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Shap Talk

Featured Headlines:

Firearm Export Licenses Stuck in the Chamber

US Waves the Red Flag on Export Control Evasion Indicators

En-COUNTER-ing a Few Welcomed ADD-itions

Rogue Registrations & Resulting Restrictions

Parking Problems

Memphis Chassis Mingle

Colombo’s Haul Jumbo

And It’s AGOA-ing…Going…Gone!

Carriers Continue Cuts

Turkish Delights

Aviation Adaptations

Firearm Export Licenses Stuck in the Chamber

  • The U.S. Department of Commerce (DOC) recently announced that it would be pausing the issuance of new export licenses involving certain firearms, related components, and ammunition under its jurisdiction for approximately 90 days. As a result, export licenses for all items controlled under ECCNs 0A501, 0A502, 0A504, and 0A505 to non-government end users worldwide—apart from certain destinations—are affected.
  • The press release also included a provision for new export assistance activities for such products to all non-governmental end users worldwide, apart from those in certain destinations.
  • The DOC’s Bureau of Industry and Security (BIS) is authorized to take additional steps to further U.S. national security and foreign policy interests. During this “pause” period, officials will further assess current firearm export control review policies to determine whether any changes are warranted.
  • Commerce stated that it will “urgently” conduct its review—which will allow officials to assess and mitigate the risk of firearms being diverted to entities or activities that promote regional instability, violate human rights, or fuel criminal activities more effectively.
  • Click here to review an FAQ sheet issued by the BIS on October 27, 2023.
  • Any questions? Feel free to reach out to our compliance experts!

US Waves the Red Flag on Export Control Evasion Indicators

  • This week, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) teamed up with DOC officials to issue a third press release for financial institutions to utilize when combatting individuals or entities suspected of evading certain export controls related to Russia’s invasion of Ukraine.
  • The latest announcement introduced a new key term for filers to use—dubbed the Suspicious Activity Report (SAR)—and also included a detailed list of 13 red flag indicators of export control evasion.
  • According to officials, here are a few of the things to look for:
    • Transactions involving entities with little to no web presence, such as a website or a domain-based email account.
    • Transactions involving customers with phone numbers with country codes that do not match the destination country.
    • Transactions involving a last-minute change in payment routing that was previously scheduled from a country of concern but now routed through a different country or company.
    • Transactions involving payments being made from entities located at potential transshipment points or involving atypical shipping routes to reach a destination.
  • For the full list of indicators, check out the FinCEN & BIS Joint Notice issued on Monday, November 6.

En-COUNTER-ing a Few Welcomed ADD-itions

  • On October 24, 2023, the Department of Commerce (DOC) initiated its investigations of less-than-fair-value and countervailing duty investigations on “Aluminum Extrusions” from 15 countries.
  • The Antidumping Duty Investigation will be conducted for the following countries:
China A-570-158
Columbia A-301-806
The Dominican Republic A-247-004
Ecuador A-331-804
India A-533-920
Indonesia A-560-840
Italy A-475-846
The Republic of Korea A-580-918
Malysia A-557-826
Mexico A-201-860
Taiwan A-583-874
Thailand A-549-847
Turkey A-489-850
The United Arab Emirates A-520-810
Vietnam A-552-837
  • Preliminary determinations in the Antidumping Investigations are due by March 12, 2024.
  • For the proposed scope in the Antidumping Duty Investigation, please see the Initiation of Less-Than-Fair-Value Investigations in the Federal Register.
  • The Countervailing Duty Investigation will also be conducted for the following countries:
China C-570-159
Indonesia C-560-841
Mexico C-201-861
Turkey C-489-851

Rogue Registrations & Resulting Restrictions

  • Are you aware that the Food and Drug Administration (FDA) requires foreign and domestic facilities importing, producing, and/or distributing medical devices into the U.S. to be registered every year?
  • Unregistered facilities can be locked out of U.S. trade markets as a penalty. If that’s not enough of a deterrent…the failure to submit, renew or update a registration could result in civil or criminal actions—or even further import restrictions. Talk about the opposite of R&R…!
  • As a result, it’s crucial for importers to ensure that their registrations are up to date on their renewals as soon as possible to avoid costly detentions and/or delays on your shipments!
  • To view the full announcement, please refer to CSMS # 58306521.

