U.S. Seeks Help on Transport Security

(Reuters)

U.S. Homeland Security Secretary Janet Napolitano called on Thursday for more international cooperation in protecting transport routes against attack and controlling trade in potentially dangerous materials.

In a speech in Brussels, Napolitano said security and customs authorities needed to work closer with industry to develop new technologies and share information to track chemicals that can be used to produce weapons.

Not enough effort is made, she also said, to minimise potential disruptions to trade and transport in case major infrastructure hubs are damaged by attacks.

“Consider the consequences of such an attack ... Beyond the immediate impact ... the consequences could quickly snowball and impact economies around the world,” Napolitano said during a two-day visit to meet European Union officials. Read more here.

Ocean Freight Rates Should Remain Stable

(International Freighting Weekly – Mike King)

Forwarders believe lines may have learned their lesson on capacity management

Ocean freight rates will remain stable in the first half of 2011 if shipping lines have learned the capacity management lessons of the last two years, according to leading forwarders.

Kaiying Chan, Senior VP for Ocean Freight, South Asia-Pacific at DHL Global Forwarding, told IFW the lines were now more efficient in their ability to manage capacity through peak and low seasons. 
“There were no drastic rate decreases through 2010, like we have seen in the past,” he said. 

“Market levels stabilised during the slack season and for weeks now shipping lines have been announcing peak season surcharges again on various trade lanes like the transpacific eastbound. Fleets are growing as per demand, and if demand is moderate in comparison to supply, shipping lines understand well enough how to balance that.” Read more here.

U.S. BTS Releases North American Surface Trade Numbers for October

(CIFFA eBulletin)

Trade using surface transportation between the United States and its North American Free Trade Agreement (NAFTA) partners Canada and Mexico was 14.9% higher in October 2010 than in October 2009, reaching $70.6 billion, according to the Bureau of Transportation Statistics (BTS) of the U.S. Department of Transportation. The value of U.S. surface transportation trade with Canada and Mexico in October 2010 remained 2.9% below the October 2008 level despite the 2009-2010 increase.

BTS reported that the value of U.S. surface transportation trade with Canada and Mexico rose 3.3% in October 2010 from September 2010. Month-to-month changes can be affected by seasonal variations and other factors.

U.S.-Canada surface transportation trade totalled $40.7 billion in October, up 12.2% compared to October 2009. U.S.-Mexico surface transportation trade totalled $29.9 billion in October, up 18.8% compared to October 2009. In October, 86.1% of U.S. trade by value with Canada and Mexico moved on land.

Country of Origin Labeling Required for Packed Honey

(World Trade Interactive)

The Department of Agriculture’s Agricultural Marketing Service has adopted as final, effective Feb. 3, a July 2009 interim rule concerning labeling requirements for packed honey. This rule (a) establishes new regulations requiring country of origin labeling for packed honey bearing any official USDA mark or statement and (b) adds a new cause for debarment from inspection and certification service for honey if country of origin labeling requirements are not met for packages of honey containing official USDA grade marks or statements.

News from TAHOCO: Weekly Updates

An updated list of recently published US government memorandums, notices, regulations and decisions for the week ending January 7, 2011 is now available on our website here.

EC Calls for Streamlining of Over-Complex Food Import Controls

(FoodQuality.com – Rory Harrington)

Europe’s food import controls are fit for purpose but their fragmented and complicated nature means they are inconsistently applied across the economic bloc, according to a report from the European Commission (EC). 

The body called for the streamlining of the complex framework governing scrutiny of food, animal feed, animals and plants, with a more “holistic” approach to provide greater coherence. Improvements to legislation and safety tools such as the Rapid Alert System for Food and Feed (RASFF), as well as the better allocation of resources were also vital to boost the efficacy of the structure.

But the EC stressed that while it had highlighted ways to improve import control methods, the current system was “effective" in ensuring consistent scrutiny across the EU’s 27 member states. Its proposals should be viewed as enhancements rather that a call to overall the system, it said.
The European Union (EU) is the world's largest importer of food and animal feed with imports of €85 billion for the period 2007-2009. Described as “pivotal to EU prosperity”, the food sector is the bloc’s largest manufacturing sector with a global annual turnover reaching €900bn, said the EC. Food safety controls for the region are enshrined in the General Food Law (Regulation EC No 178/2002) and the complementary Official Food and Feed Control Regulations (EC 884/2004). Read more here.

