Customs and International Trade Law Blog

Do You Know the Top 10 Tips When Importing?

Jennifer Diaz — Tue, 18 Jun 2013 13:10:28 -0500

Do you know the top 10 tips when importing to ensure compliance? If not, here's why you should attend my Compliance Online webinar on June 27, 2013 at 10:00 a.m., EST.

If you import merchandise into the U.S., you are the responsible party and must be aware your requirements and potential liability. In this presentation, we will discuss how to comply with U.S. Customs and Border Protection’s (CBP's) vast laws and regulations. By the end of the webinar you will know and understand the importance of:

Tariff classification;
Customs valuation;
Country of origin marking;
Intellectual Property Rights (IPR) Protection and CBP Enforcement; and
Free Trade Agreements (FTA) you should be taking advantage of.

You will also learn basic customs concepts and terms like:

CBP Form 3461 & CBP 7501;
Protests;
Seizure cases;
Liquidated damage claims, Penalties/Fines;
Prior disclosure; and
FP&F Petition Process.

Learn key best practices and hear real life case studies. Learn what to do, and more importantly, what NOT to do, and what the consequences are for non compliance.

To register for this webinar on June 27, 2013 at 10:00 EST, click here.

Export Regulations and Cloud Computing...Beware!

Jennifer Diaz — Tue, 28 May 2013 12:05:51 -0500

Co Authored by Perry Sofferman

Forrester Research predicts that the global market for cloud computing services will have increased from $40.7 billion dollars in 2011 to approximately $241 billion dollars by 2020. You can see the ZDNet article here. This figure includes the Platforms as a Service, Infrastructure as a Service and Business Process as a Service delivery models. What this information reveals is that while cloud computing is already a significant part of operational strategy for many businesses (as well as governmental agencies), we should expect it to not only grow as a market but to become even more intertwined with the way we conduct business and store data on a daily basis. Consequently, businesses in general and export compliance officers in particular need to be vigilant and make sure that their use of this important technology is consistent with US export regulations.

When using cloud services, the user is uploading data to available servers in the cloud provider’s server facility(ies). The type of data uploaded and the location of the server where that data is stored can potentially trigger export compliance issues for the user. In fact, the ultimate location of the particular server used to hold the user’s data may be unknown to either the user or the cloud provider. Data can be redirected to various servers in different countries in order to properly allocate server space based on fluctuations of usage in different time zones. It should be noted that this is only one example of several possible scenarios where the actual export of restricted data could occur inadvertently by the user.

Based on Advisory Opinions issued by the Bureau of Information and Security (“BIS”), there is guidance indicating that in scenarios where exports take place through means of cloud computing:

(i) the cloud computing provider is not the exporter (the user is) and
(ii) if foreign nationals employed by the provider access restricted data there may well be a deemed export of such data to such foreign national on the part of the user.

If, however, a cloud computing service provider is aware that the service will be used to support certain proscribed activities, then the provider will be obligated to properly acquire the necessary license. Neither the Directorate of Defense Trade Controls (DDTC) nor the Office of Foreign Asset Controls (OFAC) have yet provided substantive guidance on the subject of export regulations in relation to cloud computing, although OFAC has provided some limited guidance related to exports to Iran involving software and services incidental to personal communications. “Cloud Computing” remains an undefined term in the EAR, ITAR and OFAC regulations.

Top 5 Tips for Export Compliance Professionals in Regard to Cloud Computing

It is critical for compliance officers and others involved in export control management, including providers of cloud computing services, to take steps to better familiarize themselves with the many complex issues at play in this area. A good start would be a detailed review of the BIS advisory opinions, which can be found here.
In addition, users of cloud services should think about how to approach this issue with their providers. Users might consider gaining a good understanding of where their provider’s servers are located and whether the providers have instituted any safeguards to address export compliance issues. Likewise, providers may want to delve more deeply into the ITAR regulations with particular emphasis placed on the relation between cloud computing services and “brokering” activities.
Compliance officers should make sure that members of their organizations are aware that export regulations are applicable to cloud services and that while the storage of data in the cloud might feel virtual, the penalties for export regulation violations remain brick and mortar.
While exporters remain liable for violations of export regulations, compliance officers should work with their IT departments when negotiating terms to agreements with cloud services providers. For example, require the service provider to notify you in the event servers are added in geographic locations that might be problematic for you. See if it is possible to obtain a right to terminate in such instance. In addition, try to get the provider to indemnify you in the event there is an export violation as a result of a provider’s action or inaction.
Make sure a review of how your organization uses cloud services is part of your standard compliance self-audit so as to identify any possible problems or lapses before they become significant.

In a speech in 2012, Under Secretary of Industry and Security, Eric Hirschorn, noted that a future project for the Bureau might be a review of “for clarification’s sake – the rules regulating cloud computing.” For both users and providers, such a review should be anxiously awaited.

June 10 - FSMA Rules Will be Released!

Jennifer Diaz — Wed, 22 May 2013 09:18:41 -0500

The U.S. Food and Drug Administration (FDA) has been court ordered to set firm dates for FSMA's implementation. Details of the court case forcing FDA to set these dates, and the organization that sued the FDA to make this happen follow.

Background

The Center for Food Safety (CFS), a national non-profit public interest and environmental advocacy organization, filed a lawsuit against the FDA on August 29, 2012. The complaint alleged FDA failed to promulgate 7 food safety regulations required by the Food Safety Modernization Act (FSMA). Congress enacted the FSMA – which was signed into law on January 4, 2011 – to modernize food safety laws and regulations by mandating science-based standards and controls; by providing the FDA with greater authority to prevent and address food safety hazards by taking steps to prevent them from occurring; by strengthening the FDA’s inspection and enforcement powers; and by improving coordination among federal, state, and foreign food safety agencies. CFS documented the foodborne illness outbreaks since FSMA was signed into law, January 4, 2011.

Court Order

The court case is being heard by Judge Phyllis Hamilton, in the U.S. District Court for the Northern District of California. Yesterday, May 21, 2013, Judge Hamilton ordered that the FDA and CFS have an extended deadline of June 10, 2013 to file a joint statement with a mutually agreeable proposed schedule for the outstanding food safety rules.

