Tim Warren

RANCHO MIRAGE, California -- Much of the $34 million in "additional money earmarked for ACE" within the recent omnibus government funding bill is already "planned out," said Jim Swanson, CBP director-cargo and conveyance security and controls, while speaking at the National Customs Brokers & Forwarders Association of America's annual conference on May 1. "That money was to be allocated for new development or enhancements in the ACE process," he said. CBP has a priority list, he said. Among the factors for the priority list was a list of requests provided to CBP from the NCBFAA (see 1802200043).

CBP is working on a regulatory update for its prohibition on imports made by forced labor that it hopes will offer some guidance for compliance, said Brenda Smith, executive assistant commissioner-trade at CBP, while speaking at an April 25 American Apparel and Footwear Association event. That should help to alleviate some, but not all, of the concerns over a change in law that requires CBP to treat goods made by North Koreans as made through forced labor, Smith said. "We also have been looking at our regulations to understand where the gaps are and why we are not as effective as we would like to be," she said.

The internal debate on the role of foreign-trade zones in e-commerce is ongoing within the government, said Brenda Smith, executive assistant commissioner-trade at CBP, while speaking at an American Apparel and Footwear Association event on April 25. "I recognize that, from a business perspective, people are very interested in reducing their duty costs," she said. "It presents an interesting policy question, really, for the Department of Commerce, about 'what are FTZs for, why do we want them?'" CBP is considering a ruling on whether larger shipments can be brought to FTZs and then broken up into smaller shipments valued under the $800 de minimis threshold (see 1804130042).

Despite an increased focus on illegal fentanyl shipments at the federal level, the effects so far on commercial cargo have been minimal, Frank Russo, acting director of CBP’s New York Field Operations, said in an April 23 interview. "We've done a pretty good job of identifying the threat in the mail environment," said Russo, who is overseeing CBP's efforts to prevent illegal entries of the drug. "When it comes to the express world, you know DHL, FedEx, UPS, we haven't really seen too much of it there. It's mainly been something that's been more in the mail facility." Such issues are almost nonexistent through commercial cargo modes in air or ocean shipments, he said.

Trade groups for clothing companies and retailers would like to see Congress take up legislative language that would allow for yarns and fabrics to be treated as duty-free "components," the group said in an April 23 letter to leadership of the Senate Finance and House Ways and Means committees. "The proposed program would firmly root U.S. inputs into global production supply chains by signaling that U.S. content -- whether that content comes in the form of a recognized stand‐alone component or is otherwise incorporated into a finished article -- is exempt from an applicable import duty," the U.S. Hide, Skin and Leather Association said in a news release. The groups, which also include the U.S. Fashion Industry Association, the American Association of Exporters and Importers and the National Retail Federation, said "congressional action is needed now."

CBP will allow for a valuation based on the first sale between an unrelated manufacturer and a middleman related to the importer of record after the port of entry said otherwise, the agency said in a Feb. 27 ruling. The importer, Tillsonburg Company (USA), successfully demonstrated through documentation that a "bona fide sale" had in fact occurred, CBP said in HQ H268741. Sandler Travis filed the protest on behalf of Tillsonburg in 2015.

Comcast updates to its X1 system allow its X1 set-top boxes to fall outside the scope of an International Trade Commission limited exclusion order (LEO) issued in November against the company (see 1711270031), CBP said in a March 5 ruling that was recently released. The CBP ruling marks a potentially important win for Comcast, which has been litigating STB patent issues with Rovi, now named TiVo, for years. "Comcast has carried its burden of demonstrating that the changes made to the X1 system will prevent Comcast’s customers from using the modified X1 system, of which the STBs at issue are a component, in a manner which directly infringes," CBP said in the ruling.

The slew of trade remedies "changes everything" for importers, making programs like drawback and foreign-trade zones more valuable to companies that previously didn't need to consider such options, said Amie Ahanchian, KPMG managing director, Trade and Customs Services, during an April 16 KPMG webinar. Of the 1,333 tariff lines on the Section 301 list (see 1804040019), about 60 percent, or around 800 line items, are duty-free today, she said. That means "if you're importing these items, you may not have ever considered a customs planning strategy because there were no duties to mitigate in the current trade environment," she said.

Misclassification and valuation are among areas of enforcement focus for CBP's administration of the Section 232 tariffs on steel and aluminum, CBP officials said during an April 10 interview. "Classification is a way to play with it, valuation as well, but these are things we will have to look at," said John Leonard, executive director of trade policy and programs at CBP. There are some different considerations involved for looking at possible transshipments because most antidumping or countervailing duty evasions involve countries around China, such as Malaysia or Thailand, but those countries are affected by the 232 tariffs too, he said. "It's hard to put it in that same context," he said.

CBP will expand its definition of "importer" under Importer Security Filing (ISF) regulations, the agency said in a notice. Despite some concerns raised by the National Customs Brokers & Forwarders Association of America and the World Shipping Council (see 1609120024), the final rule adopts the definition changes as proposed in 2016 (see 1607050028). The rule will take effect on May 14.