NAFTZ
Partnership. Pride. Prosperity.
CONTENTS
The National Association of Foreign-Trade Zones
ZONESREPORT
CHAIRMAN’SLETTER
CHAIRMAN’SLETTER
Dear NAFTZ Members,
PRESIDENT’SLETTER
Now that spring has arrived, although it may
not seem that way in some parts of the country,
we embrace the warmth and fuzzy feeling we
get during this time of year. We also realize
that it’s the time when business starts to pick
up and for some it seems that business never
slowed down.
NAFTZNEWS
Early-bird Rate Deadline is
Approaching for Annual Spring
Seminar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
U .S . Customs Responds to NAFTZ
Request for ACE Guidance . . . . . . . . . . 5
APHIS Holding Regular Conference
Calls on ACE Guidance; NAFTZ
Members Urged to Prepare for May
28 Deadline . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
NAFTZ Offers Opportunities for
Leadership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
FTZ COMMUNITYNEWS
Jan Frantz: Trade Zone Continues to
Drive Local Economy . . . . . . . . . . . . . . . . . 8
The Push to Make Albuquerque (New
Mexico) a Transportation Hub Just
Got More Traction . . . . . . . . . . . . . . . . . . . . . 8
First Airbus Aircraft Produced in the
U .S . Takes Maiden Flight . . . . . . . . . . . . . 8
TRADENEWS
MTB Supporters Eye April
Committee Action, Starting with
Hearing Next Week . . . . . . . . . . . . . . . . . . 10
Reichert Announces Trade
Subcommittee Hearing on the
Miscellaneous Tariff Bill . . . . . . . . . . . . . 11
Congress to Consider Revised
Miscellaneous Tariff Bill . . . . . . . . . . . . . 11
REGULATORYUPDATE
THANK YOU TO OUR
SPONSORS
APRIL2016
At the NAFTZ, the buzz is about new opportunities with customers
and business expansion, and with that I want to touch upon the
need to understand why the NAFTZ exists. As the trade advocacy
and networking association for all grantees, service providers, users
and operators who have a stake in the Foreign-Trade Zones program, it’s incumbent upon us to know about all the benefits that this
program offers. Many of us marvel at the most advantageous benefits such as duty elimination for exports, duty deferral and inverted
tariff relief. We should also advocate that the FTZ program has made
international trade easier through many streamlined processes that
have improved the speed of supply chains and enhanced inventory
control in both the manufacturing and distribution environments.
Members should also be cognizant of other less known advantages
such as the federal preemption of inventory that the FTZ Act mentions, which applies to foreign goods and domestic merchandise that
is exported. Last but not least, the FTZ program is fundamentally
about jobs and investment in the United States, and we can proudly
say that U.S.-based companies that manufacture in FTZs are truly
“Made in America” success stories, that distribution zones continue
to add complex quality control procedures while also providing jobs.
The bottom line is the FTZ program levels the playing field by encouraging companies to expand or maintain their U.S. operations, while
managing negative effects of free trade agreements, higher tariff
rates and/or other global market trade barriers.
Changing the talk to current affairs at the NAFTZ, at this month’s
Board of Directors meeting the following new members and committee members were approved:
New Membership in NAFTZ: Debra Brunco, Townsend Leather;
and Sonia Meek, Springsteen Logistics.
Grantee Committee: Rick Tucker, FTZ No. 83, Huntsville-Madison
County Airport Authority, Alabama.
Operator/User Committee: Darin Graves, Nammo Tactical
Ammunition Co. LLC
Regulated Industries Committee: Darin Graves, Nammo Tactical
Ammunition Co. LLC
In addition, with approval of the board I appointed a Nominating
Committee for the purpose of reviewing applicants and nominating
a slate of directors and officers to be elected at the next annual
members business meeting, which will take place on October 19,
2016, in Orlando, Florida. The Nominating Committee members
are: David Ostheimer, Service Provider, Chairman; Christine Allen,
Grantee; Steve Boecking, Grantee; Kim Taylor, Operator, Tony
Rodriguez, Grantee; and Alternate Maria Isabel Romero, Grantee.
Furthermore, I appointed a Strategic Planning Working Group.
The purpose of the SPWG will be to keep the board focused on
short term strategic priorities that were identified during our February
strategic session. The SPWG will be chaired by Trey Boring, and
includes the following directors: Lesley Couch, Melissa Irmen, Ken
Carlstedt and Sean Lydon. Thank you for volunteering and your
commitment to the NAFTZ.
This being an election year, legislative work gets complicated in
Capitol Hill, and interaction with federal agencies is critical to NAFTZ
members. Having said this, members must be involved if they want
to make a difference in what eventually rolls out of ACE and the
PGAs. Yes, there’s a lot of work to be done with PGAs but we have
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
1
ZONESREPORT
NAFTZ
APRIL2016
Partnership. Pride. Prosperity.
NAFTZ STAFF
President
Daniel Griswold
[email protected]
Director of Events
and Education
Victoria Cartwright
[email protected]
more to gain if we collaborate and contribute through agency meetings and pilot programs—dealing with technical issues—that will
surely challenge not only the trade community but PGAs.
In this month’s Zones Report you will find additional ACE and PGA
information, plus relevant trade updates that will keep you focused
on FTZs. We are pushing hard to get CBP to continue to work with
the NAFTZ on ACE issues, and so I ask that members stay tuned
for more to come.
I look forward to seeing many of you at next month’s Spring Seminar
in Nashville.
Yours truly,
Jose Quinonez, Chairman, NAFTZ
Manager of
Communications &
Member Services
Jarmila Zapata
[email protected]
Note: All NAFTZ materials, including
Zones Report, are the intellectual
property of the association and are
intended for the benefit of members only.
The use of NAFTZ materials to advise or
otherwise serve non-member clients is
discouraged.
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
2
ZONESREPORT
NAFTZ
APRIL2016
Partnership. Pride. Prosperity.
BOARD OF
DIRECTORS
OFFICERS
Chairman of the Board
Jose Quinonez, Foreign-Trade Zone
Manager, City of El Paso, El Paso
International Airport
Vice Chairman
Trey Boring, Sr. Vice President
IMS Worldwide, Inc.
Treasurer
Rebecca Williams, Managing Director
The Rockefeller Group, LLC
Secretary
Cornelia Steinert, Program Manager,
International Trade – Canon Virginia, Inc.