Rationale for Suit and Missed Deadlines

The ongoing battle between the CFS and FDA to complete this process has lasted for several months. On August 2012, the CFS filed a suit against the FDA Commissioner after the FDA missed a series of deadlines for publishing the regulations mandated by the Food Safety Modernization Act. After numerous deadlines went by without the release of the mandated rules, CFS went to court to try to force FDA to adhere to these time constraints. Following the court appearance, Judge Hamilton ruled that the FDA must come up with a new schedule for issuing the proposed rules by May 20. This extension came about as a result of the inadequacy in time provided for the FDA and CFS to resolve their differences regarding the schedule FDA suggested to issue the proposed rules.

The FDA sent its updated schedule to CFS on May 15; however, CFS was not satisfied with the proposed timeline. Due to the fact that there were only five days left until the deadline expired, the parties filed a Joint Stipulation for Extension of Time. This extension was granted by Judge Hamilton.

New Rules Released by FDA & What's to Come

Since CFS filed its complaint last year, FDA has released some of the key FSMA mandated rules it failed to publish on time, including preventive controls for human food and standards for produce safety, both released in early January. However, there are some rules that are yet to be released. Among them is the foreign supplier verification program (section 301). This program is set to overhaul import safety, an establishment of regulations to ensure the safe transport of food products and a rule ensuring neutrality of third-party audits. I think of it akin to C-TPAT (Customs-Trade Partnership Against Terrorism). It's a self policing and auditing type program that includes functions like monitoring records for shipments, lot-by-lot certification of compliance, annual on-site inspections, checking the hazard analysis and risk-based preventive control plan of the foreign supplier, and periodically testing and sampling shipments.

I look forward to seeing and reporting on FDA's implementation of FSMA.

ACI's Import Compliance & Enforcement Conference,

Jennifer Diaz — Mon, 06 May 2013 17:00:25 -0500

The American Conference Institute will be having its 8th Import Compliance and Enforcement Conference on June 11, 2013, in Washington DC. The conference will consist of two days full of lectures discussing highly complex U.S. import compliance challenges, along with how to satisfy Canadian and Mexican customs authorities. Unlike previous conferences, this unique event is designed to provide attendees with a comprehensive benchmarking experience, where participants can exchange best practices and lessons learned for 2013 and beyond. Some of the most notable industry experts that will be present are Chrystler, Hershey, Williams-Sonoma, Boeing, IBM, General Electric, Cisco, Tyco and yours truly.

This event is uniquely designed to maximize benchmarking on how to resolve the most complex, pressing import compliance issues affecting the industry. The new program features for 2013 are:

Two highly focused sessions on valuation and transfer pricing:
ISA member case studies: New and longstanding members speak about their recent experiences, and how to meet ISA requirements.
Inside a focused assessment: Lessons learned from recent experiences on how to handle common and unanticipated CBP requests
C-TPAT and Foreign Re-Validations: Meeting new expectations for C-TPAT risk assessments, and how the new EU Mutual Recognition Agreement affects importer validation requirements
NAFTA, CAFTA, and US-Korea - FTA success stories:
- The finer points to minimizing duties, fees, taxes, red tape, and proving origin
Developing a global strategy for customs classification and tariff engineering.

One of the most notable topics discussed will be broker selection and management. I have the privilege to discuss important aspects within the broker selection and management process such as:

Detecting warning signs: How far you need to go in conducting due diligence.
Designing a questionnaire for brokers: Assessing the skills, experience, and resources of customs brokers.
Evaluating brokers’ supply chain relationships
Quantifying risk factors
Communicating compliance expectations and requirements to brokers, and developing guidelines for your brokers
Where the importer and broker responsibilities begin and end
Incorporating contractual safeguards, including audit mechanisms
How to monitor compliance, and what to do if you suspect or discover non-compliance by a broker
Auditing foreign brokers, and conducting periodic review sand site visits
When and how to terminate the relationship
What constitutes customs brokering and business,and how to avoid unintended brokering activities

The conference will kick-off with discussions about strengthening global trade compliance. Meredith Covey, Director of Customs Operations and Compliance at Williams-Sonoma Inc., will discuss real world issues related to the implementation and monitoring of monitoring a global import compliance program. She will discuss structures, resources, tools, and techniques leading companies are using to implement, manage, and monitor an import compliance program. Following the conclusion of multiple speakers discussing these aspects, a discussion on Canadian customs regulations and enforcement will ensue. Eric Trudel, a Manager of CBSA, will discuss the key concepts and common pitfalls to compliance in Canada.

The ACI offers my clients and colleagues, and you, my special blog followers, a discounted price to attend the conference on June 11-12. This rate will expire on May 17th. Contact Adina Schwartz, JD, at 310-295-9789 or A.Schwartz@AmericanConference.com to get your discounted rate! You don't want to miss this!

Ready to Travel to Cuba? OFAC Simplifies Process

Jennifer Diaz — Mon, 29 Apr 2013 18:00:03 -0500

On April 18, 2013, the Office of Foreign Assets Control ("OFAC") announced its effort to streamline license processing procedures by accepting requests for licenses, license amendments, and interpretive guidance electronically. This will not only simplify the process for those that wish to travel to Cuba, this new electronic application program can also be used for applications to request the release of blocked funds and much more.

For those that are more "old school" - you still have the opportunity to submit applications by snail mail pursuant to 31 C.F.R. § 501.801.

The new electronic OFAC License Application Page will allow users to apply:

to travel to Cuba (for many, though not all, categories of travel to Cuba);
to export agricultural commodities, medicine, or medical devices to Sudan or Iran pursuant to the Trade Sanctions Reform and Export Enhancement Act of 2000;
for the release of a wire transfer blocked at a U.S. financial institution; and
for a license or interpretive guidance in all other circumstances (referred to generally as Transactional).

For those wishing to travel to Cuba in a jiffy, you must first consult an expert to review and assure you understand the Comprehensive Guidelines for License Applications to Engage in Travel-Related Transactions Involving Cuba. Once you know that you can apply to OFAC for your specific category of travel - the next step is reviewing the online application page.

Thus far, the electronic form may be used to apply for licenses to travel to Cuba in the following categories of travel, which are not generally authorized pursuant to 31 C.F.R. 515:

Journalistic Activities
Professional Research and Professional Meetings
Religious Activities
Support for the Cuban People
Humanitarian Projects Activities of Private Foundations
Research or Educational Institutes Exportation
Importation
Transmission of Information or Informational Materials
Licensed Exportations

The OFAC has stated that they intend to update the online application system in the future so that all the categories of travel (including family visits, educational activities, public performances, clinics, workshops, competitions, and exhibitions) may be applied for using this streamlined online process.