Shipping on the Right Terms

(Business Without Borders – Paul Gallant)

The latest iteration of ‘Incoterms’ will help you avoid costly misunderstandings when sending your products

“When was the last time you saw a truck floating?” asks Joy Nott, the president of the Canadian Association of Importers and Exporters. “I don’t think you have.”

But when Canadian companies import or export goods internationally, Nott estimates that 90% of them use the shipping code FOB – short for “Free On Board” or “Freight On Board.” The vast majority of Canadian international trade is by truck; international guidelines state that cargo sent FOB must be carried by a sea vessel. For international land and air transportation, shipping cargo FOB invites only confusion and possible legal headaches. Yet Canadian companies can’t seem to part with the term. Understanding shipping, and the terms that define it, is crucial for any business sending goods abroad.

Nott hopes an update of the International Commercial Sales Terms, known as Incoterms, could persuade Canadian businesses to look more carefully at what they’re agreeing to when they draw up shipping contracts with international suppliers and customers. The 11 revised Incoterms, which come into effect January 1, 2011, are aimed at making the responsibility of buyer and seller even more clear in an era where multimodal transportation has become the rule, not the exception. Read more here (membership required).

Logistics World Looks Beyond China in 2011

(Transport Intelligence – Thomas Cullen)

The world's economy may not be seeing the acute instability of the past two years but it is not quite out of the crisis yet. Growth in world trade remains strong at around 5%, which augurs well for the sectors such air and sea freight, yet the drivers of growth may not be quite the same as those in the recent past.

The health of the Chinese economy continues to be a vital question. Although growth in both domestic demand and export activity is still very high, the signs of over-heating continue to emerge. The money supply is growing fast, driven in part by the effects of quantitative easing in the U.S., whilst the economy still seems hugely over-balanced in favour of investment. Wage rates are rising and the viability of the property market is in question. There is the risk that an unstable China could result in an acceleration of the shift of manufacturing export production away from Southern China. This in turn could also lead eventually to a realignment of trade patterns with many other low cost markets benefiting.

In fact 2011 could well be the year when many emerging markets come of age. Although many of these, such as Brazil, are influenced by Chinese investment and demand, they are also experiencing growth in domestic consumption as GDP per head rises. Consequently opportunities for domestic orientated logistics provision in these markets look good. Indeed, whilst top-line growth numbers may be weaker, the attractions of markets in say Turkey or Brazil may be greater due to stable and transparent markets. This aspect may counter-balance possible instabilities in exports from these countries, such as agricultural products and mineral raw materials.
Read more here (subscription required).

New California Proposal for Greatly Expanded Product “Hazard Traits” Escalates Risks for Product Manufacturers

(Lexology – Alston and Bird LLP)

In yet another dramatic step in California’s assertion of regulatory authority over product design in the name of “environmental safety,” product manufacturers selling into California may soon be facing increased risks resulting from new and expansive product “hazard traits” just proposed by the California Office of Environmental Health Hazard Assessment (OEHHA).

On December 17, 2010, OEHHA announced proposed rulemaking that would exponentially expand the hazard trait characteristics of product ingredients, which, in turn, would substantially increase the exposure of product manufacturers to California environmental regulations. While California’s existing Proposition 65 requires labels or consumer notification for products containing “carcinogens” or “reproductive toxins,” the new list of over 30-plus hazard traits will eventually be combined with the green chemistry regulations and their associated lists of chemicals and products of concerns to trigger data call-ins and potential regulatory actions such as bans, recalls of inventory, substitution of ingredients and end of life stewardship requirements, as well as labels under the green chemistry regulations.

Read more here and click here to view Proposed New Hazard Traits.

