U.S. Customs and Border Protection (CBP) held its annual Trade Symposium on July 23 – 24, 2019, in Chicago, IL. With over a thousand attendees, this year’s trade symposium provided a high-level overview of the Agency’s current stance on various issues and the need for stronger partnership between all stakeholders, including the trade community. DTL was on the ground meeting with CBP to get answers to our client’s questions and ensuring we keep our readers in the loop on CBP’s TOP trade priorities. The two-day event included panel discussions and one on one meetings with the Directors and Executive Directors other Centers of Excellence and Expertise, along with exhibitor booths that ranged from CBP Enforcement of Forced Labor, AD/CVD, and IPR to USDA and FDA. Here is a detailed recap of who, what, and when:


Day one kicked with opening remarks by CBP’s Acting Commissioner, Mark A. Morgan, who applauded CBP for facilitating 2.6 million in imports and confirmed that CBP was able to collect 5.2 billion dollars in duties and fees (an increase of 23% from the previous year!). Commissioner Morgan, who was appointed just over 2 weeks ago, addressed the need for stronger partnership with the trade community, as he called on all stakeholders to “work together to stay ahead of the curve in radically changing areas that include global complexity such as e-commerce” and closed his remarks with affirming his “commitment to listen to you [trade community]!”

Keynote Luncheon speaker, former CBP Commissioner, and now DHS’ Acting Secretary, Kevin K. McAleenan, also echoed Commissioner Morgan’s interest in addressing e-commerce concerns, as he announced the launch of the e-commerce pilot program. Similarly, Secretary McAleenan also shared his excitement for the IPR Pilot program, where 8 participants from the tech. industry will win 100k each to develop a hardware or software program with scanning capabilities to identify packaging contents at a faster rate. When asked what future issues need to be addressed, Secretary McAleenan responded with:

  • What do we do with 3D printing? What does it mean when the devices are programmed to print regulated goods?
  • Movement from crypto currencies when converted and introduce to our monetary platform?
  • What should the trade community do to push the DHS mission?

Panel discussions held fruitful dialogues on the following topics:

