From: David Hickmott
[DHickmott@uli-atl.com]
Sent: Tuesday, November 06, 2007
9:13 PM
To: Eric Moeller
Cc: David Hickmott; David Hickmott
Subject: Customs Brokers Caught in Import
Safety Legislative Net
Attachments: 20071106124145.pdf
Dear Valued ULI Customer,
Please see the below national pipeline issued by the National Customs Brokers and Freight Forwarders Association. We as licensed Customs Brokers have a legal obligation to make sure we are acting with “responsible supervision and control” in transacting Customs business between the trade community and Customs & Border Protection.
As per Customs Regulations CFR 111.29, “Each broker MUST exercise due diligence in making all financial settlements with CBP, in answering all correspondence from CBP timely, and in preparing and filing all entry records relating to any Customs transaction or business matter handled by him/her as a broker.”
With the below proposed bill drafted by the Senate Commerce, Science and Transportation Committee, about to be reviewed on the Senate floor in Washington, we as Licensed Customs Brokers will now be held with the highest level of accountability for violations incurred to import safety laws mandated by the Consumer Product Safety Commission.
Customs Brokers are intermediaries and act as the liaison between the importer of record and Customs and Border Protection. We do not control or determine who is supplying the product, where it is coming from, or how it is manufactured. We do not take title to the goods and rarely have physical contact with the product.
If this bill is passed, we as your Customs Broker, based on power of attorney issued to ULI to conduct Customs business on your behalf, will be required to be even more vigilant than ever when preparing Customs entry on your import shipments. With the additional scrutiny on our transactions, on a per shipment basis we will need to make sure that the CPSC does not consider us as offenders in the aiding and abetting of violating the consumer product safety laws.
Unique Logistics is an active partner in the C-TPAT program as we have already been certified and validated at the highest level. We will always look out for your best interest in every aspect of every Customs transaction.
Thank you for your continued support.
(Please note effective immediately my new email address is emoeller@uli-atl.com)
Eric Moeller
Unique Logistics International (ATL) Inc.
General Manager / LCHB
Direct Tel- 678-365-6003
Fax- 404-767-1156
TO ALL NCBFAA AFFILIATED ASSOCIATIONS:
*** URGENT LEGISLATIVE ALERT ***
IMMEDIATE ACTION REQUIRED!!!
Senate Committee Says Revoking Customs Broker Licenses Is the Remedy for Consumer Product Safety Import Violations
The Senate Commerce, Science and Transportation Committee yesterday marked up and approved S. 2045, The CPSC Reform Act of 2007, introduced by Senator Daniel Inouye (D-HI) and Senator Mark Pryor (D-AR). The bill must next go to the Senate floor. Over the objections of NCBFAA and other trade groups, the Committee included a hastily-drafted section (Section 15) that would give the Consumer Product Safety Commission (CPSC) the authority to designate customs brokers as “repeat offenders” if they are found by the Commission to have aided and abetted the importation of a consumer product that violates safety laws on “multiple occasions.” Under section 15, the CPSC can then refer the customs broker to CBP for revocation of his customs broker license. The legislation further states that CBP “shall revoke the import license of any customs broker” referred to it by the CPSC.
The bill was drafted by legislative staff with a very limited knowledge of the trade process. The original version of the bill sought to revoke “the import license” of any person who repeatedly violated the import safety laws. When the trade community pointed out to the committee staff that there was no such thing as an import license, the committee staff turned instead to the customs broker license in the committee amendment prepared just before the mark-up. Since they were dead set on revoking a license of some kind, apparently they turned to the customs broker license as their alternative.
NCBFAA and others voiced strong opposition to Section 15, pointing out that customs brokers are intermediaries in the import process responsible for preparing entry documentation and not the party they need to be pursuing for imported consumer product safety violations. The committee agreed to meet with us to discuss the language before the bill goes to the Senate floor. Nevertheless, the provision remains in the bill for now.
