US - State certifies shrimp harvesting nations

On May 26, 2016, the Department of State published in the Federal Register a document [Public Notice: 9584] announcing that on May 3, 2016, it certified that 14 shrimp-harvesting nations (Colombia, Costa Rica, Ecuador, El Salvador, Gabon, Guatemala, Guyana, Honduras, Mexico, Nicaragua, Nigeria, Pakistan, Panama, and Suriname) have a regulatory program comparable to that of the United States governing the incidental taking of the relevant species of sea turtles in the course of commercial shrimp harvesting and that the particular fishing environments of 26 shrimp-harvesting nations and one economy do not pose a threat of the incidental taking of covered sea turtles in the course of such harvesting. Sixteen nations have shrimping grounds only in cold waters where the risk of taking sea turtles is negligible: Argentina, Belgium, Canada, Chile, Denmark, Finland, Germany, Iceland, Ireland, the Netherlands, New Zealand, Norway, Russia, Sweden, the United Kingdom, and Uruguay. Ten nations and one economy only harvest shrimp using small boats with crews of less than five that use manual rather than mechanical means to retrieve nets or catch shrimp using other methods that do not threaten sea turtles. Use of such small scale technology does not adversely affect sea turtles. The 10 nations and one economy are: The Bahamas, Belize, China, the Dominican Republic, Fiji, Hong Kong, Jamaica, Oman, Peru, Sri Lanka, and Venezuela.

A completed DS–2031 Shrimp Exporter’s/Importer’s Declaration must accompany all shipments of shrimp or shrimp product into the United States. Only shrimp or products from shrimp harvested in the 40 certified nations and one economy listed above may be accompanied by a DS–2031 with Box 7(B) checked. All DS–2031 forms accompanying shrimp imports from uncertified nations must be originals with Box 7(A)(1), 7(A)(2), or 7(A)(4) checked, consistent with the form’s instructions with regard to the method of production of the product and based on any relevant prior determinations by the Department of State, and signed by a responsible government official of the harvesting nation’s competent domestic fisheries authority.

US – President announces lifting of Vietnam arms embargo

On 23 May 2016, at a joint press conference with President Quang in Hanoi, President Obama announced the lifting of the U.S. arms embargo against Vietnam, which had been in place since 1984. The U.S. Department of State’s Directorate of Defense Trade Controls (DDTC) subsequently announced the end of its policy prohibiting the sale and transfer of lethal weapons to Vietnam. This announcement follows DDTC’s recent lifting of arms embargoes on Sri Lanka and Côte d’Ivoire.

Prior to these rule changes, DDTC had imposed a policy of denial on all license applications for exports or imports of defense articles and defense services destined for or originating in Vietnam, Côte d’Ivoire, Sri Lanka, respectively, except for certain limited categories of items eligible for case-by-case review. These categories included: (for Vietnam) non-lethal items, non-lethal, safety-of-use defense articles for lethal end-items, and, pursuant to a November 2014 rule change, limited categories of lethal items intended to enhance maritime security and domain awareness; (for Sri Lanka) items for humanitarian demining or aerial/maritime surveillance; and (for Cote d’Ivoire) items to support certain UN operations, humanitarian uses, and the Ivorian security forces.

For additional information, contact Bart M. McMillan or Maria H. van Wagenberg. Check our Sanctions blog for updates.

UK – Policing and Crime Bill: New explanatory notes published

Further to our blog post on 26 April 2016 summarising the proposed Part 8 financial sanctions elements of the Policing and Crime Bill 2015-16 to 2016-17 (the “Bill“), the Bill reached its 1st and 2nd reading stages in the House of Commons on 19 May 2016 without any questions put. As previously set out, the Bill proposes the introduction of an extended maximum penalty, Serious Crime Prevention Orders and Deferred Prosecution Agreements, and a new monetary penalties regime in respect of breaches of financial sanctions, as well as temporary UK legislation to bridge the time gap between the adoption of UN sanctions and their implementation by the EU.

The Bill has now been printed with new explanatory notes. The Bill as introduced at its reading stages can be accessed here. The explanatory notes can be accessed here. The notes provide an overview of the Bill, stating the following in relation to its financial sanctions elements:

“Part 8 strengthens the enforcement regime for financial sanctions by increasing the maximum custodial sentence on conviction for breaching sanctions, expanding the range of enforcement options, including a new system of monetary penalties, and by providing for the immediate implementation of UN-mandated sanctions.”

The explanatory notes go on to set out the following:

    • provide a background on the UN and EU sanctions framework;
    • note that currently under UK law the maximum penalties relating to financial sanctions breaches are two years’ imprisonment upon conviction on indictment and three months imprisonment upon summary conviction, and that these are inconsistent with penalties for similar offences in other sanctions regimes;
    • refer to an ‘enforcement gap’ between situations deemed serious enough to warrant prosecution and cases where a cautionary letter may be sufficient;
    • refer to the creation of the new Office of Financial Sanctions Implementation (for more information see our previous blog post); and
    • summarise the main provisions of Part 8. (Paragraphs 166 to 178.)

The notes then provide a detailed analysis of the Part 8 draft provisions (from paragraphs 883 to 931).

A date for the report stage of the Bill has yet to be announced. If approved, the Bill will proceed to the House of Lords for consideration and potential amendment.

For additional information, please contact Mara Ghiorghies of our London office.

UN Security Council terminates Liberian sanctions

On 25 May 2016, the UN Security Council (UNSC) adopted Resolution 2288 (2016), which terminated, with immediate effect, the measures on arms, previously imposed by paragraph 2 of Resolution 1521 (2003) and modified by paragraphs 1 and 2 of Resolution 1683 (2006), by paragraph 1 (b) of Resolution 1731 (2006), by paragraphs 3, 4, 5 and 6 of Resolution 1903 (2009), by paragraph 3 of Resolution 1961 (2010), and by paragraph 2 (b) of Resolution 2128 (2013) and dissolved, with immediate effect, the Committee established by paragraph 21 of Resolution 1521 (2003) and the Panel of Experts established pursuant to paragraph 22 of Resolution 1521 (2003), and subsequently modified and extended, including in paragraphs 3 and 4 of Resolution 2237 (2015).

The actions were taken because the Council determined that the ceasefire in Liberia is being fully respected and maintained, disarmament, demobilization, reintegration, repatriation and restructuring of the security sector have been completed, the provisions of the Comprehensive Peace Agreement are being fully implemented, and significant progress has been made in establishing and maintaining stability in Liberia and the subregion.

Switzerland - Sanctions against Côte d’Ivoire lifted

On 25 May 2016, the Swiss Government announced that on the basis of UN Security Council Resolution 2283 (2016) of 28 April 2016, the Federal Council has repealed the Ordinance on Measures against Côte d’Ivoire. The measures involved a partial embargo on armaments, as well as financial and travel sanctions. The Ordinance is repealed as of 6pm on 25 May 2016.

Following the failed putsch against Laurent Gbagbo's government on 19 September 2002 and the subsequent outbreak of civil war in the country, the Federal Council issued the Ordinance on Measures against Côte d’Ivoire, thereby implementing the UN Security Council sanctions. The Ordinance and its annex have been amended several times to take account of political developments. For example, in late 2014 the measures regarding trade in raw diamonds originating in Côte d’Ivoire were repealed. Since then, the Ordinance has covered only a partial embargo on armaments, travel sanctions and the freezing of assets.

As the political situation in the country has become less tense, and with presidential elections correctly conducted on 25 October 2015, the UN Security Council has decided to lift the remaining sanctions against Côte d’Ivoire. On the basis of the corresponding Resolution 2283 (2016), the Federal Council will repeal the Ordinance as of 25 May 2016.

US – FAS publishes WTO agricultural quantity-based safeguard trigger levels

On May 25, 2016, the Foreign Agricultural Service (FAS), U.S. Department of Agriculture, published in the Federal Register a notice that lists the updated quantity-based trigger levels for products which may be subject to additional import duties under the safeguard provisions of the WTO Agreement on Agriculture. The notice also includes the relevant period applicable for the trigger levels on each of the listed products.

