COPPERSMITH GLOBAL LOGISTICS

COMMITTED!  CONNECTED!  COMPLETE!

 


OCTOBER 2011
Welcome to Coppersmith Global Logistics
 

Greetings!

In the last weeks and months there has been legislation passed and regulations proposed that impact the international trade community in a significant way.  In this newsletter we have provided you with a summary of some of these changes and links to additional information. 

Coppersmith is closely following all of these and makes every effort to keep our valued customers informed. 

 

Please visit our website often for updates. 

 

Merchandise Processing Fee (MPF) To Increase. 

RECENT TRADE LEGISLATION H.R. 2832 CHANGED THE MERCHANDISE PROCESSING FEE RATE FOR FORMAL ENTRIES (CLASS CODE 499) FROM 0.21% (.0021) TO 0.3464% (.003464). THE MINIMUM MERCHANDISE PROCESSING AMOUNT OF $25.00 AND THE MAXIMUM MERCHANDISE AMOUNT OF $485.00 WERE NOT CHANGED.

 

CBP IS IN THE PROCESS OF MODIFYING ITS AUTOMATED SYSTEM (ABI) TO ACCEPT THE NEW MPF RATE OF 0.3464%. AT THE PRESENT TIME, CBP DOES NOT HAVE AN EXACT DATE WHEN THE MPF SYSTEM CHANGES WILL BE COMPLETED.

  

CBP WILL NOTIFY US IN A FUTURE MESSAGE WHEN THE TRADE CAN BEGIN SUBMITTING THEIR SUMMARIES WITH THE NEW MPF RATE. CBP PLANS TO PROVIDE THE TRADE WITH AN APPROXIMATELY ONE WEEKS NOTICE REGARDING THE DATE THAT CBP WILL BE ABLE TO ACCEPT THE NEW MPF RATE. THIS PROCEDURE APPLIES TO BOTH ACS AND ACE FILED SUMMARIES.

 

The bottom line is that the MPF will be increased from 0.21% to 0.3464% for the period of October 1, 2011 to June 30, 2021. No instructions have been issued on how CBP will collect the additional MPF from October 1st.

GSP and ATPA/ATPDEA Renewed 

GSP

On October 12, 2011, the House passed the Senate's version of the GSP/MPF/TAA bill. The bill now goes to the President, who is expected to sign it into law October 21st. GSP's retroactive renewal through July 31, 2013 would take effect 15 days after the President signs the measure into law.

 

CBP has confirmed that they will be following the same procedures it did the last time GSP expired and was retroactively renewed. As a result, filers who filed their entries with a GSP SPI (A,A*, A+) will receive automatic refunds without having to take any additional steps. Entries which did not use the GSP SPIs, a request for liquidation or reliquidation will need to be filed with CBP no later than 180 days after October 21 that contains sufficient information to enable CBP to locate the entry, or to reconstruct the entry if it cannot be located. Any amounts owed would be paid, without interest, not later than 90 days after the date of liquidation or reliquidation.

 

ATPA/ATPDEA

 

As passed by Congress, H.R. 3078 would renew ATPA/ATPDEA through July 31, 2013, effective for articles entered on or after 15 days after the date of enactment, which is approximately November 5th.

Goods entered after ATPA/ATPDEA expired on February 12, 2011, but before the effective date of the renewal provision (approximately November 5), that would have qualified for duty-free treatment or other preferential treatment under ATPA/ATPDEA had the entry been made before ATPA/ATPDEA expired, will be eligible to be liquidated or reliquidated, with a refund of duty.

 

CBP did not permit the continued use of the ATPA/ATPDEA Special Program Indicators (J and J+) when ATPA/ATPDEA expired on February 12, 2011.  CBP is not able to process refunds automatically and a request for liquidation or reliquidation must be filed. 

A request for liquidation or reliquidation will need to be filed with CBP no later than 180 days after the October 21 date of the enactment. Any amounts owed would be paid, without interest, not later than 90 days after the date of liquidation or reliquidation.

HTS Changes in 2012 

 In June 2011, the World Customs Organization announced that it was close to finalizing its work to implement the 2012 version of the international Harmonized System (HS) Nomenclature. There were a total of 225 amendments (affecting 5,205 tariff numbers) to the 2012 HS, some of which were made to facilitate the use of the HS for the compilation of food security data and agriculture (including forestry and fisheries) statistics. The largest volume of such amendments arose from a single request by the Food and Agriculture Organization (FAO) for separate identification of food products in Chapters 1-21.

 

The 2012 HS also creates a new heading for hygiene absorbent products, such as infant diapers, adult incontinence products, feminine sanitary products, etc. Currently, these products are classifiable in the 2007 HS under headings 48.18, 56.01, 61.11 or 62.09 according to their constituent materials. However, as of January 1, 2012, these hygiene absorbent products, of any material, will fall in the 2012 HS under heading 96.19.

 

Other changes include amendments of particular economic and technological importance include those providing separate identification in the HS for biodiesel fuels, nickel-metal hydride batteries (used in hybrid motor vehicles), and lithium-ion batteries (used to power consumer electronics products).

 

Other amendments were made to take into consideration technological progress, changes in trade patterns, trade practices, and to clarify certain texts

Food Safety Modernization Act (FSMA) Updates 

On August 1, 2011 FDA issued a Notice of Proposed Rule Making addressing User Fee Rates which were provided for in the Food Safety Modernization Act (FSMA).  COMMENTS are due by October 31st. 

