CBP Proposes to Limit the Uuse of Special Reduced Duty Apparel Provision under the DR-CAFTA
Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP/ http://gdlsk.com/knowledge/342-cbp-proposes-to-limit-the-use-of-special-reduced-duty-apparel-provision-under-the-dr-cafta.html
In a notice published in the Customs Bulletin of December 24th, CBP has proposed to limit the circumstances under which reduced duty treatment can be claimed under HTS 9822.05.10.
This provision accords reduced-duty treatment for garments that are cut (or knit to shape) and assembled in a beneficiary country under the Dominican Republic-Central American Free Trade Agreement (“DR-CAFTA”) from U.S. formed fabric (regardless of the origin of the yarns) when the sewing is accomplished using U.S.-formed sewing thread.
Under this provision, importers are provided with a duty allowance to account for the value of the U.S. fabric (or knit to shape components) and any other U.S. origin materials used in the production.
In its notice, CBP is proposing to limit the applicability of this provision to those instances in which all fabrics in a garment are wholly formed in the U.S. Thus, it is proposing to revoke several rulings where the 9822.05.10 duty allowance was permitted where secondary fabric components (e.g., neckband tape fabric, ribbon hanger fabric, leg and waist elastic fabrics, sequined mesh fabric waistband overlay, etc.) were not of U.S. origin.
It would appear that this interpretation runs counter to previous Customs pronouncements that, under this provision, “duty calculation . . . will be similar to the duty calculation for tariff numbers 98020080 and 98020090” (i.e., a duty allowance provided for U.S. materials without requiring that all materials be of U.S. origin).
CBP is accepting comments on its proposal until January 23, 2015.
Should you have any questions in connection with this DR-CAFTA provision or if we can be of assistance in the drafting of comments in opposition to the proposal, please do not hesitate to contact Arthur W. Bodek ( abodek@gdlsk.com) or any other members of our firm.
PNCT OPEN Monday (1/19) for Martin Luther King Jr Day
- 7:00 AM - 3:00PM
PNCT / http://www.pnct.net/MessageUpdates.aspx#3
PNCT will be OPEN Monday for Martin Luther King Jr Day
Receiving and Delivery (all move types)
7:00 AM - 3:00 PM
Maher Terminals Will be Open 1/19
Maher Terminals / http://www.maherterminals.com/index.cfm/do/page.info/show/news/which/225
Please be advised that all Maher Terminals facilities including the Empty Depot located at Columbia will be open for truck line activity between 6 a.m. - 4 p.m. on Monday, 1/19/15, Martin Luther King’s Birthday.
PierPass: Port Truck Gate Schedule for Martin Luther King, Jr. Day
PierPass / http://www.pierpass.org/
Terminals at the Ports of Los Angeles and Long Beach have announced their schedules for the Martin Luther King, Jr. Day holiday on Monday, January 19, 2015. The schedule is posted below, and a PDF of the schedule can be downloaded at http://goo.gl/VqEiVh.
Please continue to monitor the websites of individual terminals for potential updates.
OTEXA: Press Releases
International Trade Administration - Office of Textile and Apparel (OTEXA) / http://otexa.ita.doc.gov/
01/13/2015 - The Office of the U.S. Trade Representative announces its 2015 Special 301 Review to identify countries that deny adequate and effective protection of intellectual property rights (IPR) or deny fair and equitable market access. Public comments are requested by February 6 and a public hearing will be held on February 24.
Congestion at U.S. Ports is Commission Priority for 2015
Federal Maritime Commission / http://www.fmc.gov/congestion-priority-2015/
On January 13, 2015, Federal Maritime Commission Chairman Mario Cordero announced to staff that his priority for the Commission in 2015 is addressing congestion issues that are plaguing the Nation’s ports. Starting in September 2014, FMC Commissioners led public forums concerning port congestion and international supply chain efficiency issues. The Chairman noted that this focus is in keeping with the Commission’s 2014-2018 Strategic Plan.
