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"Shap" Talk
September 2004 - Issue #29
In This Issue:
Shapiro Transportation Seminar…Huge Success!
FDA and CBP Revise Notice Documents for Imported Food
Full Mandatory Filing of the Shipper’s Export Declaration
Export Reference information from the U.S. Census Bureau
Dominican Republic Signs onto CAFTA
President Bush Signs U.S.-Australia Free Trade Agreement
West Nile Virus Spurs New Requirements for US Exports to China
FDA Announces Contingency Plan for Prior Notice System Outages
Pilot Bond Centralization Program Update
Trade Industry News
Shapiro Transportation Seminar…Huge Success!
Baltimore Corporate (August 18, 2004) Not even the threat of Hurricane Charley could keep Shapiro customers away from Samuel Shapiro & Company’s first annual Transportation and International Logistics Seminar held Thursday, August 12, 2004.
The morning seminar preceded an afternoon of networking and fun at the Baltimore Propeller Club’s annual outdoor Crab Feast held in Essex, Maryland. According to a spokesperson at the Conrad Ruth Villa (venue for the event), over 4000 people attended the crab feast including more than 50 customers and staff from all eight of Samuel Shapiro’s East Coast operations.
“It was one of our customers who suggested that we create this perfect summer activity… a little transportation education combined with a little festivity. It was a terrific day,” explained Marjorie Shapiro, President and CEO of Samuel Shapiro & Company, Inc. “The seminar was a success, and the Crab Feast just topped it off.”
Shapiro employees handed out giveaways including: golf shirts, water bottles, envelope openers, stress balls, and sunglass cases inscribed with Shapiro’s logo. The event gave Shapiro employees and customers the opportunity to meet and mingle with long-time acquaintances in the maritime industry along with new ones.
“It was an amazing networking experience,” explained Bill Burwell, Director of the Baltimore Export Assistance Center. “I would like to personally thank Samuel Shapiro & Company, Inc. for inviting us to their Transportation and International Logistics Seminar and for sharing their booth at the Baltimore Crab Feast,” added Burwell. “We met many new contacts that will help us to provide export services, market research, and trade opportunities to export ready firms through out Maryland.”
In addition to presenting private seminars, Shapiro hosts public seminars, available throughout the year, for the importing and exporting communities. It is our way of creating an engaging environment for all interested parties, allowing for an exchange of ideas and information, with the ultimate goal of strengthening business relationships.
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FDA and CBP Revise Notice Documents for Imported Food
On Thursday, August 12, 2004, the United States Food and Drug Administration (FDA) and the U.S. Customs and Border Protection (CBP) issued a revised compliance policy guide (CPG) that describes their strategy for enforcing the requirements of the prior notice interim final rule (IFR) while maintaining an uninterrupted flow of food imports.
FDA and CBP also announced a corresponding three month delay in their projected date for issuing the prior notice final rule from March 2005 to June 2005. This will allow FDA and CBP to retain the three month assessment period to determine whether the prior notice time frames can be reached further as they develop the prior notice final rule.
Lastly, the agencies announced the issuance of an updated prior notice compliance summary, and a new "Guidance for Industry: Prior Notice of Imported Food Contingency Plan for System Outages." The compliance summary states that since increased enforcement began in June, entries submitted to FDA and CBP with no prior notice have been almost eliminated. Although some problems still exist, only a small percent fail to submit any prior notice information. Most prior notice data are being submitted. Completion of registration number and bill of lading is lower than completion of most other data elements, however.
More detailed information is available at the FDA web site on The Bioterrorism Act of 2002 under the heading "Recent Activities" located at http://www.fda.gov/oc/bioterrorism/bioact.html.
Information includes:
Source: FDA, Customs Revise Notice Documents for Imported Food dated August 16, 2004, appearing on FDA Website at https://www.fda.gov/
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Full Mandatory Filing of the Shipper’s Export Declaration
The President signed into law P.L. 107-228, the Security Assistance Act of 2002, which gives the Secretary of Commerce the authority to issue regulations requiring full electronic filing of all export information covered by Title 13, Chapter 9. Provisions in this law also provide for penalties for failure to file and false filing.
At the AAEI Conference last June, the Department of Commerce advised the community to expect the Federal Register notice this fall on the mandatory filing of electronic information, will implementation slotted for early 2005.