DIRECTORS
Angie Atwood, FTZ Administrator
Columbus Regional Airport Authority
Frankie Bryson, Manager, Import Compliance
Nissan North America
Kenneth Carlstedt, Global Compliance
Manager – Momentive Performance Materials
William Carr, US Customs Compliance
Phillips 66
Lesley Couch, Principal
Indigo Trade Solutions
Johnny Fernandez, Executive Director
CODEZOL C.D.
Bill Fisher, Chief Compliance Officer
FTZ Networks, Inc.
Shannon Fura, Partner
Page Fura, P.C.
James Grogan, Manager
Ernst & Young LLP
Melissa Irmen, SVP, Products & Strategy
Integration Point
Sean Lydon, President
ISCM, Inc.
Honorary Director
Dom Gambardella,
PricewaterhouseCoopers, LLP
Immediate Past Chairman
Jan Frantz, Executive Director
BC/CAL/KAL Inland Port Development
General Counsel
Marshall V. Miller, Esq. Miller & Company, P.C.
PRESIDENT’SLETTER
Dear NAFTZ members:
NAFTZ is actively engaged with U.S. Customs
and a number of key Partner Government
Agencies to manage the challenging transition to filing Type 06 entries in the Automated
Commercial Environment. In a story below, we
report on the response from Customs on March
23 to a letter from NAFTZ seeking clarification on
a number of points important to FTZ filers in ACE. I urge all NAFTZ
members to read the CBP communication carefully.
Meanwhile, NAFTZ continues to work directly with such key PGAs
as APHIS, NHTSA, and FDA on the special requirements for filing
message sets in the FTZ environment. U.S. Customs has invited
NAFTZ to participate in a seminar/webinar for PGAs that will help
educate them on the FTZ process, including the use of the Customsapproved UIN/FIFO method of inventory control. The date and time
of the presentation has yet to be determined.
NAFTZ is also organizing industry subgroups of operator/users who
can then work with the individual PGAs on matters important to
their industry. In a survey we recently sent to NAFTZ members, the
Food and Drug Administration was named as the most common
PGA to require zone filing information. The other PGAs that were the
most frequently named by those responding to the survey were the
Federal Communication Commission, the Environmental Protection
Agency, the Animal and Plant Health Inspection Service, the National
Highway Traffic Safety Administration, the Fish and Wildlife Service,
and the Consumer Product Safety Commission. Based on the
survey, NAFTZ will be focusing its efforts in the coming weeks on
those specific PGAs.
change existing filing requirements. For example, any decision about
when data elements will be required, whether at admission or entry
summary, should be based on existing practice, the regulatory needs
of the agency, and industry input. We will also be seeking confirmation in writing from the individual PGAs that the UIN/FIFO inventory
layering system is compatible with PGA data collection, as it is specifically allowed for in the Customs Part 146 regulations.
More broadly, NAFTZ is seeking a meeting with U.S. Customs
leadership to ensure that the concerns of the FTZ industry are fully
accounted for in the ACE transition process with Customs as well
as the PGAs. As we like to remind the officials we work with, U.S.
foreign-trade zones handle 12% of total U.S. merchandise imports.
A successful transition to ACE cannot be accomplished without
FTZs being an integral part of the system.
The transition to ACE will be a major topic at the NAFTZ Annual
Spring Seminar May 22-24 in Nashville, TN. We expect to hear
from and interact with a number of Customs and PGA officials at
the seminar, which is taking place less than a week before the big
May 28 deadline for filing Type 06 entries and APHIS and NHTSA
data sets in ACE. I would invite you to attend the seminar, which
promises to be informative and a lot of fun as well, as you can see
from the article elsewhere in Zones Report.
Best wishes,
Dan Griswold, President, NAFTZ
Along with general education on how FTZs work, we will be seeking
to impress on those agencies that the implementation of ACE is NOT
the time to request significant new data elements or to fundamentally
Public Affairs Advisor
James P. Smith Smith Dawson & Andrews
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
3
ZONESREPORT
NAFTZ
APRIL2016
Partnership. Pride. Prosperity.
EVENT
ADVERTISEMENT
OPPORTUNITY
NAFTZ is giving you the
opportunity to advertise one of
your own events or educational
opportunities through our
website. If you would like to
post information on one of our
event pages, please call the
office at 202.331.1950 for more
information.
NAFTZ Event Advertisement
Guidelines
• Advertising space must be
purchased in three (3) month
blocks.
• The cost is $3,500 for each
three (3) month block of
advertising space.
• Advertising will be displayed
on the bottom of the specified
event’s page.
• NAFTZ has final approval
of advertisement content.
Advertisement must not conflict
with NAFTZ events or interests.
Early-bird Rate Deadline is Approaching
for NAFTZ's Annual Spring Seminar
Save $100 Today – Early-bird registration is available
through Monday, April 18, 2016.
NAFTZ’s Annual Spring Seminar is taking place May 22-24
at the Loews Vanderbilt Hotel in Nashville, TN. Plan to join us
as we work with U.S. Customs and Boarder Protection (CBP)
officials help prepare FTZ professionals for the CBP 06 entry
deadline. The program will include key officials from Nashville
and Washington D.C., such as Andrew McGilvray, Executive
Secretary of the FTZ Board.
Walk away with a better understanding of new developments
and best practices at CBP and the FTZ Board.
Key topics include:
• CBP Update on ACE Implementation
• Automation, PGAs and 06 Entries
• ABI Errors & System Setup
• FTZ ICRS Systems Setup
• 3PL Marketing
Top Reasons to Attend
•Experience customized learning: Choose the
sessions and/or tracks that matter most to you and your
organization. We offer specialized tracks for Grantees,
Operator/Users and those new to the industry.
•Learn New Skills: Attendees can earn up to 13 CPE and
12 CCS/CES credits and leave prepared to drive success in
a changing regulatory environment.
•Value: Industry leaders from CBP, the U.S. Foreign-Trade
Zone Board, other participating government agencies, and
top practitioners from the private sector and prominent FTZ
grantees will be sharing insights and best practices you’ll
be able to implement immediately.
•Network with Your Peers: Gain insights and share
ideas with colleagues experiencing similar challenges
and opportunities. Make new friends during our welcome
reception Sunday evening and our Monday evening
reception.
•Invest Back in the Industry: NAFTZ’s sponsoring
organizations use revenue to provide many other important
programs for its members. Contact Victoria Cartwright at
[email protected] for available sponsorships.
.
• This space is available for
“event” advertisement only,
including trainings, webinars,
and other educational offerings.
No specific products, software,
or services, may be promoted
in the advertisement space
NAFTZNEWS
FTZ CLASSIFIEDS
Visit our website to see up-to-date
job openings!
