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

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!

Cuba Designated a State Sponsor of Terror

The U.S. State Department designated Cuba a State Sponsor of Terrorism (“SST”) on January 11, 2021. Countries are designated on the SST list when they are determined by the U.S. Secretary of State to have repeatedly provided support for acts of international terrorism.

The four main categories of sanctions resulting from designation can include restrictions on U.S. foreign assistance; a ban on defense exports and sales; certain controls over exports of dual use items; and miscellaneous financial and other restrictions. Here, the January 11 re-designation of Cuba on the SST subjects Cuba to:

• Sanctions that penalize persons and countries engaging in certain trade with Cuba
• Restricts U.S. foreign assistance to Cuba
• Bans defense exports and sales to Cuba
• Imposes certain controls on exports of dual use items.

Cuba joins only three other countries on the list: (1) North Korea (designated November 20, 2017); (2) Iran (designated January 19, 1984); and (3) Syria (designated December 29, 1979). Sudan was recently removed from the list by the Trump administration on December 14, 2020.

U.S. Secretary of State Mike Pompeo designated Cuba as a State Sponsor of Terrorism for many reasons, including:

• Cuba’s domestic oppression of its people
• Cuba’s malign interference in Venezuela and elsewhere in the Western Hemisphere
• Harboring of fugitives and denial of extradition requests
• The U.S. State Department’s notification to Congress in 2019 that Cuba is “not cooperating fully” with U.S. counterterrorism efforts

This action is part of a broader Trump administration policy to impose stronger trade and economic restrictions on Cuba. In November 2017, the Trump administration restricted financial transactions with entities controlled by the Cuban government. Furthermore, many new entities have been added to the Cuba restricted list under the Trump administration. As of 2019, the Trump administration has more or less abandoned engagement with the Cuban government, and has opted instead to increase sanctions based on Cuba’s human rights violations and its support of the Venezuelan government under Nicolas Maduro.

For more information, check out our recent article on Trump vs. Biden policies on Cuba.

Export and Sanctions Compliance

Fortunately, there is a lot you can do to be proactive about your export sanctions compliance. To ensure compliance with EAR, ITAR, FCPA, and OFAC regulations, businesses should develop and maintain an export compliance plan that is thoughtful, proactive, and well-executed. While having a sanctions compliance plan is not a guarantee that a sanctions violation will not occur, a coherent export compliance program can minimize the risk of non-compliance.

Diaz Trade Law’s EAR, ITAR, FCPA, and OFAC-related services include:

• Developing an effective export compliance program
• Export compliance training
• Transaction vetting
• Voluntary self-disclosures
• OFAC specific license applications
• Export license applications
• Mitigation and corrective action
• Navigating export seizures and penalties

Contact Us

If you have questions on sanctions or export-related matters, contact Diaz Trade Law today at info@diaztradelaw.com or 305-456-3830.

Department of Transportation (DOT)’s Offices of Pipeline Safety and Hazardous Materials Safety (PHMSA) perform the regulatory oversight of the transportation of hazardous materials. The Federal hazardous materials transportation law authorizes PHMSA’s Chief Counsel to assess a civil penalty or to refer matters for criminal prosecution.  The final determinations as to the penalty assessed are publish under PHMSA’s Hazardous Materials Legal Orders. In one case, in March 2013, the violator was fined a $24,900 penalty for three violations. The Legal ordered states:

[The violator] filled and offered for transportation, in commerce, a hazardous material (UN1075, Propane, 2.1), packaged in DOT 4E specification cylinders that were out of test, and overdue for periodic requalification; it offered and transported in commerce a hazardous material (UN 1075, Propane, 2.1) in quantities that required placarding, while failing to register as an offeror and carrier of hazardous materials and failing to pay a registration fee with DOT; and it allowed employees to perform a function subject to the requirements of the HMR, while failing to provide each hazardous materials employee with initial or recurrent general awareness, function-specific, safety, and security training.

What’s a Hazardous Material?

Title 49 of the DOT regulations help to ensure the safety of cargo and persons on board a flight.

DOT’s definition of “hazardous material” is codified at Title 49 CFR § 171.8 and defines it as:

a substance or material that the Secretary of Transportation has determined is capable of posing an unreasonable risk to health, safety, and property when transported in commerce, and has designated as hazardous under section 5103 of Federal hazardous materials transportation law (49 U.S.C. 5103). The term includes hazardous substances, hazardous wastes, marine pollutants, elevated temperature materials, materials designated as hazardous in the Hazardous Materials Table (see 49 CFR 172.101), and materials that meet the defining criteria for hazard classes and divisions in part 173 of this subchapter. (emphasis added).