Particularly onerous is the portion of the law which requires all "U.S. Agents" under a foreign facility's registration number to be financially responsible for re-inspection charges of that foreign facility. This is to the tune of $335 per hour for these inspections outside the U.S. to be billed directly, and without limit, to the U.S. Agent named on the foreign food facility registration. 

  

 Many US agents who agreed to act in this capacity under Prior Notice with obligations only to be a communication contact in the event of Bioterrorism threat may elect not to take on the additional liability for fees payments.  In doing so the Foreign Facility's Registration becomes invalid and your shipments may be held up.  If you elected to act as the US Agent for your foreign food suppliers you should take steps to confirm these new obligations and establish payment understandings. 

 

Since any entry requiring FDA Prior Notice must have a valid registration number to certify in the Customs entry process and with FDA registration numbers being confidential to the registrant only, you will want to confirm with your food suppliers that they have arranged to have a US Agent that assumes these responsibilities (assuming you are not the US Agent) and that if your shipments are delayed or you incur additional costs or penalties that they will be responsible.

 

Many organizations will be making comments.  Coppersmith is directly involved in commenting to FDA on the consequences of this legislation to the Brokerage community as well as their food importers are making suggestions on systems changes and timing of implementation so that everyone has ample time to prepare. 

 

COPPERSMITH'S WEBSITE has posted the most recent NPRM and FDA FAQ's.

New Free Trade Agreements

Product Duty Rates for Korea, Colombia, & Panama FTAs Available

President Obama will sign the Korean, Panama, and Colombia FTA implementing bills, on Friday, October 21, 2011.  There are many steps still required before Implementation of the Agreements.

 

The International Trade Administration, Office of the U.S. Trade Representative, and the Commerce Department all have useful information regarding the pending Free Trade Agreements with Korea, Colombia, and Panama. ITA has a tool that allows users to search each of the pending FTAs by tariff number to see the resulting duty rates over time for qualifying goods. USTR also has information on the pending FTAs by sector, as well as fact sheets, legal texts of the three agreements with duty rates, and the implementing legislation. Commerce has overviews of each agreement.

KORUS Within five years of enactment of the U.S.-South Korea Free Trade Agreement (KORUS), over 95% of bilateral trade in consumer and industrial products would become duty free and most remaining tariffs would be eliminated within 10 years. For agricultural products, KORUS would immediately eliminate or phase out tariffs and quotas on a broad range of products, with almost two-thirds (by value) of Korea's agriculture imports from the United States becoming duty free upon enactment. KORUS also addresses non-tariff barriers and has provisions on cross-border services, telecommunications, and electronic commerce.

PANAMA TPA Under the U.S.Panama Trade Promotion Agreement, over 87% of U.S. exports of consumer and industrial products to Panama will become duty-free immediately, with remaining tariffs phased out over 10 years. U.S. products that will gain immediate duty-free access include information technology equipment, agricultural and construction equipment, aircraft and parts, medical and scientific equipment, environmental products, pharmaceuticals, fertilizers, and agro-chemicals. U.S. agricultural exports will also benefit. Panama will immediately eliminate duties on high-quality beef, frozen turkeys, soybeans, soybean meal, crude soybean and corn oil, almost all fruit and fruit products, wheat, peanuts, whey, cotton, and many processed products.

COLOMBIA TPA Under the U.S.-Colombia Trade Promotion Agreement, over 80% of U.S. exports of consumer and industrial products to Colombia would become duty free immediately, with remaining tariffs phased out over 10 years. Key U.S. exports did gain immediate duty-free access to Colombia, including almost all products in the agriculture and construction equipment, aircraft and parts, auto parts, fertilizers and agro-chemicals, information technology equipment, medical and scientific equipment, and wood sectors.

In This Issue
MPF To Increase
GSP/ATPA/ATPDEA Renewed
Tariff Updates in 2012
Food Safety Modernization
New Free Trade Agreements
No More Courtesy Liquidation Notices
DO YOU NEED CARGO INSURANCE?
Cargo Vessel Hits Reef
Coppersmith has very competetive rates to protect your shipments against loss or damage in the normal course of transit.
CONTACT US TODAY FOR A QUOTE 
Join Our Mailing List

CBP No Longer Issuing Courtesy Liquidation Notices

Effective September 30, 2011, CBP discontinued mailing paper courtesy notices of liquidations to importers who file entries through the Automated Broker Interface (ABI) system.

Coppersmith is finalizing development of a Liquidation Service for our importers. 

Shortly we will issue a notice to our customers advising the location on our website where you may sign up for this service.

Although these notices are not the official notice of liquidation and are not mandated by statute, they nonetheless serve as a significant compliance tool in tracking the status of customs entries. By statute, importers of record have 180 days from the date of liquidation to object to decisions of CBP by generally filing administrative protests pursuant to 19 U.S.C. 1514 and the related customs regulations.

 

"This newsletter is for clients of Coppersmith Global Logistics and is for informational purposes only.  Topics contained herein are taken from numerous sources and are edited to provide an overview of the subject and should not be solely relied upon for implementation or compliance purposes.  Where possible we provide sources for more detailed information."

 

Maggie Smith Ranney
Coppersmith Global Logistics