October 2024 | Customs & International Trade Law Blog

Customs and Trade News Weekly Snapshot

Here is a recap of the latest customs and international trade news:

Customs and Border Protection (CBP)

CBP released the September 2024 monthly update. Highlights:
- Identified $7.6B in duties to be collected
- Stopped 425 shipments for further examination based on the suspected use of forced labor
- Seized 1,873 shipments that contained counterfeit goods
CBP released an updated version of the Air Cargo Advance Screening – Implementation Guide (ACAS-IG) Version 2.3.3.
CBP and CPSC seized $61,000 in infant products that were determined to be unsafe for entry due to high lead paint content and choking hazards.
On October 26, 2024, CBP plans to retire the filer and shipper/consignee legacy ACE portal account views.

Bureau of Industry and Security (BIS)

BIS added 26 entities to the Entity List for activities contrary to U.S. national security and foreign policy.
BIS announced the removal of Canada-based Sandvine Incorporated from the Entity […]

By Jennifer Diaz|2024-10-25T13:12:57-04:00October 25, 2024|Snapshot|Comments Off

ICYMI: USTR Opens Exclusion Process for Domestic Manufacturing Machinery

On October 15, 2024, the Office of the United States Trade Representative (USTR) announced that it is opening a process for interested persons to request that certain machinery be temporarily excluded from Section 301 duties in the Investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.

301 Investigation Background

In August 2017, USTR initiated an investigation into China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation. The agency released a report of its findings in March 2018 and in June 2018 began imposing additional duties on products of China in four tranches.

Under the Trade Act of 1974, the USTR is required to conduct a four-year review if they receive an appropriate request to continue an action taken under Section 301. The agency is required to review:

(A) the effectiveness in achieving the objectives of section 301 of (i) such action, and (ii) other actions that could be taken (including actions against other products or services), and
(B) the effects of such actions on the United States economy, including consumers.

In accordance with this requirement, USTR announced in May 2022 that it was commencing this review and opened a docket for interested persons to submit comments.

The agency received nearly 1,500 comments. Throughout 2023 and early 2024, USTR and the Section 301 Committee (a USTR-led, interagency Trade Policy Staff Committee) held numerous meetings with agency experts to consider the comments received.

In May 2024, USTR issued a formal proposal in […]

By Jennifer Diaz|2024-10-25T12:59:25-04:00October 25, 2024|301 INVESTIGATIONS, U.S. Trade Representative (USTR)|Comments Off

Customs and Trade News Weekly Snapshot

Here is a recap of the latest customs and international trade news:

Customs and Border Protection (CBP)

CBP announced the publication of its re-vamped Forced Labor website. The re-design includes navigation improvements as well as a new enforcement page with statistics and dashboards.
CBP modified the withhold release order (WRO) against disposable gloves produced by Brightway Holdings in Malaysia. Effective immediately, the U.S. will allow disposable gloves produced by the Brightway Group to enter the U.S. provided they are otherwise compliant with U.S. laws.
A team of two CBP agriculture specialists at the Port of Brownsville intercepted a “First in Port” pest that had the potential to defoliate hundreds of species of trees and shrubs.
CBP is now accepting applications to operate a Centralized Examination Station (CES) in the Area Port of Port Chicago. Applications to operate a CES must be received by 4 p.m. on Nov. 26.
CBP published an updated ACE Development and Deployment Schedule.

Bureau of Industry and Security (BIS)

BIS added eight companies to its Unverified List after it was unable to […]

By Jennifer Diaz|2024-10-18T12:23:37-04:00October 18, 2024|Snapshot|Comments Off

Reminder: Listing of OTC Monograph Drug Products No Longer Certifiable through Old Categories in the FDA’s Listing System

As of October 1, 2024, listing of over-the-counter (OTC) monograph drug products will not be able to be certified under the old marketing categories and old application number fields in FDA’s Electronic Drug Registration and Listing System (eDRLS). Instead, the listing of such products will need to include the current Marketing Category and Application Number values.

New Certification Requirements Background

The FDA utilizes the eDRLS for several key programs including drug quality reports, adverse event reports, and drug import and export compliance.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. The law amended the Federal Food, Drug and Cosmetic Act (FD&C Act) and modernized the OTC drug review process.

The amendments required the FDA to update the marketing category and application number fields for OTC monograph drugs in the eDRLS.

eDRLS Field Updates

The change in current values to be used effective October 1st, 2024, are:

For the marketing category field, the categories “OTC monograph final” and “OTC monograph not final” are permanently replaced with the single term “OTC monograph drug,” to be used for nonprescription drug products marketed without an approved new drug application.
For the application number field, the use of OTC monograph CFR parts was discontinued starting October 2023 and the old submissions referencing the CFR parts must now be updated to include the appropriate Monograph ID.

As of October 1, 2024, drug listing records that refer to the old marketing categories and CFR parts citations will no longer be available for certification.

OTC drug […]

By Jennifer Diaz|2024-10-18T12:25:39-04:00October 18, 2024|U.S. Food and Drug Administration (FDA)|Comments Off

BIS Issues Guidance to Financial Institutions on Best Practices for Compliance with the Export Administration Regulations

The Department of Commerce’s Bureau of Industry and Security (BIS) recently published guidance for financial institutions containing several recommendations for complying with the Export Administration Regulations (EAR).