Such material is referred to as “HAZMAT”. Manufacturers/suppliers are required to classify their goods as dangerous or not. If the goods are deemed HAZMAT, suppliers are required to provide a shipper’s declarations to the freight forwarder prior to the goods being transported, certifying that the cargo has been packed, labeled and declared according with the International Air Transport Association (IATA) Dangerous Goods Regulations (DGR).

Freight forwarders rely on a shipper’s declaration to safely transport HAZMAT goods and bare a high risk of liability when providing shipping services. HAZMAT requirements govern HAZMAT goods shipped by air, ocean, or by land.

What is a Shipper’s Declaration?

The shipper’s declaration details what is being shipped, the danger level, and the required labeling, packing and transportation method.

 9 Classes of HAZMAT & Required Labeling

There are nine classes of HAZMAT products. Each class has specific labeling requirements. When your product falls within a certain class, the packaging must bear the appropriate label as depicted below. Some of these products may be transported together, but your Freight Forwarder is barred from co-mingling certain items pursuant to 49 CFR 177.848:

Class 1: Explosives

Class 2: Compressed Gasses

Class 3: Flammable Liquids

Class 4: Flammable Solids

Class 5: Oxidizers

Class 6: Poison/Toxic

Class 7: Radioactive

Class 8: Corrosive

Class 9: Miscellaneous (Dry ice, magnets, vehicles, etc)

49 CFR 177.848(d), provides a table to assist freight forwarder’s identify how hazardous materials must be stored, loaded or transported. Certain items may not be stored, packaged, or transported together. The following chart provides guidance on how your freight forwarder is able to commingle certain hazardous classes.

• Green indicates no restrictions.
• Yellow indicates that classes can be transported together with some restrictions.
• Red indicates that there are no circumstances under which these goods can be transported or stored together.)

Mishandling HAZMAT goods may lead to disastrous situations and penalties! It’s important that you as a supplier, importer, or exporter follow your Freight Forwarder’s transportation practices to safely and compliantly ship your goods to their final destination.

If you receive a penalty, DTL is ready to help you. We can be reached at info@diaztradelaw.com or 305-456-3830.

The main benefit of an SLI is federal regulatory compliance! Prior to your goods being exported, Foreign Trade Regulations require a freight forwarder to transmit certain information to U.S. Customs and Border Protection on your behalf. To efficiently gather the required authorizations to act on your behalf and the information needed to be transmitted, the trade community developed a SLI.

What is a SLI?

• A SLI is a ‘letter’ from the exporter instructing the freight forwarder on how and where to handle the export shipment. The exporter is granting permission to the freight forwarder to act as the authorized forwarding agent for U.S. export control and customs.
• SLI is not a mandatory document or a legally binding document.
• SLI is multi-purpose document to assist you in communicating information to the freight forwarder SLI is designed to avoid misunderstandings that can result in financial loss to the exporter – or to the freight forwarder so it is vitally important that this document be accurate.
• A SLI is strictly used to gather information about your cargo to ensure your goods are exported in compliance with Foreign Trade Regulations.

What information and authorizations are obtained when you complete the SLI?

• You provide data for your freight forwarder to report Electronic Export Information (“EEI”) when you instruct your freight forwarder to file EEI on your behalf.
• You authorize your freight forwarder to transmit to the Automated Export System (“AES”).
• You provide information and instructions for documentation and billing.
• You provide transportation instructions your freight forwarder.
• You provide your freight forwarder consent to screen when you instruct your freight forwarder to screen on your behalf.

Why do we require a SLI?

• Consistently formatted information.
• All instructions and data on a single document.
• More efficient processing.
• Freight Forwarders no longer need to search through numerous, challenging, multi-page commercial documents to find relevant data elements.
• Allows for more accurate AES reporting Record keeping and provides back-up to the EEI filing.

Why should you complete a SLI?

