Annual CBP Trade Symposium Scheduled

U.S. Customs and Border Protection announced the dates for its annual Trade Symposium to be held on October 29-31, 2008 at the JW Marriott Hotel in Washington, DC. Check the CBP web site for additional information regarding registration procedures and program details that should be available in September.

“First Sale” Update

During the Senate Finance Committee hearing on June 24, Commissioner Basham stated that CBP would not proceed with the proposed changes to the “first sale” rule. In accordance with the previous suggestions by Congress, CBP will collect data to provide to the ITC for analysis. CBP will revisit the proposed change again in January 2011.

CFR Amended to Implement CAFTA-DR Provisions

On June 13, 2008, U.S. Customs and Border Protection “CBP” published an interim rule in the Federal Register outlining amendments to Title 19, Code of Federal Regulations (CFR) related to the Dominican Republic-Central America-U.S. Free Trade Agreement (CAFTA-DR). The interim rule was effective June 13, 2008.

The majority of the regulations have been included within Subpart J of Part 10 in the CFR (19 CFR Part 10, Subpart J); however, the Federal Register Notice discusses all changes to the CFR, including those outside of Subpart J, Part 10.

The full text of the interim rule, including instructions for submitting comments, can be accessed online at: http://edocket.access.gpo.gov/2008/E8-13252.htm. The changes to 19 CFR Part 10 can also be seen in the Electronic Code of Federal Regulations.


CBP is soliciting comments, due by August 12, 2008, related to the “economic, environmental or federalism effects that might result from this interim rule”. Comments must be identified by docket number and submitted by one of the following methods:


Federal eRulemaking Portal:
http://www.regulations.gov/. Docket number USCBP–2008–0060.




Mail:
Trade and Commercial Regulations Branch, Regulations and Rulings
U.S. Customs and Border Protection

1300 Pennsylvania Avenue, NW., (Mint Annex)

Washington, DC 20229.

BIS Creates Emerging Technology and Research Advisory Committee

In May, the Bureau of Industry and Security (BIS) announced the creation of the Emerging Technology and Research Advisory Committee (ETRAC). ETRAC, a technical advisory committee will assist BIS in reviewing and making recommendations concerning currently controlled technologies and emerging technologies that may have national security interest.

The ETRAC will provide recommendations to BIS on how to help keep the Commerce Control List current with respect to emerging technologies and research and development activities that have dual-use applications. The committee will assess new and existing regulatory controls that are of greatest consequence to U.S. national security and study the implications of the release of dual-use technology to foreign nationals under current deemed exports licensing requirements.

The ETRAC will be responsible for:

(1) identifying emerging technology and research development activities related to dual-use commodities;

(2) prioritizing new and existing controls that affect national security; and

(3) addressing the potential impact of dual-use export controls requirements on research activities.


BIS was seeking 25 individuals from the private sector to join and requested interested applicants to submit a copy of their resume to BIS by June 24, 2008. Qualified leaders in industry, academia and research were encouraged to apply. Members are expected to have in-depth knowledge of U.S. research and emerging technology that could affect U.S. national security and be able to qualify for Secret clearance. Additional information can be found in the Federal Register Notice.

Report Trade Violations to CBP

U.S. Customs and Border Protection launched a new system called e-Allegations that will make it easier for the public to report violations of import and export laws.

e-Allegations can be used to report violations related to issues such as misclassification, country of origin, health and safety, intellectual property, textiles and other trade violations. For example, if you know that a company is declaring the wrong country or origin on a product to obtain lower duty rates, that violation could be reported through the online system. The system cannot be used for reporting security issues such as potential terrorist activities or weapons of mass destruction.

If you have knowledge of a violation of United States trade law, you can access the online system at https://apps.cbp.gov/eallegations/ and click the "Report Trade Violations" button after reading the Privacy Policy. Complete the short form explaining the violation. The following information will be required; (1) type of trade violation, (2) description of what has occurred, and (3) products or goods involved and the alleged violator’s name and/or company. Other information may be included on a voluntary basis. These reports are confidential and may be made anonymously. Once you have submitted the form, a confirmation e-mail will be sent to the address you provided, if you gave one. You may also report trade violations by calling 1-800-BE-ALERT.

BIS Launches Online Advisory Database

The U.S. Bureau of Industry and Security has launched an online database containing advisory opinions on certain export issues subject to the Export Administration Regulations. Although the BIS Advisory Opinions are not as comprehensive as the rulings found on the CBP Cross database, BIS plans to add future advisory opinions as appropriate.

Protecting Your Laptop from Thieves, Terrorists and CBP

International travelers, beware of what you store on your laptop. As a result of a recent court case, travelers may see increased inspection of laptop computers. On Monday, April 21, 2008, the U.S. Court of Appeals for the Ninth Circuit ruled that CBP may examine the electronic contents of a passenger’s laptop computer and other electronic devices without any suspicion of criminal wrongdoing.

CBP officers at Los Angeles International Airport requested that a passenger returning from the Philippines boot up his laptop. The officers reviewed pictures found on the laptop and found one showing two nude women. Agents with Immigration and Customs Enforcement (“ICE”) were called and the computer was seized after the agents found other images that appeared to be child pornography. The grand jury charged the passenger with various pornography violations. The passenger filed a motion to suppress the information because the government conducted the search without reasonable suspicion and the district court granted the motion. However, the U.S. Court of Appeals for the Ninth Circuit reversed the district court based on a series of cases that demonstrated reasonable suspicion is not needed for customs officials to search a laptop or other personal electronic storage devices at the border. One government official analogized that rummaging through a computer's hard drive is no different from looking through a suitcase. Click HERE to read the entire ruling.