Parking Problems

  • It’s looking like rush hour for the world of trucking, as the American Trucking Association (ATA) lays on the horn in a last-mile and final ditch effort to get enough attention from governors to pave the way for access to highly coveted extra federal funding.
  • Their mission is simple: to expand the parking paradise for our highway heroes. #ParkingProblems is the new bumper sticker for the industry’s latest logistical headache.
  • In the fast lane of freight concerns, a parking pinch is revving up to second place in the American Transportation Research Institute’s 2023 industry pit stop survey. Motor carrier execs and road warriors alike are flashing their hazard lights over this growing gridlock.
  • Why the sudden traffic jam for trucker turf? Well, federal road rules say truckers can only hit the gas for 11 hours in a 14-hour window. After that, it’s time to parallel park and hit the brakes—no ifs, ands, or truck butts.
  • And the parking plight’s epicenter? None other than Pennsylvania—earning it a dubious five-star rating in the ‘Where Not to Park’ guidebook. After all, it is the state where finding a post-shift parking spot is harder than threading a semi through a needle’s eye…

Memphis Chassis Mingle

  • Roll out the red carpet on the loading docks, because Memphis is hosting the most exclusive mixer of the year. It’s the latest shindig in town, aiming to give truckers and cargo owners a VIP pass out of the old hauling hassles.
  • The North American Chassis Pool Cooperative (NACPC) is the new kid on the block, soft launching with a fleet of ~2,500 shiny chassis. They’re looking to double their guest list by next year, because, well, the more, the merrier!
  • Talk about a universal plus-one invite! ONE containers at Union Pacific’s Memphis terminal are all set to tango with these new chassis, proving it’s a match made in logistics heaven.
  • But let’s not forget about the longstanding belle of the ball: Consolidated Chassis Management. They’ve been leading the conga line since 2007, and they’re not stepping aside without a dance-off anytime soon.

Colombo’s Haul Jumbo

  • Strategically placed between the Bay of Bengal, the Arabian Sea, and the Indian Ocean, it is said that deepwater Colombo in Sri Lanka will host at least 50% of the world’s cargo vessels (giving them Ceylon tea, of course!) at some point during their service.
  • And these vessels are not just picking up the garments, tea, and coconut products Sri Lanka is famous for producing. Those exports are impressive, but Colombo is vital as a feeder vessel gateway for ports from the Middle East, to India, to Bangladesh and beyond.
  • China has certainly noticed, having invested $2B in Sri Lankan transportation and port projects between 2020 and 2022.  Guess who noticed China noticing?
  • Yup, Uncle Sam has entered the strategic fray and is partnering with India’s Adani Ports on a $1B terminal development project at West Container Terminal.
  • Through the International Development Finance Corp (DFC), the US will be contributing $553 million to bolster Sri Lanka’s essential port hub in her capital city.
  • The DFC is a little-known US agency designed to help the US compete with China on infrastructure projects around the globe, especially in the thriving Indo-Pacific region.
  • By the end of 2023, the DFC will have invested nearly $10B in the developing world.
  • As we collected the latest news from Sri Lanka, we also encountered a fascinating ancient fact about an ancient tree named Sri Maha Bodhi.
  • It is said that tree, planted in AD 21 is not only the oldest living tree planted by mankind, but that the original cutting came from the tree under which the Buddha gained enlightenment.  Brand new port terminals AND 2,000-year-old trees?!  What a place!

And It’s AGOA-ing…Going…Gone!