Chairman Cordero stated, "Among the Commission’s statutory goals is the assurance of an efficient ocean transportation system. The efficient operation of the Nation’s ports is squarely within that mandate and paramount to the Commission’s responsibilities. As we move forward, I look forward to a thorough review of the issues and views that have been provided from various maritime industry stakeholders. The FMC will continue its role in protecting the shipping public and addressing unreasonable or unjust practices by carriers or marine terminal operators."
New Jersey Man Sentenced to 33 Months in Prison for Trafficking in Illegally-Imported Narwhal Tusks and Money Laundering
U.S. Fish & Wildlife Service/ http://www.fws.gov/
A New Jersey man found guilty of illegally importing and trafficking in narwhal tusks and associated money laundering crimes was sentenced to 33 months in prison. He also must forfeit $85,000, several narwhal products and pay a fine of $7,500. “The significant penalties imposed…send a powerful message to any individual that decides to engage in the trade of illegal wildlife,” said the Service’s Edward Grace, Deputy Assistant Director for Law Enforcement. Narwhals are listed as “threatened” under the Endangered Species Act.
News Release
U.S. Department of Transportation Fines Honda $70 Million for Failing to Comply with Laws That Safeguard the Public
Department of Transportation / http://www.dot.gov/briefing-room/us-department-transportation-fines-honda-70-million-failing-comply-laws-safeguard
NHTSA Issues More Fines in 2014 Than in Agency’s Entire History
WASHINGTON – The U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) announced today that as a result of a NHTSA investigation, Honda will pay two $35 million civil penalties, for a total of $70 million, for failing to report deaths, injuries, and certain warranty claims to the federal government in violation of the TREAD Act. In the Consent Order, finalized just before the new year, Honda also agreed to increased NHTSA oversight and third party audits to ensure that all required reporting is completed now and into the future.
In 2014 alone, NHTSA issued more than $126 million in civil penalties, exceeding the total amount collected by the agency during its forty-three year history.
“Honda and all of the automakers have a safety responsibility they must live up to – no excuses,” said U.S. Transportation Secretary Anthony Foxx. “Last year alone, we issued more fines than in NHTSA’s entire history. These fines reflect the tough stance we will take against those who violate the law and fail to do their part in the mission to keep Americans safe on the road.”
NHTSA’s investigation into Honda’s safety reporting found that the automaker failed to submit early warning reports (EWR reports) identifying potential or actual safety issues. The first civil penalty is a result of Honda’s failure to report 1,729 death and injury claims to NHTSA between 2003 and 2014. The second civil penalty is due to the manufacturer’s failure to report certain warranty claims and claims under customer satisfaction campaigns throughout the same time period. Additional details are available in the audit report prepared for Honda by Bowman and Brooke and in Honda’s Response to NHTSA’s Special Order addressing the violations.
Federal law requires manufacturers to submit comprehensive EWR reports of potential safety concerns to the Department. These quarterly reports include production information; incidents involving a death or injury; aggregate data on property damage claims, consumer complaints, warranty claims, and field reports; and, copies of field reports involving specified vehicle components, a fire, or a rollover. The data are then used to investigate whether safety defects or defect trends exist and warrant further action, including possible recalls.
“Today’s announcement sends a very clear message to the entire industry that manufacturers have responsibility for the complete and timely reporting of this critical safety information,” said NHTSA Administrator Dr. Mark Rosekind. “The actions we are requiring will push Honda to significantly raise the bar on the effectiveness of its EWR reporting program. Our ongoing oversight will ensure compliance and determine if there is cause for additional actions.”