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
4
ZONESREPORT
NAFTZ
APRIL2016
Partnership. Pride. Prosperity.
UPCOMING
EVENTS
Annual Spring Seminar
May 22-24, 2016
Loews Vanderbilt Hotel
Nashville
Nashville, TN
Early Bird pricing
ends April 18
Annual Conference
& Exposition
October 16-19, 2016
Loews Royal Pacific Hotel
Orlando, FL
Registration is expected
to open in June
Online Webinar
ZoneCast: Trade
Preference Programs
and Compliance – for
Petroleum
May 18, 2016, 11am-12pm ET
Online Webinar
If you have suggestions for
future ZoneCast topics, please
email Victoria Cartwright at
vcartwright@naftz .org .
GET INVOLVED
NAFTZ members can help
shape the future of the FTZ
industry by serving on a
committee.
Contact us today for details.
NAFTZNEWS (CONTINUED)
U.S. Customs Responds to NAFTZ
Request for ACE Guidance
U.S. Customs and Boarder Protection responded on March 23 to
an NAFTZ inquiry on several key issues confronting FTZ filers in the
Automated Commercial Environment.
In a December letter to CBP, NAFTZ had sought confirmation on
five issues important to ACE implementation:
•The use of FIRMS codes as Exam sites;
•Privileged FTZ merchandise filing date where there are multiple
FIFO layers;
•FTZ line item quantity and units of measure for cargo release
and entry summary;
•The line item limit on cargo release;
•Availability of remote location filing (RLF) for 06 weekly entry filing.
CBP provided guidance on RLF at an earlier date. The March 23
communication from Customs seeks to provide answers to NAFTZ’s
remaining questions on behalf of the industry. All NAFTZ members
are urged to read this document carefully as you prepare to file your
entries in ACE.
View CBP’s responses to NAFTZ questions.
APHIS Holding Regular Conference Calls
on ACE Guidance; NAFTZ Members Urged
to Prepare for May 28 Deadline
To help FTZ filers prepare for the coming deadline for reporting Type
06 entries in ACE, the Animal and Plant Health Inspection Service
wants NAFTZ members to be aware of regular conference calls
focused on filing Lacey Act data in the Automated Commercial
Environment.
According to information sent to NAFTZ recently by APHIS, the Trade
Support Network (TSN) conference call is focused on the Lacey Act,
and discussion will be geared specifically towards the Lacey Act and
ACE implementation. Facilitated by CBP, the call includes a number
of CBP and APHIS Lacey Act Program officials, along with many
interested members of the importing community (brokers, software
developers, and importers).
The most recent calls were March 14th and 29th. During the March
29th call, the trade discussed the Lacey Implementation Guide (IG)
and submission samples, which APHIS is now updating and will
send to the working group for review and comment.
In addition, a daily 2 p.m. conference call is primarily an open forum
during which APHIS trade partners can ask questions and raise any
issues they may be having related to ACE. This call will also provide a
daily opportunity for trade participants to hear ACE-related updates
and request input/clarification on any technical or policy questions.
All who want to participate can use the following call information:
APHIS/ACE Daily Conference Call
2-3 p.m. Eastern time
Call 1-877-336-1828 or 404-443-6396
Access Code: 6124214
Industry stakeholders may submit questions related to Lacey
and ACE implementation to the following CBP email: ASKACE@
CBP.DHS
In addition to direct communication with APHIS, NAFTZ members are
also welcome to contact NAFTZ directly through [email protected] or
by contacting me at the NAFTZ office. NAFTZ urges its members to
continue to work with their brokers and software providers to prepare
for the May 28 deadline for filing Lacey Act declaration data in ACE.
NAFTZ Offers Opportunities for Leadership
NAFTZ invites all its members to consider how they can contribute
to the leadership of the association. Involvement can range from
volunteering to help at an NAFTZ event, to becoming a member or
chair of a committee, to joining the NAFTZ Board of Directors.
NAFTZ leadership is open to all members, whatever your age,
background, level of experience, or category of membership. The
association encourages you to give serious thought to how you
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
5
NAFTZ
Partnership. Pride. Prosperity.
ZONESREPORT
APRIL2016
NAFTZNEWS (CONTINUED)
can become more involved in the association, both
for the benefit of your fellow members and industry
as well as enhancing your credentials as an FTZ
professional.
Within the next few weeks, NAFTZ members will be
receiving information on how to apply to be a candidate to join the association’s Board of Directors. The
2016 Nominating Committee was approved by the
board during its April 6 meeting and the committee
will soon meet to refine the application form and to
accept and review applications.
NAFTZ members who are interested in serving on
the board will be invited to fill out an application form
and to submit it to the Nominating Committee by
a certain deadline, which will be announced well
in advance. A slate of proposed directors recommended by the committee will then be voted on for
approval by NAFTZ’s primary voting members at the
annual conference in Orlando in October.
Please consider applying to join the NAFTZ Board
of Directors. The obligations are not onerous and
the rewards are great. The NAFTZ board meets
monthly to consider policy changes and opportunities to advance the association’s mission. The board
meets in person three times a year, at the Legislative
Seminar, Spring Seminar, and the Annual Conference
and Exhibition. On the other nine months, board
members convene by conference call for 90 minutes
on the first Wednesday of the month.
Board members typically each serve as a liaison
to one of the NAFTZ committees or task forces,
attending their conference calls and reporting to the
board. Board members may also be asked by the
chairman to serve on a working group or to take on
short-term assignments. Board members also attend
meetings with government officials as representatives of the association. Every board member signs a
conflict of interest and non-disclosure agreement to
safeguard proprietary information of the association
and to ensure candid discussions at the board level.
Board members benefit from their service by gaining
a deeper understanding of the issues before the FTZ
community. They build lasting professional relationships with the other board members as well as with
government and industry officials outside of NAFTZ
who they deal with as representatives of the association. They gain valuable leadership and organizational
skills that they can apply in their workplace and other
volunteer positions. And they enjoy enhanced visibility within the NAFTZ community.
One of the board’s newest members, James Grogan
of Ernst & Young, shared this about his experience:
“I was originally inspired by the opportunity to
serve on a Board that puts the NAFTZ members’
interests first and is comprised of genuine experts
with a wealth of experience. We have routine
opportunities to effect policy and regulatory
change on a national level, which I view as a rare
and tremendous privilege.”
In evaluating board candidates, the Nominating
Committee is directed by NAFTZ policy to consider
a number of important and specific criteria. First,
the Nominating Committee looks for balanced representation, seeking a diversified cross-section of
board members by geography, industry groups, and
membership category—grantees, operator users,
and service providers.
