C-AIR TIMES ISSUE #622 - - Friday, March 20, 2020 07:18

USTR Annouces the Extension of Certain Soon to Expire China Section 301 List Exclusions - Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP

In a notice to be published in the Federal Register of March 19, 2020, the Office of the United States Trade Representative (“USTR”) announced extensions for certain soon to expire exclusions from the China 301 List 1 tariffs (the $34 billion trade action).

To date, ten sets of exclusions have been issued in connection with List 1. The second set of exclusions is scheduled to expire on March 25, 2020. The USTR has announced that the expiring exclusions on the below items will be extended for one year (to now cover the specified goods entered for consumption, or withdrawn from warehouse for consumption, before March 25, 2021).

Unless extended under the current action or prior actions, exclusions will expire on their previously scheduled expiration date. If you have any questions on the status of any particular China 301 exclusion(s), please contact our office.

LIST 1 EXCLUSIONS EXTENDED

8412.21.0045
8607.21.1000
Breast pumps, whether or not with accessories or batteries (described in statistical reporting number 8413.81.0040)
Machinery for filtering water, submersible, powered by batteries, manually operated, such machinery designed for use in pools, basins, aquariums, spas or similar contained bodies of water (described in statistical reporting number 8421.21.0000)
Hand-held ultraviolet water purifiers, powered by batteries (described in statistical reporting number 8421.21.0000)
Filters designed to remove sulfites from wine (described in statistical reporting number 8421.22.0000)
Filter housings, covers, or couplings, the foregoing of steel and comprising parts of machinery or apparatus for filtering liquids (described in statistical reporting number 8421.99.0040)
Vulcanized rubber tracks, each incorporating cords and cleats of steel, designed for use on construction equipment (described in statistical reporting number 8431.49.9095)
Automated data processing storage units (other than magnetic disk drive units), not assembled in cabinets for placing on a table or similar place, not presented with any other unit of a system (described in statistical reporting number 8471.70.6000)
Electric motors, AC, permanent split capacitor type, each in a housing with outside diameter of 84 mm or less, with output of 6 W or more but not exceeding 16 W (described in statistical reporting number 851.10.4020)
Inoculator sets of plastics, each consisting of a plate with multiple wells, a display tray, and a lid; when assembled, the set measuring 105 mm or more but not exceeding 108 mm in width, 138 mm or more but not exceeding 140 mm in depth, and 6.5 mm or less in thickness (described in statistical reporting number 9027.90.5650)

Federal Register Notices:

Coronavirus (COVID-19) Update: FDA Focuses on Safety of Regulated Products While Scaling Back Domestic Inspections - U.S. Food & Drug Administration

Protecting the health and safety of our staff and their families is of paramount concern to the U.S. Food and Drug Administration. As a nation we must do everything we can to help slow the spread of the virus and help flatten the curve of the COVID-19 pandemic. Now more than ever, the American people are depending on us. We must ensure our workforce remains healthy to carry out the FDA’s critical public health mission to keep Americans safe.

In keeping with the White House Coronavirus Task Force and cross-government guidance, this week we directed all eligible FDA employees to begin teleworking. While this does not apply to those carrying out non-portable activities, such as certain lab activities or the monitoring of imported products, we will continue to adjust our approach to a number of activities, including facility inspections for all FDA-regulated products such as food, animal feed, drugs, biological products, devices and tobacco.

Earlier this month, we announced that we are postponing most foreign facility inspections through April and that inspections outside the U.S. deemed mission-critical will be considered on a case-by-case basis as this outbreak continues to unfold.

Today, we’re announcing that for the health and well-being of our staff and those who conduct inspections for the agency under contract at the state level, and because of industry concerns about visitors, we have temporarily postponed all domestic routine surveillance facility inspections. These are facility inspections the FDA traditionally conducts every few years based on a risk analysis. Importantly, all domestic for-cause inspection assignments will be evaluated and will proceed if mission-critical. We will continue to respond to natural disasters, outbreaks and other public health emergencies involving FDA-regulated products.

I want to assure the American public that we have full confidence in the safety and quality of the products we all use every day and that the FDA will continue to leverage all available authorities to continue to ensure the integrity of the products we regulate.