  • In the latest episode of international trade dramas, President Biden is featured as the host of a game show nobody wants to win, AGOAing, Going, Gone. This round features a not-so-fond farewell to the nations of Gabon, Niger, Uganda, and the Central African Republic as they take their exit from the AGOA stage.
  • Flashback to the year 2000, when the African Growth and Opportunity Act (AGOA) was the golden ticket for sub-Saharan sweethearts, offering duty-free glam to over 1800 imports to the US. It was the trade catwalk where African countries strutted their stuff.
  • Now, Niger and Gabon find themselves booted off the runway—not by the fashion police for a minor fashion faux pas—but for a more serious breach instead. Military couture is so last season, especially when it involves coups! President Biden, doubling as a judge for the trade runway, cited a lack of commitment to the latest trend in governance—political pluralism and a tailored fit of the rule of law.
  • The Central African Republic and Uganda had their membership cards revoked for a significant style no-no: gross violations of internationally recognized human rights. And when it comes to the rights of love and life, the law’s runway is not the place for a death penalty design.
  • Let’s not forget previous seasons’ eliminations, where Burkina Faso, Mali, and Guinea were “out” after their own military makeovers.
  • So, as the AGOA spotlight dims for these four, the show must go on, with hopes that the next season brings back styles of stability and human rights haute couture.
  • For more information, please refer to the Statement from Ambassador Katherine Tai on the AGOA Eligibility Review. 
  • Like what you hear? Keep the conversation AGOA-ing with Shapiro’s chatty freight experts!

Carriers Continue Cuts

  • All aboard the fiscal fiasco express! Maersk is sailing through choppy economic waters with a $27 million operating loss flag flying high in Q3. It seems even the biggest carriers can hit a financial iceberg (or two).
  • With a stormy market forecast ahead, Maersk’s captains of industry are charting a course for drastic shores, signaling an SOS for savings with 10,000 crew members set to walk the plank in layoffs around the globe (that’s about 10% of their crew, gang!). #CarriersContinueCuts is the distress call echoing across the seven seas of shipping.
  • The CEO, Vincent Clerc, is at the helm, navigating through the overcapacity oceans, where a tsunami of price cuts is washing over the industry’s once-buoyant profits.
  • As Maersk steers towards the upcoming contract season, they’re keeping a spyglass on the 68% of their cargo fleet currently anchored by BCO contracts. It’s a case of “all hands on deck” to see how this will shape their treasure map to recovery.
  • The revenue ship is taking on water, with some Maersk branches bailing out a 56% loss. Even their sturdiest financial vessel, the terminals branch, is dipping with the waves with a 24% profit plummet.
  • Follow Shapiro on LinkedIn to view our monthly Supply Chain Reaction posts, which include ocean, air and drayage rate updates!

Turkish Delights

  • While the package world is tightening belts faster than a pre-flight safety demo, Turkish Airlines is expanding its waistline with a feast of new freighters. Get ready for a second helping of cargo carriers, because this airline is serving up a deluxe menu of #TurkishDelights!
  • The airline’s fleet is set to balloon from a hearty 429 to a whopping 800, with cargo planes getting their own supersize from 24 to over 40. That’s right, this fleet’s getting fatter than a stuffed grape leaf.
  • Chief Cargo Officer, Turhan Ozen, is the soothsayer of shipping, predicting a near tripling of volumes over the next decade. It’s like predicting more baklava at a Turkish banquet – a sure bet.
  • And it’s not just about bigger bellies on their planes. Turkish Airlines is spicing up its route map, from 104 destinations to a mouthwatering 150. Revenues are expected to rise like dough in a hot Istanbul kitchen, expanding their (confident) culinary cargo conquest.

Aviation Adaptations

  • The skies are getting a bit less crowded in the world of airfreight, as the titans of the industry navigate through a dip in demand. E-commerce’s descent is leaving a little more blue sky than usual.
  • FedEx, the winged messenger of the packaging world, is now guiding some of its flock to new nests. On Monday, the call went out for pilots to co-pilot with American Airlines, who’s currently short on captains to steer their sky chariots.
  • It’s been a bumpy flight for FedEx over the past year, with some belt-tightening turbulence. They’ve waved goodbye to jobs, sent some old birds into retirement, closed some hangar doors, and trimmed down their weekend delivery schedule, all to glide $4 billion closer to the green by 2025.
  • For the pilots, this new flight path to American Airlines might just be the tailwind they need. It’s a better deal than a one-way ticket to Layoff Land, after all. Here’s to clear skies and smooth flying for those making the #AviationAdaptations shuffle!