Yesterday, January 22, 2018, U.S. Trade Representative (USTR) Robert Lighthizer announced the imposition of safeguard tariffs on solar cells and modules. Much has been said in the general press about this case, but only now is the key point starting to register, and is something international traders immediately thought about – is President Trump starting a new trade war with China?
By way of a quick summary, after seeking relief through the antidumping and countervailing duty laws and not getting the desired market relief, Suniva, later joined by SolarWorld, invoked Section 201 of the Trade Act of 1974. The appropriate petition was brought, the International Trade Commission (ITC) conducted the required proceedings, found detrimental harm, and made recommendations to the President. While disagreement among the Commissioners was acknowledged, most favored an increase in duties, and President Trump agreed. Safeguard tariffs have been imposed for four years – the maximum length of time permitted – on a per year basis – 30%, 25%, 20% and 15%. The USTR announcement also states the first 2.5 gigawatts of imported cells are excluded from the safeguard tariff. A critical point here is these safeguards are being imposed on both the cells and the modules, regardless of where made, as would be expected from a global safeguard, but the solar cells are overwhelmingly made in China. (more…)
Earlier this month, MSK attorneys David Rugendorf and Frida Glucoft published an Alert summarizing the latest directive issued by Customs and Border Protection (CBP) regarding the search of electronic devices. A copy of their original article can be found here – Hold That Call International Travelers. Given the increasing likelihood of any traveler’s electronic devices being subjected to a search, whether arriving or departing the U.S. by air, ocean or land, these recent changes warrant a deeper dive.
First, for those who want to read the actual document, it is CBP Directive 3340-049A. As the earlier Alert noted, CBP has the broad rights to search any individuals, luggage, and cargo entering and leaving the U.S. Searches of cargo are governed by other laws and regulations. This directive deals only with arriving and departing travelers and their devices. (more…)
In the September 18, 2017 Federal Register notice (see 82 FR 43556) , U.S. Citizenship and Immigration made clear it will now routinely require those applying to enter the U.S. to provide social media handles. As such, the obvious starting point for these tips must be a reminder that Customs and Border Protection (“CBP”) officers may require arriving travelers to provide the unlock code to their electronic devices and user names/passwords to gain access to programs, including social media accounts, so make sure all your programs are closed when you cross the border! The contents on your devices can be examined, and that is true whether or not you are a U.S. citizen, and regardless of your profession. If you are selected for such an inspection, you can expect this two page summary may be handed to you.
The national security concerns of protecting the homeland allow CBP officers to inspect passengers and their belongings without meeting the Fourth Amendment protections against unreasonable search and seizure. A CBP officer is not required to articulate why he or she directs you to secondary or why you or a particular device is of interest. (more…)
On September 21, 2017, President Trump issued an Executive Order (yet to be numbered) (“EO”) imposing additional sanctions on North Korea. It took effect the next day. The general press has quoted Treasury Secretary Mnuchin as stating: “Foreign financial institutions are now on notice that going forward they can choose to do business with the United States or North Korea, but not both.” These latest changes raise the specter for even more caution on the part of companies conducting international business. The question every CFO at every company should ask is – is our due diligence program as good as it needs to be? If not, your funds could get seized and dealing with the Dept. of Justice in these types of cases can be quite challenging. The government often has information the private sector does not possess and, if your due diligence program is not deemed sufficient, you stand little chance of getting those funds released. Given the current climate, you can bet getting funds released related to the North Korea sanctions is going to be even more difficult!
The new Executive Order is broadly worded to include any person who is determined: (more…)
Two actions took place at the end of last week which heighten concerns that a trade war with China could be ever more likely. First, there was the preliminary decision in the solar panels 201 case. Then, we had the additional sanctions imposed by the President on North Korea.
The 201 solar panel case began when Suniva Inc. and SolarWorld Americas Inc. filed their cases before the International Trade Commission (“ITC”) in April and May 2017. These actions are, of course, in addition to the antidumping and countervailing duties currently being imposed on these products from China. (more…)
Today, President Trump signed into law H.R. 3364, the “Countering America’s Adversaries Through Sanctions Act”. The general press is covering this story by writing about Russia’s initial retaliation taking the form of cutting the staff authorized at the U.S. embassy in Moscow and the seizure of certain U.S. diplomatic property within Russia. When it comes to international traders, the impact on dealing with Russia, but also Iran and North Korea, takes the form of enhanced compliance efforts.
The new law will provide more in the way of direct and indirect sanctions. A direct sanction arises because the person (or company/entity) is listed by one of the relevant U.S. agencies on the appropriate blocked persons list. A secondary sanction arises because a blocked person (individual or entity) owns or has a controlling ownership in a company not otherwise listed as blocked. Of course, additional headaches exist when there is U.S. content in the good being sold, so the impact is on both exports and imports. (more…)
“Trump cracks down on Cuba” or variations on that phrase have peppered the general press since Friday, when the President announced his policy towards Cuba. When you read what was actually written, you come away with a more tempered reaction. Yes, there will be changes, and the most critical one is yet to come, but we focus here on what was actually written.
First, the format is not an Executive Order but rather a June 16, 2017 “National Security Presidential Memorandum on Strengthening the Policy of the United States Towards Cuba” accompanied by a Fact Sheet. The memo can be found here, and the Fact Sheet here. So, nothing changes right away.
Taken together, there are two points that could impact international traders. (more…)
Are you the importer, consignee, or agent for food imported into the United States? If so, the Foreign Supplier Verification Program for Importers of Food for Humans and Animals (FSVP), a key element of the Food Safety Modernization Act (FSMA), likely applies to you. Implementation of the FSVP will begin on May 30, 2017, but categories of companies or foods may be subject to later compliance deadlines. Where do you fit?
The FSVP regulations aligns with key components of the FDA’s overall food safety plan for facilities that manufacture, process, pack or hold food which must now establish and follow the regulations regarding current good manufacturing practice (CGMP) and hazard analysis and risk-based preventive controls for human food and animal food (Preventive Controls or PC).
With the ever-increasing scrutiny being brought to compliance and the payment of duties on imported goods by Customs and Border Protection (CBP), it is worth commenting that any duties which are due when an entry liquidates may, in fact, end up having to be paid even if the related protest remains pending due to the legal and contractual relationship between the importer and his surety company. Simply put, if a surety insists on receiving payment of any amounts demanded by CBP upon liquidation, the importer does not have any solid grounds to object. Why would the surety do so if a protest is pending? Because the surety is looking to mitigate its risk. If the importer does not pay, the surety will have to do so, at least up to the face amount of any bonds it has written, and sureties try their best not to be put in that position. (more…)
On April 18th, President Trump issued an Executive Order (“EO” or “Order”) focused on the Buy American laws and regulations. See Buy American EO. This EO directs federal government entities to review their procurement rules so that, to the extent legally permitted, preference is given to American made goods. Section 2 specifically states: “[i]t shall be the policy of the executive branch to buy American and hire American”. At the same time, the EO confirms: “[n]othing in this order shall be construed to impair or otherwise affect … existing rights or obligations under international agreements”. So, what does this EO mean to the private sector when it comes to government contracting?
First, it is important to keep in mind the review triggered by this Order applies only to federal procurement. States and other governmental entities have their own rules. They cannot contradict the federal rules, but they can be different.
Next, nothing in this Order has any impact on privately funded projects. The typical example given in the general press is the Keystone Pipeline. Nonetheless, the point is you are only impacted if you are providing or intend to provide goods to a U.S. government entity. (more…)