Importantly, during this interim period we’re evaluating additional ways to conduct our inspectional work that would not jeopardize public safety and protecting both the firms and the FDA staff. This can include, among other things, evaluating records in lieu of conducting an onsite inspection on an interim basis when travel is not permissible, when appropriate.

In fact, inspections are just one part of a robust and multi-pronged approach to overseeing the safety and quality of FDA-regulated products, however inspections are not what cause quality to happen. Safety and quality need to be owned by the industry and firms have the primary responsibility to reliably produce quality products. For example, the medical product and food industries we regulate are subject to certain reporting requirements about their facilities and also must adhere to Current Good Manufacturing Practice (cGMP) requirements pertaining to, for example, operating procedures, manufacturing, sanitation, and processing controls, as well as preventive controls to reduce or eliminate food safety hazards.

The FDA remains committed to using all available tools to oversee the safety and quality of FDA-regulated products for American patients and consumers. As this remains a dynamic situation, we will continue to assess and calibrate our approach as needed and we stand ready to resume any postponed inspections as soon as feasible.

The FDA, an agency within the U.S. Department of Health and Human Services, protects the public health by assuring the safety, effectiveness, and security of human and veterinary drugs, vaccines and other biological products for human use, and medical devices. The agency also is responsible for the safety and security of our nation’s food supply, cosmetics, dietary supplements, products that give off electronic radiation, and for regulating tobacco products.

USITC Institutes Section 337 Investigation of Certain Capacitive Touch-Controlled Mobile Devices, Computers and Components - U.S. International Trade Commission

The U.S. International Trade Commission (USITC) has voted to institute an investigation of certain capacitive touch-controlled mobile devices, computers, and components thereof. The products at issue in the investigation are described in the Commission’s notice of investigation.

The investigation is based on a complaint filed by Neodron, Ltd., of Dublin, Ireland, on February 14, 2020. The complaint alleges violations of section 337 of the Tariff Act of 1930 in the importation into the United States and sale of certain capacitive touch-controlled mobile devices, computers, and components thereof that infringe patents asserted by the complainant. The complainant requests that the USITC issue a limited exclusion order and cease and desist orders. The USITC has identified the following as respondents in this investigation:

Amazon.com, Inc., of Seattle, WA;
Apple Inc. of Cupertino, CA;
ASUSTeK Computer Inc. of Taipei, Taiwan;
ASUS Computer International of Fremont, CA;
LG Electronics Inc. of Seoul, Korea;
LG Electronics USA, Inc., of Englewood Cliffs, NJ;
Microsoft Corporation of Redmond, WA;
Motorola Mobility LLC of Chicago, IL;
Samsung Electronics Co., Ltd., of Suwon, South Korea;
Samsung Electronics America, Inc., of Ridgefield Park, NJ;
Sony Corporation of Tokyo, Japan; and
Sony Mobile Communications Inc. of Tokyo, Japan.

By instituting this investigation (337-TA-1193), the USITC has not yet made any decision on the merits of the case. The USITC’s Chief Administrative Law Judge will assign the case to one of the USITC’s administrative law judges (ALJ), who will schedule and hold an evidentiary hearing. The ALJ will make an initial determination as to whether there is a violation of section 337; that initial determination is subject to review by the Commission.

The USITC will make a final determination in the investigation at the earliest practicable time. Within 45 days after institution of the investigation, the USITC will set a target date for completing the investigation. USITC remedial orders in section 337 cases are effective when issued and become final 60 days after issuance unless disapproved for policy reasons by the U.S. Trade Representative within that 60-day period.

Philadelphia CBP Seizes $113,000 in Atlanta-bound Counterfeit Designer Brand Handbags from Turkey - U.S. Customs & Border Protection

PHILADELPHIA – U.S. Customs and Border Protection (CBP) officers seized a shipment of 32 counterfeit designer brand handbags March 10 that arrived in Philadelphia in an express delivery parcel from Turkey. If genuine, the handbags, which were destined to an address in Atlanta, would have had a manufacturer suggested retail price of $113,683.

This is the second significant shipment of designer brand handbags that CBP officers recently seized in Philadelphia, following the $317,080 in counterfeit designer brand products officers seized February 24.