Census reports have confirmed that plans are being developed for implementation in the first quarter of 2005 for full mandatory filing of the Shipper’s Export Declaration (SED) or Automated Export System (AES) information.
Some of the highlights of the full mandatory filing include:
- The paper SED form 7525-V will be eliminated. The Automated Export System (AES) must be used for all exports that require filing.
- The Data Entry Center Program (DEC) will cease to exist. Current DEC filers must obtain Power of Attorney or written authorization from the USPPI ‘s (US Principal Party in Interest) and become forwarding agents.
- Option 4 will accept new applications. USPPI’s already approved will not need to reapply.
- The current AES Exemption Statement will be called “Proof of Filing Citation”.
- The ITN will be mandatory as part of the AES Proof of Filing Citation on the bill of ladings, air waybills, or other loading documents.
- A new Proof of Filing Citation for shipments moving under Downtime will be present. The XTN can no longer be used except during downtime.
- Penalties will increase from $100.00/day to $1000/day with a maximum of $10,000.00 per violation. Penalties can be civil or criminal and can carry up to 5 years in jail. Penalties can be assessed against USPPI’s, Forwarders/Agents and/or Carriers.
Filing Time Frames
- Vessel -24 hours prior to departure from U.S. port where cargo is laden.
- Air & Courier -2 hours prior to departure from the U.S.
- Rail -2 hours prior to arrival at the border.
- Truck -1 hour prior to crossing the border.
To find a summary of the Trade Act Regulations and the Final Rule for required advanced presentation of electronic cargo information, along with a spreadsheet of the rules by mode of transport, please refer to the following link: http://www.cbp.gov/xp/cgov/import/communications_to_industry/advance_info/.
Samuel Shapiro & Company, Inc. is fully automated on the AES system to serve our customers needs. If you have any questions, please contact compliance@shapiro.com.
Source: July 2004 AES Newsletter, Volume, Issue 19 http://www.census.gov/foreign-trade/aes/documentlibrary/index.html#aes_newsletters appearing on the U.S. Census Bureau website.
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Export Reference information from the U.S. Census Bureau
The Department of Commerce, U.S. Census Bureau, and Foreign Trade Division website has a wealth of information for U.S. Exporters. Daily updates to FAQ’s and the Document Library are of particular help to exporters.
The Frequently Asked Questions (FAQ’s) cover the following subjects:
AES - Questions about the Automated Export System (AES)
- General - General questions about foreign trade data... as well as items not covered by specific topics below.
- DropBox - Questions related to downloading files from our DropBox
- Foreign Trade Zones - Questions about the Foreign Trade Zone program.
- Regulations - Questions about Foreign Trade regulations
- Schedule B search - Questions about searching for Schedule B numbers
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- AES Frequently Asked Questions are located at the following link: http://www.census.gov/foreign-trade/faq/index.html .
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- The Document Library contains AES Newsletters, Reports and Notices, AES Broadcasts, technical information and Compliance Alert and Statistical Verification Conditions. The Document Library can be accessed at the following link: http://www.census.gov/foreign-trade/aes/documentlibrary/index.html.
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- Additional export related information is available on the U.S. Census Bureau website: http://www.census.gov/index.html.
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- Source: The Department of Commerce, U.S. Census Bureau, and Foreign Trade Division website located at: http://www.census.gov/foreign-trade/www/.
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Dominican Republic Signs onto CAFTA
On August 5, 2004, the Office of the United States Trade Representative issued a press release pronouncing that the Dominican Republic joined the Central American Free Trade Agreement, creating the U.S.-Dominican Republic – Central America Free Trade Agreement (DR-CAFTA). With this agreement, the Dominican Republic becomes a member of CAFTA, which was signed earlier this year between the U.S. and Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua.
Negotiations with the five countries began in January 2003. In 2003, the U.S. exported $15 billion of goods to the Dominican Republic and Central American countries. The combined total goods traded between the U.S. and the original give CAFTA (Central America Free Trade Agreement) countries were $23.6 billion in 2003. The addition of the Dominican Republic represents an additional $8.7 billion in annual two-way trade, for a combined total trade relationship of approximately $32 billion.