QUANTITY-BASED SAFEGUARD TRIGGER

Product

Trigger level

Period

Beef

317,530 mt

January 1, 2016 to December 31, 2016

Mutton

3,316 mt

January 1, 2016 to December 31, 2016

Cream

2,789 liters

January 1, 2016 to December 31, 2016

Evaporated or Condensed Milk

1,173,090 kg

January 1, 2016 to December 31, 2016

Nonfat Dry Milk

525,441 kg

January 1, 2016 to December 31, 2016

Dried Whole Milk

3,406,679 kg

January 1, 2016 to December 31, 2016

Dried Cream

586 kg

January 1, 2016 to December 31, 2016

Dried Whey/Buttermilk

18,198 kg

January 1, 2016 to December 31, 2016

Butter

13,656,765 kg

January 1, 2016 to December 31, 2016

Butter Oil and Butter Substitutes

6,076,713 kg

January 1, 2016 to December 31, 2016

Dairy Mixtures

15,718,595 kg

January 1, 2016 to December 31, 2016

Blue Cheese

4,865,957 kg

January 1, 2016 to December 31, 2016

Cheddar Cheese

11,292,096 kg

January 1, 2016 to December 31, 2016

American-Type Cheese

663,153 kg

January 1, 2016 to December 31, 2016

Edam/Gouda Cheese

8,161,533 kg

January 1, 2016 to December 31, 2016

Italian-Type Cheese

19,591,643 kg

January 1, 2016 to December 31, 2016

Swiss Cheese with Eye Formation

28,790,738 kg

January 1, 2016 to December 31, 2016

Gruyere Process Cheese

3,745,854 kg

January 1, 2016 to December 31, 2016

NSPF Cheese

52,603,975 kg

January 1, 2016 to December 31, 2016

Lowfat Cheese

153,319 kg

January 1, 2016 to December 31, 2016

Peanuts

19,037 mt

April 1, 2015 to March 31, 2016

13,106 mt

April 1, 2016 to March 31, 2017

Peanut Butter/Paste

3,592 mt

January 1, 2016 to December 31, 2016

Raw Cane Sugar

676,944 mt

October 1, 2015 to September 30, 2016

617,282 mt

October 1, 2016 to September 30, 2017

Refined Sugar and Syrups

177,579 mt

October 1, 2015 to September 30, 2016

355,264 mt

October 1, 2016 to September 30, 2017

Blended Syrups

87 mt

October 1, 2015 to September 30, 2016

106 mt

October 1, 2016 to September 30, 2017

Articles Over 65% Sugar

385 mt

October 1, 2015 to September 30, 2016

415 mt

October 1, 2016 to September 30, 2017

Articles Over 10% Sugar

20,158 mt

October 1, 2015 to September 30, 2016

18,930 mt

October 1, 2016 to September 30, 2017

Sweetened Cocoa Powder

86 mt

October 1, 2015 to September 30, 2016

72 mt

October 1, 2016 to September 30, 2017

Chocolate Crumb

12,167,560 kg

January 1, 2016 to December 31, 2016

Lowfat Chocolate Crumb

500,069 kg

January 1, 2016 to December 31, 2016

Infant Formula Containing

Oligosaccharides

309,726 kg

January 1, 2016 to December 31, 2016

Mixes and Doughs

230 mt

October 1, 2014 to September 30, 2015

234 mt

October 1, 2015 to September 30, 2016

Mixed Condiments and Seasonings

961 mt

October 1, 2015 to September 30, 2016

894 mt

October 1, 2016 to September 30, 2017

Ice Cream

2,964,185 liters

January 1, 2016 to December 31, 2016

Animal Feed Containing Milk

27,792 kg

January 1, 2016 to December 31, 2016

Short Staple Cotton

2,330,949 kg

September 20, 2015 to September 19, 2016

1,363,307 kg

September 20, 2016 to September 19, 2017

Harsh or Rough Cotton

0 kilograms

August 1, 2015 to July 31, 2016

13 kg

August 1, 2016 to July 31, 2017

Medium Staple Cotton

48,783 kg

August 1, 2015 to July 31, 2016

0 kg

August 1, 2016 to July 31, 2017

Extra Long Staple Cotton

1,505,611 kg

August 1, 2015 to July 31, 2016

1,270,096 kg

August 1, 2016 to July 31, 2017

Cotton Waste

793,048 kg

September 20, 2015 to September 19, 2016

925,273 kg

September 20, 2016 to September 19, 2017

Cotton, Processed, Not Spun

2,058 kg

September 20, 2015 to September 19, 2016

51 kg

September 20, 2016 to September 19, 2017

US – DDTC posts notices on exports to Vietnam, Côte d’Ivoire, Sri Lanka

On May 23, 2016, the State Department’s Directorate of Defense Trade Controls (DDTC) posted an Industry Notice on exports to Vietnam which states:

Change in Policy on Exports of Munitions to Vietnam

Pursuant to a decision made by the Secretary of State and effective immediately, the Department of State's policy prohibiting the sale or transfer of lethal weapons to Vietnam, including restrictions on exports to and imports from Vietnam for arms and related materiel, has been terminated. Consequently, in accordance with the Arms Export Control Act, the Directorate of Defense Trade Controls (DDTC) will review on case-by-case basis applications for licenses to export or temporarily import defense articles and defense services to or from Vietnam under the International Traffic in Arms Regulations (ITAR). DDTC will soon publish a rule in the Federal Register to implement a conforming change to ITAR §126.1.

On May 5, 2016, the State Department’s Directorate of Defense Trade Controls (DDTC) posted an Industry Notice on exports to Côte d’Ivoire which states:

Policy on Exports to Cote d'Ivoire

Pursuant to UNSCR 2283, adopted April 28, 2016 and effective immediately, the UN Security Council sanctions regime against Cote d'Ivoire, including restrictions on exports to Cote d'Ivoire of arms and related materiel, has been terminated. Consequently, in accordance with International Traffic in Arms Regulations (ITAR) §126.1(c), the Directorate of Defense Trade Controls (DDTC) will review applications for licenses to export or temporarily import defense articles and defense services to or from Cote d'Ivoire under the ITAR on a case-by-case basis. DDTC will publish a Federal Register notice to implement a conforming update to ITAR §126.1.

On May 4, 2016, the State Department’s Directorate of Defense Trade Controls (DDTC) posted an Industry Notice on exports to Sri Lanka which states:

Policy on Exports to Sri Lanka

Licensing restrictions relating to Sri Lanka articulated in §7044(e) of the Consolidated Appropriations Act, 2015, Pub. L. No. 113-235, and in previous appropriations acts, were not carried forward in §7044(e) of the Consolidated Appropriations Act, 2016, Pub. L. No. 114-113. Effective immediately the Directorate of Defense Trade Controls (DDTC) will review applications for licenses to export or temporarily import defense articles and defense services to or from Sri Lanka under the International Traffic in Arms Regulations (ITAR) on a case-by-case basis. DDTC will publish a Federal Register notice to implement a conforming update to ITAR §126.1(n).

US – Commerce proposes word limits for certain AD/CVD filings

On May 20, 2016, Enforcement and Compliance, International Trade Administration, Department of Commerce (Commerce) published in the Federal Register a proposed rule [Docket No. 160506400-6400-01] to modify the regulation pertaining to written argument in antidumping and countervailing duty proceedings and is seeking comments from parties. This modification, if adopted, is intended to establish word limits for submission of case and rebuttal briefs. This action is necessary to streamline the process contained in the current regulation, to better align with current Department practices and to reduce the strain on resources.

To be assured of consideration, written comments must be received no later than June 20, 2016.

CBP issues final determinations in procurement cases

CBP has published in the Federal Register the following determinations concerning the country of origin of merchandise for purposes of US Government procurement under the Trade Agreements Act. A copy of the final determination may be reviewed by clicking on the ruling number. Any party-at-interest may seek judicial review of the final determination within 30 days of the date of publication in the Federal Register.

F.R. Date

Ruling Reference (Date Issued) and Product

Country of Origin

05-16-16

HQ H270580 (May 10, 2016) Exercise Equipment: Matrix® G3–S60 Selectorized Dip/Chin Assist and the Matrix® G3–FW52 Back Extension Bench

Scenario 1 – USA

Scenario 2 – China

05-20-16

HQ H273529 (May 13, 2016) Twenty foot long intermodal container

Korea

US – CBP announces ACE as sole EDI system for entry and entry summary processing

On May 23, 2016, U.S. Customs and Border Protection (CBP) published in the Federal Register a general notice announcing that effective July 23, 2016, ACE will be the sole CBP authorized EDI system for the electronic entry and entry summary filings listed below, for all filers. These electronic filings must be formatted for submission in ACE, and will no longer be accepted in ACS.