Food Safety Overhaul to Become Law; ST&R Offers Webinar to Review Changes

(World Trade Interactive)

President Obama was expected to sign as early as Jan. 4 the FDA Food Safety Modernization Act, which incorporates the most sweeping changes in U.S. food safety regulation in 70 years. This law will affect all businesses involved in the U.S. food supply chain, foreign and domestic, who will need to meet new requirements related to food safety plans, certification standards and mandatory recalls.

Sandler, Travis & Rosenberg is offering a webinar on Thursday, Jan. 13, to help companies examine the provisions of this new law and plan how to efficiently and economically meet their obligations under it. Topics to be addressed include hazard analysis, written safety plans, verification of controls, import certification, safety standards for certain food categories, more FDA inspections, suspension and revocation of FDA registration, mandatory recalls, and criminal and civil penalties. Click here to register for this webinar.

One Year Later, ISF Has Unfinished Business

(American Shipper)

Contrary to industry expectations, U.S. importers have experienced relatively little hardship since the U.S. government began requiring importers to transmit 10 data elements in advance of vessel loading for security screening purposes.

The smooth implementation so far is a byproduct of extensive outreach by U.S. Customs and collaboration with international shippers in the years leading up to the Jan. 26, 2010 enforcement date, which was preceded by a one-year dry run to help both sides familiarize themselves with a new system.

Although the Importer Security Filing has proven less disruptive than anticipated, especially with regard to postponed shipments due to incomplete data, there are still a number of latent issues that trade specialists want to iron out. The top item on their agenda is shortening the statute of limitations for ISF penalties. Read more here.

Free CBP Webinar on Working with Forms and Declarations in ACE – January 13

(CBP)

Are you interested in taking advantage of ACE functionality related to CBP forms and declarations? Did you know that once a Non-Reimbursement Blanket Statement declaration record is created in ACE it is considered to be filed at every port of entry? Did you know that declaration records created in ACE apply to both ACE and ACS filed entries? Learn the benefits that this functionality can have for your company. Join the free CBP webinar for brokers and importers titled “Working with ACE Forms and Declarations.”

Date and Time:
• Thursday, January 13, 2011
• 2:00 – 3:30 PM Eastern Time

The “Working with ACE Forms and Declarations” Webinar is designed to introduce the attendees to viewing and responding to a CBP Form 28, 29 and 4647 through the ACE Portal as well as creating, viewing and cancelling declaration records created in ACE.

Access to the forms and declarations hyperlinks must be granted by the Trade Account Owner so please ensure you can view those links on the Accounts tab before signing up for the webinar.
Attendees should come prepared to create a declaration record in ACE. The following blanket declarations are supported in ACE: Affidavit of Manufacturer, Importer Certifying Statement, Non-Reimbursement Blanket Statement (AD/CVD and North American Free Trade Agreement (NAFTA) Certificate of Origin. We will first sign on as an importer and create a Non-Reimbursement Blanket Statement (AD/CVD) declaration record. We will then change to the broker view to create the same record for a non-portal account. We will also be covering cancellation of a declaration record so you will have the option of immediately cancelling the declaration record that you create during the webinar.

Finally, attendees will be reviewing the AM 7002 Trade Declarations report and the ESM 7025 CBP Form 28, 29, 4647 Status Report.

Registration:
Participation in this webinar is limited. Please register early to ensure availability. This webinar will be posted to CBP.gov following the event.

To register, please click here to access the registration form.

Please be on the lookout for email messages from TradeEvents@dhs.gov. An email confirming your registration will be delivered upon acceptance of your registration, and an email providing the Webinar URL will be delivered prior to the Webinar.

Cancellation: Because space is limited, please take the consideration to cancel by January 11, 2011 if you are unable to participate to allow another member of the trade community to participate. If you need to cancel your registration, please click here to complete the cancellation form.

Report Details Distribution Center Costs

(American Shipper)

A new report details the wide range in costs of operating a distribution center in different parts of the U.S. and Canada.

The Boyd Co., a corporate relocation firm based in Princeton, N.J., said, “with fuel and shipping rates projected to spike significantly in 2011, comparative costs for factors like labor, property taxes, energy and real estate are under the site selection microscope like never before. “While shipping rates are often negotiable among competing carriers, most other operating costs facing the warehouse site planner are fixed and a less than optimum operating cost structure can lead to a compromise of competitive position that will persist for years.” Read more here.

