Resources for Exporting: A Visit to the Mississippi Gulf Coast

Last week I visited the beautiful Mississippi Gulf Coast to attend the Gulf States Trade Alliance’s 2012 Annual Export conference from April 10-12 at the Beau Rivage Resort.  The theme for the event was “Export Resources and New Market Opportunities for Small Business”, and the markets focused on during the conference were Central America, the Caribbean, and Canada.  First, a little background on the trade alliance.

The Gulf Coast Trade Alliance consists of economic development agencies from Louisiana, Mississippi, Alabama, and Florida who come together in organizing a regional conference each year focused on international trade and exporting.  The conference highlights tools and resources available to small businesses in each of these four states that enable small business to enter into the world of international trade or grow their existing international business.

After a warm welcome, the conference started out with a discussion of Caribbean market opportunities with discussions by Robert Jones, Counselor for Commercial Affairs for the Caribbean Region (U.S. Commercial Service, American Embassy, Santo Domingo, DR) and Gandy Thomas, Consul General of Haiti Atlanta.  Mr. Jones discussed the benefits of doing business in the Dominican Republic and other Caribbean nations and noted that among  the best prospects for exporting to the region are:  construction in support of tourism, medical equipment and supplies, and renewable energy.  As many businesses engaged in export already know, the United States also has a free trade agreement that encompasses the Dominican Republic making trade with that Caribbean country even more inviting for U.S. businesses.  Mr. Thomas spoke to the fact that demands in Haiti for energy and manufacturing is huge, and the plethora of languages spoken in the region suggests that Haiti is a prime location for businesses to locate call centers.  Each speaker identified that one of the most important aspects of doing business in the Caribbean is establishing relationships face to face and keeping up those relationships even after your visit to their sunny islands.

Later in the conference we heard from Leroy Sheffer, Managing Partner, ITAS Group (Specialized Services Firm, American Chamber of Commerce & Industry in Panama) and Bryan Smith (Counselor, Commercial Affiars for the U.S. Commercial Service at the U.S. Embassy in San Jose, Costa Rica regarding opportunities in Central America, specifically Panama and Costa Rica.

Rounding out the afternoon was Jennifer Rosebrugh, the Senior Trade Commissioner for the Consulate General of Canada located in Atlanta, Georgia.  Ms. Rosebrugh extolled the virtues of doing business with Canada, the United States largest trading partner.  Similar to Mr. Jones and Mr. Thomas, Ms. Rosebrugh said that a key to international trading is to do business with honesty, reliability, kindness, friendliness, compassion, civility, forgiveness, and generosity, and these actions are much more easily undertaken with someone who you’ve met face to face than with someone solely interacted with over email and phone.

Other conference speakers discussed services that will help a small business engage in international trade.  These services are provided by agencies such as the U.S. Commercial Service, the Small Business Administration, the Southern U.S. Trade Association, the Mississippi Development Authority (or other state development boards), banks with international departments, law firms with expertise in international trade issues, customs brokers, etc.  If you are considering entering into international trade business or looking to expand the business you already have, there are many resources available.  Using these resources from the outset to ensure you are making the right choices for your company will help you succeed in both the short and long term.  Understanding both the advantages and pitfalls of international trade will allow your company to make wise decisions that will help ensure your success.

Our firm provides not only legal services for those who have already encountered issues related to international trade, but we also provide business services for those seeking to engage in or expand their trade operations in a way that helps them avoid legal problems down the line.  With over three decades of experience in international trade from both the logistics and the legal sides, we can help you ensure your company is on the right track.  For more information, please visit our website at www.customscourt.com , email us at either nmooney@customscourt.com or smorrison@customscourt.com, or call us at (850) 893-0670 or (800) 583-0250.

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Free Trade Agreement Series: Part 5- Peru and Colombia FTAs

As the US seeks to reap the benefits of free trade throughout the world, it is imperative that agreements are reached with our regional trading partners. The past two administrations have secured Free Trade Agreements with multiple Central and South American countries. Agreements with both Peru and Colombia were signed in 2006; however, the ratification process was not the same for both agreements. The US-Peru Trade Promotion Act (US-Peru TPA) was ratified on December 14, 2007 and entered into force on February 1, 2009[1]. On the other hand, the US-Colombia Trade Promotion Agreement (US-Colombia TPA) was ratified by Congress on October 12, 2011 and has not yet entered into force.[2]

Both nations previously benefited from the Andean Trade Promotion and Drug Eradication Act (ATPDEA), but in a very unusual twist, even after the US-Peru TPA entered into force, ATPDEA benefits for Peru continued to apply for some time (see our earlier Free Trade Agreement Series Part 3 for details).

As of this writing, Colombia still enjoys preferential treatment from ATPDEA, pending implementation of the US-Colombia agreement.  Like all other Free Trade Agreements other than that with Peru, once the Colombian agreement enters into force, ATPDEA benefits for Colombia will immediately end.  As an example of the effect of this, imagine an importer of suits and garments from Colombia now using Peruvian woolen cloth.   Prior to these FTAs being implemented, cumulation rules allowed them to claim ATPDEA benefits and full duty free treatment when importing to the US, since all of the labor and material was ATPDEA regional. However, a year after the Peruvian FTA entered into force, this importer could no longer use Peruvian wools and still claim ATPDEA preferential treatment since Peruvian fabrics were stripped from all their ATPDEA benefits.  The garments would now have to be duty-paid, even though all of the labor and components come from duty-free origins.

While it is true that the US-Colombia TPA has not yet entered into force, the agreement is expected to do so once the Colombian government meets certain requirements later in 2012.  This could happen very quickly, so those who import from Colombia, especially textiles that will all become duty-free once the agreement is implemented, be forewarned that ATPDEA benefits will end for Colombia when the US-Colombia TPA enters into force.  This means that any other ATPDEA content (Ecuadorian) would be excluded from duty free treatment if imported via Colombia.  Be prepared to claim for preferential treatment under the US-Colombia TPA, which will require different filing procedures than you are now accustomed to.

Here is a link for claiming preferential treatment under US-Peru TPA: http://export.gov/FTA/peru/eg_main_017979.asp

There is currently no similar link to the US-Colombian TPA since the agreement is not yet in force.

Finally, for those of you currently seeking a “short supply” finding for fibers, yarns, and fabrics not available in commercial quantities in a timely manner, note that the review and approval process of Committee for the Implementation of Textile Agreements (CITA) takes several months to complete. The US-Colombia TPA may already be implemented by the time CITA determines whether or not any newly requested fabrics could be added to the ATPDEA short supply list.  If this becomes the case, these fabrics would not qualify for preferential treatment anymore.  A new and different Commercial Availability request process will be required. Since there are yet to be published any CITA procedures for the US-Colombia TPA here is a link to the US-Peru TPA CITA procedures:

http://otexa.ita.doc.gov/fr2008/comavperuip(08-09).htm

We are assuming that the Colombian FTA procedures will be similar to those immediately above applicable to Peru.  We are already prepared to immediately file short supply requests for some clients upon implementation of the agreement.

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