    • 01—Consumption—Free and Dutiable
    • 02—Consumption—Quota/Visa
    • 03—Consumption—Antidumping/Countervailing Duty
    • 06—Consumption—Foreign Trade Zone (FTZ)
    • 07—Consumption—Antidumping/Countervailing Duty and Quota/Visa Combination
    • 11—Informal—Free and Dutiable
    • 12—Informal—Quota/Visa (other than textiles)
    • 21—Warehouse
    • 22—Re-Warehouse
    • 23—Temporary Importation Bond (TIB)
    • 31—Warehouse Withdrawal—Consumption
    • 32—Warehouse Withdrawal—Quota
    • 34—Warehouse Withdrawal—Antidumping/Countervailing Duty
    • 38—Warehouse Withdrawal—Antidumping/Countervailing Duty & Quota/Visa Combination
    • 51—Defense Contract Administration Service Region (DCASR)
    • 52—Government—Dutiable
    • 61—Immediate Transportation
    • 62—Transportation and Exportation
    • 63—Immediate Exportation
    • 69—Transit (Rail only)
    • 70—Multi-Transit (Rail only)

Electronic entry and entry summary filings for the following entry types must continue to be filed only in ACS. CBP will publish a subsequent Federal Register Notice in the future when these entry and entry summary filings will be transitioned in ACE.

    • 08—NAFTA Duty Deferral
    • 09—Reconciliation Summary
    • 41—Direct Identification Manufacturing Drawback
    • 42—Direct Identification Unused Merchandise Drawback
    • 43—Rejected Merchandise Drawback
    • 44—Substitution Manufacturer Drawback
    • 45—Substitution Unused Merchandise Drawback
    • 46—Other Drawback

Due to low shipment volume, filings for the following entry types will not be automated in either ACS or ACE

    • 04—Appraisement
    • 05—Vessel—Repair
    • 24—Trade Fair
    • 25—Permanent Exhibition
    • 26—Warehouse—Foreign Trade Zone (FTZ) (Admission)
    • 33—Aircraft and Vessel Supply (For Immediate Exportation)
    • 64—Barge Movement
    • 65—Permit to Proceed
    • 66—Baggage
US – President continues national emergency with respect to stabilization of Iraq
US – President continues national emergency with respect to stabilization of Iraq
On May 20, 2016, the Federal Register published Presidential Notice of May 18, 2016 - Continuation of the National Emergency With Respect to the Stabilization of Iraq which continues the national emergency first declared in Executive Order (E.O.) 13303 of May 20, 2016. Because the obstacles to the orderly reconstruction of Iraq, the restoration and maintenance of peace and security in the country, and the development of political, administrative, and economic institutions in Iraq continue to pose an unusual and extraordinary threat to the national security and foreign policy of the United States, the national emergency declared in E.O. 13303, as modified in scope and relied upon for additional steps taken in E.O. 13315 of August 28, 2003, E.O. 13350 of July 29, 2004, E.O. 13364 of November 29, 2004, E.O. 13438 of July 17, 2007, and E.O. 13668 of May 27, 2014, are being continued for 1 year.
US – USTR waives discriminatory purchasing requirements for Ukraine

On May 18, 2016, the Office of the U.S. Trade Representative (USTR) published in the Federal Register a notice announcing a determination regarding waiver of discriminatory purchasing requirements under the Trade Agreements Act of 1979. On November 11, 2015, the WTO Committee on Government Procurement approved the accession of Ukraine to the World Trade Organization (“WTO”) Agreement on Government Procurement (GPA). Ukraine submitted its instrument of accession to the Secretary-General of the WTO on April 18, 2016. The GPA will enter into force for Ukraine on May 18, 2016. The United States, which is also a party to the GPA, has agreed to waive discriminatory purchasing requirements for eligible products and suppliers of Ukraine beginning on May 18, 2016. Section 1-201 of Executive Order 12260 of December 31, 1980 delegated the functions of the President under sections 301 and 302 of the Trade Agreements Act of 1979 to the USTR.

Beginning on May 18, 2016, with respect to eligible products (namely, those goods and services covered under the GPA for procurement by the United States) of Ukraine and suppliers of such products, the application of any law, regulation, procedure, or practice regarding government procurement that would, if applied to such products and suppliers, result in treatment less favorable than that accorded – (A) to United States products and suppliers of such products, or (B) to eligible products of another foreign country or instrumentality which is a party to the GPA and suppliers of such products, shall be waived. This waiver shall be applied by all entities listed in United States Annexes 1 and 3 of GPA Appendix 1.

US – USDA increases FY 2016 raw sugar TRQ
On May 18, 2016, the Office of the Secretary, U.S. Department of Agriculture (USDA) published in the Federal Register a notice increasing the fiscal year (FY) 2016 raw cane sugar tariff-rate quota (TRQ) of 127,006 metric tons raw value (MTRV).
US – State updates list of independently produced Cuban goods and services
On May 18, 2016, the Department of State published in the Federal Register a notice [Public Notice: 9568] with an updated list of goods and services produced by independent Cuban entrepreneurs authorized for importation into the United States (Section 515.582 List). On April 22, 2016, the Department of State published on its website an updated list of goods and services produced by independent Cuban entrepreneurs whose importation into the United States is authorized by the Department of the Treasury’s Cuban Assets Control Regulations (CACR). This list updates the version of the list published on February 13, 2015. These changes allow for more engagement with Cuba’s private sector through new business opportunities.
US – USITC releases report on Trans-Pacific Partnership Agreement

On May 18, 2016, the U.S. International Trade Commission (USITC) released its report assessing the likely impact of the Trans-Pacific Partnership (TPP) Agreement that the President has entered into with Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam.

The USITC's report, Trans-Pacific Partnership Agreement: Likely Impact on the U.S. Economy and on Specific Industry Sectors (Inv. No. TA-105-001, USITC Pub. 4607), provides an assessment of the likely impact of the Agreement on the U.S. economy as a whole and on specific industry sectors and the interests of U.S. consumers, as requested by the U.S. Trade Representative and required by the Bipartisan Congressional Trade Priorities and Accountability Act of 2015.

In making its assessment, the USITC investigated the impact the agreement will have on the U.S. gross domestic product; exports and imports; aggregate employment and employment opportunities; and the production, employment, and competitive position of industries likely to be significantly affected by the agreement. In preparing its assessment, the USITC also reviewed available economic assessments regarding the Agreement, including literature concerning any substantially equivalent proposed agreement. The USITC provides a description of the analytical methods used and conclusions drawn in such literature, and a discussion of areas of consensus and divergence between the USITC’s analyses and conclusions of other economic assessments reviewed.

US – Burmese Sanctions Regulations amended to add general licenses

On May 18, 2016, the Office of Foreign Assets Control (OFAC) published in the Federal Register a final rule amending the Burmese Sanctions Regulations (31 C.F.R. Part 537) to add a general license authorizing certain transactions related to U.S. persons residing in Burma. OFAC is also incorporating a general license authorizing certain transactions incident to exports to and from Burma that has, until now, appeared only on OFAC’s website on the Burma sanctions page, and expanding this authorization to allow certain transactions incident to the movement of goods within Burma that otherwise would be prohibited. Finally, OFAC is expanding and updating another existing authorization allowing most transactions involving certain blocked financial institutions.

Please check our Sanctions blog for additional information and future updates.

US – President continues national emergency with respect to Burma
On May 18, 2016, the Federal Register published Presidential Notice of May __ 2016 – Continuation of the National Emergency With Respect to Burma which continues the national emergency first declared in Executive Order (E.O.) 13047 of May 20, 1997. Because the actions and policies of the Government of Burma continue to pose an unusual and extraordinary threat to the national security and foreign policy of the United States, the national emergency declared on May 20, 1997, and the measures adopted to deal with that emergency in E.O.s 13047 of May 20, 1997; 13310 of July 28, 2003; 13448 of October 18, 2007; 13464 of April 30, 2008; 13619 of July 11, 2012; and 13651 of August 6, 2013 are being continued for an additional year.
US – CITA makes determination on CAFTA-DR commercial availability
On May 17, 2016, the Committee for the Implementation of Textile Agreements (CITA) published in the Federal Register a determination that certain warp stretch woven rayon blend fabrics, as specified in the Federal Register document, are not available in commercial quantities in a timely manner in the CAFTA-DR countries. The products will be added to the list in Annex 3.25 of the CAFTA-DR Agreement in unrestricted quantities.
US – CBP announces ACE as sole EDI system for certain FDA entries

On May 16, 2016, U.S. Customs and Border Protection (CBP) published in the Federal Register a general notice announcing that the Automated Commercial Environment (ACE) will be the sole electronic data interchange (EDI) system authorized by the Commissioner of CBP for processing electronic entries and entry summaries associated with the entry types specified below, for merchandise that is subject to the import requirements of the Food and Drug Administration (FDA). The notice also announces that the Automated Commercial System (ACS) will no longer be a CBP-authorized EDI system for purposes of processing these electronic filings.

