New ADD/CVD Petition Filed Against Wood Cabinets and Vanities

This week the American Kitchen Cabinet Alliance, a group consisting of 27 US domestic cabinet manufacturers filed a new anti-dumping and countervailing duty petition against wood cabinets and vanities from China.  The scope of this petition covers wooden cabinets and vanities that are designed for permanent installation (including floor mounted, wall mounted, ceiling hung or by attachment of plumbing), and wooden components thereof that are made substantially of wood or engineered wood.

Imports of subject goods are classified under HTSUS 9403.40.9060 and 9403.60.8081, and the subject component parts may be entered under HTSUS 9403.90.7080.

Based on an analysis done by the domestic industry they estimate dumping margins in the area of 175.5% to 259.99%, with an average margin of 216.04%.

Vandegrift will follow this developing issue and continue to advise as new information becomes available.

India and Turkey to Lose GSP Status

The U.S. Trade Representative has announced that India and Turkey will lose their GSP status after a 60 day period as they no longer comply with the program’s criteria. The Generalized System of Preferences provides duty free treatment for certain products for beneficiary developing counties.

The USTR’s announcement states that India has failed to provide the U.S. with assurances that it will provide equitable and reasonable access to its markets in numerous sectors. Because India has implemented multiple trade barriers that negatively affect U.S. Commerce, it has failed to meet GSP criteria and will be removed from the program.

Turkey’s GSP status is being terminated as the country is sufficiently economically developed and no longer needs to benefit from preferential tariff treatment in the U.S. market.

These changes will not take effect until 60 days after notifications to Congress and the governments of India and Turkey. We will send a further update once the termination date has been established.

Vandegrift Blog: 21st Century Customs Framework by Janet Labuda

Last Friday, U.S. Customs and Border Protection (CBP) officially announced the kickoff of the 21st Century Customs Framework at a hearing attended by over 1,000 participants. This Framework, which is focusing on six key objectives, is designed to further modernize various aspects of CBP’s trade mission. These six aspects are:

  1. Self-funded Customs infrastructures to ensure optimum ACE operations and enhancement;

  2. Making use of cutting edge technology;

  3. Data access and sharing—better use of the vast amount of data that is collected;

  4. Emerging roles in the global supply chain such as the explosion of e-commerce transactions where the downstream consumer becomes the importer;

  5. Intelligent enforcement; and

  6. Trade processes—how CBP is conducting business.

The all-day hearing featured a number of speakers, from all segments of the trade community, who were asked to provide 5 minutes of discussion on five of the six focal points. In addition to individual companies, representatives from the American Apparel and Footwear Association, the Footwear Distributors and Retailers Association, the American Association of Exporters and Importers, the National Retailers Federation and the National Customs Brokers and Forwarders Association spoke on behalf of their constituents. These trade representatives spoke to a panel of government officials from CBP, the Departments of Agriculture, Commerce, Homeland Security and Treasury, and the International Trade Commission.

In general, the invited speakers agreed that the use of state of the art technologies was important, but that regulations and operations must keep pace. Additionally, the use of technologies like the distributive ledger/block-chain, machine learning, and artificial intelligence must be cost effective as well as deliver the intended goals of securing the supply chain and enhancing trade facilitation.

Other comments included leveraging the Automated Commercial Environment (ACE), reassessing the effectiveness of using the Automated Broker Interface in its current state, data authentication, continued partnership, co-testing through proof of concept, enhancing wireless networks, achieving the proper balance between data collection and use, to name a few. The panel also was reminded that the licensed Customs House Broker is a force multiplier and the use of brokers will enable enhanced compliance.

While very little emphasis was placed on the human aspect of the Framework, everyone agreed that improved communication was critical for any progress.

CBP will be publishing another Federal Register notice in the near future seeking additional comments and ideas for moving forward.

Section 301 Duty Increase Postponed

According to CSMS 19-000095, issued February 28, please be advised that until further notice the additional duties that went into effect on September 21, 2018 as a result of the Section 301 investigation on over 5,700 HTS numbers will hold at 10%.  

CSMS 19-000095 will nullify a prior Federal Register notice that said rates would increase on March 2, 2019.  The Section 301 duties currently apply to specified products with a county of origin of China.

Please contact Vandegrift with any questions regarding the application of 301 duties to your imported goods.