  • Northern Triangle: Looking at factors to achieve Prosperity, Governance, and Security
    • This panel provided a holistic view into the economic dynamics in the region of Central America by addressing the lack of economic opportunity in the Northern Triangle countries of Central America (Guatemala, Honduras, and El Savldador), the insecurity associated therewith, and how such factors are impacting the region.
    • Panelists highlighted potential government and non-government efforts to promote regional economic prosperity, and shared examples of past successes of regional investment, such as the Security Governance Initiative (SGI) in Africa.
    • Panelist, DHS’ Michael Dougherty, Assistant Secretary, Border, Immigration, and Trade Policy addressed the Conditions on the SW Border by commenting that we are seeing a 103% increase from the previous year on immigration and emphasized the cause for this is the lack of equal opportunity in the Northern Triangle.
    • Similarly, Panelist and Senior Adviser of the Western Hemisphere for Overseas Private Investment Corporation (OPIC), Kristie Pellecchia, shared funding/direct investment opportunities for companies interested in working with the Northern Triangle. She explained that OPIC’s focus is foreign policy based and targets development by creating jobs in the local market. “Our goal is to create economic prosperity by providing equal access opportunity, which is essential to creating stability.” Currently OPIC has 23 million dollars that are committed or funded (25% is earmarked to Northern Triangle region). Projects range from small to large. For companies interested in applying for funding, visit OPIC’s website for criteria and application process.
  • Trade Remedies: Implementation through Collaboration (Section 232 Tariffs and 301 Tariffs)
    • This panel highlighted the successes and challenges of the trade remedies process to date, underscoring the importance of stakeholder collaboration at every stage.
    • CBP’s Africa Bell, Acting Director, Enforcement Operations Division, Trade Remedies Law Enforcement Directorate looped in the CEE’s and their influence and involvement in the trade remedies, noting that trade remedies are a priority for all 10 CEE’s. To date, based on enforcement actions, CBP has been able to collect 74% of 232 Tariffs and 50% of 301 Tariffs from imports subject to the respective trade remedy. The CEE’s played a “powerful voice and role in deciding which HTS is listed on the 301 Lists based on being able to identify the commodity and collect duties.”
    • CBP’s Gail Kan, Chief, Entry Process & Duty Refunds Branch, Commercial and Trade Facilitation, Regulations and Rulings clarified CBP’s role in the Trade Remedy process by stating that CBP participates, but doesn’t get to have a say in policy – CBP may not supersede federal statutes, for example, if an entry is liquidated and not protested we do not have authority to make a change.
    • S. Department of Commerce’s Erika Maynard, Special Projects Manager, Bureau of Industry and Security (BIS), Office of Technology Evaluation (OTE), explained that BIS leads the exclusion request process for 232 Tariffs and encouraged the trade community to engage with the 232 Tariff Portal – a streamlined coordination with the DOC and CBP.
    • Office of the United States Trade Representative (USTR)’s Arthur Tsao, Associate General Counsel, Section 301 encouraged the trade community to engage with the 301 Tariff Portal and gave recommendations on best practices in effectively drafting and submitting exclusion requests for products subject to List 3 – the number ONE concern is the proper classification of a product – we HIGHLY recommend all submitter’s to consult with our firm to confirm your product is properly classified or submit a Binding Ruling PRIOR to submitting the exclusion request (remember, you have until September 30, 2019)!
    • A common theme during the panel discussion was the unexpected volume of exclusions which ultimately made interagency coordination much more important. The interagency coordination is based on 3 stages:
      • Trade analyst to review each request (based on evidence and factors in the federal register notice)
      • Technical review by all
      • Product Description conducted by the ITC and CBP
    • 232 Exclusions are specific to the applicant, while 301 are HTS specific (impacts the trade industry, i.e., if you win, everyone else who imports under your HTS also wins (don’t expect a present)).
  • 21st Century Customs Framework: Key Customs Process Areas That Are Ripe for Improvements
    • Panelists provided their perspective regarding the modernization of customs processes. Industry representatives shared how enhancements affect the facilitation and enforcement as to imports and exports while CBP looks into the 21st Century Customs framework.
    • Chris Floersch, Manager, Trade Services, American Honda Motor Co., Inc. provided a good tip on how to lower costs through block chain: Use block chain to track costs to reduce administrative costs (e.g., Microsoft used block chain to track royalties for programmers.)
    • Jon Gold, Vice President, National Retail Federation (NRF) echoed the value of block chain as he stated “It is essential to have PGAs in part of the block chain process” and call on PGA’s to also “facilitate trade” as right now they are only enforcement based.
    • Brandon Lord, Deputy Executive Director, Trade, Policy & Programs, OT, CBP shared insights on what CBP is currently working on, which includes:
      • Streamlining the entry process by using data that already exists in the supply chain to make clearance more predictable.
      • Seamless information sharing targeted to getting better at sharing bad actor’s data.
      • Supporting more timely entries based on better exchange of information with the goal of less wait time for both brokers and CBP.
      • Develop a robust framework for e-commerce looking at rules and responsibilities for both traditional and new actors
  • E-Commerce: Challenges and Opportunities
    • Sir PicThe panel discussed how CBP, its Partner Government Agencies, and industry are responding to challenges and opportunities (rapid rise of e-commerce, fueled by new technologies and business models) by working together to identify enforcement threats, while facilitating legitimate trade. International trade and logistics are in the midst of a revolution.
  • CBP confirmed that 1.3 million e-commerce packages enter the US and CBP doesn’t have the man power to review all, but is rather seeking on relying on the trade partnership.
  • CBP also notes an “explosive growth for trucking shipments and low value shipments” where it would take 2-3 days to inspect a truck load of shipments.
  • Since E-commerce is huge for small business, CBP needs its partners to work together to clear compliant shipments and not import illicit goods.
  • Kevin Willis, Director, Global Trade Services of Amazon joined the panel and confirmed that Amazon’s Goal is for Safe secure and authentic transactions and seeks open lines of communication to building relationships in a super complicated space. Engaging in partnership and communication will help keep the traditional requirements and approach to new market places.
  • CBP discussed its voluntary test (321 pilot) (announced on July 23, 2019) on to collect advance data related to e-commerce shipments with import values of less than the $800 de minimis. CBP is conducting this test to determine the feasibility of requiring advance data from different types of parties and requiring additional data that is generally not required under current regulations in order to effectively identify and target high-risk shipments in the e-commerce environment.


