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Why Pre-Compliance is a MUST

posted by Jennifer Diaz April 7, 2016 13 Comments

Compliance Blue Marker

If the thought of monetary penalties, shipment delays, detentions or seizures of merchandise keep you up at night, then this article is for you.  First, it’s quite easy to establish a U.S. company, pick (what you hope is) a terrific customs broker, file Form 5106 with U.S. Customs and Border Protection (CBP) to request your importer number, pick a surety (there are many, your broker will likely sway you to their favorite) and WALLAH! Right? Wrong. No one sits you down during this process to say, wait, importing can be great, but, this is also a LOT of responsibility. Your company (and SOMETIMES even YOU) have liability and a burden when importing. This article will walk you through YOUR burden as an importer, how CBP can question your imports, and how penalties can ensue and what you should be doing about it, in advance!

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Build Your Own ‘People to People’ Mission & More Cuba Changes

posted by Jennifer Diaz March 16, 2016 3 Comments

Plane, United States and Cuba flags

If you have been following our Cuba updates, you’ll note we’ve been busy. A full listing of all of our posts to get you caught up are all the way at the bottom. Also, check out our new blog design and let me know what you think!

Here’s the Cliff Notes version:

  • On December 17, 2014, President Obama made a historic announcement: “Today, the United States is taking historic steps to chart a new course in our relations with Cuba and to further engage and empower the Cuban people.”
  • By January 16, 2015, both the U.S. Treasury Department, Office of Foreign Assets Control (OFAC) amended its Cuban Assets Control Regulations, and the U.S. Department of Commerce’s, Bureau of Industry and Security (BIS) amended the Export Administration Regulations with a “Support for the Cuban People” license exception. Both OFAC and BIS’s new rules were effective as of January 16, 2015.
  • OFAC and BIS issued additional new rules on June 15, 2015, September 21, 2015, January 27, 2016 and again today!

As far as travel goes, the NY Times posted their travel tips, but, here are MY travel tips to you:

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Diaz Trade Consulting Partners with 305 Cargo and SBDC on Compliance Seminars

posted by Jennifer Diaz February 23, 2016 0 comments

SeminarDiaz Trade Consulting partners with leading experts to bring you compliance seminars catered to your international business.

COMPLIANCE SEMINARS FOR INDIVIDUALS & SMALL BUSINESSES

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Register Now to Meet FDA’s Director of Import Operations and Maintenance – November 12, 2015

posted by Jennifer Diaz November 6, 2015 0 comments
Do you need to know the current issues affecting importing and exporting for international trade professionals?  What about common compliance issues when importing food, cosmetics, and medical devices?  If you answered yes, you will not want to miss the last of our three-part seminar series that will cover these topics and much more.  Plus, members of supporting organizations, clients of Becker & Poliakoff, and future members and clients, will receive a discount!  Here’s all the information about our upcoming seminar:

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3 Part Compliance Seminar Series You DON’T Want to Miss!

posted by Jennifer Diaz August 24, 2015 0 comments
We are excited to announce our upcoming 3 part seminar series on ImportingExporting, and FDA Compliance! Government and private speakers will participate.  
Each seminar will provide resources for new and experienced international trade
professionals including:

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CBP Updates Trade Community on GSP Expiration

posted by Jennifer Diaz May 16, 2014 0 comments

For those of you that relied on the Generalized System of Preferences (GSP) and are now subject to duties, CBP sent a notice today that directly impacts you.

A previous post discussed the expiration of GSP and need for congressional action to renew it. GSP expired July 31, 2013. Importers were advised to continue to use the Special Program Indicator (SPI) “A” when importing into the U.S., which would signify a valid claim for GSP but to pay duty subsequent to that date, so that in the event of a retroactive renewal, CBP could process refunds automatically.

Unfortunately, the picture above is still correct – the trade community is in limbo – will we get our duties refunded if we are entitled to GSP?  The answer… Yes, Maybe, No.  Not comforting or reassuring.

Today, CBP advised the trade community that:

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FDA Released Draft Guidance on Prior Notice of Imported Foods

posted by Jennifer Diaz April 7, 2014 0 comments

For those of you keeping up with the FDA Food Safety Modernization Act (FSMA), big changes are coming for those in the food industry.  We have been keeping you up to date with blogs on updates to FSMA. We have even created an updated website on FDA to help you understand the vast requirements under the FSMA, as well as complying with FDA generally. If you are a foreign manufacturer, processor, packer, storer or holder of food products, you need a U.S. agent, and must register with the FDA – for more information, review www.FDA-USA.com.