What should you do to protect private information? Are you required to provide passwords and encryption information to CBP officials? Deleting browser histories and cookies and encrypting the entire hard drive is something that should be done for security in case the computer is lost or stolen. The courts are divided on the issue of providing passwords and encryption information to CBP. A recent decision, which is being appealed by the government, ruled in favor of the defendant stating disclosure of the information was a violation of his Fifth Amendment rights. While the traveler may decide not to provide the information, CBP may retain the laptop to obtain a warrant requiring the decryption key. Businesses should review their current policies to ensure adequate procedures are in place to safeguard proprietary information. Additionally, employers should instruct employees on how to respond to CBP and other government officials requesting access to the proprietary information.

CBTPA Extended and First Sale Rule Delayed

On May 22, Congress overrode President Bush's veto of H.R. 2419. Two specific provisions related to imports include the extension of CBTPA benefits and delayed implementation of revisions to CBP’s first sale rule.

Originally scheduled for expiration on September 30, 2008, the provisions of the Caribbean Basin Trade Partnership Act (CBTPA) have been extended until September 30, 2010.

Congress expressed that CBP should not implement changes to the current usage for the first sale rule prior to January 1, 2011 and created a requirement for collecting and analyzing information about first stale transactions, as well as consulting with House Ways and Means and Senate Finance before taking action. For one year, beginning 90 days after enactment, importers will be required to provide declaration with each entry submitted to CBP providing information on whether the importer has used the first-sale methodology in declaring transaction value for the entry. The data will be analyzed and reported to Congress. So, importers have a couple of years some time to analyze their current transactions and plan for alternatives in the event CBP is able to make those changes to the first sale calculations and importers taking advantage of CBTPA benefits have two more years to enjoy the reduced and free duty provisions.

Special Notice: Explanatory Notes Now Available In Four Installments At Reduced Rates

Boskage Commerce Publications, the only authorized U.S. distributor of the Explanatory Notes to the HTSUS, has changed the pricing and terms of purchase of that publication.

The Explanatory Notes is the main publication tool used in classification, and is published by the World Customs Organization, in Brussels, Belgium. The newest edition was released in January of 2007, at WCO-set prices that were considerably higher than the previous edition. Last week, Boskage announced a discount and new terms, in response to a perceived growing need.

Starting today, Boskage is offering the Notes for $890 -- $200 off the list price of $1090 -- and allowing the tool to be purchased in four monthly installments. "We hope to allow a wider range of clients to acquire this landmark classification tool," said Boskage CEO Scott Warren Taylor. "The Explanatory Notes should be used by every individual engaged in classifying. We hope that this move will help make that necessity a reality."

CBE Appeal Checklist

If you plan to appeal your CBP Exam score, it is important to follow CBP’s appeal requirements. CBP will reject the appeal if it:

• is incomplete, is untimely, or is in the wrong format


• includes any arguments written by another person


• does not provide supporting arguments


• argues for an answer the applicant did not select


• contests an incomplete erasure or insufficient marking on the applicant’s answer sheet

CBP will provide to the examinee written notice of the decision on the appeal. If the CBP decision on the appeal affirms the result of the examination, the examinee may request review of the decision on the appeal by writing to the Secretary of Homeland Security, or his designee, within 60 calendar days after the date of the notice of that decision. 19 CFR 111.13(f)

To help you submit an appeal that complies with CBP requirements, we’ve created the CBE Appeal Checklist. Be sure to review each item and place a check mark next to the individual requirements.

New Regulations Require Electronic Filing of Export Documents

The final rule requiring the mandatory filing of electronic export information was published in the Federal Register on June 2, 2008. The Bureau of Census announced the final rule requiring mandatory electronic filing of export information through the Automated Export System (AES) or AESDirect for shipments where a Shipper’s Export Declaration is required. The AES is an electronic method for filing the paper SED information directly with the U.S. Customs and Border Protection (CBP) and the Census Bureau. The AESDirect is the Census Bureau's free Internet-based system for filing SED information through the AES. The current $2,500 exemption level for reporting will not change since this would increase the number of shipments reported and neither Census nor CBP has the resources to process the information.

Under the new regulations, exporters or their agents will be required to file electronic data in roughly the same time intervals as import cargo: 24 hours for ocean cargo, two hours in advance for rail and air, and one hour before trucks arrive at the border. Effective July 2, exporters will be required to file all export documents electronically; however, exporters will be given 90 days to adjust before enforcement actions will be taken. Even though the majority of exporters currently file electronically, may exporters at the southern border still file paper copies.

When the enforcement starts in October, parties could be fined up to $10,000. Penalty amounts have been increased from $100 to $1000 each per day of non-compliance for a maximum of $10,000 per violation. Criminal penalties may be applied in which the penalty will not exceed $10,000 and/or imprisonment for not more than five years. Enforcement responsibilities have been delegated to the Bureau of Industry and Security (BIS), CBP and U.S. Immigration and Customs Enforcement (ICE). Other noteworthy provisions include information on how to submit voluntary self-disclosures of a violation or suspected violation of the reporting requirements, power of attorney requirements for agents and a section on record keeping that explains the documentation/records each party is expected to retain. Records must be maintained for 5 years from date of export.

Click HERE to view the full text of the new export regulations.

Kosovo Country of Origin Requirements

Since the United States has officially recognized the Republic of Kosovo as a sovereign state on February 18, 2008, imported goods must be marked in English using the words Kosovo or Republic of Kosovo. CBP recognizes that manufacturers and importers need time to adjust to the changes; therefore, goods entering the United States that are marked “Serbia” will be permitted entry until February 18, 2009.