• Avoid misunderstandings between the exporter and the freight forwarder and other parties involved in the shipping transaction.
• Secure method of providing the correct information to your freight forwarder.
• Establishes a best practice for your firm.
• You have a written record of who receives the shipping documents, who to contact for questions, who to contact for proof of export, and who issued the export control documentation that supports the decision to send your products to your foreign customer.
• New to the export industry and need guidance on export requirements.
• Unfamiliar with export control requirements.

Need guidance on completing the SLI?

The best way to comply with export requirements is to have an expert by your side. Diaz Trade Law specializes in compliance with Foreign Trade Regulations, CBP, and other regulatory government agencies. For information on SLIs, contact us at 305-456-3830 or via email at info@diaztradelaw.com.

The morning kicked off with a networking breakfast where experienced and novice industry members were able to engage in meaningful dialogue about overlapping issues they experience in their respective workplaces in dealing with the topic of FSMA. We heard comments from small to large business on their current implementation strategies in place to ensure they meet FSMA requirements by FDA’s compliance dates.

The seminar promptly began at 9:00 am with introductory remarks by our own President, Jennifer Diaz. We had all attendees introduce themselves and include why this seminar was important to attend. We were glad to hear from majority of attendees that their reason for participating was to further their education on FSMA. One attendee commented, “Excited to hear from FDA about FSVP requirements and what the broker’s role is in the process.”

Next Representatives of Miami Free Zone explained their role in international business solutions as it provides users and visitors with convenient international business resources including turnkey FTZ solutions for distribution; a wholesale marketplace; an international business center environment; and premium showroom, office, and warehouse spaces. As well as providing FTZ users with flexible control over their domestic and foreign inventory, duty elimination and deferment, and high security standards for their businesses and valuable merchandise.

The first speaker was Elena O. Asturias, is a licensed U.S. Customs Broker, and Certified Customs Specialist providing customs brokerage services for imports. Elena provided top tips for custom brokers as she has been involved in logistics for over fifteen years, and has experience handling a broad range of commodities. Some helpful tips from here presentation include:

• Make sure food facilities that must be registered with the FDA pursuant to the Bioterrorism act are registered to avoid delays upon entry into the U.S.
• A major issue causing FDA to detain food products are product labeling violations
• Ensure you use correct Affirmation of Compliance (AofC) Codes
  • When the entry is filed with FDA, use AofC codes to affirm the products meets specific import requirements.
  • Depending on the product type, many AofC’s are required, and must be submitted upon time of entry.
  • The AofC is a 3 letter indicator, then the qualifier which will vary in format. In some cases no qualifier is required.
    • Examples: PFR is the code used to designate a Manufacturer Food Facility Registration Number and it’s used with a 11 digit qualifier.
      • PFR 12345678901
      • FDA Affirmation of Compliance (AofC) Code Quick Reference
• FSVP – Unique facility identifier (UFI)
  • As of May 30th, you will need to add the UFI (Unique Facility Identifier) when you transmit the entry.
  • The AofC code being added is FSV, which will require the following:
    • DUNS number (as acceptable UFI)
    • Importer name & address
    • Email address
    • If the importer doesn’t have a DUNS number yet, you can transmit UNK “unknown” temporarily.
  • ENTRY DATA TRANSMISSION PROCESS:
  •  

• ITACS
  • ITACS – Import Trade Auxiliary Communications System
  • Importers are able to see the current FDA status (as long as they have the entry number), using the ITACS system (you have the ability to monitor your shipments without having to call your broker!).

Lundy Patrick followed Mrs. Asturias’ presentation and echoed the significance of being familiar with the importation process. Mr. Patrick is Lieutenant Commander serves as a U.S. Public Health Officer assigned to the Florida District Office of the FDA as an Imports Compliance Officer.  There were questions and answers during his presentation as the attendees had submitted questions prior to the seminar.  Here are highlights from the discussion:

• Articles are expected to be in compliance AT THE TIME OF ENTRY. Therefore, you need to exercise due diligence to make sure the products you intend to import are in compliance PRIOR to the importation of the goods.
• The following food imports require Prior Notice:
  • Food imported for use, storage, or distribution in the U.S. (including gifts and trade and quality assurance/quality control and market research samples)
  • Food transshipped through the U.S. to another country
  • Food imported for future export, or food for use in a Foreign Trade Zone, unless it is on the list of exemptions
• If you fail to provide Prior Notice, the food shipment is subject to refusal and, if refused, must be held at the port of entry unless directed to another location. The importing or offering for import into the U.S. of an article of food in violation of Prior Notice requirements is a “Prohibited Act” under the laws FDA administers.
• If a food product is assigned for examination/sampling, FDA will examine and will collect samples. Historically between 1-2% get examined/sampled.
• Lieutenant Commander Patrick echoed the importance of product label compliance and stressed FDA does not pre-approve labels for food products.
• He stated that the State of Florida, the third busiest district, has had over 8,000+ detention and 2200+ Refusals and provided the top reasons for food product detentions:
  • Labeling Issues:
    • Incorrect or missing statement of identity/name of the food
    • Failure to List potential allergens
    • Failure to declare ingredients
    • Failure to bear nutrition labeling or the nutrition label is in incorrect format.
  • Most common Import Alerts the FDA sees in Florida:
    • IA 16-81 – “Detention Without Physical Examination of Seafood Products Due to the Presence of Salmonella“
    • IA 99-05 – “Detention Without Physical Examination Of Raw Agricultural Products for Pesticides”
  • If Refused Goods are sold and Cannot be Redelivered for Export / Destruction, you may face:
    • Liquidated Damages and/or 19 USC 1592 Penalties

Thereafter, Giselle Jordan took the floor to discuss the hot topic of FSMA Compliance and Foreign Supplier Verification Program. Giselle is a Consumer Safety Officer at the Division of Import Operations of FDA. In August 2016, she joined the newly established Food Safety Verification Program Team. Here are highlights from her presentation:

• Resources:
  • www.fda.gov/fsma   ß SIGN UP (there is a subscription feature available)
• FSMA Sec. 301 requires importers to have FSVPs and FDA to issue regulations.
  • The goal for FSMA is FOOD SAFETY
• Key Principles of FSVP Rule
  • Establishes explicit responsibility for importers to ensure the safety of imported food
  • Risk-based (according to types of hazards, importers, and suppliers)
  • Alignment with PC supply-chain provisions
  • Flexibility in meeting requirements (assessing activities conducted by others)

• Purpose of an FSVP
  • To provide adequate assurances that:
    • Foreign suppliers produce food using processes and procedures providing same level of public health protection as FSMA preventive controls or produce safety provisions
    • Food is not adulterated or misbranded (as it relates to allergen labeling)
  • Who Must Comply?
    • “Importer” is U.S. owner or consignee of a food at time of U.S. entry.
    • If no U.S. owner or consignee at entry, importer is U.S. agent or representative of the foreign owner or consignee, as confirmed in signed statement of consent to serve as the importer under FSVP (“FSVP Importer”).
    • Note that the responsibility for FSVP compliance lies with the FSVP Importer and the FSVP Importer can be different from the Importer of Record.
  • FSVP Exemptions
    • Firms subject to juice or seafood HACCP regulations
    • Food for research or evaluation
    • Food for personal consumption
    • Alcoholic beverages and alcoholic beverage ingredients (7%)
    • Food transshipped through U.S.
    • Food imported for processing and export
    • “U.S. foods returned”
    • Meat, poultry, and egg products subject to USDA regulation at time of importation
    • Low acid canned food facilities (microbiological hazards only)
  • Appropriate Verification Activities
    • Must document determination, performance, conduct, review and assessment of results
    • Verification activities include:
    • Onsite audits (qualified auditor), sampling and testing of the food, a review of foreign supplier relevant food safety records, other appropriate activities
  • To qualify as a “Very Small Importer”:
    • Must meet definition of a very small importer
    • Less than $1 million/yr. in human food sales
    • Less than $2.5 million/yr. in animal food sales
    • Annually documentation of eligibility
  • Compliance Dates
    • The final FSVP rule was published on November 27, 2015
    • First compliance date: May 30, 2017
    • Last compliance date: July 27, 2020
    • http://www.fda.gov/Food/GuidanceRegulation/FSMA/ucm503822.htm

Jennifer Diaz concluded the seminar with best practices for due diligence and best practices for responding to enforcement actions and FDA Notice of Action. Check out DTL’s TOP 10 TIPS for importing food products into the U.S.

For more information on how we can help you through the maze of importing and FSVP email us at info@diaztradelaw.com.

A special thanks to all our prize winner for participating during the seminar. We appreciate your involvement and interest! For pictures of the event LIKE us on Facebook.

Subscribe Today to keep up with the latest Customs and International Trade Law News.