The latest news is that the FDA has released the third Edition of the U.S. Food & Drug Administration (FDA) draft guidance titled “Guidance for Industry: Prior Notice of Imported Food Questions and Answers”.  Prior notice is just what it sounds like, “notification to the FDA that an article of food, including food for animals, is being imported or offered for import into the United States in advance of the arrival of the article of food at the U.S. border.”

FDA is seeking comments on the draft guidance and addresses questions received since the publication of the second edition of the guidance in May 2004.  The guidance also includes information related to the FSMA, which requires additional information to be provided in a prior notice of imported food submitted to the FDA.  The FSMA included a new Prior Notice element, now the FDA requires a person submitting prior notice of imported food, including food for animals, to report the name of any country to which the article has been refused entry.

Although pursuant to 21 CFR 10.115(g)(5), comments can be made on the guidance at any time, in order to ensure that the FDA considers your comments on this draft guidance before it begins to work on the final version of the guidance, your comments must be submitted either electronically or in writing within sixty (60) days from the date in which the notice announcing the availability of the draft guidance is published in the Federal Register, or March 31, 2014.  If you have questions on FDA’s FSMA or on submitting a comment, please feel free to contact me at (305) 260-1053 or via email at JDiaz@bplegal.com.

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CBP Trade Day – Port of Miami

posted by Jennifer Diaz March 17, 2014 1 Comment

cargo at portTrade Day is coming to Miami, courtesy of U.S. Customs and Border Protection, (CBP) on April 2, 2014.  The ports of  Champlain, Boston, Savannah, Buffalo and Detroit have held Trade Day (some already twice) and we are thrilled CBP’s Port of Miami is bringing Trade Day to us.

This is the time to take advantage.  Importers, exporters, customhouse brokers, freight forwarders and all other interested parties in the international trade community – if you have been looking for an informal opportunity to meet one-on-one with government officials that are responsible for processing and facilitating trade related import transactions and enforcing the various Free Trade Agreements and trade laws, this is your chance.

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BEWARE – Liquidated Damages WILL be Imposed for 10+2 Violations

posted by Jennifer Diaz July 18, 2013 0 comments

For those who thought CBP’s “measured and commonsense” approach for those that weren’t fully complying with the Importer Security Filing (ISF or 10+2) rules would last forever, think again!

Effective, July 9, 2013, CBP advised it would start the liquidated damages phase of the Importer Security Filing (ISF) enforcement process. CBP will now make use of the newly activated cargo holds in the Automated Cargo Environment (ACE) system to address non-compliance with the ISF rule. CBP may also withhold the release or transfer of non-compliant ISF shipments at the terminal until the required ISF is filed. For carrier violations of the vessel stow plan requirement, CBP may refuse to grant a permit to unlade the merchandise. Once the ISF data is received and a security assessment is made, additional enforcement actions including a Non-Intrusive Inspection (NII) and/or intrusive exams may be initiated.

Liquidated Damages

CBP may also assess liquidated damages of up to $5,000 per violation for the submission of an inaccurate, incomplete or untimely filing. CBP Dec. 09-26 discusses “Guidelines for the Assessment and Cancellation of Claims for Liquidated Damages for Failure to Comply with the Vessel Stow Plan, Container Status Message, and Importer Security Filing Requirements.”  First violations may be mitigated to $1,000-$2,000 – depending on the presence of aggravating or mitigating factors.  Some mitigating factors for the failure to file a complete, accurate and timely ISF include evidence of progress in the implementation of ISF during the “flexible enforcement period,” small number of violations compared to number of shipments, Tier 2 and 3 C-TPAT status, remedial action….  CBP has advised that “no relief will be granted if CBP determines that law enforcement goals were compromised by the violation.”  Aggravating factors include multiple errors on your ISF!  If you do receive a Liquidated Damages claim, it is important you consult with an expert to file a timely, persuasive Petition to CBP and address all relevant mitigating factors to assure you receive the maximum reduction possible.

What’s ISF Again?

The ISF rules require importers and vessel-operating carriers to provide additional advance trade data on cargo shipments to CBP 24 hours prior to vessel lading, pursuant to Section 203 of the Security and Accountability for Every Port (SAFE Port Act) of 2006.