Boyd says copies of its report can be obtained on a complimentary basis by writing contact@theboydcompany.com.

China Considering New Export Quotas on Rare Earth Alloys

(Industry Week – Agence France-Presse)

Also mulling separate export quotas for heavy and light rare earths

A report from Dow Jones Newswires on Dec. 30 said that China is considering new export quotas on rare earth alloys – a move that would further restrict shipments of the minerals used in a variety of high-tech industries.

The country – which has a near-monopoly in the industry – is also mulling separate export quotas for heavy and light rare earths, Dow Jones Newswires reported, citing an unnamed official with knowledge of the plans. The commerce ministry declined to comment on the report. Read more here.

Stay of Enforcement Lifted on Testing and Certification of Some Non-Children’s Products

(World Trade Interactive)

Effective Jan. 26, 2011, the Consumer Product Safety Commission is lifting its stay of enforcement of the testing and certification requirements under the Consumer Product Safety Improvement Act of 2008 with respect to non-children’s products subject to CPSC regulations pertaining to vinyl plastic film, carpets and rugs, and clothing textiles. As a result, as of that date manufacturers (including private labelers) of such products that are imported for consumption or warehousing or distributed in commerce must have such products tested by a third-party conformity assessment body accredited to do so and must issue a certificate of compliance with the applicable regulations based on that testing.

The Influence Game: Safety, Trade Interests Clash

(Washington Post – Joan Lowy, The Associated Press)

An Obama administration proposal aimed at preventing air shipments of lithium batteries from causing fires in flight is drawing fierce opposition from some of the United States’ top trading partners, who say it would disrupt international shipping and drive up the cost of countless products.

The European Union, China, Japan, South Korea and Israel are lobbying against requiring air shipments of lithium batteries and products containing them to meet hazardous cargo regulations, diplomatic and industry officials told The Associated Press.

At a minimum the proposal could cost hundreds of millions of dollars and disrupt the flow of products such as cellphones, laptops, medical devices, water meters and electric car batteries, among others, these governments say.

But the Transportation Department estimates its proposal would cost only $9 million a year. Pilot unions want the additional safety precautions, saying it’s only a matter of time before the batteries cause a plane crash. Read more here. 

Canada Seeks to Expand [Buy American] Deal

(Montreal Gazette – Andrew Mayeda, Postmedia News)

Buy American. Negotiations for broader agreement on horizon

Canada will enter negotiations with the United States early next year in the hopes of reaching a broader, long-term agreement based on the Buy American compromise the two sides reached earlier this year, says Trade Minister Peter Van Loan.

The worst fears of Canadian exporters – getting frozen out by their trading partner – became a reality when the U.S. government included Buy American provisions in its $787-billion U.S. economic-stimulus legislation. The bill required all iron, steel and manufactured goods used in construction projects that received stimulus funding to be produced in the United States. […]

Van Loan declined to provide a timeline for a wider deal, noting that individual states will have to be convinced. “It’s too early to predict what the timeline would be, because there’s so many variables. You’re not just dealing with a national government, you’re dealing with specific states,” he said, adding that any deal likely would be separate from the North American Free Trade Agreement. Read more here.

Permeable to Trade, Impregnable to Threats

(The Economist Blog)

THERE was a time when Canadians boasted that the line separating Canada from the United States, stretching for 8,900 kilometres (5,500 miles), formed the world’s longest undefended border. Security measures taken by the American administration in the wake of the terrorist attacks of September 11th 2001 put an end to that. […]

In the last nine years, Canadian governments have tried to keep the border as open as possible for trade while at the same time allaying American security fears with a series of deals. It hasn’t worked. Exporters continue to complain about a thickening of the border, which has helped reduce goods shipments to the United States from 87% of the total in 2001 to 73% in 2009 (though the emergence of new trading partners in the developing world and a lengthy recession south of the border also played a part).

