As the pandemic has continued to escalate around the world, severely impacting the global economy, the Commercial Customs Operations Advisory Committee (COAC) met virtually for the second time this year on Wednesday (15.07.2020/XNUMX/XNUMX), Customs and Border Protection (CBP) reported.
According to release, the meeting of the advisory group for the implementation of the Trade Facilitation Act, began with the Acting CBP Commissioner Mark A. Morgan, who stressed that Trade continues to flow across U.S. borders“Despite COVID-19 and everything that’s going on, CBP continues to process cargo. We never stopped from day one. There was a false narrative out there that the borders had closed. That was false then and it’s false now,” he said. He added: “Americans and American businesses must continue to have access to necessary goods and supplies during this pandemic.”
Important initiatives
One proactive measure Morgan spoke of was the CBP COVID-19 Cargo Resolution Team, which was established to facilitate critical shipments of personal protective equipment and resolve cargo admissibility issues for legitimate trade. Morgan noted that since its inception in late March, the task force had answered nearly 2,500 questions from the trade community and facilitated the clearance of more than 400 Federal Emergency Management Agency-organized flights filled with critical medical supplies.
"Also We continue to seize counterfeit and prohibited COVID-related products“Unfortunately, every time there is a crisis, criminals step up to the plate to try to take advantage of it for their own greed and profitability. COVID-19 is no exception.” Morgan shared that “from January 1 to July 7, CBP has seized more than 120,000 FDA-banned COVID-19 test kits, more than 12 million counterfeit face masks, and more than 24,000 FDA-banned chloroquine tablets.
The Acting Commissioner also discussed a number of agency initiatives. United States-Mexico-Canada Agreement, or USMCA, which went into effect July 1, was one of them. “Every day, more than $3 trillion in trade transits the borders of the United States, Mexico and Canada,” Morgan said. “We know that this trade is absolutely essential to the economies of not just the United States, but of all countries in North America.”
Morgan explained that the new agreement USMCA makes compliance easier by not requiring a specific paper form. As such, it differs from the trade agreement that preceded it, the North American Free Trade Agreement, known as NAFTA. Instead, USMCA resembles more recent trade agreements such as the Dominican Republic-Central America Free Trade Agreement, or CAFTA, and the revised U.S.-Korea Free Trade Agreement.
«USMCA also improves our ability to combat human trafficking and forced labor, and expands our customs authorities to enable us to better enforce threats to human and agricultural health"Morgan said.
Regarding forced labor, Morgan told the virtual hearing that CBP has conducted several enforcement actions in recent months prohibiting the importation of goods produced with forced labor. Two release orders have been issued to prevent the importation of hair products from companies in China that use systematic forced detention and forced labor. A third release order was issued against a Taiwanese-owned fishing vessel. Working with the National Oceanic and Atmospheric Administration, CBP found indicators of forced labor, including debt bondage, excessive overtime, and restriction of movement. “The inhumane labor practices for financial gain are just disgusting,” Morgan said. “The conditions and what they make some of these people do to produce cheaper products is truly unbelievable.”
Morgan also welcomed Jon Perdue, the new executive director of CBP's Office of Trade Relations. “Jon served the past three years in USAID’s Latin America and Caribbean Office,” said Morgan, who then announced that Brian White, director of global logistics and trade compliance for The J.M. Smucker Company, would serve as one of the COAC co-chairs alongside Lenny Feldman.
Speaking on behalf of the COAC, Feldman, a senior fellow at the law firm Sandler, Travis & Rosenberg, expressed appreciation for the payment flexibility given to importers who have faced significant hardship due to the pandemic. “We were glad to see the duty deferral come into play on April 20. It was fast and furious to say the least over the 90-day period for March and April entries,” Feldman said. “About 2600 importers participated in that. Nearly $600 million in duties, taxes and tariffs were deferred. A good start,” he said. “We’re now hitting that 90-day mark, and we’re going to find that some companies may have a hard time paying those duties and tariffs. So, we’re going to have to look at the policy.”
Intellectual Property
COAC Co-Chair Brian White shared his views on a range of trade concerns, including intellectual property.l. “As a brand owner, intellectual property rights are really critical to us, especially for a food manufacturer like Smucker and other food manufacturers,” White said. “Think about food safety and food fraud and the different things that can happen with these types of branded products. Known counterfeiters, terrorists, different proliferators, and other bad actors pose a threat to the health and safety of the U.S., and the security of our economy,” he said. “So, We are looking to establish mechanisms that help identify and eliminate these bad actors from the supply chain.«.
Acting Commissioner Morgan echoed the gravity of the threat. “The American people really have no idea of the significant loss to this country on multiple fronts due to the theft of intellectual property from American companies. It’s devastating to this country,” Morgan said. “That’s why what we’re doing together as partners is so important.”
The meeting, which was also co-chaired by Timothy Skud, deputy assistant secretary for tax, trade, and tariff policy at the U.S. Treasury Department, included updates on trade programs and the work of the COAC subcommittee. Among the many topics discussed was el bonding process, which delays customs clearance and release of cargo until it reaches its final destination in the U.S. or is exported. “One of the key areas we want to address is full visibility of bond transactions,” said Michael
Young, a COAC member, vice president of business processes and systems at OOCL, a container shipping and logistics services company. “Right now, we have a number of situations where when cargo is moving under bond, not all parties within the supply chain have visibility into the status of the cargo. Some may have visibility later than others and that impacts the ability to effectively move cargo efficiently through the supply chain,” Young said. Lack of visibility can also result in huge financial penalties.
The following were also discussed benefits of participating in CBP's voluntary supply chain security program, Customs Trade Partnership Against Terrorism, or CTPAT. The COAC presented recommendations on how CBP can identify, implement, and measure benefits for businesses participating in the tiered Trusted Merchant Program. “We believe there is a need for ongoing evaluation and measurement of existing benefits, as well as the implementation of new benefits to keep Trusted Merchant Programs current and relevant as business environments change and supply chains continue to evolve,” said Alexandra Latham, COAC member and director of customs compliance for Costco Wholesale Corporation.
Recommendations
At the meeting, they were introduced 46 recommendations and were approved unanimously. Eleven of the recommendations pertained to CBP’s trusted trader programs. The remaining 35 recommendations focused on exports, remote and autonomous cargo processing, bail bonding, forced labor, intellectual property rights, bonds, antidumping and countervailing duties, and modernization of the customs broker examination.
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