DIAZ Trade Law

Customs & International Trade Law Expert

IMPORTING & COMPLIANCE ISSUES

Diaz Trade Law regularly counsels all sizes of U.S. companies from individuals, small and medium size enterprises, to Fortune 500 companies. Our expertise is in assisting companies in complying with the vast U.S. federal laws and regulations for both import and export transactions as well as supply chain security. We are your “outside, inside counsel”.
Call 305-456-3830

Meeting Your Legal Obligation When
Importing into the United States

Diaz Trade Law provides expert counsel on both Pre-Compliance issues as well as assisting to mitigate enforcement actions on an expedited basis. U.S. CBP import laws and regulations of vast importance include classification (HTSUS), valuation, country of origin marking and labeling, qualification under duty preference programs, and intellectual property rights compliance. We specialize in assisting companies apply for participation in the Customs-Trade Partnership Against Terrorism (C-TPAT), supply chain security program that assists in expediting your cargo upon entrance to the U.S. We help companies meet their compliance obligations under the Customs Modernization Act. Diaz Trade Law assists companies in applying for a bonded warehouse and foreign trade zone. We specialize in assisting in mitigating the impact of enforcement actions by federal government agencies. Enforcement actions include responding to U.S. Customs and Border Protection (CBP) requests for information (CBP Form 28), notices of action (CBP Form 29), CBP notices of detention, seizure notices, liquidated damages and penalty notices.

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Other U.S. Federal Government
Agencies Regulating Imports

Diaz Trade Law provides expert counsel in working with the many Federal agencies regulating trade, including, but not limited to, the U.S. Food & Drug Administration (FDA), U.S. Customs and Border Protection (CBP), U.S. Department of Homeland Security (DHS), U.S. Environmental Protection Agency (EPA), U.S. Federal Maritime Commission (FMC), Transportation Security Administration (TSA), and the Alcohol and Tobacco Tax and Trade Bureau (TTB),

Diaz Trade Law counsels a wide range of individuals, as well as domestic and international clients in successfully navigating increasingly complex federal laws and regulations as well as mitigating federal enforcement actions.

HOW DIAZ TRADE LAW CAN HELP YOU

 

Importing into the United States

Whether your company is new to importing, or has been in the business for years, CBP expects importers to use “reasonable care” in reporting your classification (HTSUS), value, country of origin, duty preference program, etc. This is a subjective standard; however you may still want to consult with Diaz Trade Law to make sure you’re on the right track and have the right Pre-Compliance standards in place. The first question CBP will ask is whether or not you have retained an expert (lawyer, customs broker, accountant, or customs consultant) to assist you in complying with CBP requirements. If this answer is no, and you want to import, you need to get an expert, or the penalties for non-compliance can be severe. 19 U.S.C. 1592 is the statute CBP references when issuing penalties for negligence, gross negligence or fraud – depending on the degree of culpability CBP believes you had at the time of your non-compliance. Diaz Trade Law provides customized training to get you started. Get a FREE quote today.

See relevant blog post here:
http://diaztradelaw.com/band-aid-or-stitches-whats-your-compliance-approach-2/

Customs house brokers – Powers of Attorney – Terms and Conditions

In addition to expert legal counsel, customs brokers are the most important relationship an importer will have. Diaz Trade Law advises companies on how best to manage their relationship with their licensed Customs broker, helps you negotiate language in powers of attorney, especially as they relate to “Terms and Conditions”. Licensed Customs brokers are essential, but, compliance and the “reasonable care” requirement is still an obligation of the Importer of Record alone. Your customs broker is responsible to use “reasonable supervision and control” not develop your classifications and internal compliance processes. U.S. Customs and Border Protection (CBP) holds an importer, not a broker, liable when there are errors performed on entry documentation. Diaz Trade Law assists importers in perfecting their Pre-Compliance plans, and working in harmony with Customs Brokers.

Classification

The Harmonized Tariff Schedule of the United States (HTS), is the primary resource for determining tariff classifications and deciphering customs duties owed for goods imported into the United States. Experts use the HTS, in conjunction with explanatory notes, general notes, general rules of interpretation, and Customs Binding Rulings to help determine the correct HTS. Correct classification is a part of the importer of records “reasonable care” requirement. Penalties for non-compliance can be severe. 19 U.S.C. 1592 is the statute CBP references when issuing penalties for negligence, gross negligence or fraud – depending on the degree of culpability CBP believes you had at the time of your non-compliance.