Effective June 15, 2016, ACE will be the sole CBP-authorized EDI system for electronic entry and entry summary filings for merchandise subject to the import requirements of the FDA, associated with the following entry types:

    • 01—Consumption—Free and Dutiable
    • 03—Consumption—Antidumping/Countervailing Duty
    • 06—Consumption—Foreign Trade Zone (FTZ)
    • 11—Informal—Free and Dutiable
    • 23—Temporary Importation Bond (TIB)
    • 51—Defense Contract Administration Service Region (DCASR)
    • 52—Government—Dutiable
US – ITA announces meeting of the President’s Export Council
On May 13, 2016, the International Trade Administration, U.S. Department of Commerce (ITA) published in the Federal Register a notice of an open meeting (by teleconference) of the President’s Export Council (Council) to present observations from a recent trip to Cuba by the Council’s Chair and Vice Chair and to deliberate a recommendation related to Cuba. The final agenda will be posted at least one week in advance of the meeting on the Council’s website. The meeting will take place on June 8, 2016 at 10:00 a.m. EDT. The deadline for members of the public to register, including requests for auxiliary aids, or to submit written comments for dissemination prior to the meeting, is 5:00 p.m. EDT on June 6, 2016.
US – CBP publishes quarterly interest rates
On May 13, 2016, U.S. Customs and Border Protection (CBP) published in the Federal Register a general notice advising the public and CBP personnel that the quarterly Internal Revenue Service interest rates used to calculate interest on overdue accounts (underpayments) and refunds (overpayments) of customs duties will increase 1 percent from the previous quarter. For the calendar quarter beginning April 1, 2016, the interest rates for overpayments will be 3 percent for corporations and 4 percent for non-corporations, and the interest rate for underpayments will be 4 percent for both corporations and non-corporations.
US – President continues national emergency with respect to Yemen
On May 13, 2016, the Federal Register published Presidential Notice of May 12, 2016 - Continuation of the National Emergency With Respect to Yemen which extends for one year the national emergency first declared on May 16, 2012 in Executive Order (E.O.) 13611, because actions and policies of certain members of the Government of Yemen and others in threatening Yemen's peace, security, and stability continue to pose an unusual and extraordinary threat to the national security and foreign policy of the United States.
US – MTB reform legislation passes in Senate, sent to President

On May 10, 2016, the American Manufacturing Competitiveness Act (H.R. 4923) passed the U.S. Senate by unanimous consent. It previously passed in the House of Representatives by a 415-2 vote. It now goes to the President. The bipartisan, bicameral legislation establishes a new framework for Miscellaneous Tariff Bills (MTBs) that permit tariff suspensions and reductions in duty for raw materials needed by American manufacturers and producers. The bill seeks to avoid the Congressional ban on “earmarks” by initiating the MTB process through a public International Trade Commission (ITC) vetting process, before which the ITC would analyze and seek public comment on MTB product petitions and submit its recommendations for goods to receive tariff benefits back to Congress for approval or disapproval. In past MTBs, involved importers, manufacturers and producers submitted petitions directly to a Member of Congress for introduction. It was then referred to the International Trade Commission, U.S. Customs and Border Protection and the Office of the U.S. Trade Representative for vetting and a determination of whether any resulting changes can be administered. Bills that passed this vetting were then consolidated in a single legislative package – sometimes tied to other trade legislation. The new MTB process has received broad bipartisan support from groups such as the National Association of Manufacturers, Americans for Tax Reform, the National Taxpayers Union, and a coalition of more than 200 small businesses.

House Committee Report H. Rpt. 114-519, may be downloaded. For more information about the American Manufacturing Competitiveness Act of 2016, click here.

US - BIS removes short-supply license requirements for crude oil exports
On May 12, 2016, the Bureau of Industry and Security (BIS) published in the Federal Register a final rule [Docket No. 160302175- 6175- 01] amending the Export Administration Regulations (EAR) to remove the short supply license requirements that, prior to the entry into force of the “Consolidated Appropriations Act, 2016” on December 18, 2015, applied to exports of crude oil from the United States. Specifically, this rule removes the Commerce Control List (CCL) entry and the corresponding short supply provisions in the EAR that required a license from BIS to export crude oil from the United States. The rule also amends certain other EAR provisions to reflect the removal of these short supply license requirements. The changes made by the rule are intended to bring the provisions of the EAR into full compliance with the act, which mandates that, apart from certain exemptions specified therein, “no official of the Federal Government shall impose or enforce any restriction on the export of crude oil.” Consistent with the exceptions in the act, exports of crude oil continue to require authorization from BIS to embargoed or sanctioned countries or persons and to persons subject to a denial of export privileges. The rule was effective on publication.
US - CBP User Fee Advisory Committee to meet
On May 12, 2016, U.S. Customs and Border Protection (CBP) published in the Federal Register a notice [Docket No. USCBP-2016-0018] announcing that the CBP User Fee Advisory Committee (UFAC) will meet on Wednesday, June 1, 2016, in Washington, DC from 1-3 p.m. The meeting will be open to the public. For registration information, please see the Federal Register notice.
Canada and US enter into a Food Safety Systems Recognition Arrangement

On May 4, 2016, the Canadian Food Inspection Agency (CFIA) announced that the United States Food and Drug Administration (FDA), the CFIA, and the Department of Health of Canada (Health Canada) had entered into a Food Safety Systems Recognition Arrangement (the Arrangement) which offers benefits for public health, consumer protection and trade, including the use of Systems Recognition as an important tool for enhancing the safety of imported Food. The Arrangement allows for: more efficient and effective use of resources; collaboration on risk-informed decision-making about activities that may be carried out in each country; and enhanced regulatory cooperation, improved coordination and greater reliance on the other country's Participant(s) for follow-up and coordination when a Food Safety Concern arises. It may also result in reductions in the type and frequency of verification activities. The Arrangement incorporates earlier agreements protecting confidential information. The Arrangement excludes the following articles from its scope:

    • Meat;
    • Poultry;
    • Processed egg products;
    • Farmed catfish and catfish products;
    • Grade "A" milk and Grade "A" milk products;
    • Raw bivalve molluscan shellfish; and
    • Dietary supplements and natural health products.
WCO releases revised Data Model

On 9, May 2016, the World Customs Organization (WCO) announced that it had released version 3.6.0 of the WCO Data Model. WCO Data Model, a collection of international standards on data and information required not only by Customs, but also by government agencies, developed with the objective of achieving a consensus on the manner in which data will be used in applying regulatory facilitation and controls in global trade.

The Data Model contains data sets for different border procedures, including definitions of data elements, recommended data formats and suggested code lists. The data elements are logically grouped into units of meaningful information, called “information models”. These information models serve as reusable building blocks with which one can build electronic document and data exchange templates.

The Data Model also includes Information Packages, which are standard electronic templates linked to business processes – goods declarations, cargo reports, conveyance reports, licences/permits, and certificates. It is a library of data components and electronic document templates that can be used to effectively exchange business data.

Among others, the new release contains the new European Union (EU) Customs Data Model (CDM) Derived Information Package (DIP). The EU-CDM has been developed based on the WCO Data Model. It is included as the technical annex of the EU Union Customs Code (UCC) and will be used as reference on harmonized and standardized Customs data requirements for the EU Member States.

The new version also contains a report on the conformance of the ASYCUDA information model to the WCO Data Model, particularly on the Import and Export data requirements (Single Administrative Document - SAD). This report can be used by ASYCUDA users as the reference for establishing harmonized exchange of information based on the WCO Data Model.

Additionally, update to several data elements are incorporated in to the new package based on the Data Maintenance Requests (DMR) submitted by Canada, EU, Ghana, Malaysia, the Netherlands, Oman, Sweden, the United Stated of America, UN/ECE (eTIR) as well as UN/CTAD (ASYCUDA).

Last but not least, XML Schemas – a tool for software designers, used to express the structure and constraints of an XML document – enriched with additional information on data element’s attributes are now included in the Data Model. They will enable users to browse the data elements, its structures as well as the attributes of particular information package using any available XML viewer. Additional information now available includes WCO Id, WCO Name, WCO Description, WCO Format representation, Trade Data Element Directory (TDED) Unique Id, as well as the TDED Name.