CBP officers initially examined this latest shipment on February 26. The shipment contained 31 Louis Vuitton handbags and one Gucci handbag. Officers detained the shipment due to the poor quality and packaging of the merchandise.

CBP officers worked with CBP’s Consumer Products and Mass Merchandising Centers for Excellence and Expertise, the agency’s trade experts and verified through the trademark holder that the products were counterfeit.

CBP protects businesses and consumers every day through an aggressive Intellectual Property Rights (IPR) enforcement program. Importation of counterfeit merchandise can cause significant revenue loss, damage the U.S. economy, and threaten the health and safety of the American people. On a typical day in 2019, CBP officers seized $4.3 million worth of products with Intellectual Property Rights violations. Learn more about what CBP did during "A Typical Day" in 2019.

“Customs and Border Protection officers encounter a wide variety of counterfeit consumer goods, like these trademark-infringing products, and we continue to work with our trade and consumer safety partners to identify and seize counterfeit products,” said Joseph Martella, Area Port Director for the Area Port of Philadelphia. “CBP urges consumers to protect their families and their wallets by purchasing authentic goods from reputable vendors.”

CBP officers and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigation (HSI) agents seized 27,599 shipments containing counterfeit goods in Fiscal Year (FY) 2019. The total estimated manufacturer’s suggested retail price (MSRP) of the seized goods, had they been genuine, increased to over $1.5 billion from nearly $1.4 billion in FY 2018. 

Additionally, HSI arrested 256 individuals, obtained 197 indictments, and received 157 convictions related to intellectual property crimes during FY 2019.

The People’s Republic of China remained the primary source economy for seized counterfeit and pirated goods, accounting for a total estimated MSRP value of over $1 billion or 66 percent of the estimated MSRP value of all IPR seizures. 

CBP's border security mission is led at ports of entry by CBP officers from the Office of Field Operations. Please visit CBP Ports of Entry to learn more about how CBP’s Office of Field Operations secures our nation’s borders. Learn more about CBP at www.CBP.gov.

Follow the Director of CBP’s Baltimore Field Office on Twitter at @DFOBaltimore and on Instagram at @dfobaltimore for breaking news, current events, human interest stories and photos.

CBP Officers Seize Fake COVID-19 Test Kits at LAX - U.S. Customs & Border Protection

Suspected Counterfeit Test Kits Mislabeled as “Purified Water Vials”

LOS ANGELES - U.S. Customs and Border Protection (CBP) officers assigned to Los Angeles International Airport (LAX), International Mail Facility (IMF), intercepted a package containing suspected counterfeit COVID-19 test kits arriving from the United Kingdom.

On March 12, 2020, CBP officers discovered six plastic bags containing various vials, while conducting an enforcement examination of a parcel manifested as “Purified Water Vials” with a declared value of $196.81. A complete examination of the shipment, led to the finding of vials filled with a white liquid and labeled “Corona Virus 2019nconv (COVID-19)” and “Virus1 Test Kit”. The shipment was turned over to the U.S. Food and Drug Administration (FDA) for analysis.

“Protecting the health and safety of the American people is a top priority for CBP,” said Carlos C. Martel, CBP Director of Field Operations in Los Angeles. “This significant interception, at a time when the U.S. is in the midst of a National Emergency, demonstrates our CBP officers’ vigilance and commitment to ensure dangerous goods are intercepted and not a threat to our communities and our people.”

Authorized diagnostic testing for COVID-19 is conducted in verified state and local public health laboratories across the United States. The American public should be aware of bogus home testing kits for sale either online or in informal direct to consumer settings.

“CBP commits substantial resources to detect, intercept and seize illicit goods arriving in the air package environment,” said LaFonda Sutton-Burke, CBP Port Director at LAX. “Smugglers are constantly attempting to take advantage of consumers by disguising their illicit goods as legitimate shipments.”

FDA Requires New Health Warnings for Cigarette Packages and Advertisement - US Food & Drug Administration

Today, the U.S. Food and Drug Administration issued a final rule to require new health warnings on cigarette packages and in cigarette advertisements. The warnings feature textual statements with photo-realistic color images depicting some of the lesser-known, but serious health risks of cigarette smoking, including impact to fetal growth, cardiac disease, diabetes and more.

