C U S T O M S / S E C U R I T Y

CBP Announces Priority Trade Issues for 2008

U.S. Customs and Border Protection recently established the following priority trade issues for 2008.

AD/CV Duties. CBP states that its ability to fulfill its statutory responsibility to collect all revenue due the U.S. government has been affected by (a) the retrospective nature of the antidumping/countervailing duty system, which requires CBP to issue bills one to two years after an entry has occurred to importers who may be unwilling, unable or simply have no intention of paying an increase in duties, and (b) companies who willfully circumvent AD/CV duties through illegal transshipment, undervaluation or misclassification of merchandise. CBP has therefore elevated the AD/CV program to PTI status to ensure that a concerted, systematic approach is implemented to facilitate legitimate trade, detect and deter circumvention of AD/CV duties and timely liquidate transactions with correct determinations regarding final duties owed. CBP will utilize a risk-based approach to identify and address violations and circumvention schemes.

Penalties. The goal of CBP’s penalties trade strategy is to improve the effectiveness of the trade fraud penalty process by (a) emphasizing national direction, uniformity and swift action, (b) applying trade compliance alternatives to traditional commercial fraud penalties and (c) focusing trade fraud resources on PTIs. The trade fraud penalty process is a PTI because considerable CBP resources are expended to achieve modest penalty collections and penalties are often the only tool available to CBP to deter noncompliance in the trade environment.

Textiles. Due to the high-risk nature of imports of textile and apparel products, CBP has designated this industry as a PTI for 2008. Many different schemes are used to evade duties or quotas on imports of such goods. Some importers engage in transshipment while others use false documents or labels or provide incorrect descriptions of the merchandise. In recent textile enforcement operations over $12 million in misdescribed goods have been seized.

CBP has also identified significant intellectual property rights violations involving textile products and seized approximately $27 million in infringing goods in 2007.

CBP uses a multifaceted approach consisting of trade pattern analysis, on-site verification, review of production records, audits and laboratory analysis to enforce U.S. trade laws and ensure that the appropriate revenue is collected. To conduct on-site verifications, CBP’s Textile Production Verification Teams travel to foreign factories to review and verify that wearing apparel that is shipped to the U.S. is produced at those facilities. These “jump teams” visited 15 countries and approximately 671 factories in FY 2007, a 57 percent increase over the previous year.

Import Safety. CBP will focus on protecting the public health and safety from unsafe importations through more refined risk analysis, further developments in the Automated Commercial Environment, enhanced targeting and tracking, improved interagency and intra-agency communication and coordination, and continued partnerships with the trade community.

Agriculture. CBP’s agriculture trade strategy is designed to detect and prevent agro-terrorism and bio-terrorism; i.e., the intentional contamination of agricultural products or foods or the intentional introduction of diseases or pests intended to cause harm to the American public, American agriculture or the U.S. economy. This will include the risk assessment and prevention of biological, chemical and radiological methods of contaminating the food supply or agricultural products.

Revenue. Primarily in response to an independent auditor’s review of CBP’s internal controls over financial reporting done in FY 2002, revenue became a PTI. The auditor’s report stated that CBP did not adequately monitor the effectiveness of its internal controls over entry duties and taxes. In today’s environment of management accountability and reliance upon internal controls, CBP must take a proactive approach in determining areas that pose a material risk in its revenue process and ensuring that its internal operations and controls are designed to mitigate the risks at the point in the entry process where they occur.

return to front page  

CBP Breaks Ground on First New Arizona Port of Entry in More Than a Decade

03/18/2008 Friday, February 15th, marked an historic date for U.S. Customs and Border Protection. This was the day ground was broken for a brand new commercial port of entry in San Luis, Ariz., the first port in Arizona in more than a decade. Planning for the event began months ago, during the design approval process, when representatives from CBP and the General Services Administration began talking about holding an event to celebrate the beginning of construction. Months of coordination, including putting together programs, arranging for guest speakers, gathering names for invitations, selecting an appropriate date and time, working on visual displays, writing speeches, creating press kits, and a myriad of other tasks, kept the Tucson Field Office and the San Luis port of entry busy.

The morning began cold, and by midmorning, high winds and dust storms threatened to scrap the event, but CBP OFO kept things on track as their vehicles were moved into position to act as windbreaks, plans were modified, transportation was re-arranged and, eventually, Mother Nature assisted when the winds began to calm down a bit right before the ceremony.