It is imperative that the regional associations contact your members immediately to urge them to CALL or send a FAX to their Senators, asking them in turn to contact Senator Daniel Inouye, Senator Ted Stevens and Senator Mark Pryor, as well as the Senate Commerce, Science and Transportation Committee. The message your members should deliver is attached. They can reach their Senator by calling the Capitol Switchboard at 202-224-3121 and asking for your Senator. When they reach his or her office, ask to speak to the Legislative Assistant for trade.
MESSAGE TO YOUR SENATORS
* The Senate Commerce Committee recently approved S. 2045, a bill to reform the Consumer Product Safety Commission. While we support the goal of strengthening the imported consumer product safety, this bill as drafted shows a very poor understanding of the import process and is not helpful to achieving this goal.
* I am a professional customs broker. We work with our clients -- US importers – to assist with federal agencies determining the entry of goods – by preparing entry documents and submitting payment of duties. Customs brokers are intermediaries in the import process. We do not determine who is supplying the product or where it is coming from. We do not take title to the goods. In fact, we rarely have physical contact with the product or container.
* That is why we are surprised by the remedy in Section 15 of S. 2045. It authorizes the Consumer Product Safety Commission to designate customs brokers as “repeat offenders” when they have been found to aid and abet the importation of a consumer product in violation of the consumer product safety laws on multiple occasions. No other party is named as a potential repeat offender – just the customs broker.
* We find it perplexing that the bill singles out for punishment a participant in the supply chain with the least ability to control or know firsthand about the substance of a product. We work from the information provided by the importer. We are not in a position to choose the supplier or source of a product. Naming the customs broker as the responsible party does not make sense from either a legal or practical standpoint.
* Section 15 further directs CBP to “revoke the import license of any customs broker referred to it” by the CPSC. Customs brokers do not even have import licenses. We have licenses issued by CBP to conduct customs broker business. This shows a fundamental misunderstanding of the import process by the drafters of this bill. We are not the party responsible for ordering the consumer product, for inspecting it, receiving it or selling it. We simply are handling the entry documentation that is presented to CBP. And, if they mean to take our broker licenses, they are driving us out of business for activity we cannot control – or likely even know about!
* We urge you to contact Senator Daniel Inouye, Senator Ted Stevens and Senator Mark Pryor, as well as the Senate Commerce Committee to urge them to eliminate this provision. It is counterproductive to the goal of strengthened import safety and certainly unfair to professional customs brokers.
Thank you for
your support of Unique Logistics International. We appreciate and value
your business!
Best Regards
David Hickmott - Executive Vice President
ph#404-767-0500 (ext 306)
Mobile# 678-478-6604
Fax# 404-767-3319
Customs brokers caught in import safety legislative net
A consumer product safety bill that passed a Senate committee last week
contains a nasty surprise for customs brokers -- the possible loss of their license
for repeated entry of unsafe imports.
Commerce, Science and Transportation staff inserted the provision
on Oct. 30 during final editing of the Consumer Product Safety Commission
Reform Act of 2007, which increases the agency's enforcement authority and
funding levels.
The original version of the bill said any importer who repeatedly
brings in products that violate consumer product safety law could be referred
to Customs and Border Protection to yank its import license. Committee members
subsequently realized that there is no such thing as an import license, so they
substituted customs brokers as the target of the repeat offender rule because
they require a license to do customs business, industry lobbyists involved in
the issue said.
Under the provision, brokers found by the Consumer Product Safety
Commission to have aided or abetted in the transportation of unsafe products
can have their license revoked.
The legislation is a reaction to numerous recalls of tainted or
faulty toothpaste, pet food, toys, tires, fish and other products from China
this year.
"This bill is about safety,” said Chairman and co-sponsor
Sen. Daniel Inouye, D-Hawaii, in a statement. “Harmful products continue to
enter the stream of commerce, resulting in tens of thousands of deaths, tens of
millions of injuries, and hundreds of billions of dollars in losses to our
country each year. These numbers are too high, and an effective CPSC should
help reduce these grievous losses.”