“The 11 finalized cigarette health warnings represent the most significant change to cigarette labels in more than 35 years and will considerably increase public awareness of lesser-known, but serious negative health consequences of cigarette smoking,” said Mitch Zeller, J.D., director of FDA’s Center for Tobacco Products. “Research shows that the current warnings on cigarettes, which have not changed since 1984, have become virtually invisible to both smokers and nonsmokers, in part because of their small size, location and lack of an image. Additionally, research shows substantial gaps remain in the public’s knowledge of the harms of cigarette smoking, and smokers have misinformation about cigarettes and their negative health effects. The new cigarette health warnings complement other critical FDA actions, including outreach campaigns targeted to both adults and youth, to educate the public about the dangers associated with using cigarettes, as well as other tobacco products.”

Beginning June 18, 2021, these new cigarette health warnings will be required to appear prominently on cigarette packages and in advertisements, occupying the top 50% of the area of the front and rear panels of cigarette packages and at least 20% of the area at the top of cigarette advertisements. Once implemented, the new warnings must be randomly and equally displayed and distributed on cigarette packages and rotated quarterly in cigarette advertisements.

As the FDA outlined in the proposed rule issued last year, the agency undertook a science-based approach to develop and evaluate the new cigarette health warnings. These warnings focus on serious health risks that are less known by the public as being negative health consequences of smoking. For example, current smokers have been found to have almost four times the risk of bladder cancer as never smokers, and it has been estimated that smoking is responsible for 5,000 bladder cancer deaths in the U.S. each year — yet research shows the public has limited awareness of bladder cancer as a consequence of smoking.

While the proposed rule put forward 13 warnings for consideration, the FDA finalized a set of 11 required warnings for the final rule based on the full results of the FDA's consumer research studies, the relevant scientific literature, public comments submitted to the proposed rule docket and other legal and policy considerations. The final cigarette health warnings each consist of one of the following textual warning statements paired with an accompanying photo-realistic image depicting the negative health consequences of smoking:

WARNING: Tobacco smoke can harm your children.
WARNING: Tobacco smoke causes fatal lung disease in nonsmokers.
WARNING: Smoking causes head and neck cancer.
WARNING: Smoking causes bladder cancer, which can lead to bloody urine.
WARNING: Smoking during pregnancy stunts fetal growth.
WARNING: Smoking can cause heart disease and strokes by clogging arteries.
WARNING: Smoking causes COPD, a lung disease that can be fatal.
WARNING: Smoking reduces blood flow, which can cause erectile dysfunction.
WARNING: Smoking reduces blood flow to the limbs, which can require amputation.
WARNING: Smoking causes type 2 diabetes, which raises blood sugar.
WARNING: Smoking causes cataracts, which can lead to blindness.

In addition, the FDA has issued a guidance to accompany the final rule. The “Required Warnings for Cigarette Packages and Advertisements: Small Entity Compliance Guide” guidance for industry will assist small businesses in understanding and complying with the final rule.

Treasury and IRS Issue Guidance on Deferring Tax Payments Due to COVID-19 Outbreak - U.S. Department of Treasury

Washington – Following President Donald J. Trump’s emergency declaration pursuant to the Stafford Act, the U.S. Treasury Department and Internal Revenue Service (IRS) today issued guidance allowing all individual and other non-corporate tax filers to defer up to $1 million of federal income tax (including self-employment tax) payments due on April 15, 2020, until July 15, 2020, without penalties or interest. The guidance also allows corporate taxpayers a similar deferment of up to $10 million of federal income tax payments that would be due on April 15, 2020, until July 15, 2020, without penalties or interest. This guidance does not change the April 15 filing deadline.

“Americans should file their tax returns by April 15 because many will receive a refund. Those filing will be able to take advantage of their refunds sooner,” said Treasury Secretary Steven T. Mnuchin. “This deferment allows those who owe a payment to the IRS to defer the payment until July 15 without interest or penalties. Treasury and IRS are ensuring that hardworking Americans and businesses have additional liquidity for the next several months.”

Today’s guidance will result in about $300 billion of additional liquidity in the economy in the near term. Treasury and IRS will issue additional guidance as needed and continue working with Congress, on a bipartisan basis, on legislation to provide further relief to the American people