The agreement will eliminate eighty percent of the tariffs immediately, with the remaining tariffs phased out over 10 years. According to U.S. Trade Representative Robert B. Zoellick, “this agreement significantly cuts trade barriers and expands regional opportunities for the workers, manufacturers, consumers, farmers, ranchers, and service providers of all our countries. Zoellick also notes that “adding the Dominican Republic to CAFTA will create new economic opportunities, by eliminating tariffs, opening markets, promoting transparency, and establishing state-of-the-art rules for the 21st-Century commerce”.
Other Free Trade Agreements (FTAs) are currently being negotiated and implemented. Below you will find a summary of all pending FTAs:
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Agreement
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Status of Negotiations
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Status in Congress
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Required Documentation
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Australia
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President Bush signed implementing legislation (H.R.4759; P.L.108-286) into law on August 3.
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House approved implementing bill July 14 by a vote of 314-109; Senate approved July 15 by 80-16
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Awaiting P.L. number
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Morocco
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President Bush will shortly sign H.R.4842 into law
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House approved implementing bill July 22 on a vote of 323-99; Senate approved July 21 by a vote of 85-13
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Central America (CAFTA) and Dominican Republic
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Completed with four countries December 17, 2003, with Costa Rica January 25; with the Dominican Republic on March 15; Final text of the agreement as of June 1; Dominican Republic formally attached to CAFTA on August 5
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signed the DR-CAFTA agreement on August 5, starting a 90-day clock preparatory to presenting implementing legislation to Congress
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Advisory committee reports on CAFTA released March 22; USITC hearing on CAFTA April 27; USITC Dominican study initiated March 17; Dominican advisory reports released April 23
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Southern African Customs Union
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Negotiations are still underway
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Awaiting 90-day notification of intent to sign the agreement
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No pending studies
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Bahrain
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Negotiations completed May 27; Draft text of agreement released June 21
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Administration notifies Congress of intent to sign agreement June 18, triggering 90-day clock preparatory to presenting implementing legislation to Congress
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Advisory committee reports released July 19
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Colombia, Bolivia, Ecuador, and Peru
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Negotiations launched May 18; 2nd round completed in late July; third round to take place in mid-September in Puerto Rico. Bolivia currently has observer status only
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No action pending at present
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TPSC hearing on March 17; USITC hearing held on February 10, with report to USTR April 8
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Panama
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Administration notified Congress of intent to negotiate on November 18, 2003; negotiations began April 26; comments on environmental study released May 14
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No action pending at present
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USTR release interim environmental review July 9
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Thailand
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Administration notified Congress of intent to negotiate on February 12; comments on environmental study were due May 14
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No action pending at present
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TPSC hearing on March 30; USITC requests comments for study; report to USTR on August 19
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Sources: “Dominican Republic Joins Five Central American Countries in Historic FTA with U.S.” on Office of the United States Trade Representative’s website athttp://www.ustr.gov/Document_Library/Press_Releases/2004
/August/Dominican_Republic_Joins_Five_Central_American_Countri es_in_Historic_FTA_with_U.S on August 5, 2004 and “Current Status of Pending Free Trade Agreements” appearing on AAEI International Trade Alert on August 9, 2004.
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President Bush Signs U.S.-Australia Free Trade Agreement
On August 3, 2004, President Bush signed the United States-Australia Free Trade Agreement (FTA). The U.S.-Australia FTA will eliminate duties on more than 99 percent of manufactured goods as soon as the agreement enters into force, while duties on other commodities will be phased out over periods of up to ten years.
According to the Office of the U.S. Trade Representative, trade with Australia has increased dramatically during the past decade, totaling more than $19 billion in 2001. It is estimated that eliminating these tariffs will increase the export of manufactured commodities by nearly $2 billion per year, which may represent new jobs for Americans. It is also expected that the elimination of duties will result in tariff savings of about $300 million for U.S. manufactured goods exporters in the first year of the agreement.
During his speech upon signing the FTA, President Bush noted that “the U.S.-Australia Free Trade Agreement is a milestone in the history of our alliance. It expands out security and political alliance by creating a true economic partnership. President Bush also emphasizes that the FTA “will create jobs and opportunities in both our nations. It will fuel economic growth throughout the Pacific Rim, and it will strengthen our common ties of family and friendship”.
The objective is for the FTA to take effect on January 1, 2005.
