The Department of Commerce announced on March 11, 2005, that it will be continuing the steel import monitoring program through March 21, 2009. The Steel Import Monitoring and Analysis (SIMA) system is part of the President’s steel safeguard program established in March 2002. The purpose of SIMA is to collect statistics on anticipated steel imports and to provide steel producers, steel consumers, importers, and the general public with information about steel import trends. The program was formerly called the Steel Import Licensing and Surge Monitoring System. While “201 steel” duties were terminated in December 2003, the President directed the Department of Commerce to continue the monitoring system until March 21, 2005.
Along with the extension, Commerce has modified the licensing program by expanding coverage of SIMA to include all basic steel mill products, and by terminating licensing for carbon and alloy flanges and pipe fittings currently covered under the program. The expansion and termination will not take effect until June 9, 2005, to allow affected parties sufficient time to adapt to and implement the new requirements.
The Department of Commerce feels the steel licensing program has proven useful to both steel producers and consumers. SIMA’s goal is to provide timely and accurate data on steel imports with minimal burden on parties subject to licensing requirements. Licenses are required at the time of entry summary, but may be obtained up to 60 days prior to the expected date of importation. License numbers must be reported on the CF7501 Entry Summary at the time of filing. Entry summaries presented without the required license numbers are considered incomplete and are subject to liquidated damages.
Please refer to the Federal Register notice for a complete list of products that will continue to require licensing, those being added to the list, and those that will be removed from the program. The notice may be found at: http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-4971.pdf
Should you have any questions, please feel free to contact Samuel Shapiro & Company, Inc.’s compliance department at compliance@shapiro.com.
CBP’s Marking of Country of Origin Publication
The office of U.S. Customs and Border Protection (CBP) has revised its brochure entitled “Marking of Country of Origin on U.S. Imports: Acceptable Terminology and Methods for Marking.” The publication is for general information purposes only. Sole reliance on the information may not be considered reasonable care.
Every article of foreign origin entering the U.S. must be legibly marked with the English name of the country of origin unless an exception from marking is provided for in the law. The purpose of marking is to inform the ultimate purchaser in the U.S. of the country in which the imported article was produced.
The following articles have special marking requirements (list not all inclusive):
- watches and clocks;
- knives, forks, steels, cleavers, clippers, shears, scissors, safety razors, blades for safety razors, surgical instruments, dental instruments, etc.;
- pipes and pipe fittings of iron, steel or stainless steel;
- certain compressed gas cylinders; and
- man hole rings or frames, covers, and assemblies thereof.
- Clothing, tobacco, food, pharmaceuticals, and automobiles are subject to additional labeling requirements.
Articles that are considered “excepted” do not require marking. The following is a partial list:
- an article that is incapable of being marked;
- an article that cannot be marked prior to shipment to the U.S. without injury to the article;
- an article that cannot be marked prior to shipment to the U.S. except at an expense economically prohibitive of its importation;
- the article is a crude substance;
- the article is imported for use by the importer and is not intended for sale in its imported or any other form;
- the article is to be processed in the U.S. by the importer, or for his account, in such a manner that any marking would be permanently concealed, obliterated, or destroyed;
- the article was produced more than 20 years prior to its importation into the U.S.; and
- pursuant to 19 USC 1304(a)(3)(J), an article is of a class or kind with respect to which the Secretary of the Treasury has given notice by publication in the weekly Treasury Decisions within two years after July 1, 1937, that articles of such class or kind were imported in substantial quantities during the five-year period immediately preceding January 1, 1937, and were not required during such period to be marked to indicate their origin, provided certain conditions are met. (See CBP’s brochure for a list of over 80 such articles, which include works of art, buttons, playing cards, cut flowers, hairnets, etc.)
The following articles are not required to be marked with the country of origin (list not all inclusive):
- articles brought into a foreign trade zone (FTZ) or a bonded warehouse for immediate exportation or for transportation and exportation;
- products of U.S. possessions;
- products of the U.S. exported and returned;
ceramic bricks; diodes, transistors and similar semiconductor devices; photosensitive semiconductor devices, electronic integrated circuits and micro assemblies that are goods of a North American Free Trade Agreement (NAFTA) country;
- certain spice products and;
- silk scarves and silk fabric.
An article not required to be marked with the country of origin must still show markings on the immediate container, with certain exceptions.