If you want to travel to Cuba, want to export agricultural commodities, medicine, or medical devices to Sudan or Iran, have funds blocked by OFAC, or want interpretive guidance from OFAC, assure you consult a regulatory expert so you have the best chance for success with OFAC.

Do You Keep Your Manifest Information CONFIDENTIAL?

Jennifer Diaz — Mon, 15 Apr 2013 12:13:15 -0500

Did you know importers and consignees can request that U.S. Customs and Border Protection (CBP) keep your manifest information confidential?

If you are currently letting your competitors know your source, read on, and learn how to keep your private data private!

Pursuant to the privacy statute, 19 C.F.R. § 103.31 (d) the public is allowed to collect manifest data (e.g., bills of lading) at every port of entry. This information is limited to vessel manifests. Air, rail, and truck manifests are not available to the general public in any form.

Websites such as panjiva.com, datamyne.com and importgenius.com (to name a few) collect and publish the names of importers, suppliers, and manufacturers from vessel manifest data. This can be troubling for some, as your competitors are able to access information related to the sourcing and/ or manufacturing of your products. However, an importer/shipper may make a request to CBP for confidentiality. The confidential protection is valid for 2 years, thereafter, you have to renew your request.

The public may obtain manifest data at every port of entry. However, Section 103.31 states that

Only the name and address of the shipper, general characteristics of the cargo, number of packages, gross weight, name of the vessel, port of exit, port of destination, and country of destination may be copied and published.

The regulation also states that

An importer or consignee may request confidential treatment of its name and address contained in inward manifests, to include identifying marks and numbers. In addition, an importer or consignee may request confidential treatment of the name and address of the shipper or shippers to such importer or consignee.

It is essential that you send in renewal requests 60 days prior to the expiration of the 2 year confidentiality period. The importer will receive a response when the confidentiality request has been granted and it will state the effective time period.

CBP sent a message to trade on Feburary 7, 2013 (CSMS #13-000064), titled "improperly formatted ACE ocean manifest data resulting in release of confidential data." CBP made it clear that after an importer requests confidentiality, and its granted by CBP, the importer must be sure the commercial party names submitted to CBP always match - CBP will not grant confidentiality if you use any variation of the name originally requested. One incorrect keystroke by an individual who is processing the information can result in a new variation of company information that is not covered by the grant of confidentiality. CBP has stated that the release of confidential data is strictly the result of improper data entry by users and not by CBP programming or system errors.

To assure you send an effective request for confidentiality and so your competitors don't have access to your private data, contact me today!

Seizure Averted - Why a Customs Lawyer is Essential at Detention

Jennifer Diaz — Mon, 01 Apr 2013 10:39:40 -0500

Sitting with your head down moping about U.S. Customs and Border Protection (CBP) holding your goods is never the right answer!

Two days ago, a potential client called and explained that a valuable shipment was detained by CBP. The potential client asked if I could help recoup the goods from CBP, during this detention phase, or if they should wait.

When I get this question, I always want to scream, NOW!! This is the most essential time an importer has. Here's the real question - do you want an expert in Customs law to assist you before your goods are guaranteed to be stuck in CBP for months, or work on getting them back for you NOW?!

I always request pertinent information about the commodity and the supposed rationale for the detention (if you don't have this information yet, I help you get it). In this case, the potential client adamantly stated that the goods were legitimate, gray market goods; however, CBP was skeptical.

I advised the potential client that obtaining my services at this point would be the BEST option so I could clearly determine and explain to CBP the legitimacy of the merchandise and demand the release. After being hired, I immediately began working on the case due to the exigency of the circumstances. My tasks were to understand the basics of the commodity, learn the history of the product, and prove the legitimacy of the goods before CBP made a decision to seize them.

The consequences of not taking these immediate actions would be the potential seizure of the goods. More importantly, if the goods are seized by CBP, it could take several months (sometimes years) before they may be released. The great news is within 1 business day I was able to convince CBP that the goods were in fact legitimate gray market goods, and they were released. Waiting an extra week to get me involved would have been the difference between a detention by CBP (and release of the goods) or CBP's seizure of the goods, and many months (or years) before the goods were released (with storage fees to pay!).

Thereafter, I worked with this client and discussed pre-compliance - which is especially important to understand why the detention occurred in the first place and how to avoid a similar situation from re-occurring.

Hiring an expert in CBP laws, prior to the seizure of the merchandise saved this client much time and a considerable amount of expenses. If your business is going through a similar issue with CBP, contact me during the detention phase, preferably before the seizure notice is issued!

Sequestration Causes Furloughs in CBP - What This Means for You

Jennifer Diaz — Mon, 25 Mar 2013 10:18:54 -0500

International passengers at Miami International Airport (MIA) have certainly felt the detrimental effects caused by the sequestration, as thousands have missed connecting flights - because of CBP processing delays.

The sequestration has created hard caps on the amount of government spending due to the government's inability to compromise on a budget. Prior to the sequestration, CBP stated that they would ensure that their core mission would not be compromised, and under no circumstances would CBP diminish their commitment to completing their responsibilities. On March 11, 2013, CBP began sending furlough notices to all of its 60,000 employees as the agency aims to make $754 million in cuts required under the sequestration. The furloughs are set to begin on April 21, 2013 and continue through September 30, 2013.

These furloughs will...

put full time employees on unpaid leave for no more than 14 workdays.
pro-rate furlough time for part-time workers.
freeze hiring
reduce and eliminate overtime and compensatory time

CBP agrees the biggest hit to border security comes from cuts to overtime. CBP will see income cut by 40%. Partly as a result of having to take up to 14 unpaid days off work.

What should importer/exporters and those involved in international trade expect?

Cargo processing during arrivals/departures outside normal business hours may experience delays until the following business morning. This roll over of work may in turn provide for regular cargo processing delays which are expected to take from 30 minutes up to a few hours during regular working hours. The daily tasks completed by cargo processing are not expected to be reduced. However, additional work usually performed during normal overtime shifts will be added to these daily shifts thus providing for extra delays!

CBP has prioritized perishable goods due to the obvious health risks involved. Agricultural products will also be prioritized to avoid spoilage and delays of these delicate products. The Food and Drug Administration (FDA) has commented that they are not expecting any direct impact to their operations and will immediately notify the industry if they anticipate any negative effects to sequestration. For the Transportation Security Administration (TSA) at Fort Lauderdale Airport (FLL) overtime was immediately ceased, with the exception of security checkpoints. Staff has been kept on to accommodate delayed departing flights. TSA is still evaluating possible furloughs.