The ceremony began with an introduction by Peter Stamison, the Regional Administrator for GSA (Region 9), acting as Master of Ceremonies. The Tucson Field Office Honor Guard marched in and presented the colors while the national anthem was sung by a guest singer from the local area.

The Governor of Arizona, Janet Napolitano, was the first guest speaker. She spoke of the importance that having a new, state-of-the-art port of entry will mean to the Arizona economy and the ability to facilitate international trade through the state.

U.S. Department of Transportation Secretary Mary Peters told the crowd how critical international trade is to the nation’s economy and how a new commercial facility will help to facilitate legitimate international trade in the area.

CBP OFO Assistant Commissioner Thomas Winkowski followed her and gave remarks about the importance of partnerships in getting a new port of entry funded, designed, and built. He also spoke of how a new port of entry, with the latest technology, will enhance our security efforts and ability to facilitate legitimate international trade.

The impact of a new port to the local community and potential for increased trade in the area is something San Luis Mayor Juan Carlos Escamilla reiterated to the community followed by the Chairman of the Greater Yuma Port Authority, Gary Magrino who spoke also of the partnerships between agencies/organizations and the historical steps taken to get the project from a simple idea to beginning construction.

The final speaker was GSA Administrator Lurita Doan, who shared what an important role land border

return to front page

CBP and ICE Donate Thousands of Shoes to Charity

Washington — U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement donated 10,000 pairs of shoes to Samaritan’s Feet, a non-profit charity based in Charlotte, NC. Samaritan’s Feet is a charity that seeks to cover the feet of 10 million impoverished people around the world in 10 years.

CBP officers and Import Specialists seized the shoes for violations of intellectual property rights laws. The holder of the legitimate trademark has agreed to allow the government to make this donation rather than destroying the shoes.

"We are very pleased that the efforts of CBP and ICE officers and agents have not only stopped counterfeit goods from being distributed in the United States illegally, but have made it possible for the people served by Samaritan’s Feet to benefit," said W. Ralph Basham, Commissioner, U.S. Customs and Border Protection.

The top commodity seized in FY 2007 was footwear with a domestic value of $77.7 million, which accounted for 40 percent of the entire value of goods seized.

CBP and ICE are dedicated to the enforcement of intellectual property rights laws to protect American businesses and consumers from potentially unsafe and illegitimate goods. In FY 2007, CBP made more than 13,600 seizures worth approximately $200 million in domestic value, exceeding the value of last year’s by 27 percent.

Department of Homeland Security U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement FY 2007 Top IPR Commodities Seized

Source: U.S. Customs and Border Protection Office of International Trade 11-14-07

return to front page

“DENIED PARTIES LIST”

Our government precludes business relationships with certain individuals, companies and even countries.   Exporters following good compliance processes regularly refer to the following lists.

Denied Persons List  A list of individuals and entities that have been denied export privileges. Any dealings with a party on this list that would violate the terms of its denial order is prohibited.

Unverified List  A list of parties where BIS has been unable to verify the end use in prior transactions. The presence of a party on this list in a transaction is a “red flag” that should be resolved before proceeding with the transaction.

Entity List  A list of parties whose presence in a transaction can trigger a license requirement under the Export Administration Regulations. The list specifies the license requirements that apply to each listed party. These license requirements are in addition to any license requirements imposed on the transaction by other provisions of the Export Administration Regulations.

Specially Designated Nationals List  A list compiled by the Treasury Department, Office of Foreign Assets Control (OFAC). OFAC’s regulations may prohibit a transaction if a party on this list is involved. In addition, the Export Administration Regulations require a license for exports or reexports to any party in any entry on this list that contains any of the suffixes "SDGT". "SDT", "FTO" or "IRAQ2".

Debarred List  A list compiled by the State Department of parties who are barred by §127.7 of the International Traffic in Arms Regulations (ITAR) (22 CFR §127.7) from participating directly or indirectly in the export of defense articles, including technical data or in the furnishing of defense services for which a license or approval is required by the ITAR.

Nonproliferation Sanctions  Several lists compiled by the State Department of parties that have been sanctioned under various statutes. The Federal Register notice imposing sanctions on a party states the sanctions that apply to that party. Some of these sanctioned parties are subject to BIS’s license application denial policy described in §744.19 of the EAR (15 CFR §744.19).

General Order 3 to Part 736      This general order imposes a license requirement for exports and reexports of all items subject to the EAR where the transaction involves a party named in the order. This order also prohibits the use of License Exceptions to export or reexport to these parties. These parties are currently located in: Dubai, United Arab Emirates; Germany; Syria; Lebanon; Malaysia; Iran; and Hong Kong.