The Customs Publication “Marking of Country of Origin on U.S. Imports: Acceptable Terminology and Methods for Marking” is available at: http://www.cbp.gov/linkhandler/cgov/toolbox/publications/trade/markingo.ctt/markingo.doc
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New Rules for Storage and Demurrage at the Port of Charleston
The Port of Charleston will put into effect the following rules on June 1, 2005. These changes can be seen on the Port’s website at www.port-of-charleston.com.
Free time for loaded containers will be seven (7) consecutive days, including Saturdays, Sundays and holidays. After seven days, the port will begin charging storage/demurrage to the shipping line which owns or leases the containers. The charges for days 4 through 7 will be $10.00 per TEU. From days 8 through 11 the charge will increase to $20.00 per TEU. After that it will increase to $40.00 per TEU. This will be on both imports and exports. Remember, a TEU equates to one twenty-foot container. So a forty-foot container will incur twice these amounts.
Reefer containers will only have three free days. The charges for days 4 through 7 will be $75.00 per day and after that it will go to $150.00 per day. Again, remember, the port will be charging the shipping line—not the broker or importer.
With these changes in mind, we would suspect that the shipping lines will be trying to invoice these charges back in cases where the client may have extra free time with the line.
The port is not going to adhere to the shipping lines’ rules on multiple containers. If the line has a multiple container rule, the port is still going to start charging demurrage or storage after the seventh consecutive day. We do not know yet how this will affect our customers who bring in eight or more containers on one bill of lading. This will have to be handled with each line individually.
Please be sure to check the Port of Charleston’s port tariff on their website. The above information was provided by the Managing Director of Pricing and Tariffs and is to be published April 15, 2005.
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Canada Proposes Additional Duties on US Imports
The Government of Canada announced on March 31, 2005 that it will retaliate against the United States in light of its failure to comply with the World Trade Organization (WTO) ruling on the Byrd Amendment. Following extensive consultations with domestic stakeholders, Canada will impose a 15% surtax on U.S. live swine, cigarettes, oysters and certain specialty fish, starting May 1, 2005.
“For the last four years, Canada and a number of other countries have repeatedly urged the United States to repeal the Byrd Amendment,” said International Trade Minister Jim Peterson. “Retaliation is not our preferred option, but it is a necessary action. International trade rules must be respected.”
Canada’s current retaliation level is $14 million. The Government will review the products each year against the fluctuating nature of Byrd disbursements.
Please refer to this link for the full press release dated 3/31/05, and background information on the WTO dispute settlement understanding. http://webapps.dfait-maeci.gc.ca/minpub/Publication.asp?publication_id=382342&language=E
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The European Union Proposes Additional Duties on US Imports
The EU Commission has adopted a proposal to impose sanctions on certain products from the United States. The Commission took this latest step in the dispute over the Byrd Amendment in light of the continuing failure of the United States to bring its legislation into conformity with its international obligations. The Commission proposes that an additional duty of 15% applies as of May 1, 2005 on a range of products which include paper, agricultural, textile and machinery products. The European Council is expected to vote on this action some time this month.
Please refer to the full press release dated 3/31/05. http://europa.eu.int/eur-lex/lex/LexUriServ/site/en/com/2005/com2005_0103en01.pdf
The Proposal for the Council Regulation, which includes, the proposed tariff numbers that would be affected can be found at: http://europa.eu.int/eur-lex/lex/LexUriServ/site/en/com/2005/com2005_0103en01.pdf
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Are you FAST?
The FAST (Free and Secure Trade) program is a bilateral initiative between the U.S/Mexico and U.S./Canada designed to ensure security and safety while enhancing economic prosperity. In developing this program, the countries involved have agreed to coordinate to the maximum extent possible, their commercial processes for clearance of commercial shipments at the border. This will promote free and secure trade by using common risk-management principles, supply chain security, industry partnership, and advanced technology to improve the efficiency of screening and clearing commercial traffic at our shared border.
The objective of the FAST program is to revolutionize the processing of transborder trade by increasing the integrity of supply chain security, streamlining and integrating registration processes, minimizing paperwork, expediting the clearance of transborder shipments, and physically examining cargo transported by these low-risk clients with minimal frequency. FAST approved U.S./Mexico and U.S./Canada highway carriers benefit from dedicated lanes, where available, for greater speed and efficiency in the clearance of FAST transborder shipments, reduced number of examinations, and enhanced supply chain security and safety.