Among the individual criteria that are given specific
consideration:
•Representative of major industry users;
•Representative of service providers;
•Demonstrated commitment of candidate to
actively work toward goals and objectives of the
Association;
•Resources, commitment and stability of the
organization the potential candidate represents;
•The candidate’s political strength or the
candidate’s company/organization etc. political
strength;
•Demonstrated a thorough understanding of
FTZ issues, and who can provide different
perspectives of the FTZ program;
•An active member of NAFTZ with primary
member status.
While board members have followed different pathways to joining the board, they have often served as
committee leaders and have volunteered for specific
activities that have advanced NAFTZ’s mission. Many
board members are Accredited Zones Specialists,
although others are not and it is not a mandatory qualification. Strong board candidates come with the support
of the companies or organizations they represent.
If you have any questions about leadership opportunities at NAFTZ, including serving on the Board
of Directors, please contact any board member or
NAFTZ President Dan Griswold.
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
6
ZONESREPORT
NAFTZ
APRIL2016
Partnership. Pride. Prosperity.
May 18 ZoneCast: ‘Trade Preference
Programs and Compliance – for Petroleum’
Help NAFTZ Enhance Our
FTZ Careers Section
We invite you to join us on Wednesday, May 18,
2016, at 11:00 a.m. Eastern for an educational
webinar. Speakers Michael Leightman, EY Trade,
and Michael Knoll, Marathon Petroleum, will discuss
the relationship between NAFTA and the petroleum
industry.
Your help is critical for us in adding more value to
the FTZ Careers section. An important step in this
initiative involves creating a professional development
section. Consequently, we are offering our members
two unique writing opportunities. Tell us how you got
to where you are in your FTZ career. We’re curious
how you got into the FTZ industry, and also the
details of your path. We will share these FTZ career
stories in upcoming Zones Reports and on our new
website. We strive to illustrate the diversity of career
options within the FTZ industry. Our second writing
opportunity is for people in the hiring manager role.
For this opportunity, we are open to your suggestions
on article topics. Please contact Jarmila Zapata if you
are interested in either writing opportunity.
Register today!
As an update, our March 22 ZoneCast entitled,
“Taking Exports to a New Level/Advanced Training,”
attracted 77 participants. We’d like to thank our
speakers Trey Boring of IMS Worldwide, Inc. and
Malcolm Appelbe of Lam Research.
Current FTZ Job Opening
MANAGER OF FOREIGN-TRADE ZONE
PORT OF CORPUS CHRISTI
Deadline to submit application and resume is
April 25, 2016
We are looking for a highly motivated individual
responsible for assisting with Port compliance,
planning, organizing and administration of Customs
& Border Protections (CBP) issues as they relate
to the Foreign Trade Zone (FTZ), and adherence to
FTZ Board, Customs and Animal and Plant Health
Inspection Service (APHIS) regulations, policies
and procedures.
World Free Zones Organization Releases
its First Quarterly Bulletin of 2016
This issue is dedicated to the theme of the 2nd World
FZO Annual Conference & Exhibition taking place May
9-11, 2016, in Dubai, United Arab Emirates. The World
FZO has been created through the efforts of NAFTZ
and more than a dozen other founding members, with
a focus of raising global standards and promoting best
practices among global zones programs.
Read the Bulletin
View and share this job opportunity
HOW TO SUBMIT A JOB POSTING:
There is no cost for individuals belonging to NAFTZ
member organizations to submit an FTZ job opening.
Send your listing to Jarmila Zapata.
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
7
ZONESREPORT
NAFTZ
APRIL2016
Partnership. Pride. Prosperity.
FTZ COMMUNITYNEWS
Jan Frantz: Trade Zone Continues
to Drive Local Economy
April 4, 2016
Battle Creek Enquirer
By Jan Franz, Guest Commentary
On March 31, Foreign-Trade Zone 43, headquartered at the U.S. Customs and Border Protection
Port of Battle Creek, submitted statistics to the
U.S. Commerce Department for its annual report
to Congress. According to the report, during 2015
exports from Foreign-Trade Zone 43 reached a value
of $49.9 million. That’s $1.5 million more in exports
than the total value of exports from FTZ 43 in 2014.
Read the full article
The Push to Make Albuquerque
(New Mexico) a Transportation
Hub Just Got More Traction
Albuquerque Business First
By Blake Driver
March 22, 2016
Supporters hope it’s a development that will ultimately bring more jobs to the city and the state.
The Mid-Region Council of Governments (MRCOG)
and the city of Albuquerque announced Tuesday the
selection of a consultant to spearhead an extensive
transportation and logistics hub study for the area.
The study is to focus on evaluating the metro area’s
real assets for becoming the country’s next big transloading center.
Read the full article
First Airbus Aircraft Produced in
the U.S. Takes Maiden Flight
Reuters
Reporting by Michael Rose
March 21, 2016
The first aircraft produced in the United States by
European aerospace company Airbus (AIR.PA)
took off from Mobile, Alabama on Monday and
landed safely after a three-and-a-half hour flight, the
Toulouse, France group said.
Commentary: Kit Johnson, a member of NAFTZ
and Customs Manager at Airbus Americas informed
the NAFTZ that this aircraft came from the Airbus
assembly line, for which they have production
authority, but the site will not start activation until
later this year. Therefore, the manufacturing did not
take place under zone procedures yet.
Read the full article
S.C. Ports Authority Exports 2
Millionth BMW Vehicle Made in S.C.
Charleston Business Journal
March 17, 2016
By Liz Segrist, Guest Commentary
The S.C. State Ports Authority exported its 2 millionth S.C.-made BMW today from Columbus Street
Terminal in downtown Charleston.
Officials from the port, BMW and the shipping community counted up as BMWs were being driven onto
the Elektra vessel operated by Wallenius Wilhelmsen
Logistics.
Read the full article
Coleman’s Plan to Repatriate
Manufacturing Jobs Triggers Opposition
SportsOneSource Media
March 17, 2016
Segments of the U.S. textile industry are opposing
efforts by The Coleman Company, Inc. to bring more
manufacturing jobs from Asia to a plant in Minnesota,
where it has already repatriated about 250 jobs since
2009 by investing more than $2 million in automation.
At a Feb. 24 hearing before the Foreign Trade Zones
(FTZ) Board, representatives from South Carolina’s
Milliken & Co. and three U.S. textile trade associations opposed Coleman’s request to activate Foreign
Trade Zone status at the Stearns plant in Sauk
Rapids, MN that makes personal flotation devices,
or PFDs. Coleman wants FTZ status so the plant can
import fabrics at the same duty rates – 4.5 percent as competitors pay on finished PFDs imported into
the United States. Without approval, Coleman would
have to pay the standing 14.9 percent duty rate on
imported polyester and nylon fabrics – even though
it wants to use them to create up to 40 new manufacturing jobs at the plant.