Deadline Approaching for EPA Formaldehyde Compliance

Effective March 22, 2019 importers of certain composite wood products will be responsible for compliance with the formaldehyde emissions standards under the United States Environmental Protection Agency's (EPA) Toxic Substances Control Act (TSCA), Title VI. The TSCA Title VI formaldehyde emissions standards apply to three types of composite wood products: 

  1.  hardwood plywood 

  2.  medium-density fiberboard (MDF) 

  3.  particleboard 

The foreign producer must have the products tested and certified by an EPA-recognized 3rd party.

To assist importers with the new requirements, CBP is partnering with the EPA to offer a webinar on March 6 that will cover the importers responsibilities under this regulation.   

Please contact Vandegrift with any questions regarding compliance with this regulation.

President Delays U.S. Tariff Increase on Chinese Goods

Several news sources are reporting that President Trump plans to delay an increase in tariffs on Chinese goods that had been scheduled for Friday, citing "substantial progress" in U.S.-China trade talks over the weekend.  

According the reporting Trump plans to meet with Chinese President Xi Jinping to come to a more formal agreement.

Vandegrift will continue to monitor this situation as additional information becomes available.

Vandegrift Blog: Trade Abuzz by Janet Labuda

Over the past few days, most trade publications and law firm daily releases have been abuzz with the increased emphasis by CBP on combating forced labor. I have written a number of blogs, over the last year, alerting my readers to this issue. According to the recent CBP publication “Frontline,” CBP’s air, land and seaports processed more than 33 million imports last year.  Shirts, shoes, lumber, electronics, dishes, eggplants, squid, coffee, bricks and soccer balls are just a sliver of the commerce, worth a mind-boggling $2.4 trillion, making the U.S. the world’s second largest importer behind the European Union. 

While trade is more robust than ever, CBP cautions importers to be watchful about the source of their merchandise. Importers receive their commodities at the end of long supply chains that can originate anywhere in the world—in many cases regions where oversight is lax or even nonexistent. Such conditions tempt some manufacturers, miners, commercial fishermen, farmers and other producers to squeeze more profit from their businesses on the backs of laborers, some as young as 5 years old. 

Lured by fraudulent promises and tantalizing offers, these workers soon find themselves trapped into toiling long hours for a pittance in harsh, many times dangerous jobs. CBP combats forced labor mainly through tips from the public, stakeholders and other agencies since goods made by forced labor look the same as legitimate shipments. Ultimately, “it’s up to the importer to ensure their goods comply with the law.”

Keeping this at the forefront of sourcing plans, companies need to build a credible plan to combat forced labor. This includes,

  • Creating corporate internal controls to articulate the precautions that are being taken across the supply chain;

  • Developing training for all corporate officials, including department heads, and manufacturers/suppliers;

  • Establishing strict contract provisions with manufacturers, suppliers, buying and transporters that strictly prohibit the use of forced labor anywhere in the production or transportation chain;

  • Monitoring all forced labor websites and resources for updated information. This should be done on a regular basis and the data gleaned should be used to assess areas of possible corporate vulnerability.

  • Sourcing departments should be reaching out to buying agents, manufacturers and producers and asking what steps are being taken to ensure that forced labor hasn’t permeated the supply chain.

Remember, having a coffee table document that looks impressive is meaningless unless there is a comprehensive plan that is implemented effectively. As CBP states, it is the responsibility of the importer to ensure compliance.

Please contact Vandegrift for a complete compliance analysis. 

Vandegrift Offers Free Public Access to HTS

As the Federal Government shutdown prepares to enter another week, several government websites are no longer being maintained or updated.

Included in those is access to the 2019 HTS through the United States International Trade Commission website.  Please be reminded that Vandegrift offers free public access to the HTS through our online web portal, VFI Track.

You may access the 2019 HTS here.  Please do not hesitate to contact Vandegrift with any questions regarding how the government shutdown may impact your business.

Impact of the Government Shutdown

The U.S. federal government shut down at midnight on Friday, December 21st. The Senate has adjourned for its Christmas break without a resolution, so the shutdown will continue for several more days at the least. December 24th - 25th are already designated federal holidays.

The passenger and cargo processing by U.S. Customs and Border Protection are considered essential services and will continue to operate during the shutdown. The Centers of Excellence and Expertise will be open. The Food and Drug Administration import operations will remain open as well. U.S. Fish and Wildlife Services will operate at the ports as normal, and edecs processing remains available. The U.S. Department of Agriculture’s Agriculture Marketing Service will continue to inspect cargo. The National Marine Fisheries Service will be closed. 

For other participating government agency information, please contact your Vandegrift representative for information.  We will continue to monitor the situation and bring you new information as it becomes available.