Scan-all a trade barrier: EC

EU has added its voice of concern with the growing voices in our Congress to legislate 100% scanning of incoming cargo containers.

To close out 2007, Congress called for the scanning of all containers destined for the U.S. by 2012.  

 Risk based outcomes point to a negligible increase of security through this effort and a high economic cost to importers and the American consumer.  It is possible that our efforts in ever increasing security barriers may lead to a complaint to the World Trade organization – some in international trade already believe that security is not the real issue but rather a disguised form of protectionism.

The European Union, in a letter expressing its concern said; “To our knowledge, the U.S. 100-percent scanning legislation is not based on a proper assessment of its impact, and, currently, there is not enough evidence to measure it,” The EU asserted that this effort was a thinly disguised political move to assurage the concerns of Americans with a false sense of security.  And at the same time divert scarce resources away from more effective worldwide security efforts. percent scanning “would tend to divert scarce resources from other essential measures and might create a false sense of security and complacency. It would call for a shift of European resources away from European security requirements.”

return to front page

CBP Suspends Global Trade Exchange, Calls for Limits on 100 Percent Scanning

U.S. Customs and Border Protection official at the National customs Broker and Freight Forwarders Association convention said that CBP has suspended its plans to develop a global trade exchange system that would have expanded the amount of trade data collected by the agency. It was indicated that the effort towards great data collection was pre-mature – not dead - at this time.  This decision does not affect the work done by this agency on the so-called 10+2 security filing.  On this related note, it is expected that the 10+2 security filing will be operational in a test mode before the end of this year.

CBP hints that 100% scanning may not be the best use of scarce resources.  CBP instead believes in using its resources more effectively by targeting at risk cargo.  Cargo routed through high risk corridors could be subject to greater (100%) screening.  Customs has expressed reservations about the practicalities of a world wide system of examining 100% of imported containerized cargo destined to the US.  Maintaining necessary equipment at locations is a wide array of environmental conditions, the practical dependability of data exchanges 24/7, the questionable ability of some foreign ports to be redesigned to accommodate securing this cargo, consistent and reliable cooperation with local authorities, whom to bill for such effort, staffing, how the costs borne relative to these security exams fall under Incoterms, and the likelihood of other countries demanding the same access and control of export US product to her own countries. 

In a clearer interpretation of the comments made – managing mandated exams of inbound containers from more than 700 port of export around the world is in short – silly.

Customs will continue to ratchet up different vectors that focus on raising security of imported cargo will manageable delays, costs and intrusions.  As of 10/15/08, all inbound containers must be secured with a bolt seal.  More scrutiny on cargo moved for the benefit o NON_CTPAT parties.  And the upcoming 10+2 initiative is believe by Customs to be a significant deterrent to would-be terrorists.

DHS Notices: New ACE Feature; Coast Guard Info Collections

New ACE Tool for Download, Use of Trade Data. U.S. Customs and Border Protection announced April 7 that ACE Secure Data Portal account holders are now able to download large volumes of account data, import it into a local reporting system and generate reports tailored to their companies’ reporting software with the authorized data extract feature, formerly known as bulk data download. CBP states that all cargo entry, cargo exam, entry summary, entry summary compliance and account revenue reports are now available for importer and broker trade account owners and proxy trade account owners to request via this feature. The authorized data extract will be delivered to the account holder’s ACE portal account inbox as a compressed file that can be opened using Microsoft Excel or Access. The new feature is designed to give the trade community greater access to transactional data and more flexibility with how it is downloaded and used.

return to front page

CBP Returns Pre-Columbian Artifacts to Mexico
Tuesday, April 01, 2008

Dallas – Yesterday, in a special presentation, U.S. Customs and Border Protection’s Area Port Director of Dallas, Ana Hinojosa turned over pre-Columbian artifacts to representatives with the Mexican Government. The returned artifacts are considered priceless cultural treasures in Mexico and date back between 1250 BC and 900 BC.

Archeologists from both the Corpus Christi Museum of Science and History, and the National Institute of Archeology and History of Mexico examined the artifacts in question and determined that the items are of Mexican origin. Archeologists believed the artifacts are Pre-Columbian from the northern regions of Mexico and must have been part of funeral offerings. Pre-Columbian is a term used to refer to cultures of the New World in an era before Christopher Columbus. In practice, the term usually includes indigenous cultures as they continued to develop prior to being conquered or significantly influenced by Europeans.