For additional information, click here.

Canada - CBSA revises Memorandum 11-4-14 to reflect current policy regarding FTA certificates of origin in electronic format

On May 5, 2016, the Canada Border Services Agency (CBSA) issued a revised Memorandum D11-4-14 “Certification of Origin Under Free Trade Agreements” to reflect the CBSA’s current policy regarding the validity of certificates of origin in electronic format. The CBSA acknowledges certificates of origin in electronic format as an acceptable means of certifying the origin of goods. This allows importers to receive and maintain certificates of origin electronically and to transmit those certificates of origin by e-mail to the CBSA, upon request.

The acceptable formats for electronic certificates of origin include:

(a) scanned certificates of origin – The exporter may scan a completed and signed certificate of origin for electronic transmission to the importer;

(b) certificates of origin with Power of Attorney – The exporter provides the importer with vested power of attorney, thereby authorizing the importer to complete the certificate of origin for the goods. Under this option, the importer must be able to prove to the satisfaction of the CBSA that he/she has the legal authority to complete and sign the certificate of origin; and

(c) e-certificates of origin – The CBSA acknowledges an electronic representation of a cursive signature, or an alternative to the cursive signature, as an acceptable means to certifying the origin of goods. For example, an alternative could be a series of numbers that represents the exporter’s signature. As no one is required to physically sign the document under this option, the certificate of origin can be both created and transmitted electronically, thereby enabling an entirely paperless process. It should be noted that e-certificates of origin must contain all of the prescribed data elements and statements, however they do not necessarily need to mirror the prescribed certificate of origin in terms of their layout and manner in which the data elements and statements are presented. Lastly, the importer is fully responsible for ensuring the secure transmission of e-certificates of origin to the CBSA.

The decision rests with the importer claiming preferential tariff treatment on the basis of that certificate or statement of origin, to determine whether or not he/she is willing to accept an official document provided by the exporter in an electronic format and/or featuring an electronic representation of a cursive signature, rather than an original document and/or signature.

The onus rests with the exporter to ensure that the electronic signature that is used in certifying origin is adequately controlled, with limited delegation to subordinates, and is used only in respect of goods where the authorized user has sufficient knowledge of their origin.

Canada finalizes new agreement for exportation of untreated sawn wood to Australia

On May 9, 2016, the Government of Canada announced that the Canadian Food Inspection Agency (CFIA) and Australia’s Department of Agriculture and Water Resources (DAWR) have established a national certification program that ensures untreated Canadian sawn wood can continue to be exported to Australia. The establishment of the Canadian Untreated Sawn Wood Certification Program is an important achievement for Canada as over $40 million worth of untreated sawn wood is exported to Australia annually. The announcement said:

The Canadian Untreated Sawn Wood Certification Program replaces the Canadian Accredited Timber Scheme (CATS), a voluntary pre-shipment inspection program that facilitated the entry of untreated Canadian sawn wood into Australia. Both Canada and Australia recognized the potential for the CATS program to be developed into an official export certification program to mitigate pest risk and ensure continued market access.

Registration in the Canadian Untreated Sawn Wood Certification Program is mandatory and ensures that exports are compliant with Australia's phytosanitary import requirements.

The scientific research that supports this initiative was led by the CFIA, in collaboration with Natural Resources Canada's Canadian Forest Service, and supported by the Canadian Lumber Standards Accreditation Board (CLSAB) and Canada Wood. This achievement further demonstrates the value of the Government of Canada's science to growing the Canadian economy, supporting jobs and protecting the global environment from the spread of plant pests and diseases.

The program will be delivered by accredited agencies under the oversight of CLSAB, a recognized CFIA verification body. The accredited agencies will be responsible for evaluating and auditing Canadian mills registered under the program to maintain ongoing compliance.

Mexico awards contracts to complete phase 2 of the Single Window for Foreign Trade

On May 6, 2016, The Secretariat of Finance and Public Credit, announced that the Tax Administration Service (SAT), after the process of international competitive bidding for the services of the Single Window for Mexican Foreign Trade (VUCEM) 2, awarded the project to Axtel together with Ultrasist, both corporations with variable capital. The bid of 922,187,192.89 pesos was far below the approved budget for this project, which was estimated at 1,990,391,156.47 pesos, and below the cost of VUCEM 1. During the bidding process, which began on February 5, 2016 year with the publication of the notice, and the March 31 reception and opening of proposals, 51 companies had empowering license. Eight proposals were received, two of which were individual and six involved joint participation. The VUCEM 2 is aligned to the National Digital Strategy of the Government and international best practices, so that the following components considered must be considered:

    • Cloud computing for improved performance and responsiveness.
    • Autonomous processes and modules for easy adaptation to the business process management (BPM).
    • World Customs Organization Data Model and international information exchange standards.
    • Interoperability with other systems or foreign trade windows.
    • Interconnection with external processes, governments and operators.
    • Safe and high availability services.
    • Information cubes with customized reports for each user type.
    • Business intelligence and risk analysis.

The objective of the SAT and agencies involved is to make the VUCEM a world leader, with cutting edge technology and has a long - term vision.

Mexico and Canada sign AEO MRA

On May 11, 2016, the Mexican Tax Administration Service (SAT) announced that representatives from the Canada Border Services Agency (CBSA) and SAT singed a Mutual Recognition Arrangement (MRA) for their Authorized Economic Operator (AEO) Programs. The signing occurred during the WCO’s AEO conference, which is being held from May 11-13 in Mexico and is attended by more than 1,000 representatives from 80 countries. The MRA will allow AEO members in one country to qualify for the advantages provided to AEO members in the other country. The Canadian AEO program is called Partners in Protection (PIP) while the Mexican program is called Nuevo Esquema de Empresas Certificadas (NEEC) or New Program of Certified Companies, in English.

After the MRA signing, an AEO Plan of Action was signed among the member countries of the Pacific Alliance, Colombia, Chile, and Peru and Mexico.

US – FDA deems e-cigarettes and other tobacco products to be subject to FD&C Act

On May 10, 2016, the Food and Drug Administration (FDA) published in the Federal Register a final rule [Docket No. FDA-2014-N-0189] to deem products meeting the statutory definition of “tobacco product,” except accessories of the newly deemed tobacco products, to be subject to the Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act). The Tobacco Control Act provides FDA authority to regulate cigarettes, cigarette tobacco, roll-your-own tobacco, smokeless tobacco, including e-cigarettes, and any other tobacco products that the Agency by regulation deems to be subject to the law. With this final rule, FDA is extending the Agency's “tobacco product” authorities in the FD&C Act to all other categories of products that meet the statutory definition of “tobacco product” in the FD&C Act, except accessories of such newly deemed tobacco products. The final rule also prohibits the sale of “covered tobacco products” to individuals under the age of 18 and requires the display of health warnings on cigarette tobacco, roll-your own tobacco, and covered tobacco product packages and in advertisements. The FDA is taking this action to reduce the death and disease from tobacco products. In accordance with the Tobacco Control Act, it considers and intends the extension of its authorities over tobacco products and the various requirements and prohibitions established by this rule to be severable. The rule is effective August 8, 2016. See section IV of the Federal Register document regarding compliance dates for certain provisions.

At the same time, the FDA issued a series of related rules, guidance documents, small entity guides and notices, including:

US – Government Procurement: DoD updates threshold for duty-free entry on foreign supplies not from qualifying countries
On May 10, 2016, the Defense Acquisition Regulations System, Department of Defense (DoD) published in the Federal Register a final rule [Docket DARS–2015–0052] that amends the Defense Federal Acquisition Regulation Supplement (DFARS) to update the threshold at DFARS 225.901(3) and the clause at DFARS 252.225–7013 for duty-free entry on foreign supplies that are not from qualifying countries from the $200 threshold that was established on April 30, 2003, to $300.
EU – Commission posts Union Customs Code guidance documents

The following Union Customs Code (UCC) guidance documents have been posted by the Commissions Taxation and Customs Union. Note: These guidance documents are of an explanatory and illustrative nature. Customs legislation takes precedence over the content of these documents and should always be consulted. The authentic texts of the EU legal acts are those published in the Official Journal of the European Union. There may also be national instructions.