For now there are still many what-ifs, and that uncertainty is already taking its toll.

What can be done? Advise Congress now on how CBP furlough's will negatively impact your business.

FDA Discusses TOP Reasons for Detention of Goods

Jennifer Diaz — Wed, 20 Mar 2013 11:01:08 -0500

At today’s Import Operations Training, sponsored by the U.S. Food and Drug Administration (FDA) and the Florida Customs Brokers and Forwarders Association (FCBF), top officials from FDA traveled to Miami to educate importers and brokers. Topics ranged from a general overview of FDA compliance, TOP rationales for FDA detentions, Food Safety and Modernization Act (FSMA) updates, an overview of the newly re-organized (now DIO) Division of Import Operations (formerly DIOP - policy has now been removed), an overview of CBP & FDA’s Joint Team 488 – which handles liquidated damages claims for underlying FDA violations and much more. Highlights of the TOP rationale for detentions follows, as I feel this is of most value to you to know and is arranged by commodity.

Food Products Top Rationales for Detention

Manufacturer (processor, packer or person holding food product) is not registered with the FDA pursuant to the Bioterrorism Act. (You can Register with the FDA here: www.FDA-USA.com)
Low Acid Canned Foods (LACF) are imported without establishment registration (FCE #) or scheduled process (SID #)
The products are subject to an Import Alert
Product labeling is not compliant (FDA does not pre-approve food labeling, it is up to importers to assure it is compliant before importing)
Common labeling violations include:

Label is not in English
Incorrect or missing statement of identity
Failure to list allergens
Failure to declare ingredients
Failure to include a proper “Nutrition Facts” label (incorrect formats for Nutrition Facts labeling is also common) required by 21 C.F.R. 101.9
Color additives are not declared correctly (or at all) on the label or not certified
Food additives are unsafe or not declared on the label

Dietary Supplements Top Rationales for Detention

The products are subject to an Import Alert
Product labeling is not compliant (FDA does not pre-approve dietary supplement labeling, it is up to importers to assure it is compliant before importing)
Common labeling violations include:

Label is not in English
Unauthorized health claims
Undeclared active ingredients
Lacks a “Supplement Facts” panel required by 21 C.F.R. 101.36
Failure to list the name of product and “Dietary Supplement” or “Herbal Supplement” on the label
Failure to list the appropriate disclaimer necessary when claims are made

Cosmetics Top Rationales for Detention

The cosmetics are subject to an Import Alert (for example IA 66-38 for cosmetics labeled with drug claims)
The cosmetics are contaminated and unsafe to use
The cosmetics are manufactured under unsanitary conditions
The cosmetics contain a non-permitted color additive
Product labeling is not compliant (FDA does not pre-approve cosmetic labeling, it is up to importers to assure it is compliant before importing)
Common labeling violations include:

Label is not in English
Labeling is missing ingredients
Label lacks warnings and adequate directions for use
Missing the net quantity of contents
Cosmetic contains a “drug” claim

Drugs Top Rationales for Detention

The cosmetics are subject to an Import Alert (for example IA 66-41 – Unapproved new drugs)
Drugs are not registered or listed with the FDA
Product labeling is not compliant (FDA does not pre-approve drug labeling, it is up to importers to assure it is compliant before importing)
Common labeling violations include:

Label is not in English
Label does not contain adequate directions for use
Active Pharmaceutical Ingredients (API) is not properly labeled or listed
Drug contains a “new” chemical or a different dosage making the product a “new drug”

Medical Devices Top Rationales for Detention

The manufacturers is not registered with the FDA
The initial importer is not registered with the FDA
The device is not listed with the FDA
The product does not contain a 510k or PMA
Product labeling is not compliant (FDA does not pre-approve medical device labeling, it is up to importers to assure it is compliant before importing)
Common labeling violations include:

Label is not in English
Label is false or misleading

Bottom line, as you can see, it is up to you, the importer to perform pre-compliance and assure you get compliance right before you import. FDA expects you to know the requirements and has little mercy if you don’t. Assure you stay compliant and avoid the top rationale for FDA to detain your goods by hiring someone that is extremely knowledgeable with FDA’s laws and regulations and continually stays up to date with the constant changes.

Expedite Your International Expansion Strategy

Jennifer Diaz — Tue, 12 Mar 2013 18:25:33 -0500


Jennifer Diaz, Esq. jdiaz@becker-poliakoff.com
Alhambra Towers 121 Alhambra Plaza 10th Floor Coral Gables, Florida 33134 Tel: 305.262.4433 Fax: 305.442.2232

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Expedite Your International Expansion Strategy

UPS is sponsoring a free International Symposium and breakfast hosted by David Ruiz, President of the UPS Florida District.

Learn how you can expedite your company’s international expansion strategy with the help of the UPS.

Topics Include:

How to Make Connections in Emerging Markets,
Sandra Campbell, Director, Tampa Bay Export Assistance Center, US Commercial Services

Navigating International Trade Laws and Regulations,
Jennifer Diaz, Attorney at Law, Board Certified in International Law, Becker & Poliakoff

How to Finance the Global Supply Chain
Vicki Marks, Manager, UPS Capital

UPS Solutions to Demystify International Logistics
Rusty Richardson, International Area Sales Manager, UPS

Wednesday, March 27th, 2013

UPS APAC Facility
111 S US Highway 301
Tampa, FL 33619

Breakfast Starts at 8:00 a.m.
Symposium Concludes at 11:30 a.m.

Click Here for Event Flyer.

Please Contact Olga Diaz (olgadiaz@ups.com)
to RSVP or for additional information.

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This message was sent by Becker & Poliakoff, 3111 Stirling Road, Fort Lauderdale, FL 33312.

File Your Petitions Timely, Or Else...

Jennifer Diaz — Wed, 06 Mar 2013 10:22:50 -0500

As of January 9, 2013, Customs and Border Protection (CBP) is making procrastinators pay the price for filing untimely petitions that seek relief from liquidated damages. CBP amended it’s guidelines for the cancellation and mitigation of claims for liquidated damages in cases where petitioners are late in filing claims for relief. Additionally, CBP also changed the formula for calculating late petition mitigation.