FAST is a harmonized clearance process for shipments for known compliant importers. Therefore, any truck using FAST lane processing must be a C-TPAT approved carrier, carrying qualifying goods from a C-TPAT approved manufacturer (southern border only at this time), for a C-TPAT importer, and the driver must possess a valid FAST-Commercial Driver Card. FAST processing is based upon advanced electronic transmission of information. Two present cargo release methods exist for FAST processing: FAST, the first complete paperless cargo release mechanism put into place by Customs and Border Protection which allows for the expedited release of highly compliant cargo, and The Pre-Arrival Processing System (PAPS) which is a Customs Automated Commercial System (ACS) border cargo release mechanism that utilizes barcode technology to expedite the release of commercial.
The following are existing and upcoming FAST lanes from U.S./Mexico and U.S./Canada:
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FAST LANES - MEXICO
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CURRENTLY AVAILABLE
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U.S. BORDER
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MEXICO BORDER
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Laredo, Texas
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Nuevo Laredo, Tamaulipas
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Hidalgo, Texas
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Reynosa, Tamaulipas
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El Paso, Texas
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Ciudad Juarez, Chihuahua
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Otay Mesa, California
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Tijuana, Baja California
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Brownsville, Texas
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Matamoros, Tamaulipas
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Calexico, California
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Mexicali, Baja California
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Nogales, Arizona
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Nogales, Sonora
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OPERATIONAL BY JULY 1, 2005
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Tecate, California
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Tecate, Baja California
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San Luis, Arizona
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San Luis, Sonora
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Douglas, Arizona
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Agua Prieta, Sonora
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Santa Teresa, New Mexico
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San Jeronimo, Chihuahua
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Del Rio, Texas
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Villa Acuna, Coahila
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Eagle Pass, Texas
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Pierdas Negras, Coahuila
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Rio Grande City, Texas
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Cd. Camargo, Tamulipas
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FAST LANES - CANADA
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CURRENTLY AVAILABLE
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U.S. BORDER
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CANADA BORDER
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Buffalo, New York
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Fort Erie, Ontario
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Blaine, Washington
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Douglas, British Columbia
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Champlain, New York
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Lacolle, Quebec
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Detroit, Michigan
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Windsor, Ontario
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Lewiston, New York
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Queenston, Ontario
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Alexandria Bay, New York
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Landsdowne, Quebec
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Derby Line, Vermont
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Stanstead Place, Quebec
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Highgate Springs, Vermont
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Phillipsburg, Quebec
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Pembina, North Dakota
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Emerson Junction, Manitoba
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Portal, North Dakota
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Beinfait, Saskatchewan
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Sweetgrass, Montana
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Coutts, Alberta
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OPERATIONAL BY JULY 1, 2005
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Houlton, Maine
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Woodstock, New Brunswick
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Calais, Maine
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St. Stephen, New Brunswick
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Massena, New York
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Cornwall, Ontario
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Ogdensburg, New York
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Prescott, Ontario
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Sault Ste Marie, Michigan
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Sault Ste Marie, Ontario
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International Falls, Washington
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Fort Frances, Manitoba
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Oroville, Washington
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Osoyos, British Columbia
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For more information on how you can become a C-TPAT member and qualify for FAST, contact the Samuel Shapiro & Company, Inc. Consulting Team at consulting@shapiro.com.
Source: “FAST Application Information” at http://www.customs.gov/xp/cgov/import/commercial_enforcement/ctpat/fast/ appearing at The Bureau of Customs and Border Protection’s website.
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New C-TPAT Security Guidelines for Importers
On March 25, 2005, the Bureau of Customs and Border Protection (CBP) released the revised security standards for C-TPAT importers. These new minimum security criteria were drafted with the help of the trade community and help solidify membership expectations, and more clearly define the baseline level of required security measures.