These particular items of Pre-Columbian artifacts have been in the custody of the U.S. Customs and Border Protection for several years, some since 2001 and have been safely stored in a CBP vault in the Dallas port of entry. All of the items returned today were seized from would be smugglers in a variety of enforcement actions conducted by CBP officers and/or ICE agents at various ports of entry in the states of Texas and New Mexico.

Present to receive the artifacts on behalf of the Mexican government, were Adolfo AyusoAudry, Consul of Mexico, Cultural Affairs Division, Consul General and Humberto Romero, Protection Affairs.

T R A N S P O R T A T I O N / S H I P P I N G

BNSF Idles Freight Cars Due to Downturn
4/7/08

Freight railroad BNSF Railway Co. is parking miles of rail cars in some parts of the country because there is not enough freight to keep them moving, the Associated Press reported Monday.

Rail cars that usually carry 40-foot containers of goods shipped from Asia via West Coast ports are parked in Montana. The cars standing between Helena and Great Falls, Mont., make up about 5% of the BNSF fleet, AP said.

BNSF has parked upward of 1,000 cars in that state alone, a company spokesman told AP. More are parked in other parts of the railroad’s 32,000-mile system, which operates in 28 states and two Canadian provinces.

An official with truckload carrier Schneider National, which uses extensive intermodal in its operations, said he believed a freight recession began more than a year ago, AP said.

Schneider is not parking trucks, but neither is it buying new ones to the usual extent, AP reported

By Transport Topics

return to front page

The Westbound Transpacific Stabilization Agreement (WTSA)

FMC Agreement No. 011325, whose member lines serve the US export trades from the USA to East Asia, have announced a new “Fuel Cost Recovery Program” and increases to their Bunker Adjustment Factors (BAF) and Inland Fuel Surcharges (IFC) the month of May.  For the month of May 2008, the BAF will increase to US$ 796 per 20ft ctr, US$ 995 per 40ft/45ft ctr, and US$ 48 per WM; the Inland Fuel Charge will increase to US$ 353 per ctr for rail and intermodal rail/truck shipments, and US$ 102 per ctr for local/regional truck shipments.

Under their new fuel cost recovery program, effective July 1, 2008, the WTSA lines will increase bunker surcharges to $600 per 40ft ctr, or the full BAF formula level in effect at that time, whichever is lower.  Effective October 1, the BAF will increase to $900 per 40ft ctr, or the full BAF formula level, whichever is lower.  By January 1, 2009, the WTSA lines say they expect all tariff and contract cargo to move under the full BAF as published in their FMC tariffs and adjusted monthly according to their surcharge calculation formula.  WTSA Executive Administrator Brian Conrad stressed that the increase amounts are not a departure from the group’s existing formula, but rather an attempt to bring BAF levels, where contract terms permit, closer in line with the formula.

WTSA member carriers are American President Lines, COSCO Container Lines, Evergreen Marine Corp., Hanjin Shipping, Hapag-Lloyd Container Line, Hyundai Merchant Marine, "K" Line, NYK Line, OOCL and Yang Ming Marine.   For more info visit www.wtsacarriers.org.

return to front page 

Japan Airlines International agrees to plead guilty and pay criminal fine for fixing prices on cargo shipments

WASHINGTON — Tokyo-based Japan Airlines International Co. Ltd. (JAL) has agreed to plead guilty and pay a $110 million criminal fine for its role in a conspiracy to fix rates for international cargo shipments, the Department of Justice announced today.

According to the charges filed today in the U.S. District Court for the District of Columbia, JAL engaged in a conspiracy in the United States and elsewhere to eliminate competition by fixing the rates for international shipments of cargo to and from the United States and elsewhere from on or about April 1, 2000, to February 2006. During the time period covered by the felony charge, JAL was the largest carrier of cargo between the United States and Japan and earned almost $2 billion from its cargo flights to and from the United States.

Under the plea agreement, which is subject to court approval, JAL has agreed to cooperate with the Department's ongoing investigation.

"This price-fixing conspiracy inflicted a heavy toll on American businesses and consumers," said Thomas O. Barnett, Assistant Attorney General in charge of the Department's Antitrust Division. "Japan Airlines is the fourth cargo carrier to admit to its involvement in this cartel and to agree to cooperate with an ongoing investigation."

