CBP Planning 'Live Entry' Requirements on Steel Imports, Says White House as Customs Bill Becomes Law

CBP plans to address illegal steel imports from China through some "enhanced enforcement measures," the White House said in a report that touted the Obama Administration record on trade enforcement (here). The White House released the report in conjunction with President Barack Obama's signing of customs reauthorization legislation on Feb. 24 (see 1602240042). Among other efforts, CBP will require live entry for high risk steel shipments, meaning "all entry documents and duties" are to be "provided before cargo is released by CBP into U.S. commerce," said the White House.

Live entry requirements are already in place for "certain shipments of steel plate from China," said the White House. The agency is now in the process of looking at other high-risk steel imports that could be subject to the requirements, it said. CBP will also "be implementing enhanced reviews of Chinese steel imports which will provide a statistically valid measure of risk, increase the reviews of Chinese steel imports, and provide targets for further enforcement," said the White House. The agency also plans to increase "operational measures on steel imports, including audits of steel importers," the White House said. CBP didn't respond to a request for comment.

There's also an ongoing diplomatic effort to reduce illegal imports involving several international organizations, the White House said. Through the Joint Commission on Commerce and Trade, the Strategic and Economic Dialogue and the Organization for Economic Cooperation and Development Steel Committee, the U.S. seeks to "to work with China and other governments to reduce excess steelmaking capacity and mitigate the damaging effects of excess capacity on the U.S. and global markets," the White House said. Additionally, the Commerce Department plans to implement an enhanced steel data analysis program that will supplement the Steel Import Monitoring and Analysis program, said the White House.

While laying out trade enforcement plans, Obama lauded the efforts that resulted in the customs reauthorization bill during the signing ceremony (here). "It was a hard piece of business, but what it does is it helps us enforce our trade agreements by providing more resources for enforcement, by streamlining the process whereby we can bring an action if a country is illegally dumping goods or involved in countervailing duties," said Obama. "It makes sure that these other countries are playing by the rules, and it gives us more personnel to do it as well."

Reactions from within and outside the government were mostly positive. Department of Homeland Security Secretary Jeh Johnson celebrated the new law for making a number of improvements to current customs processes. "Most important," the law gives CBP its "first comprehensive authorization" since DHS was created in 2003," he said (here). Several lawmakers, including the Senate Finance Committee leadership (here and here) and Rep. Dan Lipinski, D-Ill. (here), celebrated the new law.

Among the law's most important features is an increase to the "de minimis" threshold to $800, under which shipments receive expedited handling at the border, said Mike Mullen, executive director of the Express Association of America. That change will mean cost savings "for millions of individual consumers who import single items which will not require a more formal entry process" and smaller companies "that import low value components for their assembly operations," said the EAA. By "establishing the highest de minimis level in the world," the U.S. showed "global leadership on an issue that will not only benefit a country’s economy, but also conserve public funds for other purposes." The American Apparel and Footwear Association also praised the law (here), highlighting simplified drawback provisions and intellectual property rights protections.

The drawback changes are "some of the most significant changes in the law" said law firm Sidley Austin in a summary of the law (here). While the "enacted legislation also asserts Congress’ strong desire to pass a miscellaneous tariff bill in the future" continuing disagreement "over whether temporary duty suspension bills constitute earmarks, passage of such a bill is not likely to happen during the current Congress," the firm said. The new law also sets the stage for CBP to begin promulgation of implementing regulations (see 1602240026), which "should provide important opportunities for input by the business community," said Sidley.