Category

Title

Data Integration and Harmonisation (DIH)

SAD Guidance document for the transitional period

Guidance on the acceptable and non-acceptable terms for the description of goods during the transitional period

Economic Operators Registration and Identification System (EORI). Guidance document for the UCC transitional period

Authorised Economic Operators (AEO)

Authorised Economic Operators Guidelines

Binding Tariff Information (BTI)

Interim Administrative Guidelines on the European Binding Tariff Information (EBTI) system and its operation

Valuation

Guidance on Customs Valuation

Debts and Guarantees

Presentation on Provisions on Customs Debts

Guarantees

Repayment or remission of an amount of customs duties

Entry and Import

Guidance on Customs Formalities on Entry and Import into the European Union

Simplifications

Simplifications – Title V UCC - Guidance for MSs and Trade

Transit

Transit Manual

Special Procedures

Special Procedures – Title VII UCC - Guidance for MSs and Trade

Export

Annex A on definition of exporter

Annex B on ship supplies

US – USDA announces increase in specialty sugar TRQ and determination of FY 2017 other sugar TRQs
On May 6, 2016, the Office of the Secretary, U.S. Department of Agriculture (USDA) published in the Federal Register a notice of an increase in the fiscal year (FY) 2016 specialty sugar tariff-rate quota (TRQ) of 20,000 metric tons raw value (MTRV). The Secretary also announces the establishment of the Fiscal Year (FY) 2017 (October 1, 2016–September 30, 2017) in-quota aggregate quantity of raw cane sugar at 1,117,195 metric tons raw value (MTRV), and the establishment of the FY 2017 in-quota aggregate quantity of certain sugars, syrups, and molasses (also referred to as refined sugar) at 162,000 MTRV.
US – CBP announces test for submission of FWS documents via ACE

On May 5, 2016, U.S. Customs and Border Protection (CBP) published in the Federal Register a general notice announcing CBP’s plan, developed in consultation with the U.S. Fish and Wildlife Service (FWS), to conduct a National Customs Automation Program (NCAP) test concerning the electronic transmission of certain import data and documents for commodities regulated by FWS. Under this test, the data or documents will be transmitted electronically through CBP’s Document Image System (DIS) or CBP’s Automated Broker Interface (ABI) system using the Partner Government Agency (PGA) Message Set, for processing in CBP’s Automated Commercial Environment (ACE).

The FWS PGA Message Set test will begin no earlier than May 1, 2016. This test will continue until concluded by way of announcement in the Federal Register. Public comments are invited and will be accepted through the duration of the test pilot.

US - President continues national emergency with respect to Syria

On May 5, 2016, the Federal Register published Presidential Notice of May 3, 2016—Continuation of the National Emergency With Respect to Actions of the Government of Syria which extends the national emergency first declared on May 11, 2004 in Executive Order (E.O.) 13338 to deal with the unusual and extraordinary threat to the national security, foreign policy, and economy of the United States constituted by the actions of the Government of Syria in supporting terrorism, maintaining its then-existing occupation of Lebanon, pursuing weapons of mass destruction and missile programs, and undermining U.S. and international efforts with respect to the stabilization and reconstruction of Iraq.

The national emergency was modified in scope and relied upon for additional steps taken in E.O. 13399 of April 25, 2006, E.O. 13460 of February 13, 2008, E.O. 13572 of April 29, 2011, E.O. 13573 of May 18, 2011, E.O. 13582 of August 17, 2011, E.O. 13606 of April 22, 2012, and E.O. 13608 of May 1, 2012. The national emergency is being extended because the Syrian regime’s actions and policies, including with respect to chemical and biological weapons, supporting terrorist organizations, and obstructing the Lebanese government’s ability to function effectively, continue to pose an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States.

US – DDTC posts policy on exports to Sri Lanka

On May 4, 2016, the State Department’s Directorate of Defense Trade Controls (DDTC) posted a Web Notice on exports to Sri Lanka which states:

Policy on Exports to Sri Lanka

Licensing restrictions relating to Sri Lanka articulated in §7044(e) of the Consolidated Appropriations Act, 2015, Pub. L. No. 113-235, and in previous appropriations acts, were not carried forward in §7044(e) of the Consolidated Appropriations Act, 2016, Pub. L. No. 114-113. Effective immediately the Directorate of Defense Trade Controls (DDTC) will review applications for licenses to export or temporarily import defense articles and defense services to or from Sri Lanka under the International Traffic in Arms Regulations (ITAR) on a case-by-case basis. DDTC will publish a Federal Register notice to implement a conforming update to ITAR §126.1(n).

EU releases texts proposed for DCFTA with Tunisia

On 29 April 2016, the European Commission announced that the European Union and Tunisia are jointly making public the initial texts of the future Deep and Comprehensive Free Trade Area (DCFTA) as proposed by the European Union (EU) and presented to Tunisian experts during the preliminary discussions in Tunis in October 2015 and during the first round of negotiations from 18 to 21 April 2016.

Texts in the following 11 areas are made available to the public. The texts are only French, because it is the language of the negotiations. Texts will be translated at the end of the negotiations and after lawyers will have checked them.
Each of them is accompanied by an explanatory note which aims to make them easier to understand:

For the context of the negotiations and the objective of the DCFTA, please see the full announcement.

EU Customs: Implementation of Union Customs Code from 1 May 2016

Introduction

EU customs legislation is undergoing some significant changes from 1 May 2016 with the implementation of the Union Customs Code (“UCC”). The changes implemented by the UCC will have significant practical and financial implications for businesses importing into or exporting from the EU. The three key changes under the UCC will be:

    • Changes to customs valuation rules;
    • Introduction of compulsory guarantees; and
    • Introduction of benefits for holders of the AEO Customs Simplifications (“AEOC”) status.

Key Changes Under the UCC

1. Changes to Customs Valuation Rules Removal of earlier sales. The basis of customs valuation, which determines the amount of duty payable on import of goods into the EU, will change under the UCC. Currently, businesses can benefit from what is known as the ‘earlier sales’ rule, by which they may take the value of the goods at an earlier sale in the supply chain, which is generally a lower amount, as the basis of the customs valuation. Under the UCC, the earlier sales rule will be removed and replaced by a ‘last sale’ rule, which means that the customs value of imported goods will be determined on the basis of the sale occurring immediately before the goods are brought into the EU. This value is usually higher than that of the earlier sale. This change will therefore result in a higher customs value and more duty payable. The UCC does allow businesses to use the ‘earlier sales’ rule until 31 December 2017, provided that the ‘importer’ is bound by a contract concluded prior to 18 January 2016. Increase in dutiability of royalties and licence fees Currently, royalties and licence fee payments that the buyer of the goods makes are included in customs value calculations where the payments: (i) relate to the imported goods; and (ii) are paid as a ‘condition of sale’ of those imported goods. The same basic rules will apply under the UCC. However, the concept of ‘condition of sale’ is being broadened to incorporate more situations. This will result in an increase in circumstances where such payments will be dutiable. For further information on this significant change, please see our client alert on this topic, available here.

2. Introduction of Compulsory Guarantees. Many businesses benefit from special arrangements that suspend their obligations to pay import duty (e.g. bonded warehousing). The UCC will make operating these arrangements more financially burdensome as they will have to provide a financial guarantee to cover the amount of the suspended duty. This change will result in additional costs for businesses.

3. Introduction of Benefits for Holders of AEOC Status or Those Meeting AEOC Criteria. AEO status is the international ‘gold standard’ for businesses as it recognises that a business’ international supply chain is secure and that its customs controls are efficient and compliant. To encourage more businesses to hold AEO status, the UCC provides important benefits to those who secure AEOC status or meet certain of its criteria. Notably, this will include a reduction or a full waiver for compulsory guarantees.

The foregoing is intended only to provide an overview of changes that will be implemented under the UCC. If you have any questions or if you require advice on any specific transactions or plans, please contact Jenny Revis, the author, or one of the other members of Baker & McKenzie’s EU Customs Group.

For further information about the changes that will be brought about by the UCC, please see our detailed client alert on this topic, available here.

US – FSIS to reinspect Siluriforme fish and fish products

CBP CSMS #16-000362 of May 4, 2016 FSIS announced that between April 15, 2016, and September 1, 2017, the Food Safety Inspection Service (FSIS) will select a subset of imported shipments of Siluriformes fish and fish products for reinspection, which will include testing for species, chemical residues, and Salmonella. Beginning September 1, 2017, FSIS will reinspect all shipments of imported Siluriformes fish and fish products, just as it reinspects all shipments of imported meat, poultry, and egg products. FSIS is providing the transitional period from April 15, 2016, to September 1, 2017 to ensure that importers, customs brokers, and other stakeholders have ample time to prepare and comply with FSIS’s mandatory reinspection requirements.