Valuation

It is essential for importers to have a system in place to properly report the correct value of imported merchandise to U.S. Customs upon entry. Otherwise, imports may be under or overpayment customs duties to U.S. Customs. Diaz Trade Law assists in analyzing valuation methodologies to confirm imports are using a correct valuation upon importation. Correct valuation is a part of the importer of records “reasonable care” requirement. Penalties for non-compliance can be severe. 19 U.S.C. 1592 is the statute CBP references when issuing penalties for negligence, gross negligence or fraud – depending on the degree of culpability CBP believes you had at the time of your non-compliance.

Country of Origin Determination & Marking

Country of origin determinations can be extremely complex when an ultimate good is sourced from multiple countries and when ascertaining the correct country of origin to use a duty preference program. U.S. Customs regulations must be carefully followed, whether it is based upon a “substantial transformation” or tariff shift. Diaz Trade Law regularly analyzes and advises clients on how to properly identify and label the correct country of origin in compliance with both U.S. Customs and the “Made in USA” rules of the Federal Trade Commission (FTC).

Duty Preference Programs

Diaz Trade Law regularly advises clients on the use of duty preference programs such as DR-CAFTA (U.S., Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua), NAFTA (U.S., Canada and Mexico), U.S.-Colombia, and U.S.-Chile Free Trade Agreements. Diaz Trade Law also assists clients in identifying how to qualify for use of the Generalized System of Preferences (GSP). Under U.S. Customs law, all imported merchandise is subject to customs duties, and it is strictly an importer of records obligation to use “reasonable care” in determining whether a duty preference program is applicable. Importers are responsible to accurately advise U.S. Customs, upon entry into the U.S., whether goods qualify for duty free treatment, and to keep accurate records to prove the declaration is correct. Penalties for non-compliance can be severe. 19 U.S.C. 1592 is the statute CBP references when issuing penalties for negligence, gross negligence or fraud – depending on the degree of culpability CBP believes you had at the time of your non-compliance. Diaz Trade Law regularly advises clients on qualification for use of duty preference programs, especially during U.S. Customs requests for information, notices of action and penalty proceedings.

Pre-Compliance Plans

Do you want to have a better relationship with U.S. Customs, or any U.S. federal government agency?

If so, Pre-Compliance is key. Diaz Trade Law prides itself upon creating custom pre-compliance plans targeting your specific business needs including all of your “reasonable care” requirements. The end goal is to expedite your supply chain with your very own custom compliance program. Often times, this will also encompass taking advantage of voluntary compliance programs.

What are my legal obligations as a U.S. Importer of Record?

A U.S. Importer of Record has vast legal obligations to meet including ensuring they have a process in place to properly identify the classification, valuation, country of origin, intellectual property rights, and free trade agreement compliance. CBP has vast resources to assist you in understanding your responsibilities as a U.S. importer.

Compliance Successes:

After successfully resolving a CBP seizure case, assisted a major electronic importer with developing a “pre-compliance” program reviewing intellectual property rights prior to importation and reporting the same to CBP proactively and thereby decreasing intensive examinations and detentions of merchandise by CBP.

Want More Information?
See relevant blog posts here:

Binding Rulings

An importer of record has a responsibility to use “reasonable care” when declaring the classification, valuation, country of origin and use of duty preference programs for merchandise upon entry to the U.S. U.S. Customs has a binding ruling program in place where importers can receive a binding determination from U.S. Customs on issues relating to classification, valuation, country of origin and use of duty preference programs, for certainty prior to importation. Diaz Trade Law regularly prepares binding ruling requests to U.S. Customs National Import Specialists in New York and to U.S. Customs Headquarters in Washington, D.C. to assist in providing importers the certainty they need to ensure compliance with U.S. Customs laws.

CBP Recordations – Protect your Trademark or Copyright by Recording it with CBP

What is a CBP Recordation?

Many companies mistakenly believe that registering a trademark or copyright with the U.S. Government provides the same protection and remedies as recording those materials with U.S. Customs and Border Protection (CBP). The processes achieve two different goals. The reason to register a trademark or copyright with the United States Patent and Trademark Office (USPTO) is to give the public notice of one’s ownership of the trademark or copyright. On the other hand, the purpose of recording a trademark or copyright with U.S. Customs is to partner with U.S. Customs to prevent the unauthorized importation of merchandise which bears a recorded trademark or copyright. U.S. Customs prevents counterfeit products from entering or exiting the United States (and included in transit goods) when registered trademark or copyright holders record their trademarks or copyrights with U.S. Customs.