CBP requires importers to conduct a comprehensive assessment of their international supply chains based upon the revised C-TPAT security criteria. The following are highlights of CBP’s new C-TPAT guidelines for importers (partial list):
- Business Partner Requirement: Importers must have written and verifiable processes for the selection of business partners
- Physical Access Controls: Access controls must be in place to prevent unauthorized entry to facilities, maintain control of employees and visitors, and protect company assets
- Security procedures: For those business partners eligible for C-TPAT certification, the importer must have documentation indicating whether these business partners are or are not C-TPAT certified. For those business partners not eligible for C-TPAT certification, importers must require their business partners to demonstrate that they are meeting C-TPAT security criteria via written/electronic confirmation
- Personnel Security: Processes must be in place to screen prospective employees and to periodically check current employees
- Container Security and Inspection: Container integrity must be maintained to protect against the introduction of unauthorized material and/or persons. Procedures must be in place to verify the physical integrity of the container structure prior to stuffing to include a seven-point inspection
- Information Technology Security: Automated systems must use individually assigned accounts that require a periodic change of password. A system must be in place to identify the abuse of IT procedures including improper access, tampering or the altering of business data
- Security Training and Threat Awareness: A threat awareness program should be established and maintained by security personnel to recognize and foster awareness of the threat posed by terrorists at each point in the supply chain
Importers who have not yet joined the C-TPAT program must meet or exceed these security criteria before being certified and eligible for program benefits. For current C-TPAT members, implementation will be phased in through three steps to ensure that an importer’s security measures are consistent with these security criteria:
- Step 1: Importers will have 60 days, until May 26, 2005, to meet the container security, physical security, and physical access controls outlined in the new security criteria
- Step 2: Importers will have 120 days, until July 26, 2005, to address internal or procedural security elements, including personnel security, procedural security, information technology security, and the establishment of a security training and threat awareness program
- Step 3: Importers will have 180 days, until September 26, 2005, to leverage their corporate strength to push security enhancements back into their supply chain
CBP notes that the C-TPAT program recognizes the complexity of international supply chains and endorses the application and implementation of security measures based upon risk analysis. The program allows for flexibility and the customization of security plans based on the member’s business model.
C-TPAT was launched in November 2001, with only seven major importers; today C-TPAT has grown to more than 8,800 enrolled companies, which include United States importers, customs brokers, terminal operators, carriers, and some foreign manufacturers - all major players in the global supply chain. C-TPAT members enjoy several benefits, including a reduced number of inspections, reduced border times, and an emphasis on self-policing, not Customs verifications.
Want to become a C-TPAT member but not sure how to get started? Samuel Shapiro & Company, Inc. can draft and submit entire your C-TPAT application to CBP. Contact the Shapiro Consulting Team at consulting@shapiro.com for more information.
Source: “New Security Criteria for C-TPAT Importers” at http://www.customs.gov/xp/cgov/import/commercial_enforcement/ctpat/criteria_importers/ appearing at The Bureau of Customs and Border Protection’s website on March 25, 2005.
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Transportation Updates
Far East
Space problems from the Far East to the USA East Coast will continue during 2005 as importers try to avoid west coast ports due to the port and rail congestion. The all water services to the east coast are still running at nearly 100% capacity with no end in sight. There will not be much additional capacity added on all water service in 2005.
Carriers are not backing off their announced increases slated for May 1, 2005. The amounts will vary based on the destination and type of service required. This is especially true for all water service to the east coast via the Panama Canal.
Far East to USA west coast:
- 20’ container $ 215.00
- 40’ container $ 285.00
- 40’ high cube container $ 325.00
- 45’ container $ 365.00
Far East to inter-modal points in the USA and East Coast via west coast (MLB):
- 20’ container $ 265.00
- 40’ container $ 350.00
- 40’ high cube container $ 395.00
- 45’ container $ 445.00
Far East to USA east coast via all water service:
- 20’ container $ 325.00
- 40’ container $ 430.00
- 40’ high cube container $ 485.00
- 45’ container $ 545.00
The carriers also intend to impose a Peak Season Surcharges to be in effect from June 15, 2005 through Nov. 30, 2005:
- 20’ container -$ 300.00
- 40’ container $ 400.00
- 40' high cube container $ 450.00
- 45' container $ 510.00
The Panama Canal Surcharge will increase from $115.00 per container to $165.00 per container.
Carriers will be watching how the market will react. Importers should be prepared for increases of close to the announced levels as the carriers are operating at or near 100% capacity on all trade routes. Samuel Shapiro & Company will do everything to mitigate the increases in our contract negotiations.
Bunker fuel surcharges went down April 1, 2005 from the Far East, however they will most likely go back up on July 1, 2005. We don’t have any information at this time on the changes for July.
Northern Europe
Carriers will raise the bunker fuel surcharge to and from Northern Europe to the United States on May16, 2005.
The bunker surcharges will be as follows:
- 20’ container $304.00 to the East Coast and $ 456.00 to the West Coast
- 40’, 40’ HC and 45’ container $608.00 to the East Coast and $ 912.00 to the West Coast.