Current Rule for Timely Petitions

Under the existing regulatory authority, in order to be considered timely, petitions for relief in response to claims for liquidated damages must be filed:

A. By bond principals within 60 days from the date of mailing of the notice of liquidated damages (see 19 C.F.R. 172.3(b)) or any lawful extension thereof; or
B. By sureties within 60 days of the demand for payment by CBP (see 19 C.F.R. 172.4) or any lawful extension thereof.

When circumstances so warrant, extensions of the time period to file a petition may be granted by the FP&F Officer (FPFO) if such an extension of time is requested during the 60-day period available for timely filing a petition (see 19 C.F.R. 172.3(c)). The amendment to the current rule does not allow a petition for relief to be considered if it is filed after (a) the commencement of sanctioning action against the bond principal or (b) the issuance of a notice to show cause against the surety.

A party responsible for a liquidated damages claim may submit an offer in compromise to CBP pursuant to 19 U.S.C. § 1617 and 19 C.F.R. 161.5. These new guidelines, which will be applicable to all liquidated damages claims for which a late petition is filed on or after Jan. 9, are applicable only to petitions for relief and do not apply to offers in compromise submitted pursuant to 19 U.S.C. 1617 and 19 C.F.R. 161.53.

Consequently, the new mitigation guidelines concerning untimely petitions will impose a more stringent standard. Untimely petitions will be accepted or considered only if the petitioner is able to demonstrate the existence of extraordinary circumstances that prevented the petitioner from filing a timely petition or timely seeking a lawful extension of time in which to file a petition. What does that mean? The FPFO will exercise his or her discretion in determining whether circumstances existed so as to warrant CBP’s consideration or acceptance of a late petition.

Untimely Petitions will NO longer be Accepted

Subject to the permitted exceptions, no untimely petition will be accepted in any circumstance if it is filed:

a. More than 180 days after the date of mailing of the notice of claim to the bond principal, or in the case of a surety, the date of mailing of the first demand on surety;
b. After the petitioner has previously submitted a petition in the same case and/or been offered mitigation in the same case, and such mitigation amount was not paid within the prescribed period;
c After the claim has been referred to Office of Chief Counsel for collection action;
d. After the commencement of sanctioning action against the bond principal; or
e. After the issuance of a notice to show cause against a surety.

CBP notes that (a) an untimely petition is not a supplemental petition described in 19 C.F.R. 172.41, (b) a supplemental petition must be timely filed following a decision on an original petition filed in accordance with the established regulatory time frames, (c) the rejection of an untimely petition does not constitute a “decision” for purposes of 19 C.F.R. 172.41, and (d) petitions that are filed untimely and not accepted for consideration will be rejected. A party responsible for a liquidated damages claim may submit an offer in compromise to CBP pursuant to 19 U.S.C. § 1617 and 19 C.F.R. 161.5.

The Exceptions…

However, untimely petitions for relief of liquidated damages claims issued for the late filing of an entry summary, the late payment of estimated duties (including under the periodic monthly statement test), the late payment of passenger processing fees or the late filing or late payment of reconciliation entries may be accepted without regard to the limitations expressed in paragraphs a and b above at any time prior to the circumstances described in paragraphs c through e.

New Mitigation Calculation for Late Petitions

CBP has also implemented a new calculation for mitigating liquidated damages for untimely petitions. In calculating the mitigated amount on a late petition, CBP will first determine the base amount (i.e., the amount of mitigation that would have been afforded on a timely petition). CBP will then determine the “additional mitigation amount” by multiplying the full assessed amount of the claim by 0.1 percent (.001) and then multiply by the number of days the petition is late (i.e., .001 times the number of days late times the full assessed claim amount.) The product will be the additional amount which will be added to the base amount to produce the mitigated amount applied to the untimely filed petition. In no case will the additional mitigated amount to be added to the base amount be less than $400. For example, a $100,000 liquidated damages claim for which a petition is filed 30 days late will be mitigated to the amount provided by the guidelines plus an additional amount calculated by the new formula (30 days late x .001 = .03 x 100,000 = $3,000 added charge.)

Bottom line, assure you have an expert Customs attorney assisting you to fight for mitigation of Liquidated Damages claims, and file your Petitions TIMELY!

Jennifer Diaz Speaks After Dominic Veneziano at Global Clinical Sourcing & Supply Summit

Jennifer Diaz — Wed, 27 Feb 2013 14:56:31 -0500

I'm thrilled to be included as a speaker in the upcoming Global Clinical Sourcing and Supply Summit in Philadelphia. I've included all the pertinent details about the summit and even a discount for you, my loyal readers!

WHAT: Global Clinical Sourcing and Supply Summit. Includes a FDA Address by Domenic Veneziano, Director of FDA's Division of Import Operations and Policy, and Industry Perspectives by speakers from Merck, Novartis Pharmaceuticals Corporation, AstraZeneca, and much more. The full agenda may be seen here.

WHEN: March 4-5, 2013

WHERE: Radisson Plaza - Warwick Hotel, Philadelphia, PA

WHO: You will benefit by attending if you are a Vice President, Director, Manager, or other Senior Executive from a pharmaceutical or biotech company with responsibilities in: Clinical Supplies, Supply Chain Planning and Forecasting, Clinical Labeling, Clinical Sourcing, Procurement, Investigational Materials, Global Logistics, Clinical Contracting, Clinical Packaging

WHY: My portion of the Summit will cover an update on current import and export control, discussion of free trade agreements in place and top trading partners, top tips to utilize when importing or exporting to assure compliance with federal government laws and regulations, and how to effectively resolve issues from U.S. Customs and Border Protection (CBP) when importing.

To give you EVEN MORE of an incentive, email me for the Promo Code to save $500 off the registration fee! Offer expires on March 4, 2013 - so don't delay!

If that's not enough for you, I leave you with an additional TOP 10 Reasons to Attend:

Hear directly from the FDA on Import processes and requirements
Optimize your communication strategies with clinical operations
Understand the risks and rewards with central versus local sourcing options
Ensure efficiency while meeting the expectations of sites, patients and regulators
Develop strategies to monitor the changing regulatory requirements in emerging markets
Analyze the complex logistical and distribution challenges in India
Effectively resolve U.S. Customs and Border Protection (CBP) issues
Establish a metrics-driven system to enhance contractor performance
Reengineer current packaging process to streamline efficiency
Navigate global quality, compliance and regulatory challenges

To give you EVEN MORE of an incentive, tell them Jennifer Diaz sent you by using Promo Code GCSSP5 and save $500 off the registration fee! Offer expires on March 4, 2013 - so don't delay!