Does CBP Take Recordations Seriously?

CBP takes Intellectual Property Rights (IPR) enforcement very seriously, in fact, it’s a priority. Shipments not destined for the U.S., that are merely in transit (for example from China for a brief stop in Miami to the ultimate destination in Latin America), are no exception. The fact that CBP enforces IPR rights for in transit merchandise surprises many — but lets face it, if CBP is to protect IPR rights, why should it stop at products solely destined for the U.S.?

When a trademark or copyright is recorded with U.S. Customs, infringing merchandise may easily be detected by U.S. Customs at all 328 official ports of entry across the country. Once a trademark or copyright is recorded with U.S. Customs, the owner’s information is entered into an electronic database accessible to over 60,000 U.S. Customs officers in the United States and overseas. U.S. Customs uses this information to target suspect shipments for the purpose of physically examining merchandise which ultimately prevents the importation or exportation of infringing goods. To make sure a trademark or copyright is properly recorded with U.S. Customs, consult with Diaz Trade Law. Diaz Trade Law is familiar with the process and familiar with teaching CBP how to look out for infringers.

What are the Advantages to Recording a Trademark or Copyright?

The most obvious advantage to recording a trademark or copyright with U.S. Customs, is that U.S. Customs will monitor and seize infringing merchandise at the ports of entry so that the trademark or copyright holder does not have to locate and prosecute every unauthorized importer, distributor, retailer illegally using its trademark or copyright.

U.S. Customs has the authority to issue monetary fines against anyone who facilitates the attempted introduction into the U.S. of seized and forfeited counterfeit merchandise. U.S. Customs may go to the U.S. Attorney’s Office and request that those involved in the illegal activity be criminally prosecuted under the Trademark Counterfeiting Act of 1984. First time violators of this Act are subject to penalties of up to ten years imprisonment and/or a $2,000,000 fine, while repeat offenders are subject to 20 years imprisonment and/or a fine up to $5,000,000.

Is it an Easy Process?

Trademark and copyright recordations may now be filed online with U.S. Customs’ new Intellectual Property Rights e-Recordation (IPRR) online system. CBP’s IPRR system allows holders of registered trademarks and copyrights to record their registration with CBP, so that CBP can police the borders for infringing goods. Once recorded, it is entered into an online search system named IPRS. CBP officers can be trained to identify and interdict counterfeit goods. Before logging on to record a trademark or copyright, a trademark or copyright holder should be extremely knowledgeable with the Customs regulations found in 19 CFR Part 133, and the specific questions that will be asked on the application. Otherwise, consult with Diaz Trade Law. Diaz Trade Law is already familiar with the process.

What are Grey Market Goods?

It is advisable to attempt to obtain “gray market” protection from U.S. Customs. “Gray market” goods are foreign-made articles bearing a genuine trademark or trade name identical with, or substantially indistinguishable from one owned and recorded by a citizen of the United States or a corporation or association created or organized within the United States, which are imported without the authorization of the U.S. holder.

What is the Benefit to my Company?

If you took the time to register your trademark or copyright with the U.S. Patent and Trademark Office then consider taking the extra step to record that trademark or copyright with CBP. Wouldn’t you want CBP to stop infringers, even if they are just passing through for a brief moment?

It is extremely beneficial for a company to record its registered trademark or copyright with U.S. Customs, as U.S. Customs may be a company’s greatest, and most cost effective ally when it comes to trademark and copyright enforcement.

Want More Information?
See relevant blog posts here:
http://diaztradelaw.com/intellectual-property-rights-are-high-priority-for-cbp/
http://diaztradelaw.com/u-s-customs-border-protection-seized-my-goods-oh-no/
http://diaztradelaw.com/importing-into-the-united-states-in-compliance-with-u-s-customs-border-protection-cbp/
http://diaztradelaw.com/china-sourcing-fair-how-to-solve-u-s-customs-issues-when-importing-from-china-2/

C-TPAT

What is C-TPAT?

The Customs-Trade Partnership Against Terrorism (C–TPAT) program is a voluntary government-business initiative to build cooperative relationships that strengthen and improve overall international supply chain and U.S. border security. To apply, businesses must fill out a company profile as well as a detailed security profile – which is then reviewed, approved, and validated in person by CBP. Many companies must make internal improvements to meet the required security standards the C-TPAT program entails. CBP encourages participation by providing incentives to participants meeting or exceeding the program requirements. As a result, the program helps CBP achieve its twin goals of improving security while facilitating the flow of global trade.