Vandegrift and USFIA Host Compliance Webinar

Please join Vandegrift's Janet Labuda and the U.S. Fashion Industry Association as they host Keeping Up With the Compliance Challenges: What Brands and Retailers Need to Know in 2019, a webinar scheduled for Wednesday, December 12th at 2:30 pm ET.

If you are wondering how to maintain control over your company's supply chain through ongoing trade disruptions and how it all impacts overall compliance we urge you to register for this important discussion.

Janet will draw upon her experience at U.S. Customs & Border Protection to discuss what can be expected in terms of enforcement and share tips on how to keep up with your supply chain, even if you’re moving to new suppliers.  

Register here.

Next Round of 301 Tariffs Hinges on Meeting with Chinese President

President Trump is scheduled to meet with Chinese President Xi on November 20th. Yesterday, Trump said the 301 tariffs on the remaining $267 billion Chinese imports will be imposed if the US and China cannot make a deal. 

Should China fail to meet demands for changes in their trade, technology transfer, and industrial subsidy policies, the US is prepared to issue “List 4” by early December with the additional duties going into effect in January or early February. 

This final list would include apparel, footwear, toys, and other consumer products. While nothing is final yet, importers should prepare for additional duties in 2019.

Vandegrift continues to follow this issue and will advise as new information becomes available.

Blog Post: VFI Track Upgrades Visual Efficiency by Josh Kohn

When people think of IT system updates they often think first of improved functionality or increased operational output. We tend to get so focused on network speed or reducing data run times that we forget to consider how important the visual component can be in positively impacting the overall user experience. It was with that idea in mind that Vandegrift's Application Development team set out to design the most recent round of VFI Track enhancements. 

VFI Track is Vandegrift’s wholly owned, in-house developed real-time data visibility on-demand report writer. VFI Track also houses several other modules including our Global Classification Tool, Purchase Order Management system, and Vendor Compliance Portal. The system was built to deliver our clients their data in a quick and concise manner without need for expensive customized programming or client IT involvement. Essentially, VFI Track becomes your in-house brokerage reporting software! 

Our latest round of improvements grew out of our desire to make the visual component as efficient as the system functionality. We are very proud to be releasing a new visual update to VFI Track on October 27.

Some key changes will include:

  • Brighter color scheme with refreshed fonts and icons.

  • Insights and Reports moved under the new Analytics module.

  • Home button and User Menu added for quick access to important pages.

  • Instructional tours added for easier system interaction and navigation.

  • Instructional tour added for Advanced Search usage (available on the advanced search screen from any module).

We will deploy the visual update during a one hour maintenance window starting at 9pm ET. Our clients will experience virtually no down time during the deployment. We are excited to roll out these visual enhancements and hope that they make your overall VFI Track experience more enjoyable.

And we’re not stopping here. We are already designing more enhancements to VFI Track in the coming weeks and months.

Please feel free to provide your feedback on the system. Your comments are very important to us and are always considered when we develop future enhancements.

Blog Post: Let the Games Begin by Janet Labuda

With additional products added to the 301 sanctions list on September 21, the familiar Olympics starting signal “let the games begin” comes to mind. As we know, with any adjustments made to trade, such as the imposition of quotas, antidumping duties, and 301 sanctions, our affected foreign trading partners are going to seek ways to continue accessing the U.S. market by using all means to circumvent the trade action.

These means include illegal transshipment through third countries, the misdescription of merchandise to change applicable duty rates, and outright smuggling. With that comes the concerns of altered/counterfeited invoices and other documents and corporate identity theft, which results in an insecure supply chain.

Importers need to carefully watch for offers, by current suppliers, to source products in third countries not included in the sanctions, to structure Delivered Duty Paid transactions, and to attempt the introduction of new supplier companies.

In changing suppliers and countries of origin, importers must take steps to verify and validate the production capacity and the security of the supply chain. If there is no history of a sanctioned product being manufactured in the third country then now is not the time to shift sourcing to that country. Any unauthorized or suggested shifts in the players should raise an alarm. It is better to sit on the sidelines than to enter the game playing into the hands of the opposing team.

If you have any concerns about merchandise on the 301 sanction list please contact Vandegrift for assistance.

Miscellaneous Tariff Bill to Take Effect October 13th

The Miscellaneous Tariff Bill was signed into law by the President on September 13th and takes effect October 13th. About 1650 items will receive tariff reductions lasting through December 31, 2020. 