During the transitional period, shipments of imported Siluriformes fish and fish products from eligible countries/establishments will not display any FSIS flags requiring submission of electronic data or paper certificates at the border. FSIS will select specific shipments for reinspection and will notify customs brokers verbally when a specific shipment has been selected. For rail, truck, and air shipments, FSIS may target a shipment of interest by the time of arrival or CBP release, whichever is later. For ocean shipments, a decision will be made within 48 hours from the time of entry filing. In any mode, if you are not notified by FSIS that your Siluriformes fish shipment has been selected for reinspection within the timeframe previously mentioned, it will not need to be presented at an official import inspection establishment for FSIS reinspection and can move in commerce after all other government agency requirements that apply to the entry (e.g., CBP) have been met. It is important to note that during the transitional period, if your shipment is not selected for reinspection by FSIS, you will not receive an electronic communication that your shipment may proceed in commerce, as was the standard practice of FDA. Importers and customs brokers are encouraged to file the entry as soon as possible to ensure that logistics of the selected shipments can be accommodated.

The 2008 and 2014 Farm Bills mandated the United States Department of Agriculture’s (USDA), FSIS inspection of Siluriformes fish and fish products. On December 2, 2015, FSIS published the final rule, “Mandatory Inspection of Fish of the Order Siluriformes and Products Derived from Such Fish,” which can be accessed on the FSIS website. As the final rule explains, fish of the order Siluriformes are amenable to the Federal Meat Inspection Act (FMIA, 21 U.S.C. 601(w) (2)), and the rule establishes the mandatory reinspection program and its regulatory requirements. Additional information regarding the FSIS Siluriformes inspection program, including importing and exporting, can be found at the FSIS inspection webpage.

US – State renews Cultural Property Advisory Committee charter
On May 2, 2016, the Department of State published in the Federal Register a notice [Public Notice: 9541] advising the public that Charter of the Department of State’s Cultural Property Advisory Committee (CPAC) has been renewed for an additional two years. The Committee was established by the Convention on Cultural Property Implementation Act of 1983, 19 U.S.C. 2601 et seq. It reviews requests from other countries seeking U.S. import restrictions on archaeological or ethnological material the pillage of which places a country’s cultural heritage in jeopardy. The Committee makes findings and recommendations to the President’s designee who, on behalf of the President, determines whether to impose the import restrictions. The membership of the Committee consists of private sector experts in archaeology, anthropology, or ethnology; experts in the international sale of cultural property; and representatives of museums and of the general public.
US - CBP announces pilot for new truck user fee payment option

On May 3, 2016, U.S. Customs and Border Protection (CBP) published in the Federal Register a general notice announcing that CBP intends to conduct a pilot test program pursuant to its authority under 19 C.F.R. 101.9(a) to allow a new payment option for commercial truck single-crossing user fees. The CBP regulations specify the applicable user fee for commercial trucks upon arrival into the United States and the methods of payment, which include payment on an annual basis or on a per crossing basis. Although commercial truck carriers can electronically prepay the user fees on an annual basis, carriers who opt for the single-crossing user fee must pay the fee upon arrival at a U.S. port of entry. This pilot will enable the owner, agent, or person in charge of a commercial truck to prepay the single-crossing user fee online prior to arrival at a port of entry. The notice describes the pilot, its purpose, how it will be implemented, the duration of the pilot, and invites public comment on any aspect of the pilot. This pilot will not affect the annual commercial truck user fee payment option.

The pilot will begin at the Buffalo, Detroit and El Paso ports of entry starting on June 2, 2016. If it is determined that the pilot is working successfully at these initial ports, the pilot would be expanded to all U.S. land border ports of entry that process commercial trucks. The exact date of the expansion to all U.S. land border ports of entry would be announced on the CBP Web site. The pilot will run for approximately one year. Comments concerning this notice and all aspects of the pilot may be submitted at any time during the pilot period

Mexico publishes tariff rates, elimination schedule and procedures for goods originating in the Pacific Alliance

On April 29, 2016, the Diario Oficial de la Federacion (the Official Gazette) published the Presidential Decree promulgating the Additional Protocol to the Framework Agreement of the Pacific Alliance, signed in Cartagena de Indias, DT and C., Republic of Colombia, on 10 February 2014 and the Ministry of Economy Acuerdo announcing the applicable rate of the general import tax for goods originating in the countries that form the region of the Pacific Alliance. The Additional Protocol to the Framework Agreement of the Pacific Alliance, signed in Cartagena de Indias, Colombia on February 10, 2014 (the Additional Protocol), was approved by the Mexican Senate on 14 December 2015 according to decree published on 15 January 2016 in the Official Gazette.

The Presidential Decree sets forth the full Additional Protocol and all its provisions, including origin criteria, tariff and non-tariff measures, customs procedures, SPS, TBT, procurement, cross border services, investment, e-commerce, telecoms, transparency, dispute settlement, exceptions, etc.

In addition, the Additional Protocol provides preferential tariff rates for imports of goods originating in Pacific Alliance countries (Colombia, Chile, Mexico and Peru), in accordance with its Schedule of Tariff Elimination set out in Annex 3.4, as well as rules of origin and other specific mechanisms for defining such goods. The Ministry of Economy Acuerdo provides the applicable rates for goods originating in Colombia, Chile and Peru that are imported into Mexico.

Also on April 29, 2016, the Ministry of Finance and Public Credit (Hacienda) published in the Diario Oficial the Resolution establishing the general rules concerning the application of customs provisions of the Additional Protocol to the Framework Agreement of the Pacific Alliance and its Annex which sets forth the certification, transshipment, recordkeeping, advance rulings, and verification requirements and procedures for goods originating in the Pacific Alliance countries.

The Additional Protocol enters into force on May 1, 2016 for trade between the Parties

EU/EFTA - New deal to cut roaming prices and standardise mobile phone chargers in the EEA among joint decisions

On 29 April 2016, the European Free Trade Association (EFTA) announced that decisions on lower roaming prices, standardised mobile phone chargers and revised public procurement rules were among those adopted by the EEA Joint Committee on 29 April 2016. In total, 37 decisions were adopted incorporating 64 EU legal acts into the European Economic Area (EEA) Agreement. The announcement said:

Among the acts incorporated was a directive on the harmonisation of laws relating to radio equipment. The new rules aim to keep pace with the growing number of devices on the market and ensure that they respect essential health and safety requirements. They apply to devices such as mobile phones, car door openers and modems, but exclude radio equipment used for public security and defence activities. The directive states that the compatibility of accessories such as chargers should be an essential requirement for mobile phones that are made available on the market, reducing unnecessary waste and cost.

Also incorporated was a regulation aiming to cut roaming fees within the EEA. This should reduce costs for consumers travelling within Europe. The regulation also guarantees that everyone has the right to access and distribute content and use and provide applications and services, irrespective of their location and of the origin or destination of the service.

Three directives, which together represent a major overhaul of public procurement law, were also incorporated. This new set of rules simplifies public procurement procedures and allows for more flexibility, which in turn should open up the public procurement market in the EEA. Cutting red tape to facilitate the participation of small and medium-sized enterprises is an important objective, for example by paving the way for the digitalisation of public procurement. The directives also recognise that public procurement is a legitimate instrument for policy strategies, enabling national authorities to implement societal and environmental policies.

So far this year 102 decisions have been adopted by the EEA Joint Committee and 180 legal acts have been incorporated into the EEA Agreement.

EFTA publishes its annual report

On 28 April 2016, the European Free Trade Association (EFTA), whose Member States are Iceland, Liechtenstein, Norway and Switzerland, announced that The 55th Annual Report of the European Free Trade Association has been published. The report contains an overview of the functions and activities of EFTA throughout 2015 in the areas of managing the European Economic Area (EEA) Agreement, EFTA’s worldwide network of Free Trade Agreements (FTAs) and the EFTA Convention.

Among the highlights of EFTA’s work was the political agreement reached between the EEA EFTA States and the European Union on renewed financial contributions to reduce social and economic disparities and to promote cooperation in Europe for the period 2014 to 2021. The EEA Joint Committee adopted 320 decisions incorporating 483 legal acts in 2015.

EFTA continued its ambitious pursuit of a worldwide network of FTAs in 2015, with EFTA Ministers signing a Joint Declaration on Cooperation with Ecuador and a protocol on the accession of Guatemala to the FTA between the EFTA States and Central American States. In addition, free trade negotiations were launched with Georgia and the Philippines.