JAL is charged with carrying out the price-fixing conspiracy with co-conspirators by:

• Participating in meetings, conversations and communications in the United States and elsewhere to discuss the cargo rates to be charged on shipments to and from the United States;

• Agreeing, during those meetings, conversations and communications, on the cargo rates for shipments to and from the United States;

• Levying cargo rates in accordance with the agreements reached; and

• Engaging in meetings, conversations and communications to monitor and enforce the agreed upon rates.

On August 23, 2007, British Airways Plc pleaded guilty and was sentenced to pay a $300 million criminal fine for conspiring to fix cargo rates for international air shipments, including to and from the United States, and to fix passenger fuel surcharges for long-haul international air transportation, including between the United States and United Kingdom. The same day, Korean Air Lines pleaded guilty and was sentenced to pay a $300 million criminal fine for conspiring to fix cargo rates charged to customers in the United States and elsewhere for international air shipments and to fix wholesale and passenger fares for flights from the United States to Korea. On January 14, 2008, Qantas Airways Limited pleaded guilty and was sentenced to pay a $61 million criminal fine for its role in a conspiracy to fix the rates of shipments of cargo to and from the United States and elsewhere.

JAL is charged with price fixing in violation of the Sherman Act, which carries a maximum fine of $100 million for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

The ongoing investigation into the air transportation industry is being conducted by the Antitrust Division's National Criminal Enforcement Section and the FBI.

Anyone with information concerning price fixing or other anticompetitive conduct in the air transportation industry is urged to call the National Criminal Enforcement Section of the Antitrust Division at 202-307-6694 or the FBI Washington Field Office at 202-278-2000.

return to front page

E X P O R T /  T R A D E 

State Hits New Exporting Record

Wisconsin's exports increased by 11.8 percent this past year to reach a record $19.2 billion in 2007. Wisconsin ranks 19th in exports among the 50 states.

"I salute Wisconsin companies for aggressively seeking new markets around the globe," Governor Doyle said. "As Governor, I'm committed to doing all I can to support a climate that encourages success for our exporters."

Exports to Canada, Wisconsin's largest international market, grew by 7.3 percent to $5.8 billion. Mexico continued as Wisconsin's second-largest export market, as exports grew 2 percent to $1.9 billion. China took third place with a 35.4 percent increase to $1.2 billion, topping $1 billion for the first time ever. The United Kingdom took fourth place with a 6 percent increase to $722.8 million. Germany ranked fifth with a 13.4 percent increase to $660.8 billion.

Industrial machinery, including computer equipment, continues to be Wisconsin's top manufacturing export commodity, growing by 11.8 percent to $6.2 billion. Electrical machinery ranked second with a 5.7 percent increase to $2.7 billion. Medical and scientific instruments ranked third with a 0.1 percent decrease to $2.1 billion. Agricultural exports ranked fourth with a 45.1 percent increase to just under $2.1 billion. Transportation equipment ranked fifth with an 18.4 percent increase to $1.7 billion.

The state's agricultural exports have nearly doubled in the past three years, up from $1.1 billion in 2004 - nearly a 100 percent increase. Dairy exports skyrocketed 131 percent, up from $84.7 million in 2006 to $195.8 million in 2007, driven by demand for cheese, whey, and butter. A relatively new export, dried distillers grains, jumped 245 percent, up from $6 million in 2006 to $19.2 million in 2007, driven by strong demand in Asia. A by-product of the state's burgeoning ethanol industry, distillers grains are sought as a high-protein livestock feed. Excel spreadsheets showing Wisconsin exports by destination and product category  from 1996 through 2007 are now available on-line.
http://commerce.wi.gov/IEdocs/IE-WIExportsByProduct.xls)

The U.S. Department of Commerce's Bureau of the Census is once again releasing data on exports by metropolitan statistical areas, although not on the same schedule as the state-by-state data. Data for metropolitan area exports in 2005 and 2006 were released on January 24. The Milwaukee-Waukesha-West Allis metropolitan area had exports of $6,849 billion in 2006 and ranked #30 nationally. Other Wisconsin communities on the 2006 list included:

• Racine, #89, $1.484 billion

• Madison, #100, $1.310 billion

• Appleton, #119, $975 million

• Oshkosh/Neenah, #139, $828 million

• Janesville, #142, $803 million

• Fond du Lac, #176, $522 million

• La Crosse, #180, $512 million (also includes Houston County in Minnesota)

• Sheboygan, #195, $442 million

• Green Bay, #197, $432 million

• Eau Claire, #199, $427 million

• Wausau, #255, $211 million

Kenosha County is considered part of the Chicago-Naperville-Joliet Metropolitan Area and Superior is considered part of the Duluth Metropolitan Area for statistical purposes. For additional information on metropolitan area exports and to view the complete data series and methodology, visit www.trade.gov/metrodata.

