reports from researchers, media, and civil society groups. Audits to vet products and supply chains in the Xinjiang Uyghur Autonomous Region are not possible because of the extent to which forced labor has contaminated the regional economy, the mixing of involuntary labor with voluntary labor, the inability of witnesses to speak freely about working conditions given heavy government surveillance and coercion, and the strong incentive of government officials to conceal government-sponsored forced labor.
• In its June 2019 Trafficking in Persons Report, the Department of State found, Authorities offer subsidies incentivizing Chinese companies to open factories in close proximity to the internment camps, and local governments receive additional funds for each inmate forced to work in these sites at a fraction of minimum wage or without any compensation.
• According to public reports, companies that are or have been suspected of directly employing forced labor or sourcing from suppliers that are suspected of using forced labor include (among others):
  • Adidas,
  • Calvin Klein,
  • the Campbell Soup Company,
  • the Coca-Cola Company,
  • Costco,
  • Esprit,
  • H&M,
  • the Kraft Heinz Company,
  • Nike, Inc.,
  • Patagonia, Inc.,
  • Tommy Hilfiger.

Whether out of ignorance or neglect, American and European dollars have helped facilitate the use of forced labor, if not slavery; which pursuant to 19 U.S.C. 1307 is prohibited.

Active Measures

In line with sanctioning individuals and entities is the strategic use of Withhold Release Orders (WROs). A WRO directs CBP Officers at all ports of entry to withhold release of goods originating from a listed company or country.  These targeted sanctions have been especially effective at identifying certain nations, industries, and companies that employ forced labor in any way. CBP provides the public with a list of all WROs and the findings of the investigations. Right now, the majority of active WROs are focused on items produced in China. In fact, the majority of WROs the USTR implemented since 2016, are directed at China.  Below is a list of each WRO implemented against China since 2016:

Following the imposition of a WRO on hair products originating from the Lop County Meixin hair product company on June 17, 2020, CBP has implemented additional WROs on other industries in the region. The impositions of WROs against China saw a recent uptick on July 1, 2020 as a result of another seizure of hair products made in China. Following this seizure, CBP issued a Xinjiang Supply Chain Business Advisory, which highlights that the Federal Government recognizes the harsh repression and illicit practices of the Chinese regime, and cautions US stakeholders– businesses, individuals, academic institutions, research service providers, and investors – that continue to operate business with entities in Xinjiang.

Specifically, the advisory states that these companies

should be aware of reputational, economic, and, in certain instances, legal, risks associated with certain types of involvement with entities that engage in human rights abuses, which could include Withhold Release Orders (WROs), civil or criminal investigations, and export controls.

Xinjiang Cotton Ban

During the last week of the Trump Administration, on January 13, 2021, the United states issued a Region-Wide Withhold Release Order on Products Made by Slave Labor in Xinjiang Specifically, CBP imposed a WRO on all Cotton, Tomatoes and Downstream Products originating in the Xinjiang Uyghur Autonomous Region (XUAR). CBP issued the WRO after identifying various forced labor indicators including debt bondage, restriction of movement, isolation, intimidation and threats, withholding of wages, and abusive living and working conditions.

According to CBP, on December 2, 2020, CBP announced the issuance of a WRO on cotton and cotton products originating from the Xinjiang Production and Construction Corps, an economic and paramilitary organization subordinate to the Chinese Communist Party. The region-wide WRO is the fourth WRO that CBP has issued since the beginning of Fiscal Year 2021, and the second on products originating in Xinjiang. All WROs are publicly available and listed by country on CBP’s Forced Labor WROs and Findings webpage.

The decision to ban cotton products marks the most substantial action. Out of the estimated three million detained Uighurs, over 500,000 have been forced to work in cotton fields. Moreover, cotton from the Xinjiang region accounts for 85% of China’s cotton production, and more than 20% of the world’s cotton.

Biden on Forced Labor

The Biden Administration has committed to maintaining a strident approach towards China. On January 20, 2021 upon being sworn in as Secretary of State, Anthony Blinken stated:

On the Uighurs I think we’re very much in agreement. And the forcing of men, women and children into concentration camps, trying to, in effect, re-educate them to be adherents to the ideology of the Chinese Communist Party, all of that speaks to an effort to commit genocide.

Practitioner Tips

According to CBP, importers must exercise reasonable care and due diligence to ensure that forced labor is not included in any aspect of their supply chain. In order to effectively mitigate their risk, importers must understand the timely and costly detention process and know the importance of using CBP’s reasonable care checklist and implementing best practices. Additionally, importers should conduct a robust internal risk assessment, and audit their supply chain and import history. Further, importers should be aware of their ability to contest a WRO or argue for the release of detained shipments.

For more information regarding CBP’s current enforcement environment in targeting and combatting the use of forced labor, as well as top tips on how to avoid forced labor to in your supply chain— reference our Bloomberg Law article titled “U.S. Customs Targets Forced Labor” co-authored by Jennifer Diaz, and Denise Calle of Diaz Trade Law with support from Zachary Kaufman.

Conclusion

For assistance with importer due diligence in relation to forced labor requirements; or for assistance re-exporting your detained merchandise, in submitting documents to dispute the use of forced labor, or for assistance with the revocation request process, contact our Customs and International Law attorneys at info@diaztradelaw.com or 305-456-3830.