Manufacturers refer to this as a “tariff inversion,” a
quirk of the U.S. tariff code that Foreign Trade Zones
have been remarkably effective addressing. That is,
until recently.
AN UNUSUAL DELAY
The FTZ Board is not expected to rule on the application until August, months after Coleman had hoped,
because it agreed in December, 2015 to delay the
hearing for two months at the request of Milliken, the
National Council of Textile Organizations (NCTO) and
two other textile trade groups. The postponement
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
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marked the first time in 20 years and hundreds of
such applications that the FTZ Board delayed such
a hearing, a government spokesman told Sports
Executive Weekly. In fact, the hearing marked only
the fourth time in the last 20 years that the board
even needed to schedule a hearing, because such
applications are rarely opposed.
The delay in the case is contributing to growing anxiety in U.S. manufacturing circles that FTZs are under
attack.
“There is a growing perception in some industries that
inconsistencies in the approval process in the face of
opposition by competing interests is making pursuit
of Foreign-Trade Zones Board approval too risky,” the
National Association of FTZ wrote in a letter to U.S.
Secretary of Commerce Jacob Lew last October.
“This perception may result in corporate decisions
to offshore production and jobs, undermining the
very purpose of the Foreign-Trade Zones program.”
A MANUFACTURING RENAISSANCE
IN SAUK RAPIDS
The Stearns plant in Sauk Rapids has been operating
since 1952, but employment levels dropped steadily
in the late 1990s and early 2000s as competitors and
retailers began shifting to lower cost Asian imports.
Stearns kept the plant open to supply industrial and
U.S. military customers, who are required to source
certain products from U.S. factories under the Berry
Amendment. The plant also continued to make PFDs,
immersion suits and survival gear for fishing boats, oil
rigs, fire rescue and other professional markets. By
2008, employment had declined to 60.
“We had a big factory that was underutilized and
could not fully absorb overhead costs,” explained Jeff
Schmitt, senior vice president of global operations for
Coleman, which took over the plant in 2008 when it
acquired Stearns Manufacturing Company.
Within a year, Coleman saw an opportunity to bring
back some manufacturing work from Asia through
automation. While the Stearns team found U.S.
sources for foam and other components, U.S. mills
were not able to provide competitive quotes for certified fabrics that met the required specifications. It was
determined that even after importing those fabrics at
full duty rates, the Stearns plant could manufacture
Puddle Jumper PFDs sold by Walmart, Costco and
other mass merchants for $12 to $35 at prices that
could compete with Asian made PFDs.
The company invested more than $2 million in
the plant, which has since added about 250 jobs.
Schmitt estimates three to four times as many jobs
were eliminated in Asia. The plant still sources about
60 percent of its materials and components from the
United States, including 210-denier, Teflon coated
fabrics used in some of its military and industrial
grade products.
ADDRESSING INVERTED TARIFFS
In 2014, Coleman determined that the plant could
bring back more production and create 40 more
jobs. To get the numbers to work, Coleman would
have to address the tariff inversion issue, so it filed
its application to expand production at the Stearns
plant as part of FTZ 119. Nearly a dozen of the factory’s suppliers wrote letters urging the FTZ Board
to approve the application, saying the project would
help bring PFD manufacturing back to the United
States.
An executive with Pregis Corp., which supplies the
Stearns plant with foam manufactured in Tupelo,
Miss, noted that relief from inverted tariffs was crucial
to “leveling the playing field between Coleman and
the foreign suppliers.”
However, Milliken and the textile groups opposed
the application, arguing it would harm the U.S. textile
sector.
Schmitt said Coleman sought quotes from U.S. mills
on the nylon and polyester fabrics it needs for the
project, but they all came back with prices that were
3.5 to 4 times higher than Asian competitors. After
months of back and forth discussions with Milliken
last year, Milliken could not provide competitively
priced certified nylon that met specifications set by
the U.S. Coast Guard.
“We worked with them more than any supplier in Asia
and was still not able to get a competitive quote for
a certified material,” said Schmitt.
Despite multiple emails and phone calls since late
December, Sports Executive Weekly has been
unable to reach Milliken or NCTO officials for further
comment.
The FTZ Board – which is comprised of officials from
the U.S. Departments of Commerce and Treasury must now determine whether Coleman’s plans for
Sauk Falls will have a net economic benefit on the
national economy.
LOOKING FOR NET ECONOMIC BENEFIT
The FTZ Board – which is comprised of officials from
the U.S. Departments of Commerce and Treasury must now determine whether Coleman’s plans for
Sauk Falls will have a net economic benefit on the
national economy.
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From James F. Henderson Jr.‘s point of view, that’s a
no brainer. His company, Henderson Sewing Machine
Co. Inc. of Andalusia, Ala. has provided hundreds of
thousands of dollars in sewing machines and automation gear to the Sauk Falls factory in recent years.
“We are trying to help them streamline their production process and compete on a more equal footing,”
Henderson told Sports Executive Weekly in February.
“They are competing with people importing goods
from companies that don’t have the same EPA and
other standards.”
Henderson employs about 30 people, or about half
what it did in 1998, when many U.S. apparel and footwear brands accelerated their offshore sourcing. He
is excited to see Under Armour, New Balance and
other footwear companies harnessing 3D printing and
flexible automation to develop closer-to-market manufacturing models. But he also notes that a collapse
in oil prices and global trade have reduced container
shipping rates to their lowest level in years. While he
laments the loss of hundreds of thousands of U.S.
apparel jobs, he sees tariff inversions as one of the
bigger obstacles to repatriating some of those jobs.
“There is tremendous push to manufacture near
market today,” he said. “We are in an age of disruptive technology. But when you yoke companies
so that they can’t compete equally, you make them
uncompetitive.”
Nissan’s Decherd (Tennessee) Powertrain
Plant Produces 10 Millionth Engine
NissanNews.com
February 29, 2016
With a new engine assembled every 19 seconds,
the production lines at Nissan’s Decherd Powertrain
Plant don’t stop often or for very long. Today was an
exception as the team stopped to celebrate a milestone – production of the plant’s 10 millionth engine.
Read the full press release.