So in some ways it was not a surprise when Stephen Harper, the Canada’s conservative prime minister, confirmed in one of his year-end interviews that Canada was negotiating a new security and economic deal with the Americans. Rumours that something called a perimeter security arrangement was in the works had been circulating for weeks. One media outlet even got its hands on the communications strategy the government would use to sell the deal to Canadians sceptical of giving away sovereignty in exchange for market access. Read more here.

Death by Antidumping

(Dan Ikenson — Forbes)

A Wall Street Journal editorial today shines a long overdue spotlight on an antidumping case that is emblematic of the dissonance within U.S. trade policy. I, too, wrote about this case last year as an example of how the U.S. antidumping regime undermines U.S. manufacturing, penalizes U.S. exporters, and diminishes chances for achieving the administration’s goal of doubling exports in five years.

In 2005, U.S. Magnesium Corporation, the sole producer of magnesium in the United States, succeeded in convincing the U.S. International Trade Commission and U.S. Commerce Department to impose duties on imports of magnesium from competitors in Russia and China. Before toasting this outcome with some clichéd or specious utterance about how the antidumping law ensures fair trade and a level playing field for U.S. producers, it is important to understand that downstream, consuming industries (those U.S. producers that require for their own production the raw materials and intermediate goods subject to the antidumping measures) have no legal standing in these cases. Read more here.

Is Globalisation on the Retreat in 2011?

(Gideon Rachman — Financial Times)

During the past two years, the world has experienced its deepest economic crisis since the 1930s. But – despite the fears of many experts – there has been no major outbreak of protectionism. Globalisation, the economic and political mega-trend of the past three decades, is still firmly in place.

However, when Barack Obama visited India recently, the US president warned his hosts that the debate about globalisation has re-opened in the west. The reasons for this are obvious. The western world has come out of the Great Recession in much worse shape than emerging powers. [...] Americans and Europeans are increasingly ill at ease with the “new world order” that emerged after the end of the cold war. As a consequence, a backlash against globalisation is forming – and it is likely to grow in strength. Read more here.

ITC Backs Rambus With 34-Company Probe

(Peter Clarke — EETimes/Design & Reuse)

The United States International Trade Commission has announced that it will launch an investigation into various chips and memory controllers and products that contain them, including PC motherboards, modems, routers and computers, following a complaint filed by Rambus Inc.

Rambus was already pursuing six companies through the law courts alleging patent infringement but additional companies cited as targets of the investigation include: Asus, Cisco, Garmin, Hewlett-Packard Hitachi GST, Motorola and Seagate as part of a list of 34 companies. Read more here (subscription required) and here.

Zeroing Would be Eliminated in Certain AD Proceedings Under ITA Proposal

(World Trade Interactive)

The International Trade Administration has issued a proposed rule that would modify the methodologies used in certain antidumping duty proceedings to reflect World Trade Organization rulings against the practice of zeroing. Comments on this proposal are due by Jan. 27. All comments must be submitted through the Federal eRulemaking Portal referencing Docket No. ITA-2010-011.

In AD proceedings, the ITA determines margins of dumping by comparing normal value with the export price of comparable merchandise. In a review, the ITA generally will compare normal value and export price using the average-to-transaction method, which involves a comparison of the weighted average normal value to the export price of individual transactions for comparable merchandise. In doing so, the ITA aggregates the results of these comparisons and has not allowed the results of the comparisons for which export price exceeds normal value to offset the results of comparisons for which export price is less than normal value.

In addition, the ITA may determine whether subject merchandise is being sold at less than fair value in an AD duty investigation by comparing the normal values of individual transactions to the export prices of individual transactions for comparable merchandise (the transaction-to-transaction comparison method). However, ITA regulations state that this method will only be used in unusual situations, such as when there are very few sales of subject merchandise and the merchandise sold in each market is identical or very similar or is custom-made. The ITA has thus rarely applied the transaction-to-transaction comparison method, but in the most recent such instance it did not grant offsets for non-dumped comparisons. Read more here.

US Reportedly to Take Step Towards Speed Limiter Legislation

(Truck News)

Reports surfaced yesterday that the US National Highway Traffic Safety Administration (NHTSA) is looking to initiate a Notice of Proposed Rulemaking that would require trucks to activate speed limits.