--Stanley Pfrang

return to front page

Under Secretary of Commerce Mario Mancuso Addresses American Bar Assn;
Remarks Highlight Interdependence of U.S. Security and Prosperity

WASHINGTON – Under Secretary of Commerce Mario Mancuso today delivered keynote remarks to a joint session of the international trade and export control committees of the American Bar Association.  Under Secretary Mancuso emphasized that dramatic changes on the international security and economic landscapes necessitated regulatory reforms to continue to advance US national security, foreign policy, and economic objectives.

Under Secretary Mancuso highlighted two key points:

• That passing the Export Enforcement Act of 2007, which would renew the Export Administration Act, was “absolutely vital” for national security.  Under Secretary Mancuso added that “this legislation will bolster our diplomatic efforts around the world to persuade countries—particularly those countries of transshipment concern—to adopt, fully implement and enforce, and improve their own export control regimes.  It is more difficult to make a credible and persuasive case to other nations to enact effective export controls when our own country doesn’t have a permanent dual-use export control law on the books.”

• Under Secretary Mancuso also noted that in a new strategic environment marked by hyper-competition and global technology leveling, it was critical for  the U.S. to “complement smart and effective export controls with an affirmative, whole-of -government strategy to outdistance our competitors, to remain the most innovative, the most competitive economy in the world.”

Bureau of Industry and Security Announces Updates to Commerce Control List

WASHINGTON – The U.S. Department of Commerce's Bureau of Industry and Security (BIS) today announced a series of updates to the Commerce Control List (CCL) as part of a systematic effort to update and refine the U.S. dual-use export control system. The CCL helps determine what U.S. goods and services require a Commerce Department export license to be shipped overseas.

The CCL changes were published in a Federal Register Notice, and are the first round of improvements which resulted from a systematic review conducted by BIS, with significant input from its technical advisory committees and the public. BIS continues to work with its interagency partners on additional CCL enhancements which were identified during the course of that review.

"U.S. economic and technology leadership are critical to ensuring U.S. national security," said Under Secretary of Commerce Mario Mancuso. "These updates to the regulations – and our commitment to revisit the CCL on a regular basis – will ensure that our controls help enhance short-term and long-term national security and economic competitiveness," he said.

BIS also announced the publication of additional information describing its process to methodically review the CCL to ensure the export control regime meets today's challenges. BIS plans to review one third of the CCL each year to create a three review cycle. Emphasis will be placed on:

• Overall structure of the CCL,

• Types of items that should be listed on the CCL,

• Particular industry sectors,

• Updates on item descriptions, and,

• Coordination and harmonization with regard to the multilateral regimes.

BIS controls exports and re-exports of dual-use commodities, technology and software for reasons that include national security, missile technology, nuclear non-proliferation, chemical and biological non-proliferation, crime control and regional stability. Criminal civil and administrative sanctions can be imposed for violations of the Export Administration Regulations. For more information, please visit www.bis.doc.gov.

return to front page

French Corporation pleads guilty to conspiracy, illegal export, and attempted illegal export of cryogenic submersible pumps to Iran

Washington, D.C. - Cryostar SAS, formerly known as Cryostar France (“CRYOSTAR”), a French corporation, plead guilty to conspiracy, illegal export, and attempted illegal export of cryogenic submersible pumps to Iran, U.S. Attorney Jeffrey A. Taylor and Assistant Secretary of Commerce for Export Enforcement Darryl W. Jackson announced today.    CRYOSTAR must be sentenced to a criminal fine of $500,000 and corporate probation of two years. 

“Foreign parties that choose to export U.S.-origin goods to embargoed destinations, such as Iran, violate our export control laws,” said Assistant Secretary Jackson.  “As this case demonstrates, we will vigorously pursue such violations.”

“Export restrictions should not be viewed as avoidable obstacles, but rather as fundamental safeguards for the protection of our national interests,” stated U.S. Attorney Taylor.  “This prosecution should serve as a reminder that failure to comply with U.S. export control laws can have severe consequences.”

BIS Establishes Online Export Control Training for Exporters

WASHINGTON – The Commerce Department’s Bureau of Industry and Security (BIS) announced the creation of the BIS Online Training Room, an innovative new resource for companies interested in learning about U.S. dual-use export control regulations.  The Training Room will act as an organized, online repository of training modules and webinars, amplifying and augmenting current BIS exporter outreach programs. 