There is still a significant shortage of open top containers throughout Europe at this time. Carriers are raising their special equipment surcharges due to this shortage.
Carriers took an increase on April 1, 2005 from Northern Europe to the USA. The average increase was about $75.00 per TEU.
Ships are still arriving relatively full as carriers have not added capacity.
The Mediterranean
The news from this region is confusing. Carriers were not uniform in the increases or the dates of their increases. The increases ranged from $200.00 -$400.00 per 20’ container and from $300.00 - $500.00 per 40’ container. This is from all markets including Turkey, Greece, Italy, Spain and Portugal which are planning to increase rates by $400.00 per 20’ container and $500.00 per 40’ container on April 1, 2005.
There are still considerable problems from Turkey to the USA. Many importers are sourcing more product from Turkey as the prices for products from Turkey are much lower than in Europe. This is especially true since the dollar has weakened against the euro. There has been a huge increase in shipments of ceramic tile and marble from Turkey. Some carriers are so full that they have placed a weight limit on cargo from Turkey, effectively eliminating the possibility of carrying tile or marble. Cargo transshipped from Turkey to the USA via Le Havre continues to see delays due to a backlog of containers.
Bunker fuel surcharges will rise on May 1, 2005. Most carriers will charge $260.00 per 20’ container and $520.00 per 40’ container.
Air News
Fuel surcharges are still on the upswing worldwide. Most carriers to and from Europe have raised their fuel surcharge to USD 0.40/kg from the USA and EUR 0.40/kg to the USA. Carriers from Asia have done the same as the fuel surcharge from Hong Kong was raised from USD 0.42/kg up to USD 0.57/kg.
Rates should creep up throughout the summer beginning in June. If there are significant problems shipping containers from Asia there will be a need for increased air capacity from that region.
Carriers are still reporting strong volume from Europe even though the euro is still very strong. Carriers have begun to add capacity for the summer season of April through October.
Export Ocean News
Bunker Fuel surcharges on export to Asia went down April 1, 2005 but they are expected to rise on July 1, 2005. We don’t know the amounts at this time.
Space is getting tighter to both Northern Europe and Asia. Carriers are being more selective on the type of cargo they carry. Low revenue commodities such as scrap metal and waste paper are harder to book as vessels fill up. Many carriers are restricting the destinations that will take scrap metal. This is a strong export commodity from the USA, but many carriers are reluctant to carry the cargo unless it is baled or packaged in some way.
Domestic USA
There are still rail delays from the west coast to the east coast with no end in sight. Southern California ports are still having the most difficulty. West Coast ports have infrastructure problems due to the high volume of imports. Ports on the East Coast have much more worrisome infrastructure problems as well as many importers are trying to ship their cargo from the Far East to the East Coast via the Panama Canal. The ports were not designed for the volume they are experiencing.
The major railroads have announced sweeping reductions at rail ramps all across the country. The 4 major railroads (Union Pacific, BNSF, CSX and Norfolk Southern) have all changed their policy in recent months restricting the amount of free time at their rail ramps. Some carriers have reduced the free time to 1 day after notification of arrival, weekends included.
Ocean carriers have significantly increased their demurrage rates and per diem rates on containers. It is extremely important that importers realize that they must have their shipments cleared prior to arrival in order to expedite delivery of their containers.
Domestically, fuel surcharges continue to rise; carriers are charging as much as 20%.
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Shapiro Products & Services
Save the Date!
Shapiro’s EXPORT ESSENTIALS seminar is set for August 11, 2005
Samuel Shapiro & Company, Inc. will be hosting a half-day seminar on Thursday, August 11th, 2005, from 9 a.m. to 12 noon, at the World Trade Center in Baltimore. Seminar topics will be focused on what your organization needs to know to be export compliant. This event is a must attend for current exporters looking to improve their export compliance program or importers interested in learning about export opportunities. Following the seminar, come join us for the Propeller Club Crab Feast. We will provide courtesy round-trip transportation from the World Trade Center immediately following the class.
Cost, if purchased by July 15th, 2005:
- $75 per person
- $60 for each additional attendee from the same company
- $45 crab feast ticket per person (in addition to your seminar cost)
Cost, if purchased after July 15th, 2005:
- $100 per person
- $75 for each additional attendee from the same company
- $45 crab feast ticket per person (in addition to your seminar cost)