TRADENEWS
MTB Supporters Eye April Committee
Action, Starting with Hearing Next Week
Inside U.S. Trade
April 8, 2016
Business supporters of legislation to reform the process for developing miscellaneous tariff bills (MTBs)
are discussing a plan under which the congressional
trade committees would approve it by the end of
April, though industry sources still fear that the bill
could face obstacles on the Senate floor.
The process will kick off with an April 14 hearing on
the bill at the House Ways & Means trade subcommittee, which was announced by Chairman Dave
Reichert (R-WA) on April 7.
A press release from Reichert hinted that an MTB
reform bill will be introduced prior to the hearing,
saying the session would “focus on legislation to help
American manufacturers lower costs and compete
in the global market.” The hearing will take place at
2 p.m. in room 1100 of the Longworth House Office
Building.
markup during the week of April 18. That same
week, the Senate Finance Committee would hold
a hearing on the bill, followed by a markup before
the end of April, they said. Finance Chairman Orrin
Hatch (R-UT) is supporting Brady’s MTB reform plan.
House Ways & Means Committee Chairman Kevin
Brady (R-TX) has already circulated a two-page plan
for MTB reform that he says is consistent with the
House Republican earmark ban, but a committee
spokeswoman has said the legislation fleshing out
the plan is expected to be introduced after the
House returns from its recess on April 12 (Inside
U.S. Trade, April 1).
Business supporters are expecting that the House
and Senate will follow this tentative schedule and are
planning to ramp up their lobbying efforts accordingly, sources said.
Under the tentative plan being discussed by business supporters, the trade subcommittee hearing
next week would be followed by a Ways & Means
They said they expect an MTB reform bill to be introduced in the Senate that is identical to the House
version, although they were unclear on who would
actually introduce it. The champions of MTB reform
in the Senate have been Sens. Rob Portman (R-OH),
Richard Burr (R-NC), Pat Toomey (R-PA) and Claire
McCaskill (D-MO).
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Sources speculated that Brady and Hatch would
likely try to fight off amendments to the MTB reform
bill during the markups, and that the House would aim
to pass the bill under suspension of rules because it
is supported by both Republicans and Democrats.
That procedure is usually reserved for noncontroversial bills and requires a two-thirds majority of House
lawmakers.
Reichert said last week that he and Brady are aiming
to have Congress pass the MTB reform bill prior to
the summer recess that begins the week of July 18
(Inside U.S. Trade, April 1). One source signaled that
this goal is possible in part because there is not a
lot on the congressional agenda over the coming
months due to the impending election.
But industry MTB supporters said their biggest worry
is that a standalone reform bill could run into trouble
on the Senate floor because it would be amendable
trade legislation. It may be hard to get unanimous
consent (UC) in the Senate to pass such a bill or tee
it up for a vote, given that it would be in the middle
of an election year where the major presidential candidates are bashing U.S. trade policy, according to
these sources.
Without a UC agreement to move the bill, it could
be weighed down by “poison pill” amendments on
the Senate floor, one source warned. These could
include an amendment critical of free trade policies or
an amendment seeking to address currency manipulation by U.S. trading partners, he said.
Burr, Portman and Toomey are all up for re-election in
November, and sources said congressional passage
of an MTB reform bill they have championed would
likely be seen as a political win for them.
One industry source held open the possibility that the
Senate Democratic leadership would “play politics”
by delaying or blocking an MTB bill in order to deny
these Republican senators a win, but said such a
scenario would be unfortunate given the history of
bipartisan support for MTB. -- Matthew Schewel
by lowering costs, creating more jobs at home, and
saving money for American consumers.
Source: Ways and Means April 7, 2016 Press
Release
Additional documents:
Source: Inside U.S. Trade – 04/08/2016, Vol. 34,
No. 14
The New Miscellaneous Tariff Bill Process
Reichert Announces Trade Subcommittee
Hearing on the Miscellaneous Tariff Bill
Congress to Consider Revised
Miscellaneous Tariff Bill
Committee on Ways and Means
April 7, 2016
Ways and Means Trade Subcommittee Chairman
Dave Reichert (R-WA) today announced that
the Subcommittee will hold a hearing entitled,
“Miscellaneous Tariff Bill: Helping U.S. Manufacturers
through Tax Cuts” on Thursday, April 14th at 2:00
PM in room 1100 of the Longworth House Office
Building. The hearing will focus on legislation to help
American manufacturers lower costs and compete
in the global market.
Upon announcing the hearing, Chairman Reichert
said:
“American businesses are hurting because there is no
longer a process in place to help them cut costs and
compete with companies around the world. It’s time
to develop a fair, transparent, and bipartisan process
for considering manufacturing tax cuts that will help
our businesses, benefit our consumers, and grow our
economy. Next week’s hearing is an opportunity to
do just that as we examine a new Miscellaneous Tariff
Bill (MTB) process that upholds the strong House
earmark ban. I am eager to discuss how this new
approach will strengthen American manufacturing
Miscellaneous Tariff Benefits (MTBs)
Politico
April 4, 2016
House Speaker Paul Ryan supports Ways and Means
Chairman Kevin Brady's plan for revamping the process for constructing the Miscellaneous Tariff Bill in a
way that avoids a conflict with the House Republican
ban on earmarks, his office confirmed Thursday.
The legislation, which waives tariffs on hard-to-find
items needed by specific industries, is one of the last
pieces of unfinished business on the legislative trade
agenda. Brady’s office has said that a bill will be introduced after lawmakers return from their Easter break.
The National Association of Manufacturers, a group
that has long lobbied for the bill, welcomed news
that lawmakers would be working on new legislation. “Right now manufacturers, especially small and
medium-size manufacturers, continue to see their
costs rise for products critical to their manufacturing
processes because Congress has not acted on this
important legislation since the last package of MTBs
expired at the end of 2012,” NAM Vice President of
International Economic Affairs Linda Dempsey said
in a statement.
Read the full document.
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TRADENEWS (CONTINUED)
Panama Canal Announces Expansion
Inauguration Date: June 26, 2016
Global Trade
April 7, 2016
The Panama Canal Authority (ACP) has announced
that the Panama Canal expansion will be officially
inaugurated on June 26, 2016.
Read the full article.
Latest ACE Capabilities Affect Split
Shipments, Bills of Lading, Bonds, RLF
Sandler, Travis & Rosenberg Trade Report
April 6, 2016
U.S. Customs and Border Protection has issued a
notice documenting the following recently deployed
Automated Commercial Environment capabilities.
Read the full report.
White House Specifies Changes in U.S.