Presentation PicDuring U.S. Customs and Border Protection Leadership Town Hall, senior executives hosted an open discussion where attendees heard first-hand CBP’s priorities and efforts in support of the agency’s strategic trade vision. Comments made included:

  • Fighting against IPR and Drug smuggling is top priority. Chicago is the 3rd largest mail hub with 40% of all e-commerce coming into Chicago. This causes difficulties with preventing IPR violations and narcotics (fentanyl).  This has led to the 321 pilot.
  • The systems that were implemented for non-intrusive inspections are faulty and need to be replaced.
    • FY18 included a 224 million budget and a 560 million budget in FY19, that’s almost 800 million in the last two years for non-intrusive inspection deployment. This will add 181 new units.
    • Moving to a multi energy scanning will allow the scanner to have different levels of radiation to be emitted. It will scan the cab with low frequency so the driver does not need to get out of the vehicle and will high frequency the trailer to look for contraband.  This has increased the output from 7 trucks an hour to 50 trucks an hour.  It is expected to increase by 2022 to 40% of cars scanned and 72 % of all trucks.
  • Another issue discussed was outdated policy systems with CBP, which has led to modernization of both revenue collection as well as issuing of receipts. Online payments streamline the process and are much more efficient.

Other important discussions held during breakout sessions included:

  • Countering Illicit Trade
    • The purpose of the “Countering Illicit Trade” panel was to raise awareness of potential threats faced by industry and the trade community, to identify means for reporting illicit activity, and to share methods for partnering with the U.S. government.
  • Port of the Future (Cargo)
    • The Port of the Future Breakout session discussed new technologies and processes that will enhance security and expedite legitimate trade at air, sea, and land ports of entry. CBP shared its innovations in automation, technology and cashless processing.
  • Forced Labor in the Supply Chain: Understanding the Government Role and What Companies Can Do
    • The panel explored U.S. Government and Company (Importer) roles in Forced Labor.
    • 25% of those importers that were surveyed, believed Forced Labor was in their supply chain.
    • The following questions were addressed:
      • What type of engagement should a company be prepared for on Forced Labor?
      • How to identify areas of risk in your supply chains?

 Recommendations included:

1. Build program that is most effective for your goods.

2. Show you did your due diligence.

3. Take a holistic approach to get an understanding of what’s taking place on the ground. Engage various stake holder

4. Supply chains must be reviewed through all tiers as the definition of forced labor includes “wholly or partially”.

5. Review Government resources (contact us (info@diaztradelaw.com) for a detailed list!)

6. Self-Audit.

7. Informed compliance for reasonable care – updated in 2017 to include force labor!

  • How the U.S. Government investigates forced labor in supply chains?
    • Allegation are not taken lightly.
    • A risk and analysis survey is sent to companies.
    • Onsite audit – These take less time to help understand your supply chain and ID your high-risk areas that should be addressed to avoid forced labor.
    • What kind of measures are in place to address forced labor concerns?
    • If Forced Labor is found, there needs to be a nexus with the US that’s within CBP’s jurisdiction. The following are CBP’s options:
      • Withhold Release Orders (WRO)
      • Publish findings report
      • Issue Penalties
      • Force importer to Abandon/destroy/export goods

CBP recommends: Don’t disengage – work with supplier to get forced labor out of their business. Help make them better, if they don’t, get CBP involved which shows you made an effort to address and change the conditions.

  • What are some Fortune 500 companies doing to combat problems in their supply chains?
    • Third party audit – use previous audit to show compliance. Careful of supplier conducted audits!!

DTL Participated in One-on-One Center Discussions!

The Center Directors provided one-on-one discussions to answer questions from the Trade Symposium participants.

DTL sat down with Center Representatives from the Agriculture & Prepared Products Center and Footwear & Textiles Center for best practices tips to share our readers. Here’s the scoop:

  • Dina Amato, Center Director, Agriculture & Prepared Products Center and Mike Maricich, Assistant Center Director, Agriculture & Prepared Products Center advised importers to be careful of AD/CVD on produce and ensure compliance with PGA’s (including timely following FDA’s notice of refusal and CBP’s Notice for Redelivery (to avoid liquidated damages)!
  • Eric Batt, Center Director, Apparel, Footwear & Textiles Center, OFO, CBP also shared that training on FTA’s will be announced in the near future in hopes that more of the trade community will take advantage of the preferential treatment – currently only 17% of importers are reaping FTA benefits! Did you know we have FTA’s in place with 20 countries?

For more insight on any of the above topics contact Diaz Trade Law at 305-456-383 or info@diaztradelaw.com and check our posts on Twitter using #2019TS.