Importers must report the following 10 data elements on each ISF:

  1. Manufacturer (or supplier) name and address
  2. Seller (or owner) name and address
  3. Buyer (or owner) name and address
  4. Ship-to name and address
  5. Container stuffing location
  6. Consolidator (stuffer) name and address
  7. Importer of record number/foreign trade zone applicant identification number
  8. Consignee number(s)
  9. Country of origin
  10. Commodity Harmonized Tariff Schedule (HTS) number

From the carrier, 2 data elements are required:

  1. Vessel stow plan – required for arriving vessels with containers.
  2. Container status messages – required for containers arriving via vessel.

Hence, 10+2!

For shipments consisting entirely of freight remaining on board (FROB) cargo or goods intended to be transported in-bond as an immediate entry or transportation and exportation entry, the following 5 data elements are required:

  1. Booking party name and address
  2. Ship-to name and address
  3. Commodity Harmonized Tariff Schedule (HTS) number
  4. Foreign Port of Unlading
  5. Place of delivery

In order to avoid liquidated damages and untimely delays with your cargo, full ISF compliance is now required.  Since we’re talking compliance, do you have your pre-compliance plan established?  If not… Let’s talk!

If you have any questions on the listed requirements, need assistance with cargo detained as a result of this new enforcement phase, getting your C-TPAT application in ASAP (and getting to Tier 2 quickly!), or any other compliance or enforcement question, please feel free to contact Diaz Trade Law at info@diaztradelaw.com and we would be happy to assist you!

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ACI’s Import Compliance & Enforcement Conference,

posted by Jennifer Diaz May 6, 2013 1 Comment

The American Conference Institute will be having its 8th Import Compliance and Enforcement Conference on June 11, 2013, in Washington DC. The conference will consist of two days full of lectures discussing highly complex U.S. import compliance challenges, along with how to satisfy Canadian and Mexican customs authorities. Unlike previous conferences, this unique event is designed to provide attendees with a comprehensive benchmarking experience, where participants can exchange best practices and lessons learned for 2013 and beyond. Some of the most notable industry experts that will be present are Chrystler, Hershey, Williams-Sonoma, Boeing, IBM, General Electric, Cisco, Tyco and yours truly.

This event is uniquely designed to maximize benchmarking on how to resolve the most complex, pressing import compliance issues affecting the industry. The new program features for 2013 are:

  • Two highly focused sessions on valuation and transfer pricing:
  • ISA member case studies: New and longstanding members speak about their recent experiences, and how to meet ISA requirements.
  • Inside a focused assessment: Lessons learned from recent experiences on how to handle common and unanticipated CBP requests
  • C-TPAT and Foreign Re-Validations: Meeting new expectations for C-TPAT risk assessments, and how the new EU Mutual Recognition Agreement affects importer validation requirements
  • NAFTA, CAFTA, and US-Korea – FTA success stories:
    • The finer points to minimizing duties, fees, taxes, red tape, and proving origin
  • Developing a global strategy for customs classification and tariff engineering.

One of the most notable topics discussed will be broker selection and management. I have the privilege to discuss important aspects within the broker selection and management process such as:

  • Detecting warning signs: How far you need to go in conducting due diligence.
  • Designing a questionnaire for brokers: Assessing the skills, experience, and resources of customs brokers. 
  • Evaluating brokers’ supply chain relationships
  • Quantifying risk factors
  • Communicating compliance expectations and requirements to brokers, and developing guidelines for your brokers
  • Where the importer and broker responsibilities begin and end
  • Incorporating contractual safeguards, including audit mechanisms
  • How to monitor compliance, and what to do if you suspect or discover non-compliance by a broker
  • Auditing foreign brokers, and conducting periodic review sand site visits
  • When and how to terminate the relationship
  • What constitutes customs brokering and business,and how to avoid unintended brokering activities 

The conference will kick-off with discussions about strengthening global trade compliance. Meredith Covey, Director of Customs Operations and Compliance at Williams-Sonoma Inc., will discuss real world issues related to the implementation and monitoring of monitoring a global import compliance program. She will discuss structures, resources, tools, and techniques leading companies are using to implement, manage, and monitor an import compliance program. Following the conclusion of multiple speakers discussing these aspects, a discussion on Canadian customs regulations and enforcement will ensue. Eric Trudel, a Manager of CBSA, will discuss the key concepts and common pitfalls to compliance in Canada. 

The ACI offers my clients and colleagues, and you, my special blog followers, a discounted price to attend the conference on June 11-12. This rate will expire on May 17th.  Contact Adina Schwartz, JD, at 310-295-9789 or A.Schwartz@AmericanConference.com to get your discounted rate!  You don’t want to miss this!