The guidance provides recommendations on steps financial institutions can take to minimize the likelihood of EAR violations. The recommendations focus on three key areas: due diligence best practices, reviewing transactions for red flags, and real-time screening.

Due Diligence Best Practices

The guidance recommends that financial institutions incorporate EAR related due diligence into their compliance and risk management and compliance processes. Due diligence should be conducted both before onboarding a new customer and as part of regular due diligence thereafter.

Specifically, BIS recommends that financial institutions:

Review customers against lists of persons subject to BIS’s end-user restrictions
Review customers – and, where appropriate, customers’ customers – against lists of entities that have shipped Common High Priority List (CHPL) items to Russia since 2023
Ask a customer to certify that it has controls in place to comply with the EAR if the customer is engaged in the export, reexport or transfer of items subject to the EAR and is on a restricted-party list

Review Transactions for Red Flags

The guidance recommends that financial institutions review transactions on an ongoing basis for red flags:

Purchases under a letter of credit that are consigned to the issuing bank, not to the actual end user.
Transactions involving entities with little to no web presence, such as a website or a domain based email account.
A customer lacks or refuses to […]

By Jennifer Diaz|2024-10-11T15:13:06-04:00October 11, 2024|Export, U.S. Bureau of Industry and Security (BIS)|Comments Off

Customs and Trade News Weekly Snapshot

Here is a recap of the latest customs and international trade news:

Customs and Border Protection (CBP)

U.S. signs Customs Mutual Assistance Agreement with El Salvador.
CBP activated a Lead Field Coordinator (LFC) to coordinate all of CBP’s essential operations within the impacted region of Hurricane Milton.
CBP issued clarifications to ACE Entry Type 86 Test.
CBP extended its rejection of vague descriptions for the Air Cargo Advance Screening (ACAS) compliance deadline to Nov. 12.
CBP Executive Director of Trade Relations Felicia Pullam defended the administration’s proposal to end de minimis eligibility for goods subject to Section 301 tariffs and reiterated the agency’s support for charging a $2 fee per de minimis package.
CBP’s Norfolk office seized over $450,000 in dental supplies lacking country of origin markings.

Bureau of Industry and Security (BIS)

BIS issues guidance to financial institutions on best practices for compliance with the Export Administration Regulations.

Office of Foreign Asset Control (OFAC)

By Jennifer Diaz|2024-10-11T11:42:02-04:00October 11, 2024|Snapshot|Comments Off

ICYMI: G7 Issues Guidance on Preventing Evasion of Export Controls and Sanctions Imposed on Russia

The United States, Canada, France, Germany, Italy, Japan, the United Kingdom, and the European Union (the G7) published joint guidance for industry on preventing evasion of the export controls and sanctions imposed on Russia.

The goal of the guidance is to protect common high priority list items from misappropriation, prevent reputational harm, and mitigate liability risk. The guidance aims to assist industry with complying with multilateral export controls and sanctions and with identifying evolving Russian evasion practices.

The guidance outlines three priority areas: Items that pose a heightened risk of being diverted to Russia, red flag indicators of potential evasion, and best practices to address red flags.

1. The Common High Priority List (CHPL)

The European Union, Japan, the United Kingdom, and the United States developed the CHPL to identify items that pose a heightened risk of illicit diversion to Russia. Items include:

Integrated circuits
Navigational instruments
Digital cameras
Transistors
Signal generators
Milling machines

See the full CHPL here.

2. Red Flag Indicators

The G7 identified the following red flags indicators of potential export control and sanctions evasion:

Sudden changes in business activity after February 24, 2022
Fales, inaccurate, or misleading documentation
Concealing the end user
Inconsistencies in the transaction
Vague details and/or incomplete information
Dividing invoices
Suspicious customer information

3. Best Practices

The G7 calls on responsible traders to improve export compliance systems and exercise enhanced due diligence. Specifically, following these steps when encountering any red flags:

Run transaction parties against applicable public sanctions lists
Conduct additional due diligence
Analyze the risk of export control and/or […]

By Jennifer Diaz|2024-10-11T11:23:50-04:00October 11, 2024|Export|Comments Off

Customs and Trade News Weekly Snapshot

Here is a recap of the latest customs and international trade news:

Customs and Border Protection (CBP)

CBP issued guidance on the modifications made to Section 301 pursuant to the findings of the four-year review of actions taken in the Section 301 investigation of China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation.
CBP officers in Norfolk, Virginia, seize food trailers and golf carts from China that violate federal motor vehicle safety standards.
CBP officers working at the Presidio port of entry seized 748 pounds prohibited Mexican bologna.

United States Trade Representative (USTR)

USTR and the United States Department of Agriculture (USDA) announced that the Biden-Harris Administration has secured over $26.7 billion in agricultural market access across the globe for America’s farmers, ranchers, fishers, and food manufacturers.
Katherin Tai submitted written responses to the Senate Finance Committee following a hearing earlier this year. In her answers, she declined to endorse a permanent e-commerce tariff moratorium and called for more money for CBP, to address Section 301 tariff circumvention.

Bureau of Industry and Security (BIS)

BIS published its second quarterly update of the boycott Requester List. The list […]

By Jennifer Diaz|2024-10-04T18:52:35-04:00October 4, 2024|news, Snapshot|Comments Off