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SAN JOSE, Costa Rica – Costa Rica is finally ready to join the Central American Free Trade Agreement . The country signed the accord in 2004 along with the rest of Central America , the United States and the Dominican Republic. But its implementation has been stalled for four years by opposition lawmakers who didn't want to open Costa Rica's powerful state-run telecommunications and insurance industries to competition. Others felt the required intellectual-property laws dictating jail time for violators were too strict. Costa Ricans voted for the trade deal in a national referendum a year ago, moving it forward. But then it became stalled again as congress squabbled over the enabling legislation dealing with 13 different aspects of the deal. On Tuesday, lawmakers overcame the final intellectual-property hurdle by allowing schools and universities to copy some materials and by reducing prison time for those guilty of selling pirated goods. President Oscar Arias finalized the paperwork needed for CAFTA to take effect in Costa Rica: "After more than four and a half years of debate, two extensions and one historic referendum in which the majority said they agreed with the free trade accord , we are finally closing this chapter," said the president's spokesman and brother, Rodrigo Arias. Costa Rica's agriculture sector stands to benefit the most from the new agreement, particularly specialized fruits and vegetables such as pineapple and yucca. Costa Ricans are also hoping competition in the cellular phone industry will lower costs and offer more services.

Part 163 of Title 19 of the Code of Federal Regulations provide that entry records must be kept for 5 years from the date of entry. The term "entry records" is defined very broadly, and basically include any and all documentation created in the ordinary course of business relating to: (1) the importation of merchandise; (2) the transportation or storage of merchandise carried or held under bond; (3) drawback claims; and (4) the payment of duties, fees and taxes to CBP. CBP can require the production of these records from owners, importers, customs brokers or other persons involved in international trade activities.
The entry records must be produced within 30 calendar days of receipt of the demand, or within any shorter period that CBP may impose, when the entry records relate to the admissibility or release of merchandise. While not specifically listed in the Federal Regulations, the following guidelines provide a useful timetable for when records should be provided to CBP:

Failure to produce entry records in a timely manner will likely result in significant monetary penalties. If CBP makes a determination that the failure to comply is the result of a willful failure to maintain, store, or retrieve the demanded record, CBP may impose a penalty for each release of merchandise not to exceed $100,000, or an amount equal to 75% of the appraised value of the merchandise, whichever is less. In a compliance assessment or audit with multiple entries, penalties can be very substantial. Even if CBP determines that the failure to comply is the result of negligence, CBP can impose a penalty for each release of merchandise not to exceed $10,000, or an amount equal to 40% of the appraised value of the merchandise.

Penalties may be cancelled or reduced. The are numerous factors that CBP uses to determine whether to cancel or reduce a penalty such as whether the violation was committed without negligence or any intent. It is also possible, however, for a person who fails to comply with a demand by CBP for entry records to avoid the assessment of penalties altogether by showing that: (1) the loss or destruction of the requested record was caused by an event beyond the person's control; (2) the person has substantially complied with CBP's demand; (3) the record demanded by CBP was presented to and retained by CBP at the time of entry, or submitted in response to an earlier demand; or (4) the person has been certified as a participant in the Recordkeeping Compliance Program, is in compliance with the procedures and requirements of that Program, and that it was the person's first violation.

United States and South Korean negotiators struck the world’s largest bilateral free trade agreement on Monday, giving the United States a badly needed lift to its trade policy at home and South Korea a chance to reinvigorate its export economy. If ratified, the trade deal would eliminate tariffs on more than 90 percent of the product categories traded between the countries. South Korea agreed to lift trade barriers to important American products like cars and beef, while the United States agreed to allow Seoul to continue to subsidize South Korean rice.The United States will eliminate the 2.5 percent tariff on South Korean cars with engines smaller than 3,000 cubic centimeters; phase out the 25 percent duty on trucks over the course of 10 years; and remove tariffs, which average 8.9 percent, on 61 percent of South Korean textiles. Full details are available from the U.S. Trade Reprsentative here.

