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.