Who is Eligible to Apply?

Businesses eligible to apply for C–TPAT membership include:

What are the Benefits of C-TPAT Participation?

C–TPAT importers enjoy certain incentives based on their tier status within a three tier structure. Tier I incentives are afforded to those importer partners that have been certified; Tier II level to those that have been certified and validated; and Tier III incentives to those that go above and beyond – and have exceeded the program’s requirements – exhibiting best practices.

Want More Information?
See relevant blog posts here:

How Can Diaz Trade Law Help?

Diaz Trade Law regularly advises clients on the guidelines necessary to implement within your supply chain to ensure U.S. Customs you have a secure supply chain worthy of entry into the C-TPAT program. Diaz Trade Law regularly helps companies apply for admission into the C-TPAT program, go through the validation process, and assists with the yearly update process to keep companies in good standing with CBP.

Bonded Warehouse Applications

Bonded Warehouse and Foreign-Trade Zones (FTZ) may be used as duty saving tools. Miami is known as the gateway to Latin America, where merchandise from Asia is transshipped through Miami, warehoused and distributed, and sent to its ultimate destination in Latin America. In these instances, merchandise transiting through Miami via a bonded warehouse or FTZ does not incur customs duties.

What is a Bonded Warehouse?

A Bonded Warehouse is a customs regulated warehouse which must comply with strict CBP requirements. There are 11 classes of bonded warehouses. In order to become a bonded warehouse, a detailed application must be filed and background checks approved by U.S. Customs. Customs entry must still be filed for merchandise in, or transiting through a bonded warehouse. Duties are deferred until goods technically enter the United States for consumption, or are deferred altogether if exported.

What is a Foreign Trade Zone (FTZ)?

Foreign Trade Zones (FTZs), although technically within the geographic limits of the U.S., are considered outside U.S. Customs territory. Foreign and domestic merchandise may be admitted into an FTZ for operations such as storage, exhibition, assembly, manufacture, redistribution, processing, and more. FTZs allow users to defer, reduce, or eliminate Customs duties.
For example,

in South Florida, companies have multiple options. One is the Miami Free Zone, a fully functioning general-purpose FTZ. Otherwise, locally, companies can use their own warehouse locations with the Alternative Site Framework (ASF) FTZ program in place with the Miami Free Zone (FTZ 32), PortMiami (FTZ 281) and the City of Fort Lauderdale (FTZ 241).

What are the main differences between Bonded Warehouses and FTZs?

Customs Bonded Warehouses and FTZs have numerous differences that must be considered before you make your choice. An FTZ is considered outside of U.S. Customs territory; whereas, a bonded warehouse is within the U.S. Customs territory. Customs entry is made at the time goods enter the bonded warehouse, but not the FTZ. In the FTZ, entry is only made when the goods enter the U.S. for consumption. The range of permitted activities in a bonded warehouse is restricted, depending on the class of approval you request. The bonded warehouse option also necessitates a Customs bond when merchandise is admitted to the bonded warehouse. Merchandise may remain in the FTZ for an unlimited period of time, while time in a bonded warehouse is limited to five years.

The following detailed chart goes through the many differences between a bonded warehouse and foreign trade zone:
https://www.miamidade.gov/portmiami/library/ftz-vs-bonded-warehouse.pdf.

Want More Information?

See relevant blog posts here:
http://customsandtradelaw.blogspot.com/2012/07/free-trade-zones-expanding-in-miami.html

How can Diaz Trade Law Help?

Diaz Trade Law can assist you in deciding which option works best and will provide the best savings opportunity for your company. Diaz Trade Law has vast experience in successfully navigating the detailed application process and assisting companies in applying to U.S. Customs for both bonded warehouses and to Port Miami’s FTZ No. 281.

Past Successes:
Assisted in applying for and getting approval for one of the first alternative site framework applications for Port Miami’s Foreign Trade Zone (FTZ) No. 281.

Foreign Trade Zone (FTZ) Applications

Bonded Warehouses and Foreign Trade Zones (FTZ) may be used as duty saving tools.

What is a Bonded Warehouse?