In addition to civil penalties, Honda has been ordered to comply with NHTSA oversight requirements under a Consent Order. It requires that Honda develop written procedures for compliance with EWR requirements, train appropriate personnel on at least an annual basis, and complete two third-party audits of the automaker’s compliance with its reporting obligations. The Consent Order also requires Honda to provide NHTSA’s Early Warning Division with information regarding the 1,729 unreported death and injury incidents and the warranty claims, so that the agency can analyze these incidents for potential safety concerns and take appropriate action to protect America’s driving public.
While 2014 was a record year for civil penalties, the fines are limited by a Congressionally-established $35 million dollar cap, the amount Honda will pay for each of the two series of violations. The Administration’s four-year reauthorization bill – the GROW AMERICA Act – proposes to increase the limit to $300 million. The Administration’s proposal also seeks additional authority to aid NHTSA in its efforts to force recalls.
NHTSA issued the following civil penalties in 2014:
- Honda, $70,000,000, for failing to both submit early warning reports and warranty claims.
- Gwinnett Place Nissan, $110,000, for failing to perform recall remedy in new motor vehicles prior to sale and delivery.
- Ferrari S.p.A. and Ferrari North America, Inc, $3,500,000, for failing to submit early warning reports.
- Chapman Chevrolet LLC, $50,000, for failing to perform recall remedy in new motor vehicles prior to sale and delivery.
- Hyundai Motor America, $17,350,000, for the failure to issue a recall in a timely manner.
- General Motors Company, $35,000,000, for the failure to issue a recall in a timely manner.
- General Motors Company, $441,000, for failing to fully respond to Special Order by due date.
- Prevost, a division of Volvo Group Canada, Inc; Volvo Industrial de Mexico S.A. de C.V.; and Prevost Car (US) Inc., $250,000, the second of six annual installments of a total of $1.5 million in civil penalties, for untimely recalls and untimely submission of early warning reports, and technical service bulletins (TSBs).
- Southern Honda Powersports (a/k/a Big Red Powersports LLC), $25,000, the second of five annual installments of a total of $125, 000 in civil penalties, for the sale of unrepaired, recalled vehicles.
Counterfeit DVD Movie Distributor Sentenced to Federal Prison
U.S. Immigrations and Customs Enforcement / http://www.ice.gov/news/releases/counterfeit-dvd-movie-distributor-sentenced-federal-prison
HONOLULU – A New York man was sentenced Monday for his involvement in a counterfeit DVD movie ring, following a probe by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
Yakov Meir Chazanow, 41, of Brooklyn, New York, was sentenced by U.S. District Judge Leslie E. Kobayashi to serve 21 months in prison for conspiring to commit criminal copyright infringement, manufacturing counterfeit goods and to trafficking in goods bearing counterfeit Dolby trademarks and counterfeit labels.
According to the evidence contained in court documents and presented at Monday’s sentencing, from 2004 to 2011, Chazanow supplied over 30,000 high-quality pirated DVDs containing infringing copies of copyright-protected Asian action movies and corresponding counterfeit labels and packaging. He then distributed them to co-conspirators, who in turn sold them to consumers in stores and online.
Charges were filed against Chazanow and his codefendants, Sharon Josef and Jeffrey Alan Stockton, in June 2013. Stockton pleaded guilty to conspiracy and two counts of trafficking in counterfeit labels in September 2013. In February of last year, Chazanow and Josef pleaded guilty to the above charges. Stockton was subsequently sentenced to 21 months in prison and ordered to forfeit $250,000 in illegal proceeds, including more than $32,000 in U.S. currency, 29 gold bars, 62 gold coins, six palladium coins and five silver coins. Josef, who supplied pirated DVDs from 2011 to 2012, was sentenced Monday to four months in prison.
The Motion Picture Association of America; Dolby Laboratories, Inc.; and DVD Format/Logo Licensing Corporation provided assistance with the investigation. The case was prosecuted by Assistant Deputy Chief for Litigation John H. Zacharia with the Department of Justice’s Criminal Division Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Andrea W. Hattan and Leslie E. Osborne, Jr. of the District of Hawaii.