11.05.2010 Highlights in International Trade and Commerce - November, 2010

The International Law Section of Williams Mullen prepared the following brief descriptions of selected issues in international trade and commerce for general information purposes and use by clients and friends of the firm.

Report on Plan to Double Exports Focuses on Small and Medium-Sized Enterprises

The Export Promotion Cabinet (“EPC”), a high-level interagency task force established by an Executive Order in March, has issued a report detailing its plans for doubling U.S. exports in the next five years. The National Export Initiative is focused on eight areas: increasing advocacy efforts on behalf of U.S. exporters, bringing more U.S. sellers and foreign buyers together, expanding small business export engagement and success, increasing access to export financing, reinforcing efforts to remove trade barriers, stepping up enforcement of trade rules and promoting policies internationally that will lead to strong, sustainable and balanced world economic growth. The EPC’s recommendations include: focusing advocacy, promotion and financing efforts on small and medium-sized enterprises; improving the federal government’s trade promotion programs with an emphasis on federal export assistance, trade missions, and increasing export credit; ensuring global economic recovery and growth; reducing barriers to trade and enforcing trade obligations; and focusing more promotion efforts on the export of services. The full report can be found here.

The Foreign Manufacturers Legal Accountability Act Envisions New Registration Requirement
The Foreign Manufacturers Legal Accountability Act, H.R. 4678, is awaiting consideration by the “lame duck” House when it reconvenes on November 15. Partly in response to several recent recalls of imported goods, the bill would prohibit the importation of consumer products, pharmaceutical products and chemicals into the United States unless the foreign manufacturer of such products has a registered agent in the United States. A registry of these agents would be maintained so that U.S. consumers would be able to pursue products liability or other civil actions against such imports. Foreign companies and importers have opposed the legislation, saying it unfairly increases selling costs and violates World Trade Organization rules, by creating a non-tariff barrier discriminating between U.S. and foreign manufacturers. Proponents, however, counter that the bill would both protect U.S. consumers by holding foreign producers accountable for unsafe products and more nearly level the competitive playing field. The House Subcommittee on Commerce, Trade and Consumer Protection has approved the bill. A companion bill was introduced in the Senate last year and referred to the Senate Finance Committee.

CBP Withdraws Its Proposed Change to First Sale Rule
U.S. Customs and Border Protection (“CBP”) has determined that it will continue to accept the First Sale Rule for purposes of valuing imported merchandise. Under the First Sale Rule, duties are applied to the price paid in the first transaction “for exportation,” even if the merchandise passes through the hands of several middlemen before arriving in the United States. As reported in previous HIGHLIGHTS, CBP in January 2008 proposed changing its method for assessing duties on imported goods to one used by other countries, which value imported goods at the price paid in the last sale prior to the goods entering the United States. Importers and trade organizations strongly opposed the proposed change because higher duties would result. CBP has now formally withdrawn the proposal. This comes after Congress, in the Food, Conservation and Energy Act of 2008 (the “Act”), required CBP to collect information from importers on whether they were using the First Sale Rule for their declared value and then to report those data to the International Trade Commission. Congress also stated that CBP could not alter the valuation method prior to January 1, 2011, and that CBP could do so then only in accordance with the terms set forth in the Act. Look for CBP to resume its campaign against the First Sale Rule some time next year.

ITC Seeks Input on Possible GSP Modifications
The International Trade Commission (“ITC”) is assessing the impact of possible modifications to the Generalized System of Preferences (“GSP”). As explained in prior HIGHLIGHTS, GSP treatment provides preferential duty-free entry for almost 5,000 products from certain designated beneficiary countries and territories in the developing world, to promote the economic growth of those regions. The modifications would remove the current duty-free status enjoyed by three U.S. Harmonized Tariff Schedule subheadings for certain beneficiary developing countries. The three subheadings are 9404.30.80 (certain sleeping bags), for all GSP-eligible countries, and 3919.10.20 and 3919.90.50 (certain types of self-adhesive plates, sheets, film, foil, tape, strip, and other flat shapes of plastics, in rolls), for Indonesia. The ITC is looking at the impact on U.S. industries, U.S. imports, and U.S. consumers and is seeking input from interested parties. The ITC will hold a public hearing on December 1. Requests to appear at the hearing must be filed by 5:15 p.m. on November 15. The ITC also is accepting written comments, which must be submitted by 5:15 p.m. on December 8.

If you have any questions concerning the subject matter addressed above, please feel free to contact any of the attorneys listed on the left.

Highlights in International Trade and Commerce by Williams Mullen is prepared for information purposes only and does not constitute legal advice. Persons seeking legal advice concerning the issues addressed in this issue are encouraged to contact competent legal counsel.

For comments or suggestions, please contact the publication editor, Jimmie V. Reyna, Esq.