EU introduces surveillance of certain iron and steel imports

On 29 April 2016, the Official Journal published Commission Implementing Regulation (EU) 2016/670 of 28 April 2016 introducing prior Union surveillance of imports of certain iron and steel products originating in certain third countries (“the Regulation”), which requires that the release for free circulation in the Union of certain iron and steel products listed in Annex I to the Regulation (whose net weight exceeds 2 500 kg) shall be subject to prior Union surveillance in accordance with Regulation (EU) 2015/478 and Regulation (EU) 2015/755. The Regulation is summarised below:

The classification of the products covered by the Regulation is based on the tariff and statistical nomenclature of the Union (‘TARIC’). The origin of the products covered by the Regulation are to be determined in accordance with Article 60 of the Union Customs Code. Products originating in Norway, Iceland and Liechtenstein are exempted.

21 working days after the entry into force of the Regulation, the release for free circulation in the Union of the products referred to above will be subject to presentation of a surveillance document issued by the competent authorities of a Member State. The surveillance document will be issued automatically by the competent authorities in the Member States, without charge and for any quantities requested, within 5 working days of presentation of an application by any importer into the Union.

A surveillance document issued by one of the authorities listed in Annex II to the Regulation is required to be made out on a form corresponding to the model in Annex I to Regulation (EU) 2015/478 or Annex II to Regulation (EU) 2015/755 for imports from the third countries listed in Annex I to that Regulation and shall be valid throughout the Union. The surveillance document will be valid for 4 months and unused or partly used surveillance documents may be renewed for an equal period.

The importer's application shall include the following elements:

  • the full name and address of the applicant (including telephone and e-mail or fax numbers and any number identifying the applicant to the competent national authority), plus the applicant's VAT registration number if he is liable for VAT;
  • where appropriate, the full name and address of the declarant or of any representative appointed by the applicant (including telephone and e-mail or fax numbers);
  • a description of the goods giving their (1) trade name; (2) the TARIC code; and (3) place of origin and place of consignment;
  • the quantity declared, in kilograms, and, where appropriate, any other additional unit (pairs, items, etc.);
  • the value of the goods, CIF at the Union frontier, in euro;
  • the following statement, dated and signed by the applicant, with the applicant's name spelt out in capital letters: ‘I, the undersigned, certify that the information provided in this application is true and given in good faith, and that I am established in the Union.’

The importer is also required to submit commercial evidence of the intention to import, such as a copy of the contract of sale or purchase or of the pro forma invoice. If so requested, for example in cases where the goods are not directly purchased in the country of production, the importer must present a certificate of production issued by the producing steel mill.

The competent authorities may allow the submission of declarations or requests to be transmitted or printed by electronic means, under the conditions fixed by them. However, all documents and evidence must be made available to the competent authorities upon request. The surveillance document may be issued by electronic means as long as the customs offices involved have access to the document via a computer network.

A finding that the unit price at which the transaction is effected varies from that indicated in the surveillance document by less than 5 % in either direction or that the total quantity of the products presented for import exceeds the quantity given in the surveillance document by less than 5 % shall not preclude the release for free circulation of the products in question.

Applications for surveillance documents and the documents themselves shall be confidential and restricted to the competent authorities and the applicant.

The Member States are required to communicate to the Commission on as regular and up-to-date a basis as possible and at least by the last day of each month, details of the quantities and values (calculated in euro) for which surveillance documents have been issued, broken down by product, TARIC code and by country.

The Member States are also required to give the Commission notification of any anomalies or cases of fraud which they discover and, where relevant, the basis on which they have refused to grant a surveillance document.
Notice are to be communicated electronically via the integrated network set up for this purpose, unless for imperative technical reasons it is necessary to use other means of communication temporarily.

This Regulation shall apply from the day following its publication in the Official Journal of the European Union until 15 May 2020.

US – USTR establishes petition process for review of AGOA eligibility
On April 29, 2016, the Office of the U.S. Trade Representative (USTR) published in the Federal Register a final rule [Docket Number USTR-2016-0002] establishing a petition process to review the eligibility of countries for the benefits of the African Growth and Opportunity Act (AGOA). The final rule adopts, without change, the interim rule published in the Federal Register on March 18, 2016 (81 Fed. Reg. 14716
US – NMFS/NOAA requests comments on trusted trader program

On April 29, 2016, the National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), published in the Federal Register a notice in which the National Ocean Council Committee on Illegal Unreported and Unregulated (IUU) Fishing and Seafood Fraud (NOC Committee) is seeking public input on the design and implementation of a Commerce Trusted Trader Program as part of an effective seafood traceability process to combat IUU fishing and seafood fraud. The Commerce Trusted Trader Program will establish within the previously proposed Seafood Import Monitoring Program such benefits as reduced targeting and inspections, and enhanced streamlined entry into U.S. commerce for holders of an International Fisheries Trade Permit that are certified for participation in the Commerce Trusted Trader Program.

Comments must be received by June 28, 2016. Public webinars will take place from 2:00 to 3:30 p.m. EDT on May 4, 2016, 2:00 to 3:30 p.m. EDT on May 10, 2016, and 2:30 to 4:00 p.m. EDT on June 6, 2016.

EU issues release on Union Customs Code – effective 1 May

On 29 April 2016, the European Commission issued a press release on the Union Customs Code (UCC) which comes into force on 1 May 2016. The release states:

New EU rules for a simpler, faster and safer Customs Union come into force

Brussels, 29 April 2016

New customs rules come into force on Sunday 1 May that will make life simpler for businesses that trade in Europe and better protect consumers against illegal and counterfeit goods.

The new Union Customs Code (UCC) represents a major overhaul of existing EU customs legislation, which dates back to 1992. It is a milestone for the European Customs Union, the framework which allows more than €3 trillion worth of goods to flow in and out of the EU each year.

The new rules aim to:

– allow traders to clear customs procedures more simply and quickly, getting goods to consumers faster and more cheaply;

– better protect consumers against illegal goods or goods which don't respect European environmental, health and safety requirements;

– improve cooperation between customs administrations with the help of new IT systems.

Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs said: "An efficient EU Customs Union facilitates trade while at the same time enforcing necessary rules for security, safety and intellectual property rights. The new Union Customs Code opens the door to new state-of-the-art IT systems that will provide fast and quality data on goods being traded and will allow extremely close coordination among the administrations of our Member States".

Modern IT systems are essential in order to allow customs systems to work efficiently and they are at the heart of the new rules. The new UCC puts in place IT systems that both customs administrations and traders need for simple and fast clearance of customs procedures while also ensuring that all necessary checks and controls are carried out. The new rules are the outcome of a rigorous and comprehensive dialogue involving all partners.

The Customs Union is unique in the world. It is a foundation of the European Union and essential for the proper functioning of the Single Market. Once cleared by Customs in one Member State, goods can move freely within the Union on the basis that all Member States apply the same revenue and protection rules at external borders.

The 28 customs administrations of the EU must act as though they were one entity, while also facilitating trade and protecting the health and safety of all EU citizens. These are not easy tasks. The EU is one of the largest trading blocks in the world. In 2015, the EU accounted for almost 15% of world trade in goods, worth €3.5 trillion. Managing this volume of international trade requires handling millions of customs declarations per year in a fast and efficient manner.

But customs are also there to protect. They play an important role in the fight against terrorism by checking for the illegal trafficking of firearms and illegal trade in works of art and cultural goods. They protect consumers against goods which present a risk to safety and health. For example, 454.2 tonnes of drugs, 35 million counterfeit goods and 3.2 billion cigarettes were seized in the EU in 2014. Appropriate controls require fast, high-quality and updated information and sound coordination among the customs administrations of our Member States.

What is the UCC?

The UCC is the new framework regulation for the rules and procedures for customs throughout the EU. It reflects a move towards a more modern customs environment for EU countries, making European business more competitive and advancing the EU Strategy for growth and jobs.

More specifically, it will:

¬– streamline customs legislation and procedures across the EU;

– offer greater legal certainty and uniformity to businesses and increase clarity for customs officials;

– simplify customs rules and procedures to make customs transactions more efficient and modern;

– complete the shift to a paperless and fully electronic and interoperable customs environment;

– introduce more speedy customs procedures for compliant and trustworthy businesses.

The UCC should be fully implemented by the end of 2020. During the transitional period, the new rules will apply by using existing IT systems and, in some cases, paper forms. Work to develop the new systems or to upgrade existing ones has already begun.

More information:

UCC on the DG TAXUD website

VIDEO: What is the UCC?

VIDEO: EU Customs in one minute

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Chair, NA International
Commercial Practice Group

Miguel Noyola
Partner, Chicago
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Members, US International
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