Determination on Need for New Section 321 Regulations Expected in July, DHS Says

A determination for “whether promulgating new regulations is necessary to better define and enforce Section 321 provisions” is expected this month, the Department of Homeland Security said in a recently released report on the effort to fight intellectual property rights violations. The DHS progress report, released July 16, lists milestones and estimated timing for implementing the broader DHS strategy (see 2001240043). The milestones “focus on immediate actions and short-term deliverables that will create the building blocks for more time-intensive action that may require legislative or regulatory changes,” DHS said.

DHS and its Executive Steering Committee within the Office of Strategy, Policy, and Plans are overseeing progress toward fulfilling the DHS strategy for preventing imports of counterfeit goods. Following the release of the DHS strategy document in January, President Donald Trump issued an executive order that called for potential new criteria for importer of record numbers (see 2001310062) and other actions that could affect brokers and importers. The administration is seen as intent on changing the Section 321 provisions that allow for streamlined customs processing for low-value shipments (see 2005180009).

In addition to the Section 321 determination this month, DHS plans to begin talks within the government and with industry about “bulk abandonment, destruction, or other disposition of contraband goods,” it said. Then in October, it will “prepare administrative guidance and/or” propose regulatory changes on “responsible parties,” it said. Other actions expected to occur in July include a look at how to streamline seizure processes and the “statutory options to grant the authority to treat IPR infringing goods as summarily forfeited upon discovery by CBP or ICE,” it said. An “update of analysis of current legal framework specific to secondary liability for trademark infringement in the e-commerce environment” is also expected this month.

DHS estimates that CBP will finish a “regulatory worksheet” in August as part of a proposed rulemaking to “exclude suspended and debarred individuals from participating in the Importer of Record Program,” it said. CBP also plans to use the data from the ongoing Section 321 advance data pilot to “develop a strategy to clarify section 321 requirements and to identify how to update relevant statutes and regulations, as appropriate,” DHS said. That is estimated to happen by October.