What are the Section 232 Investigations?

An investigation under Section 232 “is to determine the effect of imports on national security” and they may be initiated either through a request from the head of any department/agency, application from an interested party or the Secretary of Commerce can self-initiate an investigation. After the investigation is initiated, then the U.S. Secretary of Commerce must prepare a report within 270 days of initiation about “whether the importation of the article in question is in such quantities or under such circumstances as to threaten to impair the national security”.  The President can either agree or not with the Secretary’s suggestions within the report, and can then take action to “adjust the imports of an article and its derivatives”.

Why President Trump Wants to Initiate New Tariffs on Imported Vehicles:

According to Secretary Ross, “there is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry”, and because of this the Department of Commerce will conduct an investigation into “whether such imports are weakening our internal economy and may impair the national security”. The investigation will include the reduction in research, development, and “jobs for skilled workers in connected vehicle systems, autonomous vehicles, fuel cells, electric motors and storage, advanced manufacturing processes, and other cutting-edge technologies”. The Department of Commerce states that imports of passenger vehicles have “grown from 32 percent of cars sold in the U.S. to 48 percent” and “employment in motor vehicle production declined by 22 percent” in the past 20 years.

President Trump as of right now is seeking for “new tariffs as much as 25% on automobile imports” and  is expected to invite public comment and hold a hearing on the issue. According to the World Trade Organization (WTO), under the WTO agreements, “the U.S. currently charges tariffs – essentially a tax at the border – of 2.5% on light cars and 25% on trucks coming from countries where the U.S. doesn’t have a trade pact”. Due to these agreements, President Trump has consistently criticized the low car tariffs and has threatened to raise U.S. tariffs to level of other countries.

For more information, contact us today at 305-456-3830 or via email at info@diaztradelaw.com.

On February 9, 2018, U.S. Customs and Border Protection (CBP), with the assistance of Crowley Maritime Corp., AFL International Logistics Group, and King Ocean, has implemented a first of its kind process at Port Everglades for exporters shipping used vehicles from South Florida to foreign destinations. Broward county’s Port Everglades is the perfect place to pilot this program it handles more than one million TEUs annually (20-foot equivalent units, the industry standard measurement for container volumes) and serves as a gateway to Latin America, the Caribbean, Europe, and Asia.

• The new electronic Vehicle Validation Export Process Program will save exporters time and money:
• The new program offers exporter the ability to skip in-person visits to the CBP trade office in Port Everglades to deliver vehicle exportation documents.
• Shippers can now submit digital copies online any time day or night for faster review, processing, and approval.
• Reduce document processing and shipment times by around a day
• Exporters are no longer required to make multiple copies of documentation per vehicle shipped

The pilot program is expected to continue through at least March, when it will be considered for further implementation in Port Everglades and potentially in other locations.

As always, if you are unsure, consult with a professional. Penalties for failure to comply with CBP’s export requirements, aside from the inability to export your vehicle, could include monetary fines, liquidated damages, seizure of the vehicle, and/or demand for redelivery of the vehicle.

For more information regarding the requirements for exporting used vehicles and solutions to CBP compliance issues, contact us today at 305-456-3830 or via email at info@diaztradelaw.com.

CBP’s part of the $1.45 billion settlement dealt with a violation of 19 U.S.C. §1952, which “prohibits persons, by fraud, gross negligence or negligence, from entering or introducing, attempting to introduce, or aiding and abetting the entry or introduction of merchandise into the commerce of the United States, by means of statements or acts that are material and false, or by means of omissions which are material”.

CBP’s claim was that Volkswagen knowingly submitted material false statements and omitted material information, over multiple years, with the intent to deceive or mislead CBP concerning the EPA emissions standards. According to CBP, Volkswagen added a defeat device to their vehicles that allowed them to cheat on the federal emissions tests. By adding the defeat device to the vehicles, the CBP argued that Volkswagen was trying to evade their importer responsibilities and defraud revenue from the U.S.

The defeat device, is a computer software that suppresses “the car’s emissions control system when it’s being driven normally, allowing the system to work when the car is being tested in a lab”. Once the vehicle is driven on the road, the defeat device would stop suppressing the emissions control system and would then release almost 40 times the permitted levels of nitrogen oxide (NOx). Nitrogen oxide is a highly poisonous pollutant that can cause emphysema, bronchitis, and other respiratory diseases. According to the New York Times, the decision to use the defeat device in the VW vehicles was made more than a decade ago, after employees realized they would not be able to legally meet the clean air standards set by the United States. VW has even acknowledged that the former chief executive, Mr. Winterkorn, was given a memo in May 2014 stating that there were irregularities in the emissions of their diesel cars, but “did not realize the gravity of the diesel emission problem”.

Volkswagen could have easily avoided such a hefty penalty brought on by the fraud claim by fully complying with the customs laws that are set by the CBP and by making sure no defeat devices were used to evade EPA emission standards.

If a company is looking to import into the United States and would need to meet emissions standards by the EPA and ensure compliance with CBP laws and regulations, it is prudent that the company complies with every regulation to avoid any potential penalties. For help with CBP and EPA compliance please contact info@diaztradelaw.com.

So you are moving abroad and want to bring your car with you? To comply with the provisions of 19 CFR Part 192, you will need to report this export to the Federal Government by presenting both the vehicle itself as well as a specific set of documents to U.S. Customs and Border Protection (CBP) at least three (3) days prior to export.

The following documents are required when exporting a traditional used motor vehicle abroad:

1. Original Certificate of Title
2. Original Letter of Intent – for vehicles exported by sea or air, a letter provided by the carrier and identifying the date of export (be aware of 72 hour rule), destination, vehicle owner, vehicle identification number, and authorized signature
3. Export Power of Attorney – If the owner of the vehicle to be exported is not presenting the documents to CBP, a CBP Export Power of Attorney must be submitted and notarized, identifying the person submitting the documentation and signed by and identifying the ultimate purchaser/owner and the vehicle (by VIN).
4. Letter of Authorization – If the vehicle to be exported is owned by a corporation, company or business entity, it must be accompanied by a notarized letter on official business letterhead authorizing an agent to act on its behalf.
5. Lienholder Authorization – if the vehicle is leased or has a lien against it, there must be specific authorization allowing for the export of the vehicle on company letterhead.
6. Copy of the photo identification of the person presenting the export documents.
7. Copy of the photo identification of the owner of the vehicle if different from the presenter.

As always, if you are unsure, consult with a professional. Penalties for failure to comply with CBP’s export requirements, aside from the inability to export your vehicle, could include monetary fines, liquidated damages, seizure of the vehicle, and/or demand for redelivery of the vehicle.