Customs broker industry representatives expressed surprise at
being included in legislation targeted at the manufacturing industry. Brokers
do not have first hand knowledge about the product or suppliers -- they simply
process customs documentation and make sure all information passed to them by
the customer is properly submitted and import fees paid.
"We told them that a customs broker had no knowledge in
almost every instance of the nature of an importation, the specifics about the
content of the product, where it was made," said Jon Kent, legislative
representative for the National Customs Brokers and Forwarders Association of
America.
The association wrote co-sponsor Mark Pryor, D-Ark., that
"the entire bill talks about responsibilities of manufacturers, retailers
and distributors -- parties who are beneficial owners of the product and have
contractual relationships with suppliers. Yet, when it comes to the penalty,
the legislation turns to the customers’ broker, who is not in a position to
choose the supplier or source of a product. This does not make sense from
either a legal or practical standpoint."
Lobbyists said they are fighting to strip the provision out of the
bill, which now may have to go to the Senate Finance Committee because it
involves customs matters. The bill could have gone straight to the Senate floor
for a vote if it simply focused on consumer product law and not customs law.
Committee staff claim that the customs broker language is just a placeholder
until an import penalty solution is found, Kent told Shippers' NewsWire.
"The customs broker community is up and arms and been calling
their congressmen all over the country. It’s unprecedented how upset they are.
It’s partly because their licenses are at stake and because it’s such a
ridiculous provision. For our community, it undermines confidence in the
institution," he said.
The bill, which includes measures that impact the import and
logistics industries, would also:
* Ban importation of recalled products.
* Require independent, third-party certification of children's
products.
* Mandate tracking labels (source, date, production batch) on
children's goods to enhance recalls.
* Increase CSPC funding by 58 percent during the next seven years.
* Restore the commission to five members, from three. (The
commission is operating with only two members now due to a vacancy).
* Increase staff to at least 500 employees by 2013.
* Streamline product safety rulemaking procedures.
* Ban lead from children's products.
* Foster information sharing among federal, state, local and
foreign agencies about unsafe products.
* Increase civil and criminal penalties for violating consumer
product safety laws.
* Provide whistleblower protection for manufacturers' employees.
* Require companies to identify their manufacturers and
subcontractors in the supply chain.
* Require bonding of manufacturers to ensure funding for recalls.
* Enhance the CSPC's authority to order corrective action plans by
the makers of recalled products.
The House version of the consumer protection bill does not include
the customs broker provision. The Energy and Commerce Committee is scheduled
Tuesday to hold a hearing on product safety, followed by a markup session and
vote on Thursday.
The committee has investigated recent widespread findings of lead
in children’s products imported from China, and the nation’s system for
recalling defective or tainted products. In August it sent letters to 19
retailers and importers requesting information on their findings of lead.
Meanwhile, more than 110 companies and trade associations
expressed concern about provisions in pending food safety legislation that
would impose user fees on shipments of imported food to help pay for Food and
Drug Administration inspections.
In a Nov. 1 letter to Rep. John Dingell, D-Mich., chairman of the
Energy and Commerce Committee, the business groups said the cost of FDA
research and inspections should be paid for out of general tax revenue because
the benefits accrue to all citizens.
"In addition, the fee proposed in H.R. 3610 would likely
violate America’s trade agreements, invite foreign countries to impose
reciprocal fees on U.S. exports, and unfairly impact specific food
products," the letter said.
The industry letter expressed strong opposition to provisions to
permit a private right of action against food companies and retailers, new
requirements for labeling, traceability, certification, civil penalties,
process controls, quarterly inspections and to restrict food imports to a limited
number of ports.
The measures "would place enormous new burdens on FDA, food
importers, and the food industry and would dramatically increase food prices
without addressing the sources of contamination," it said.
The industry groups said risk-based safety checks were more
effective and that Congress should help the FDA and the food industry expand
the ability of foreign governments to detect and deter threats to public safety