Be Bold - Women in Transportation Recap

Jennifer Diaz — Thu, 14 Feb 2013 18:54:13 -0500

Pictured above from left to right: Natalie Putman, Michelle Livingstone, Jennifer Diaz, Monica Wooden, Andy Funk

Bold is the operative word of the day. 250 people gathered at Miami Dade College today to hear about educational and career opportunities for women and minorities in the transportation/supply chain industry. The event was put on in collaboration with the Organization of Women in International Trade (OWIT-South Florida), and the Council of Supply Chain Management Professionals (CSCMP). The audience was composed of high school and college students as well as industry professionals. The message was incredibly positive, after all, trade is booming. Jennifer Diaz, Partner & Chair of Becker & Poliakoff’s Customs and International Trade Department, cited U.S. Customs and Border Protection (CBP) statistics from its recent import trade trends, stating CBP processed 2.38 trillion worth of imported goods in 2012, up 5% from 2011. The top trading 5 partners, in order, include China, Canada, Mexico, Japan and Germany.

The audience heard from an all-star lineup composed of: Michelle Livingstone, Vice President of Supply Chain/Transportation at the Home Depot, Natalie Putnam, Vice President of Marketing at Ryder System, Inc., Monica Wooden, CEO & Founder of MercuryGate International, Inc., Andy Funk, CEO & Treasurer of Cambridge-Lee Industries, and was moderated by Jennifer Diaz.

The educational opportunities in Supply Chain at Miami Dade are extremely promising. Miami Dade announced two new degree programs it plans to offer, an Associate of Science in Transportation and Logistics, expected to roll out Fall 2013, and a Bachelor of Applied Science, expected to roll out Fall 2014. Michelle Livingstone elaborated on the importance of education and said “education can never be taken away from you,” when motivating the audience to say yes when fortunate to have a company pay for higher education opportunities. “Only 10% of women choose careers in supply chain as a major in college, it is ripe for women,” continued Michelle.

Michelle inspired the audience with her road to success, which included a map filled with 10 different locations all over the U.S. where Michelle had worked. “Sometimes you have to relocate to get ahead,” said Michelle. Michelle made it clear and matter of fact that “women must work harder to succeed then men,” and success “is 80% attitude and 20% aptitude.”

Natalie Putnam introduced a new concept, stating “problem finders” are tremendously valuable. Not problem solvers, but, instead, problem finders. Those that have the aptitude to find problems are much more so needed by organizations to evolve. Natalie commented that there are “multiple paths to success” and “1 in 9 people every day are in sales jobs” – a quote taken from Daniel Pink. Natalie discussed the importance and existence of the sale function in every line of work.

“It was encouraging to see so many women interested in the dynamic and growing supply chain field. The speakers were inspirational in sharing their experiences and how they navigated through and were successful in traditionally male dominated careers,” said Andy Funk.

Careers for Women in Transportation

Jennifer Diaz — Mon, 04 Feb 2013 10:30:35 -0500

"Be Bold! Women in Transportation" will feature prominent women in the transportation, logistics and supply chain management industry. The purpose of the event is to inform about career opportunities and attract women and minorities to the transportation industry.

I'm thrilled to moderate this event where you'll hear from top notch keynote speakers, Michelle Livingstone, VP of Supply Chain/Transportation at The Home Depot and Natalie Putnam, VP of Marketing at Ryder.

Join us to learn answers to the following questions:

Why aren't more women choosing Supply Chain/Transportation as a career?
How will jobs in Supply Chain/Transportation evolve over the next few years?
What does the logistics function look like within a manufacturing/distribution business?
How have energy prices affected the Transportation Industry?
What impact does the changing demographics of the US have on opportunities for women in the supply chain field?
What is the role of sales and marketing in supply chain, logistics and transportation?
What is changing in business culture and what do companies need to do to acquire talent?
What are the skills needed to be successful in the field of logistics today?
Why is a career in supply chain a good choice?

The cost of luncheon is $30 in advance and $40 at the door. Click HERE to register.

For more information contact Jorge Guerra.

CBP Brings Seizure & Forfeiture Notices to the 21st Century

Jennifer Diaz — Fri, 01 Feb 2013 10:11:33 -0500

Co Authored by Michael DeBiase.

U.S. Customs and Border Protection (“CBP”) has published a final rule (the “Rule”) providing CBP with the ability to publish seizure and forfeiture notices on the Department of Justice (“DOJ”) forfeiture website. CBP believes that such notices will reach a broader range of the public, at less cost, than the current local print publications or customhouse postings.

You know what? CBP is right, and kudos to them for this added efficiency that goes into effect on February 28 of this year.

Pursuant to the Rule, CBP will post all seizure and forfeiture notices for thirty (30) consecutive days on the DOJ’s site. Thereafter, CBP may still publish notice in print form when it deems such additional outreach appropriate.

The beauty of the Rule is that it provides a vehicle by which both the government and the party interested in the seized goods to share in the greater efficiency, streamlined procedures, and reduction in costs offered by giving electronic notice. This will also make it easier for the interested parties to assert claims for the seized property.

This is a change that needed to happen, and although the process and site will surely experience “growing pains”, the efficiency and cost savings should prove well worth it.

If you do receive a seizure notice, remember, you must file a Petition within 30 days of the seizure notice or, if seeking judicial review of the seizure, file a claim and cost bond equal to 10% of the value of the seized merchandise, up to a maximum of $5,000.

For a summary of the seizure process, review our blog "U.S. Customs Seized My Merchandise, Now What?"

We leave you with our top 3 tips:

Perform Pre-Compliance PRIOR to importing merchandise into the U.S. Assure the merchandise you will import is compliant with applicable laws/regulations.
If CBP detains your products, contact a knowledgeable customs attorney or customs broker to actively demonstrate that there is no violation. Getting the case resolved in the detention phase is essential. Otherwise, the seizure case will be much more costly and timely.
If CBP seizes your products, make sure your customs attorney knows the policies, procedures, and practices of CBP to effectively pursue the release of the merchandise.