Trade Law Needed to Implement TTP
Sandler, Travis & Rosenberg Trade Report
April 6, 2016
The Obama administration has released a statement
indicating that the following changes to existing trade
law will be required to bring the U.S. into compliance with its obligations under the Trans-Pacific
Partnership. These changes are likely to be included
in the TPP implementing legislation that the White
House could submit for congressional approval later
this year.
Read the full report.
US Customs’ ACE Woes
‘Jeopardizing Shipments’
Journal of Commerce
April 4, 2016
By Reynolds Hutchins, Associate Editor
The Thursday rollout of the U.S. Customs and
Border Protection’s ACE “single window” for filling
experienced few problems until Friday, when the
long-delayed initiative frustrated brokers and shippers with network errors and system-wide crashes.
Read the full article.
Introducing: Anne McKinney,
SelectUSA Investment Director
Select USA
April 4, 2016
SelectUSA was created to promote and facilitate foreign direct investment (FDI) into the United States,
because FDI supports 12 million jobs, drives more
than one-fifth of U.S. goods exports, and contributes
to American innovation. We are continuing to focus
on enhancing our services for U.S. economic development organizations (EDOs) and companies seeking
to establish or expand operations, and we are thrilled
to introduce our new Director of Investment Services:
Anne McKinney.
Anne has more than 20 years of diverse experience
working on international trade, investment, and economic development issues. As Deputy Executive
Director of the Colombian American Chamber of
Commerce (AmCham Colombia) in Bogotá, she
worked for nearly seven years with leading U.S.
and Colombian companies and helped advance the
chamber’s policy agenda on a wide range of trade,
investment, regulatory, and sustainable development
issues. Prior to joining AmCham Colombia, Anne
worked as a consultant to Cisco Systems’ Strategic
Funding and Government Advocacy team in Latin
America, where she produced actionable market
intelligence for public sector sales teams and developed a sales funnel in seven priority markets.
Anne’s experience also includes more than 12 years
at the U.S. Trade and Development Agency as a
Regional Director and Country Manager. During
her time with USTDA, Anne fostered partnerships
between the U.S. private sector and overseas project
sponsors, which helped generate U.S. exports and
enabled USTDA to respond to priority development
objectives in the Latin America and Caribbean region.
She coordinated with other U.S. government agencies and developed projects to support U.S. policy
initiatives related to market access, intellectual property rights, trade facilitation, energy, and more.
Anne has an M.A. in International Relations from
the Johns Hopkins University School of Advanced
International Studies (SAIS), with concentrations in
International Economics and Latin American Studies
and a B.A. in International Studies from American
University.
We are incredibly fortunate to have someone as talented as Anne on our team, especially during our
busiest and most exciting year yet. On April 25-29,
SelectUSA will head the U.S. Investment Pavilion at
the world’s leading industrial trade show, Hannover
Messe in Hannover, Germany. And, of course, on
June 19-21, we will be welcoming more than 2,000
international business leaders and investors, economic developers, and government officials to
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TRADENEWS (CONTINUED)
Washington, DC for our third SelectUSA Investment
Summit. I know Anne is looking forward to working
with many of you, as we gear up for these landmark
events.
Centers of Excellence and Expertise
Operational Expansion
CBP.gov
March 23, 2016
On March 23, 2016 U.S. Customs and Border
Protection (CBP) released a Guidance to the Trade
Community for Delegation Order 14-004, announcing
the final six Centers for Excellence and Expertise
(CEEs) have now begun handling post-release
operations.
The notice, in addition to announcing the final six
CEE’s also seeks to clarify the authority that Center
Directors will be able to apply versus that of a Port
Director. According to the guidance, “Port Directors
and Center Directors will communicate and collaborate to issue informed and consistent determinations
and decisions effectively.” Further clarifications,
including certain exceptions are identified in the text
of the notice.
The final industry CEEs include:
•Agriculture and Prepared Products
•Automotive and Aerospace
•Base Metals
•Consumer Products and Mass Merchandising
•Industrial and Manufacturing Materials
•Machinery
Read the full report
De Minimis Value Increases to $800
2015 IMPORT STATS
As agreed in the Trade Facilitation and Trade
Enforcement Act of 2015, signed by President
Barack Obama Feb. 24, U.S. Customs and Border
Protection (CBP) announced that March 10, it raised
the value of a shipment of merchandise imported
by one person on one day that generally may be
imported free of duties and taxes from $200 to $800.
This raising of the de minimis exemption is due to
an amendment of the Tariff Act of 1930 included in
the Trade Facilitation and Trade Enforcement Act of
2015.
Customs Commissioner R. Gil Kerlikowske recently
highlighted fiscal year 2015 trade and enforcement
statistics. Customs processed more than $2.4 trillion in imports and more than $1.5 trillion in exports,
processed approximately 33 million entries, and collected $46 billion in duties, taxes, and other fees.
Free trade agreements and other special trade programs represented approximately 27% of total U.S.
imports by value. There were 368 seizures of unsafe
imported products with a retail value of $24 million.
$1.2 billion in antidumping/countervailing (AD/CVD)
deposits were collected.
Read the media release.
ACE TRANSITION TIMELINE
CBP.gov
March 11, 2016
Customs has updated the timeline for mandatory filing
in the Automated Commercial Environment (ACE):
•Effective March 31, 2016: ACE will be the sole
Customs authorized EDI system for electronic
filing of Entry Types; 01, 02, 11, 23, 51, and
52. ACE filings will be required for these Entry
Types for merchandise subject to APHIS Lacey
Act and NHTSA (National Highway Traffic Safety
Administration) import requirements, unless
such filings also include other PGA data.
•Effective May 28, 2016: Type 06 Foreign-Trade
Zone entries must be filed in ACE along with all
required data for Lacey Act and NHTSA.
•Summer 2016: Throughout the summer, the
following agencies will provide functionality
for ACE filing: AMS, ATF, APHIS Core, CDC,
DCMA, DDTC, DEA, E&C, EPA, FWS, FSIS,
NMFS, and TTB.
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•The Food and Drug Administration (FDA) has announced that it will
be making some mandatory data elements conditional and a new
supplemental guide for ACE filing will be released shortly.
81 Fed. Reg. 10264 (Feb. 29, 2016).
CEO PENALTIES
•Louis Brothers, the former president and CEO of Valley Forge Composite
Technologies, was fined $1.1 million and sentenced to 93 months in prison for
his role in exporting military electronics to China.
•Erdal Kuyumcu, CEO of Global Metallurgy of Woodside, New York, was arrested
for exporting specialized metallic powder to Iran. If convicted, Mr. Kuyumcu faces
a $1 million fine and 20 years in prison.