A Bonded Warehouse is a customs regulated warehouse which must comply with strict CBP requirements. There are 11 classes of bonded warehouses. In order to become a bonded warehouse, a detailed application must be filed and background checks approved by U.S. Customs. Customs entry must still be filed for merchandise in, or transiting through a bonded warehouse. Duties are deferred until goods technically enter the United States for consumption, or are deferred altogether if exported.

What is a Foreign Trade Zone (FTZ)?

Foreign Trade Zones (FTZs), although technically within the geographic limits of the U.S., are considered outside U.S. Customs territory. Foreign and domestic merchandise may be admitted into an FTZ for operations such as storage, exhibition, assembly, manufacture, redistribution, processing, and more. FTZs allow users to defer, reduce, or eliminate Customs duties.

For example, in South Florida, companies have multiple options. One is the Miami Free Zone, a fully functioning general-purpose FTZ. Otherwise, locally, companies can use their own warehouse locations with the Alternative Site Framework (ASF) FTZ program in place with the Miami Free Zone (FTZ 32), PortMiami (FTZ 281) and the City of Fort Lauderdale (FTZ 241).

What are the main differences between Bonded Warehouses and FTZs?

Customs Bonded Warehouses and FTZs have numerous differences that must be considered before you make your choice. An FTZ is considered outside of U.S. Customs territory; whereas, a bonded warehouse is within the U.S. Customs territory. Customs entry is made at the time goods enter the bonded warehouse, but not the FTZ. In the FTZ, entry is only made when the goods enter the U.S. for consumption. The range of permitted activities in a bonded warehouse is restricted, depending on the class of approval you request. The bonded warehouse option also necessitates a Customs bond when merchandise is admitted to the bonded warehouse. Merchandise may remain in the FTZ for an unlimited period of time, while time in a bonded warehouse is limited to five years.

The following detailed chart goes through the many differences between a bonded warehouse and foreign trade zone:
https://www.miamidade.gov/portmiami/library/ftz-vs-bonded-warehouse.pdf.

Want More Information?

See relevant blog posts here: http://diaztradelaw.com/free-trade-zones-expanding-in-miami-dade-county

How can Diaz Trade Law Help?

Diaz Trade Law can assist you in deciding which option works best and will provide the best savings opportunity for your company. Diaz Trade Law has vast experience in successfully navigating the detailed application process and assisting companies in applying to U.S. Customs for both bonded warehouses and to Port Miami’s FTZ No. 281.

Past Successes:
Assisted in applying for and getting approval for one of the first alternative site framework applications for Port Miami’s Foreign Trade Zone (FTZ) No. 281.

Customs Audits

Under the Customs Modernization Act of 1993, importers of record have a responsibility to use “reasonable care” when declaring the classification, valuation, country of origin and use of duty preference programs for merchandise upon entry to the U.S. CBP often verifies compliance through the use of audits. Companies with over 10 million in import value are eligible for the most common audit, called a Focused Assessment. The Focused Assessment consists of an extensive review of the importer’s records (importers have a five year statute of limitations period) and documentation to prove the importer has a system in place to comply with Customs laws and regulations. For both smaller importers, and those with compliance issues, Customs uses a Quick Assessment Audit.

How Can Diaz Trade Law Help?

Diaz Trade Law assists in ensuring our clients have adequate compliance systems in place to comply with U.S. Customs laws and regulations and successfully navigate Customs audits.

Manifest Confidentiality

Importers and consignees can request that U.S. Customs and Border Protection (CBP) keep your manifest information confidential. Pursuant to the privacy statute, 19 C.F.R. § 103.31 (d) the public is allowed to collect manifest data (e.g., bills of lading) at every port of entry. This information is limited to vessel manifests. Air, rail, and truck manifests are not available to the general public in any form. Companies like panjiva.com, datamyne.com and importgenius.com (to name a few) collect and sell your import data, i.e., the names of importers, suppliers, and manufacturers from vessel manifest data.

How can Diaz Trade Law Help?

Diaz Trade Law can assist you in making a proper request to CBP for confidentiality. The confidential protection is valid for 2 years, thereafter, you have to renew your request. Diaz Trade Law keeps track of the time for you.

Want More Information?
See relevant blog post here: http://diaztradelaw.com/do-you-keep-your-manifest-information-confidential

CONTACT DIAZ TRADE LAW FOR A FREE QUOTE

 

Call 305-456-3830

Note: If you have documents you would like us to review, please email docs@DiazTradeLaw.com