FDA's Busy Implementing FSMA - Significant New Food Safety Rules are Coming

Jennifer Diaz — Wed, 30 Jan 2013 10:31:16 -0500

The FDA has proposed two new rules issued under the Food Safety Modernization Act (FSMA) that is part of a broader effort to prevent food borne illness and ensure the safety of imported and domestically produced foods. If you want your voice heard, you have until May 16, 2013 to submit your comments to the FDA on the proposed rule. The FDA does take comments seriously, we're here to help if you want assistance in drafting your comments. This rule is expected to be published shortly following the conclusion of the comment period on May 16, 2013.

The proposed rules would apply to facilities that manufacture, process, pack or hold human food. The rules focus on commonly identified routes of microbial contamination of produce, including:

(1) agricultural water

(2) farm worker hygiene

(3) manure and other additions to the soil

(4) animals in growing areas, and

(5) equipment, tools and buildings.

In general the facilities that are required to register include manufacturers, processors, warehouses, storage tanks, and grain elevators. However, there are a number of exemptions and modified requirements. We would be pleased to assist you in determining whether or not your facility may be exempt from these requirements.

Below is a recap of the proposed rules.

Rule #1 - Preventative Controls for Human Food. The rule proposes firms have written plans in place to identify potential hazards, put in place steps to address them, verify that the steps are working, and outline how to correct any problems that arise. The rule proposes each covered facility to prepare and implement a written food safety plan, which would include the following:

hazard analysis;
risk based preventive controls;
monitoring procedures;
corrective actions;
verification; and
recordkeeping

Do you have your written plan in place yet?

Rule #2 - Produce Safety. The second rule proposes enforceable science- and risk-based safety standards for growing, harvesting, packing and holding fruits and vegetables on foreign and domestic farms. These standards include requirements addressing major areas specific to agriculture that can be the conduit for contaminants:

Irrigation and other agricultural water
Farm worker hygiene
Manure and other additions to the soil
Intrusion of animals in the growing fields.
Sanitation conditions affecting buildings, equipment and tools

The proposed rule also includes additional provisions applicable to the growing, harvesting and packing of sprouts, which are more vulnerable in their growing environment to harmful bacteria.

The rules still to come are:

Foreign Supplier Verification for Importers: This program will require importers to verify that foreign suppliers are following procedures that provide the same level of health protection as that required of domestic food producers. About 15 percent of the food consumed in the U.S. is imported, including about 49 percent of fresh fruit and 21 percent of vegetables.
Accredited Third Party Certification: The accreditation of third-party auditors would help ensure that food producers in other countries comply with U.S. food safety laws.
Preventive Controls for Animal Food: This is the implementation of preventive controls at animal food facilities that are similar to those proposed for human food.

As FDA implements more of FSMA, we will keep you informed.

Do you need assistance in submitting a comment to FDA? Does your company need training on FSMA? If so, contact me anytime.

On February 1, 2013 Many Food Facilities Face Suspension

Jennifer Diaz — Tue, 22 Jan 2013 15:43:25 -0500

The U.S. Food and Drug Administration (FDA) extended the deadline for the biennial registration renewal for food facilities until January 31, 2013. Your time is almost up to re-register! If your not re-registered, enforcement will begin on February 1, 2013. FDA will cancel your Bioterrorism Act registration and your importations will be significantly delayed. Your facility will NOT be able to import, distribute or sell food products in the U.S.

Here's what you need to know about FDA's new FSMA requirement on Bioterrorism Act registrations. Owners, operators, or agents in charge of domestic or foreign facilities that manufacture/process, pack, or hold food, alcoholic beverages, and/or dietary supplements for consumption in the U.S. are required to register the facility with the FDA.

The Food Safety Modernization Act of 2011 (FSMA) has for the first time, specifically put the onus on importers to have a program to verify that the food products they are bringing into this country are safe. The idea behind FSMA is to change FDA regulatory enforcement and focus to more of a preventative approach, instead of reactionary. These new requirements include risk-based controls, foreign supplier verification program, certification, and audits. A brief overview of the requirements may be found here.

I've summarized the requirements relevant to your Bioterrorism Act Registration below, so you can be sure your registration doesn't lapse.

New Biennial Registration Requirements

FSMA amended the Food, Drug & Cosmetic Act (FD&C Act) Section 415 to provide for biennial registration updates. Facilities which are required to register will have to re-register every 2 years, during the period beginning on October 1 (in this case, October 22) and ending on December 31 in even numbered years. This will first occur in October-December 2012 (which FDA extended until January 31, 2013, as renewals did not start until October 22).

Note that even facilities which are already registered with the FDA are still required to renew their registrations during the October 22– January 31, 2013 extended registration renewal period.

U.S. Agent

FDA requires that foreign facilities have a U.S. agent. The U.S. agent must:

live or maintain a place of business in the U.S. and
be physically present in the U.S.

The U.S. Agent is also responsible for the payment of "reinspection fees" of foreign facilities and failure to comply with recall orders. Reinspections are follow-up inspections conducted by the FDA after a previous inspection by the FDA where the FDA identified non-compliance issues materially related to food safety. The purpose of the reinspection is to assure the issue has been remedied and food is now safely produced. Fees are adjusted each fiscal year. For FY 2013 (October 1, 2012-September 30, 2013), the fees are steep, at $221 an hour if no foreign travel is required, and $289 an hour if foreign travel is required.

Need a U.S. Agent?

The law firm Becker & Poliakoff, P.A. provides registration services and will act as a U.S. agent with the FDA for a nominal fee, but, the foreign facilities are always responsible for the payment of any reinspection fee or fee for a failure to comply with a recall order. Please visit www.FDA-USA.com for more information about how to make Becker & Poliakoff, P.A. your U.S. agent with the FDA.

Contact Jennifer Diaz with any questions and ensure your importation are not delayed come February 1, 2013.

What You Missed at the C-TPAT Conference

Jennifer Diaz — Fri, 18 Jan 2013 16:55:03 -0500

The Customs-Trade Partnership Against Terrorism is a voluntary government-business initiative that builds cooperative relationships that strengthen and improve overall international supply chain and U.S. border security. C-TPAT is widely recognized as one of the most effective means of providing the highest level of cargo security through close cooperation with international supply chain businesses such as importers, carriers, consolidators, licensed customs brokers, and manufacturers. At CBP's C-TPAT Conference held on January 8-9, 2013, CBP announced major updates to C-TPAT – lucky for you, I’ve recapped the highlights for you below.