“Active compliance with U.S. dual-use export control regulations is critical to maintaining safe and secure international trade, and it is essential that we support the good-faith efforts of exporters to comply with our regulations,” said Under Secretary of Commerce Mario Mancuso.  “The BIS Online Training Room will be a great help to exporters, particularly small and medium-sized enterprises, by making available a convenient mechanism to learn about our regulations.”

As part of its ongoing efforts to improve outreach, BIS will continue to create and supplement the materials regularly.  The initial launch includes the first half of the Essentials of Export Controls seminar that BIS currently offers around the country, as well as five pre-recorded webinars covering a variety of topics.  The training modules are presented in a video streaming format. The pre-recorded BIS webinars were conducted over the past year and focus on specific export control issues.

The BIS Online Training Room can be found at:
 http://www.bis.doc.gov/seminarsandtraining/seminar-training.htm 

return to front page

The Clean Diamond Trade

The Clean Diamond Trade Act (the "act"; public law 108-19) was signed into law on July 29, 2003. The act prohibits the "importation into, or exportation from, the United States on or after July 30, 2003, of any rough diamond, from whatever source, unless the rough diamond has been controlled through the Kimberly process certification scheme (KPCS)".

The Census Bureau is responsible for collecting, compiling and publishing import and export statistics for the U.S. under the provisions of tile 13 and title 15 U.S.C. the act requires the census bureau to maintain statistics on imports and exports of rough diamonds under subheadings 7102.10, 7102.21 and 7102.31 of the harmonized tariff schedule of the United States.

All importers of rough diamonds must fax a copy of their KPC certificates to the Census Bureau upon making entry with U.S. Customs and Border Protection. Copies of the KPC must be faxed to 1-800-457-7328.

Questions regarding the KPCS may be directed to Ms. Adria Gibson at 202-863-6057.

Check your International Geography IQ

Many of us in international trade are proud of the ability to find obscure and out-of-the-way places on a map. Your accuracy and speed in pinpointing cities, locations of monuments, and natural wonders, and matching countries with their flags is put to the test at the World Traveler IQ Game at http://www.travelpod.com/traveler-iq.

Is Trade the Problem?
Copyright © 2006 IFCBA | International Federation of Customs Brokers Associations

Americans are angry about trade and a lot of politicians, especially the two Democratic presidential candidates,  are eager to capitalize on it. The country would be far better served by a serious, dare we say fact-based, discussion of what is causing the dislocations in American workers’ lives, how much trade is to blame and what government can do to help.

There is no question that trade can disrupt lives. Just ask the nearly 500 workers who lost their jobs four years ago when Sanmina-SCI closed its plant in Wilmington, Mass., to move its production of circuit boards to Asia. An investigation by the Government Accountability Office found that eight months later only about 175 of Sanmina’s employees had found new jobs, with most of those taking a pay cut.

There is also no question that life for many American workers has gotten tougher since the 1970s. Paychecks have failed to keep pace with productivity as most of the spoils of growth have gone to a tiny elite.

Still, critics’ charges that trade is to blame are misguided…. Many Americans benefit from freer trade, whether they are buying cheaper imports or exporting products.

Consider the four million manufacturing jobs lost over the last decade. That number is daunting — and the human pain behind it very real. But in most years the United States generates more jobs than it loses.

Suppose the critics are right and all those workers were displaced by cheap imports and factories moving overseas. Those lost manufacturing jobs — an average of 400,000 a year — amount to less than 3 percent of the 15 million jobs lost each year across the economy. Meanwhile, about 17 million jobs were created annually, which is why the unemployment rate at the end of 2007 was not much different than it was at the end of 1997.

What about pay? Workers who lose their jobs usually have to accept a pay cut to get a new one, studies show….

There is a growing inequity in pay. From 1976 to 2006, the average salary of workers in the bottom 90 percent of the income distribution — nearly everybody — rose by only 2.3 percent, to $38,800, tax data show. Among the top 10 percent, average salaries rose 57 percent, to $195,000. While there are still high-paying jobs out there, more and more they are reserved for workers with high levels of education. Between 2000 and 2006, the only workers who saw an increase in take-home pay were those with doctorates or professional degrees.