The Electronic Freedom of Information Act was intended to open government to the citizenry. E-FOIA amendments, which took effect ten years ago. It requires federal agencies to post key records online, provide citizens with detailed guidance on making information requests and use new information technology to publish information proactively. The National Security Archive reviewed 149 federal agency and component websites and found widespread failure. Among the key findings are that just 21 percent of federal agencies and components fully follow the E-FOIA amendments and post all of the required categories of documents online; only one third s provide the required indexes and guides to agency records; and many agency websites are poorly organized and difficult to navigate.

The National Security Archive cited NASA and the US Department of Education as examples of excellent FOIA websites and the Air Force, Immigration and Customs Enforcement and the US Department of Veterans Affairs [official websites] as delinquent websites.

Proposed changes will impact approximately 1600 subheadings in 83 of the 97 chapters to an 8 digit level recognized by the World Customs Organization and eventually to the 10 digit level we use here in United States. These changes will critically impact the chapters covering industrial and high-tech products and the concentration of changes will be found in Chapters 84, 85, 87 and 90. Schedule "B" numbers will change simultaneously with the implementation of the new version of the Harmonized Tariff. Eligibility for for various free trade agreements based on tariff shift could be seriously impacted and rules may need to be rewritten in that area. Currently, the expected changes are available in Draft Form HERE.

This new method for filing initial trademark and copyright recordation applications greatly decreases the time required to register for enforcement of your intellectual property rights. The filing of an electronic application sbegin the administrative recordation process with CBP. A separate application is required for each recordation sought. The recordation fee for copyrights is $190 and for trademarks $190 per International Class of goods. To go to the Customs registration site, click HERE.

Americans could buy and carry home prescription drugs from Canada under new proposed terms to legislaton agreed upon on September 21, 2006. Customs agents would be prohibited, as part of a Homeland Security spending bill, from seizing as much as a 90-day supplies of prescribed medicines brought across the border by individuals personally. Purchasing cheaper prescriptions over the Internet or by mail-order from Canadian pharmacies would still be prohibited. Canadian prices for many popular brand-name prescription drugs are 30 percent to 80 percent lower than in the United States, according to surveys by The Associated Press and others. The agreement was announced on the same day that Wal-Mart Stores Inc. announced it plans to slash prices for generic prescriptions to $4.00.

While importing drugs into the United States is illegal, the Food and Drug Administration generally has not stopped small amounts of medicine purchased for personal use. However, Customs officials last November began intercepting prescription drugs coming across the border. Since then, CBP agents have seized more than 34,000 packages of drugs coming into the country.

In its July 18, 2006 issue, The Wall Street Journal published a column on starting up an Import business. Neil Mooney was the first attorney selected for interview, and provided most of the information used in the article which you may read here.

In Tampa, Florida on March 29, 2006, former customs agent Rafael Francisco Pacheco Jr. was sentenced to seven years and three months in federal prison after pleading guilty to taking bribes from a narcotics trafficker. Pacheco received nearly $18,000.00 from a Mexican trafficker and money launderer to influence U.S. officials. He used some of the money to pay off a car loan at Florida Customs Federal Credit Union, and he lied to representatives at the American Consulate in Mexico about using the criminal as a source in a Tampa criminal investigation. In this manner Pacheco helped the smuggler obtain visas to the United States for himself and his family.

The U.S. International Trade Commission - Tariff Database link, located HERE will take you to an interactive data base that will enable you to get an approximate idea of the duty rate for a particular product. Note that the duty rate you request is only as good as the information you provide. The actual duty rate of the item you import may not be what you think it should be as a result of your research. Customs and Border Protection actually makes the final determination of what the correct rate of duty is. For very specific duty information on a particular item you may request a Binding Ruling and/or receive guidance by calling your local CBP port.

Importers should ensure that the Commercial Invoice contains all required information for textile commodities, as specified in the U.S. Customs regulations. General invoice requirements and specific information for certain commodities can be found in the U.S. Customs regulations at 19 CFR 141.86 and 141.89.