COOL REPEAL RESULTS
A Final Rule issued by the Agriculture Department, which took effect on March 2,
removed pork muscle cuts, ground beef, and pork from the list of commodities
subject to USDA country of origin labeling (COOL) requirements. 81 Fed. Reg.
10755 (March 2, 2016).
DE MINIMIS VALUE INCREASE
•Automated Commercial Environment (ACE) programming changes were
implemented on March 7, 2016 to increase the de minimis value exemption
from entry (aka “Section 321”) from $200 to $800. This will allow express
carriers and truck carriers to test the electronic release of Section 321
shipments. CSMS #16-000170 (March 7, 2016).
•Products requiring Participating Government Agency declaration and
release may require Customs entry.
ENERGY EFFICIENCY STDS
The Department of Energy (DOE) indicated at a public workshop on February
19 that imports have been a compliance issue for energy efficiency standards
and, by requiring data submission in ACE at entry, the DOE is hoping to increase
importer compliance. The comment period on its Proposed Rule closed March
14. 81 Fed. Reg. 11686 (March 7, 2016).
EXPORT REFORM
The BIS and the Directorate of Defense Trade Controls (DDTC) have issued
Proposed Rules to move many items associated with lasers, imaging, and guidance control from the U.S. Munitions List (USML) to the Commerce Control List
(CCL). 81 Fed. Reg. 8421 (February 19, 2016); 81 Fed. Reg. 8438 (Feb. 19,
2016).
FCPA SETTLEMENT
Olympus Corp. of the Americas (OCA) has agreed to pay $646 million for alleged
violations of the Foreign Corrupt Practices Act (FCPA). OCA and Olympus of
Latin America (OLA) were accused of making payments to various hospitals and
doctors in Latin America to promote sales of endoscopes and related equipment
made by OCA.
FTR PROPOSED RULE
Census has published a Proposed Rule to modify the Foreign Trade Regulations
(FTR). The Proposed Rule includes:
•New codes for ECCN “600 series” parts and the “Support for the Cuban
People” license exception;
•New data elements for “used electronics” and “Original ITN”;
•Clarification of a few definitions; and
•Clarification that products of Export Administration Regulations (EAR) Part
758 (i.e., 600 series products) require AES submissions.
Comments are due by May 9. 81 Fed. Reg. 12423 (March 9, 2016).
GREEN GOODS
Negotiators met in Geneva on March 2-4 for the 12th round of negotiations on
the World Trade Organization Environmental Goods Agreement (EGA). A list of
340 goods is under review, with the goal of concluding the EGA in 2016.
INTRUSION SOFTWARE
Illustrating the complexity of the current government dispute with Apple over
encryption, the U.S. has started negotiating with the Wassenaar Arrangement
members to change the controls on technology related to intrusion software. The
U.S. wants to limit the controls to software that would be used by a government
to penetrate networks and extract data without the user’s knowledge. The U.S.
does not want to limit benign and civil applications.
The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
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REGULATORYUPDATE (CONTINUED)
IRAN SDNS
The OFAC has removed many individuals and entities from the Specially
Designated Nationals (SDN) List. U.S. persons are still generally restricted from
engaging in any transactions with these people or entities. 81 Fed. Reg. 13562
(March 14, 2016).
MPF
In response to a provision in the Trans-Pacific Partnership (TTP), the Obama
Administration is considering modifications to the Merchandise Processing Fee
(MPF) to create a four-tier MPF system with charges of $30, $120, $260, or $500.
This could change MPF calculations for foreign-trade zones. Changes are not
likely in 2016.
ORIGIN MARKING
The Court of Appeals for the Federal Circuit (CAFC) has ruled that trademarks do
not need to be registered or the subject of a pending trademark application for
merchandise to qualify for the relaxed origin marking standards of 19 C.F.R. §§
134.46 and 134.47. JBLU, Inc. v. U.S., CAFC Slip Op. 15-1509 (Mar. 2, 2016).
STEEL IMPORTS
•Customs will require “live entries” for steel plate from China, which means
entries must be filed with duties prior to cargo release.
•The U.S. Commerce Department has launched an antidumping and
countervailing duty investigation into imports of stainless steel sheet and
strip from China.
TEXTILE TEAM VISITS
Customs recently completed fiscal year 2015 Textile Production Verification
Team (TPVT) visits to 123 foreign factories in El Salvador, Honduras, Dominican
Republic, Korea, Ethiopia, Guatemala, Ethiopia, Lesotho, Madagascar, and
Mauritius, finding 8 closed factories, and 3 factories characterized as high risk.
In addition, 5 factories were found in violation of FTA/Preference Programs, and
29 were found to have insufficient documents to support FTA/Preference claims.
WHISTLEBLOWER LAWSUIT
On March 3, 2016, FDA released a list of updated Affirmation of Compliance (AOC)
codes for use in ACE.
The U.S. Justice Department recently announced a $3 million settlement with
a group of Pennsylvania-based importers and their owners who were sued by
another company under the whistleblower provisions of the False Claims Act for
purposefully misidentifying imports of small-diameter graphite electrodes used
in industrial furnaces to avoid paying antidumping duties.
SANCTIONS
ZTE ON BIS ENTITY LIST
REVISED FDA AOC CODES
•The Office of Foreign Assets Control (OFAC) and BIS published Final Rules
that, among other things, reduce Cuba sanctions related to carriers and
certain business activities and presence, and change licensing policy in
support of private enterprise to review on a case-by-case basis.
•President Obama has signed a law implementing increased sanctions
against North Korea. H.R. 757 (Feb. 18, 2016).
SOFTWARE PRODUCTS
Zhongxing Telecommunications Equipment Corporation (ZTE), one of the world’s
largest manufacturers of telecommunications equipment, has been placed on
the Bureau of Industry and Security (BIS) Entity List. Any export subject to the
EAR to ZTE will now require an export license, and BIS has indicated that most
requests will be denied. 81 Fed. Reg. 12004 (March 8, 2016).
The Regulatory Update is provided to Zones Report each month by Miller & Co.
A Customs Final Rule states that cyber-security software products from a
Malaysian company are considered U.S. origin for government procurement purposes. The object code is compiled in the U.S., while the source code is written
in Malaysia. A “software build” results in a substantial transformation, making the
software of U.S. origin. 81 Fed. Reg. 8733 (Feb. 22, 2016).
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APRIL2016
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The National Association of Foreign-Trade Zones Partnership. Pride. Prosperity. National Press Building | 529 14th Street NW, Ste. 1071 | Washington, DC 20045 | 202.331.1950 ph • 202-331-1994 fax | www.naftz.org
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