Items on the list that are subject to the 301 tariffs from China will still be assessed those duties on top of any reduced duty granted by the MTB. The text of what is included may be found here. The list is mostly chemicals, but some apparel and footwear items are also included.

Please contact Vandegrift if you would like an excel version of the MTB list or have any questions regarding the implementation.

FDA Food Facility Registration Renewal 10/1 through 12/31

The Biennial Renewal of Food Facility Registration will open on October 1, 2018 and run through 12/31/2018.  

If you registered or updated your food facility before October 1, 2014, you must return to the FDA Industry Systems before December 31 to renew your registration and to provide any updated information, if applicable.

As a reminder, if you are the new owner of a registered food facility, the previous owner is required to cancel the food facility’s registration within 60 calendar days of the change of ownership and you must re-register the facility reflecting the new ownership (see 21 CFR 1.234 and 1.235).

Please remember that this renewal process repeats every two years on even-numbered years from October 1 through December 31.

Please contact Vandegrift with any questions regarding the FDA Food Facility registration and renewal process.

301 Tariffs for List 3 to Take Effect 9/24/2018

The White House announced on Monday that the 301 tariffs for List 3 will go into effect on September 24th. The final list may be found here and has been reduced by 297 tariff numbers from the proposed list of 6031. 

The tariffs will start at 10% and will increase to 25% on January 1, 2019. President Trump stated that if China takes retaliatory action against US farmers "or other industries," the US will seek to impose tariffs on all remaining imports from China worth $267 billion.

Please contact Vandegrift with any questions regarding the impact these additional tariffs will have on your business.

CTPAT Importer Criteria Update

US Customs and Border Protection has published long overdue proposed updates to the CTPAT minimum security criteria. This is the first major overhaul of the criteria since the program began in 2002. There are new sections on cybersecurity, agricultural protection, money laundering, terrorist financing, and use of security technology. Additionally, CTPAT will now encompass both supply chain security and trade compliance to bring the program into alignment with AEO (authorized economic operator) programs around the world. The new criteria are influenced by lessons learned from validations and new security threats. Security audits and training will now be mandatory. The proactive role of management is accentuated throughout the criteria.

CTPAT members are strongly urged to review the new criteria and submit comments and suggestions. The updates may be found in the Partner Library on the CTPAT portal. Customs will be accepting feedback through October with implementation expected in 2020. Validation cycles will not change. Validations in 2019 will be based on the current criteria. Validations on the new criteria will start in 2020 and will focus on a phased implementation cycle.

  • Phase 1 will be cybersecurity, conveyance and IIT security, and seal security. The cybersecurity risk assessment is the most important thing a company needs to do now.

  • Phase 2 will be security training and threat awareness, business partner requirements, and risk assessment.

  • Phase 3 will be security, vision, and responsibility, physical security, and physical access security.

  • Phase 4 will be agriculture security, personnel security, and procedural security.

As always, we remind CTPAT members to perform their annual security profile review and ensure all information is up to date. If you have any questions, please contact Vandegrift at

Voluntary SIM Filing to Begin October 9, 2018

We are reminding importers of shrimp and abalone that beginning October 9, the National Marine Fisheries Service (NMFS) will accept voluntary Seafood Import Monitoring (SIM) filings before they become mandatory after Decemeber 31, 2018.

The voluntary filing period is intended to give importers time to comply with the change in regulation and begin providing the necessary documention in order to make compliant entries once the mandatory period commences. 

Entries submitted without the proper filing codes during the voluntary period will receive a warning but will still be accepted.  After December 31, 2018 entries submitted without proper SIM data will be rejected.

Please contact Vandegrift with any questions regarding SIM requirements.

APHIS To Begin Issuing Letters For Lacey Noncompliance

The Animal and Plant Health Inspection Service (APHIS) has announced its intention to begin notifying importers and customs brokers when entries have been submitted with Lacey Act declaration errors.  

Effective October 1, 2018 the agency will send letters, via email, identifying the error and asks importers to take steps to correct future declarations.  

No corrective action needs be taken regarding the error contained in the letter but if errors continue to occur and APHIS does not see any attempt to correct future filings the importer could be subject to an investigation or possible enforcement action.

Common Lacey Act declaration errors include:

  • misidentifying the species of imported wood or wood products 

  • listing unlikely country and plant species pairs 

  • submitting incomplete declarations 

  • failing to file a declaration in a timely manner

Please contact Vandegrift with any questions regarding Lacey Act declarations.