No matter how hard economists look for trade’s fingerprints on these inequities, they find it plays only a bit part. Josh Bivens of the Economic Policy Institute estimated that rising trade with poor countries increased wage inequality between college and high school graduates by about 7 percent over the past quarter-century — but the wage gap has widened by more than six times that amount over that period. And many economists think Mr. Bivens overstates trade’s impact. …

Trade’s critics overstate the threat of “cheap imports” from poor countries. Often these goods are just assembled in poor countries from components made in high-wage countries — including the United States. Moreover, many of the things imported from cheap labor markets have not been made here for a long time, so pose no threat to American goods.

So what is going on?

Economists have other explanations for the stagnation of middle incomes and the mushrooming income gap. Lawrence Katz, a Harvard economist, argues that a big part of the problem is a shortage of educated, skilled workers at a time when demand for them keeps rising. High school graduation rates are flat, and there has been a slowdown in the growth of college graduation rates, partly because of the rising cost of college. This is weighing on wages of less-educated workers while increasing the pay of the most educated. …

None of this denies that American workers are hurting. But blaming trade is not the right way to go. What the candidates need to do is respect the voters, and explain the economics and outline policies that will address the true problems. …

The candidates also need to remind workers of trade’s benefits. Trade gives companies and consumers access to cheap imports and accelerates the spread of new technologies; exporters gain access to foreign markets; foreign competition spurs innovation. According to economists at the Peterson Institute for International Economics, increased trade since World War II has added about 10 percent to American national income.

Blaming Nafta and other trade agreements for American workers’ pain may play well on the campaign stump. But it will not solve the country’s economic problems. It will only make them worse.

This article is extracted from the 27 April 2008 edition of "The New York Times".

return to front page

Antiboycott Laws:

A number of counties in the world attempt to exert pressure on American companies to curtail business with Israel.  Our government absolutely stands by the free nation of Israel and this transparent attempt to preclude the free trade of goods.

During the mid-1970's the United States adopted two laws that seek to counteract the participation of U.S. citizens in other nation's economic boycotts or embargoes. These "antiboycott" laws are the 1977 amendments to the Export Administration Act (EAA) and the Ribicoff Amendment to the 1976 Tax Reform Act (TRA).

Objectives:

The antiboycott laws were adopted to encourage, and in specified cases, require U.S. firms to refuse to participate in foreign boycotts that the United States does not sanction. They have the effect of preventing U.S. firms from being used to implement foreign policies of other nations which run counter to U.S. policy.

Primary Impact:

The Arab League boycott of Israel is the principal foreign economic boycott that U.S. companies must be concerned with today. The antiboycott laws, however, apply to all boycotts imposed by foreign countries that are unsanctioned by the United States.

Examples of Boycott Requests

Following are recent examples of boycott requests that have been reported to the Office of Antiboycott Compliance. These examples are illustrative and not exhaustive. Companies should call our advice line (202) 482-2381 with questions concerning these or any request to comply with restrictive trade practices or boycotts.

BAHRAIN:

Prohibited Boycott Condition in a Purchase Order:

"In the case of overseas suppliers, this order is placed subject to the suppliers being not on the israel boycott list published by the central Arab League."

Reportable boycott condition in an importer’s purchase order:

"Goods of Israeli origin not acceptable."

Reportable boycott condition in a letter of credit:

"A signed statement from the shipping company, or its agent, stating the name, flag and nationality of the carrying vessel and confirming ... that it is permitted to enter Arab ports."

BANGLADESH

Prohibited Boycott Condition in instructions to bidders on a contract

"No produced commodity shall be eligible for ... financing if such commodity contains any component or components which were imported into the producing country from Israel and countries not eligible to trade with ... the People’s Republic of Bangladesh. The equipment and materials must not be of Israeli origin. The supplier/bidder who are not black listed by Arab boycott of Israel will be allowed to participate in this bid."

KUWAIT

Prohibited Boycott Condition in a Custom’s document

"[The vessel entry document asks the ship’s captain to certify that,] no goods, dry cargo, or personal effects listed on the document of Israeli origin or manufactured by a blacklisted firm or company are to be landed as they will be subject to confiscation."

Prohibited Boycott Condition in Letter of Credit

"We hereby certify that the beneficiaries, manufacturers, exporters and transferees of this credit are neither blacklisted nor have any connection with Israel, and that the terms and conditions of this credit in no way contravenes the law pertaining to the boycott of Israel and the decisions issued by the Israel Boycott Office."

Reportable Boycott Condition in Letter of Credit:

"Importation of goods from Israel is strictly prohibited by Kuwait import regulations; therefore, certificate of origin covering goods originating in Israel is not acceptable."