Our next Live Broadcast webinar will be held on Wednesday, May 24, 2017 to discuss Intellectual Property Rights Violations and the U.S. Customs & Border Protections Enforcement. More information is available here.

DTL will also be at the NEI will be hosting the 3rd annual Global Trade Educational Conference held on August 7-8. NEI is bringing customs brokers, freight forwarders, NVOCCs, OTI, service providers, importers, exporters and all global logistics professionals an opportunity to update themselves on industry developments and connect with colleagues old and new. To RSVP – Read more. . .

*****This document is provided for informational purposes only and does not constitute legal advice nor does use of this constitute the formation of an attorney-client relationship.******

What is SOLAS?

• “SOLAS,” an acronym made from The International Convention for the “Safety of Life at Sea,” is an international treaty that governs the safe operation of all ships engaged in international maritime trade. The SOLAS Convention specifies the minimum standards for the construction, equipment, and operation of merchant ships. The United States is a signatory to SOLAS.

Who is responsible?

• The shipper is responsible for verified gross weight of the shipment.

Who is considered the shipper?

• According to the International Maritime Organization a shipper is a legal entity or person named on the bill of lading or sea waybill or equivalent multimodal transport document (e.g., a “through” bill of lading) as shipper and/or who (or in whose name or on whose behalf) a contract of carriage has been concluded with a shipping company.
• However, who the shipper really is can be a daunting task to figure out in the myriad of relationships that international shipping transactions create.
• Note, if you are the shipper, you want to ensure you are SOLAS ready, meaning you have a plan to ensure you know the verified gross weight – and potentially contracts in place to help avoid SOLAS liability.

What is verified gross weight?

• Verified gross weight or VGW is the certified Gross Cargo weight (including weight of all packing material) plus Container Tare weight.

How do I weigh my cargo to comply with SOLAS?

• To help you ensure you declare an accurate weight the International Maritime Organization has detailed what shippers can do to ensure they comply.
  • One of the methods would be to weigh the entire packed container.
  • A second method would be to weigh all packages and cargo items, including the mass of pallets, dunnage and other securing material to be packed in the container and adding the tare mass of the container to the sum of the single masses, using a certified method approved by the competent authority of the State in which packing of the container was completed.

What may happen if I (the shipper) do not provide the VGW?

• Your shipment may be delayed or left at port; however, more realistically the master or his representative will most likely obtain the VGW on behalf of the shipper by weighing the packed container at the terminal (and charge the “shipper” for this service).

Can I provide estimates of weight?

• Weight estimates are not permitted under SOLAS.

Effective date:

• Although SOLAS has been in effect for a years there is a renewed interest in ensuring that shippers are declaring the correct weight for the safety of the entire vessel. Therefore, as of July 1, 2016 strict enforcement of this will start to occur on a port-to-port basis.

Making Sense of SOLAS:

• Want help making sense of SOLAS? We’re here to help, contact us today at info@diaztradelaw.com, or 305-456-3830.

What steps have you taken to comply with SOLAS?

In an Indictment dated October 1, 2009, Case No. 09-20852-CR-GOLD, the United States Attorneys’ Office in Miami charged three Miami freight forwarding companies and their owners with violating the International Emergency Economic Powers Act (IEEPA),50 U.S.C. 1701 et seq., 18 U.S.C. 554 (fraudulently exporting from the United States), 18 U.S.C. 371 (conspiracy), and 13 U.S.C. 305 (knowingly submitting false Shippers Export Declarations or information through the Automated Export System (AES).

In summary, the Government has alleged that the Paraguay company paid an Ohio distributor of Sony PlayStations to ship those items to the freight forwarding companies in Miami. Once in Miami, according to the Indictment, the freight forwarders and their owners allegedly created documents falsely identifying the address of the company in Paraguay because they knew they could not ship the Sony PlayStations to the real address.  The real address of the company in Paraguay, according to the Indictment, had been designated by the Office of Foreign Assets Control (OFAC) as a Specially Designated Global Terrorist.  The designated terrorist was Galeria Page, an office mall in Ciudad del Este, Paraguay.

The case was investigated by the Miami office of the U.S. Immigration and Customs Enforcement (ICE) which issued a Press Release.  According to the Penalty Sheet filed with the Indictment, the maximum penalty for the individual owners of the freight forwarding companies who were arrested for the alleged violations is 20 years