PRESIDENT OF STEALTH COMPONENTS, INC. SENTENCED FOR PRESENTATION OF FALSE INVOICES TO CUSTOMS ON ENTRIES

Bernard Smith, the President and part owner of a distributor of computer components, will in November begin serving a sentence in connection with a scheme to avoid paying over $385,000 in antidumping duties. A Massachusetts Federal Judge sentenced Smith to 3 years of probation, the first 4 months of which are to be spent in community confinement, to be followed by 8 months and 1 day in home detention with electronic monitoring. Smith was also ordered to pay a $30,000 fine.

In May 2005, Smith pleaded guilty to a seven-count indictment charging him with conspiracy and false statements. He admitted that from November of 1998 through May of 2000, he and others participated in a scheme to defraud U.S. Custom's in order to minimize the payment of duties on imported Korean Dynamic Random Access Memory chips (DRAMs). The scheme involved the presentation of false and fraudulent invoices to U.S. Customs that undervalued the purchase price and falsely described the DRAMs in order to lessen the payment of duties. It was alleged that Smith directed foreign suppliers to prepare fraudulent invoices and other false entry documents that would be presented to Customs at the time of entry for each shipment of DRAMs that Stealth imported.

U.S. Customs and Border Protection has issued a document providing various e-mail addresses and telephone numbers to assist importers and brokers with questions about the Automated Commercial Environment (ACE). The "ACE Resource Contact Guide" can be found at CBP's web site here, as can a wealth of information on the ACE program and its very significant benefits to the importing and Customs Brokerage community alike.

Please jump to our "FDA" page for the latest information on changes to entry processing requirements as to foreign manufacturers and imported foods. Customs penalties and/or seizure may result from habitual failure to abide these and all import regulations.

Customs has published an updated fact sheet, entitled "Frequently Asked Questions & Answers Regarding CBP Procedures under the Bioterrorism Act (BTA)." It includes general information and FAQ's regarding Customs' enforcement of the U.S. Food and Drug Administration's prior notice requirements for food imported under the Public Health Security and Bioterrorism Preparedness and Response Act of 2002.

CBP has also issued other fact sheets and guidance documents regarding implementation of the prior notice and food facility registration requirements under the Bioterrorism Act. These updated guidance documents can be found here:

Customs penalties are officially subject to uniform regulation, obviously, and one would hope they would be handled the same way nationwide. However the fact is that different ports continue to interpret and implement Inspection, Detention, Seizure, and other enforcement rules differently. Here, briefly, are the best five things you can do to minimize fines or liquidated damages:

1. React immediately: if you suspect that a problem is forthcoming and know which agent or official is involved, contact them informally without delay. Often their interpretation of your complex situation is erroneous because they have had very general training and apply it to sophisticated situations. They are intelligent people, and may be made to understand the merits of your particular case without taking it any further down the seizure/penalty road.

2. Know your rights: do not divulge more than is necessary to address the issue at hand. While you have nothing to hide, allowing agency personnel to "go fishing" as to prior shipments or practices can only lead to the loss of precious time and the delayed attainment of your goal.

3. Carefully study the allegation. Often the language of a penalty says one thing, while the code or regulation cited as having been violated relates to something different. Customs personnel get used to using certain general statutes, and frequently cite irrelevant sections when issuing penalties.

4. Heed deadlines. If you were unable to prevent the issuance of a penalty or liquidated damage notice by speaking informally with the enforcement personnel, heed the deadlines in letters and formal notices. Even responding one day late may preclude relief in a case where a timely filing might have resulted in cancellation of the notice. At the same time, you may be able to request expedited handling if your response is within particular timelines.

5. Be thorough and honest in your response. Only in rare cases do you get more than two chances to petition, and since the second one will probably not be replied to sooner than eight or nine months after the initial seizure or issuance of penalties, it is important that the first petition, which you may expect a reply to in 90 -120 days, be sufficient to allow the remedy you seek.

Handling Customs and other agency penalties is a big part of our practice. You may be able to prepare and submit the first petition successfully in accordance with your own knowledge and experience. However, under no circumstances is it advisable to submit the second (supplementary) petition yourself. That is your final chance at avoiding litigation or payment and/or forfeiture, far too important, in our view, to be undertaken independently.

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