CBP CROSS Rulings

The Federal Maritime Commission said its May rule on detention and demurrage charges (see 2004290037) is helping to reduce unfair penalties imposed by carriers, but industry said the fees are continuing and the FMC’s guidance is not being followed. The rule “at first seemed to be a great victory,” said Rich Roche, vice president of international transportation at Mohawk Global Logistics, speaking during a virtual conference hosted by the National Customs Brokers & Forwarders Association of America Sept. 14. But Roche, who is also the chair for the NCBFAA’s Non-Vessel Operating Common Carrier Subcommittee, said some carriers increased their demurrage and detention fees the same week the rule was finalized.

While the changes to de minimis for Canada and Mexico have been heavily discussed, Doug Band, the Canada Border Services Agency's director general of trade and anti-dumping, directed traders to the revisions' finer points during a CBP Virtual Trade Week seminar on the USMCA, known as CUSMA in Canada.

A long-awaited rewrite of routed export regulations by the Bureau of Industry and Security and the Census Bureau will introduce a new “Export Responsibility Transfer Agreement” (ERTA) to replace the “writing” currently used to transfer filing responsibilities, with the new agreement specifically transferring filing and licensing responsibilities to the forwarder or agent of the foreign party, said Sharron Cook, a BIS senior export policy analyst, during a webcast of the American Association of Exporters and Importers Annual Conference Sept. 3.

More companies are seeking drawback payments as the economic slowdown has increased the importance of cash on hand, CBP officials and industry executives said during the American Association of Exporters and Importers virtual conference Aug. 20. “In general, I would say COVID's had a major impact on our businesses and it's also made our company even more focused on getting cash in the door,” said Kathleen Palma, senior executive for international trade compliance at GE. “One of the levers that our leadership has been looking at has been drawback.” At the same time, Palma expects that because the company is bringing in fewer shipments, that will be reflected in fewer drawback claims going forward.

The Federal Emergency Management Agency will continue export restrictions on an amended list of personal protective equipment through Dec. 31, the agency said in a notice released Aug. 6. The restrictions, which were scheduled to expire this month, now cover four categories of items, including certain respirators, masks, gloves and surgical gowns -- a decrease from the six categories FEMA has restricted since April. The changes take effect Aug. 10.

Some new provisions within the USMCA seem to make claims of U.S. goods returned under Harmonized Tariff Schedule heading 9801 for U.S. origin goods much less important than was the case under NAFTA. Kevin Riddell, director-trade and regulatory compliance at Tremco Group in Canada, highlighted the changes, which allow for USMCA claims on U.S. origin goods, in a recent LinkedIn post. While Riddell said he hadn't tried to enter U.S. goods under the new USMCA provisions, a CBP spokesperson confirmed that “a USMCA claim may be made on goods of U.S. origin, provided it satisfies its applicable rule of origin and all other requirements of the Agreement have been met.”

Because the Office of the U.S. Trade Representative was in such a hurry on implementation, some USMCA details needed by traders are either wrong or missing. For instance, there are tariff numbers that are invalid, because negotiators used the 2012 Harmonized Tariff Schedule numbers. On a call with trade professionals July 6, CBP staffers said importers or exporters can email CBP with a tariff number in question, and the agency can provide guidance on how to claim USMCA treatment for those goods.

In calls hosted by CBP on the last day of NAFTA, and the first day of USMCA, trade professionals were anxious to understand what they should change in paperwork.

Although lawmakers thought eliminating the NAFTA certificate would be helpful, some importers are more comfortable with structure, so there will be a certificate template available on CBP's trade agreements web page “as soon as possible,” Adam Sulewski, USMCA Center project leader at CBP, said during a conference call June 29. He reminded importers, “We can accept those required nine data elements in any form.”

Importers may want to delay filing for U.S.-Mexico-Canada Agreement reconciliation because the USMCA currently doesn't allow for post-entry refunds of merchandise processing fees, CBP officials said during a National Association of Foreign-Trade Zones webinar on June 16. Maya Kamar, CBP director for textiles and trade agreements, said that although the Office of the U.S. Trade Representative is working with Congress for a legislative fix to the issue, CBP doesn't yet have clarity on whether such a bill will pass (see 2006050034).