Truckinginfo.com, the Web site for US-based Heavy-Duty Trucking, reported the official announcement will come Monday. Ontario and Quebec already require the mandatory use of speed limiters.

The Owner-Operators Independent Drivers Association (OOIDA), which actively lobbied against the Canadian speed limiter laws, was quick to condemn the impending proposal.

“Speed limiting a truck at 68 miles per hour, or at any other speed, will not improve highway safety,” said Todd Spencer, executive vice-president of the OOIDA. “All credible highway research shows that highways are safest when all vehicles travel at the same speed and that different speeds for cars and trucks actually increase the likelihood of accidents.” Read more here.

Cow-Dung Toothpaste? Taryn Simon’s Book “Contraband” Unloads America’s Baggage

(Sean O’Hagan — The Guardian)

It took five sleepless days and nights inside an airport for Simon to capture these shots of seized goods, from counterfeit jewellery to deer penis. The result is a testament to the ingenuity of those attempting to bring banned goods into America – and those preventing them

Taryn Simon’s latest book, Contraband, consists of 1,075 photographs of items confiscated by US customs and the US postal service international mail facility at John F Kennedy international airport, New York, from 16 November to 20 November, 2009.

The seized items include various drugs (Xanax, anabolic steroids, Ritalin, khat, ketamine, hashish), counterfeit jewellery, bags, hats, sportswear, shirts, DVDs and watches as well as several kinds of plants, seeds, grass, nuts and foodstuffs. Among the more exotic confiscated substances are deer antlers, deer blood, deer penis and deer tongue, as well as cow-dung toothpaste and cow urine. Read more here.

PayPal Taps Cross-border Trade Potential With New China Deal

(Michael Kan — IDG News/PC World)

EBay’s online payment service PayPal is hoping to hit a “sweet spot” in China’s e-commerce market by making it easier for Chinese merchants to make money from overseas sales.

On Tuesday, PayPal signed an agreement with the Chinese city of Chongqing to jointly develop an international e-commerce hub that seeks to build cross-border trade between Chinese merchants and buyers from abroad.

PayPal, with access to 190 countries and regions, has become an important tool for Chinese merchants wanting to make sales to Internet users abroad. At the end of this year, the company expects China to have more than 1 million users of its online service, most of them small and medium-size businesses. Read more here.

US Customs and Border Protection Top 10 Seizures of 2010

(CBP)

U.S. Customs and Border Protection announces today some of its top seizures of 2010. With officers and agents protecting our nation’s borders, processing almost a million travelers a day, interceptions of cross-border tunnel smuggling operations and record narcotic seizures in Laredo and Washington State account for just a fraction of enforcement actions CBP performs each year.

From finding tigers in the Texas desert, bugs and designer baubles in Los Angeles, and scuba diving smugglers in Arizona sewers, CBP personnel protect our nation’s borders in a multitude of ways. These seizures demonstrate the effectiveness of our layered approach to security, comprised of a balance of tactical infrastructure, technology, and personnel at our borders.

Our officers and agents make thousands of seizures each year; these are some examples that personify the vigilance and service of our diverse agency and mission:

1. Multi-Agency Task Force Uncovers Border Tunnel, Seizes 30 Tons of Marijuana

2. Fourteen Persons Charged with Conspiracy to Smuggle $3.1 Million in Cash into Mexico

3. Laredo CBP Officers Seize $12.7 Million in Heroin

4. CBP U.S. Border Patrol Seizes More Than $9 Million Worth of Ecstasy

5. New “First in the Nation” Pest Halted at LA/LB Seaport- Interception Marks Second “First in the Nation” for CBP Los Angeles in Past Two Months

6. Los Angeles CBP Seizes More than $18 Million in Counterfeit Sunglasses- Louis Vuitton, Versace and Coach among the Counterfeit Trademarks

7. Border Patrol Agents Seize Scuba Gear, Marijuana in Sewer System

8. Laredo Border Patrol Agents Discover Abandoned Bengal Tiger

9. Tacoma Seaport U.S. Customs and Border Protection Officers Seize Shipment of Machineguns

10. $9 Million in Marijuana Stopped by CBP in Railroad Shipment