For more information, please visit the U.S. Trade Representative’s website at: http://www.ustr.gov/new/fta/australia.htm
Sources: “U.S.-Australia Free Trade Agreement” appearing in U.S. Trade Representative’s website at http://www.ustr.gov/new/fta/Australia/summary.htm, “President Bush Signs U.S.-Australia Free Trade Agreement” appearing in The White House’s website on August 3, 2004 at http://www.whitehouse.gov/news/releases/2004/08/20040803-1.html, and H.R. 4759 available at http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=108_cong_bills&docid=f:h4759enr.txt.pdf.
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West Nile Virus Spurs New Requirements for US Exports to China
Containers and Airfreight shipments from the United States bound for China will be subject to intensive scrutiny and high possibility of door-open-inspection, especially for shipments that involve waste and used cargos like waste paper, used tires, plastic scrap and equipment. In cases where there are live mosquitos or corpus detected, the container will be treated by appropriate methods of disinfection.
A mosquito killing certificate, to be submitted to the Shanghai Entry-Exit Inspection & Quarantine Bureau in China, will be required to be submitted by the steamship lines and airlines. This regulation is very new and we are told that carriers will be responsible for providing the certificate; Chinese importers will bear a small fee for this service. The regulation is new; requirements for the certificate may change at any time.
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FDA Announces Contingency Plan for Prior Notice System Outages
The Food and Drug Administration (FDA) has announced the availability of a contingency plan that provides guidance on submitting prior notice (PN) during system outages affecting the FDA and CBP program systems
If a broker or “self-filer’s” system is not working, or if ABI is not working, PN must be submitted through the Prior Notice System Interface (PNSI).
The FDA PN System Interface (PNSI) may be accessed via the Internet at: http://www.cfsan.fda.gov/%7Epn/pnoview.html
Filers are reminded that they will need to present a paper copy of the Prior Notice confirmation page from PNSI to CBP officers when clearing their shipments.
If PNSI is not operating, prior notice information must be submitted by e-mail or fax to the FDA.
The new FDA/CBP contingency plan identifies seven potential system downtime scenarios that could impact the transmission or confirmation and processing of prior notice submissions and explains options for each. The downtime scenarios can be viewed at the following link:
http://www.cfsan.fda.gov/~pn/pndguid.html
In any of the scenarios listed, where options include both e-mail and fax, e-mail is encouraged as the more efficient means.
Sources: U.S. Customs and Border Protection “Submission of Prior Notice to FDA for Articles of Imported During Periods When ACS/ABI is not Operational” http://www.cbp.gov/linkhandler/cgov/import/commercial
_enforcement/bioterrorism/bta_fda_web.ctt/bta_fda_web.doc U.S. Food and Drug Administration “Prior Notice of Imported Food
Contingency Plan for System Outages” http://www.cfsan.fda.gov/~pn/pndguid.html
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Pilot Bond Centralization Program Update
Effective August 16, 2004, U.S. Customs and Border Protection (CBP) announced that Baltimore, MD and Boston, MA are participating in its Pilot Bond Centralization Program for Importer Type 1 continuous bonds.
In an effort to establish a more efficient and effective bond program for CBP, the Continuous Transaction bond program is being centralized at the National Finance Center (NFC) in Indianapolis, Indiana. The migration of continuous bonds from the service ports to the NFC represents a major change in how bonds are filed and monitored. The bond centralization effort will include the filing, approval and maintenance of all Continuous Transaction Bonds. NFC has recognized that many Districts do not perform a risk assessment when reviewing the bond applications. Many times, the liability amounts are insufficient and the government is unable to collect supplemental duties. The objectives of the program are uniformity, bond sufficiency, and consistent application of regulations and policies.
NFC will analyze bond applications to make sure that all estimated usual duties, fees, including IR Tax and anti-dumping / countervailing duties are reported. They will handle them on a first in, first out basis (FIFO). The center currently processes approximately 250 applications a day. They explain that their processing time is 3 days.
In the past, depending on the importer’s activity, service ports reviewed bond sufficiency on a yearly basis. NFC will also review existing continuous bonds. If continuous bonds are deemed insufficient, NFC will require that the principal increase their existing bond liability amounts.
The NFC has established a voice mailbox for all inquiries concerning the pilot bond centralization program. This includes inquires into the status of new bond applications. The Pilot Bond Centralization Program and contact list is available at:
http://www.cbp.gov/xp/cgov/import/communications_to_industry/pilot_program/
Source: U.S. Customs and Border Protection “Pilot Bond Centralization Program”
http://www.cbp.gov/xp/cgov/import/
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