Trusted Trader Program

CBP proposes to combine CBP’s ISA program with C-TPAT. Additionally, if importers choose to be part of the Trusted Trader Program, they can take advantage of “joint validations” with other government agencies (OGA’s). CBP and TSA have already been performing joint validations for 9 months. Trade is concerned that OGA’s will go on fishing expeditions while validating and no guarantees have been made from CBP that OGA’s won’t. This is a major concern for some (rightfully so!).
CBP is seeking comments regarding its new Trusted Trader Program. Please email any comments here.

Internal Conspiracies

Top conspiracy indicators to look for are:

Anyone taking photos of entrances, fencing, hours of operation, etc..
Anyone interested in stow plans, employee schedules, transit routes, and GPS
Anyone in financial distress
Anyone attempting to access a system that they have no authorization to access
Anyone showing up to work on a day off or with large bags
Anyone entering restricted zones without access

Container Inspection

Use the VVTT process:

View seal and container locking hardware
Verify seal #
Tug on seal to make sure it is on right
Twist and turn seal to make sure it doesn’t unscrew.

Most Common Areas of Failed Criteria:

Conveyance Security – tracking an monitoring 51%
Container Security – sealing/ container inspection 49%
Business Partners – screening and subcontracting 46%
Personnel Security – background checks 31%

SW Border Strategies

86% of the time the drivers are responsible and have some involvement in conspiracies
There were 41 seizures representing C-TPAT companies in 2012
There are 160 underground tunnels from Mexico the U.S. or Canada to the U.S.

Evidence of Implementation

Suspensions and removals from January 2002-November 2012:

403 importers suspended due to validation issues
339 were removed from C-TPAT

CBP expects:

C-TPAT Manuals including all minimum security procedures
Documentation of audits, checklists, appropriate training
Assurance that all documentation is uploaded into the portal
Checklists to be uploaded that are filled out (blank forms will no longer be acceptable)
Photo and video evidence of implementation may be requested
If you DON’T contact your CBP Supply Chain Security Specialist (SCSS) when illegal activity is detected, it is a STRIKE against you

Visitor logs

Only for unknown visitors
Don’t let visitors sign themselves in!

C-TPAT Portal 2.0

Expect changes to the portal in the summer, it’s in early prototype stages now
You will not have to be a C-TPAT member to create a user account
SVI numbers will go away, tracking will be done using a business name and type
Members will have the ability to share documents
The new structure will give you the ability to combine common security practices, this is beneficial if you have more than one user account

Thomas Winkowski, Acting COO of CBP

Over 55% of goods entering the U.S. are from C-TPAT certified partners
CBP is pushing for more Mutual Recognition Agreements (MRA’s)
CBP currently has 7 MRA’s in place
MRA’s on the horizon with Taiwan, China, Israel and Mexico

Kevin McAleenan, Acting Assistant Commissioner, Office of Field Operations (OFO)

CBP is working on advancing benefits to C-TPAT members
New CBP Director Lauren Koffer was announced!

Dan Baldwin, Executive Director

Currently CBP has:

10,452 certified partners
158 – CBP staffing level
328 – Tier 3 IOR’s
22,223 – Total Validations Completed since inception

Concern regarding budget and number of validations CBP will be able to complete for FY13

In 2012 there were 822 new companies that applied for C-TPAT & 693 of those were certified

Barry Brandman, President, Danbee Investigations

Top 5 best practices:

Must enlist senior management support
Culture and security excellence (Don’t meet standards, exceed them)
Apply checks and balances throughout (Anticipate that your first line of defense will fail)
Strategically utilize security technology
Diligently audit safeguards to expose weaknesses

If you have questions regarding submitting a C-TPAT application, C-TPAT validations, advancing in tier status, or any pending C-TPAT program changes, feel free to contact me.

Protecting Your Intellectual Property Internationally

Jennifer Diaz — Sat, 12 Jan 2013 10:00:00 -0500

Do you sell products in multiple countries? How are you assuring your intellectual property is protected? Do you know about "Foreign Patent Applications" or "PCT's"? If not, you may not be adequately protecting your intellectual property abroad!

When you sell your product in multiple countries you are vulnerable to other companies stealing your idea and reproducing your intellectual property as their own.

How do you protect yourself?

To protect your business from being taken advantage of you may consider filing a foreign patent application. You may ask, what's a foreign patent application? It's a request at a foreign patent office for the grant of a patent for the invention described and claimed by that application. An application typically consists of a description of the invention, together with official forms and correspondence relating to the application.

Foreign patent protection will prevent others from profiting from your idea abroad. Many countries allow you to claim priority from your U.S. application. For utility patents you can file with priority status within one year of your original filing date in the U.S. under the Paris Convention, or six months from your original filing date for design patent applications. A utility patent protects the functional aspects of an invention and can provide broad patent protection, making it difficult for a competing product to avoid patent infringement. A design patent will protect the appearance of a new product as long as it is the main feature.

Another option you have is to file a PCT (“Patent Cooperation Treaty”) patent application for up to two and a half years from the initial filing date of your U.S. patent application. The PCT must be filed within a year of your first filed priority application to keep your priority date or before your U.S. application is published. The benefit to filing a PCT patent application is it allows you additional time to file in the specific countries of your choice. In some cases, the results of the search report issued for the PCT may be used to speed up prosecution in individual foreign countries and result in lower prosecution costs using the PCT Patent Prosecution Highway Petition.

Becker & Poliakoff, P.A. is proud to announce we have merged with Litman Law and are now offering a full range of intellectual property services, including patent and trademark services, to our valued clients. To learn more about protecting your brand internationally, please contact us.

FDA Extends Until January 31 for Food Facilities to Re-Register

Jennifer Diaz — Thu, 20 Dec 2012 10:38:53 -0500

Below are the latest and greatest updates regarding compliance with the FDA's Food Safety Modernization Act (FSMA). It includes background on FSMA, an update from FDA with 2 new guidance documents, FDA's extension to file biennial registrations, and an update on FDA using its enforcement power to suspend a facilities registration - meaning they can NOT import into the U.S.

FSMA Background

FSMA, enacted on January 4, 2011, amended section 415 of the Federal Food, Drug, and Cosmetic Act (FD&C Act) [21 U.S.C. § 350d]. The registration requirements in section 415 of the FD&C Act apples to domestic and foreign food facilities that manufacture, process, pack, or hold food for human or animal consumption in the United States. Section 102 of FSMA amended section 415 of the FD&C Act in relevant part to provide that food facilities required to register with FDA must renew their registrations with FDA every other year, during the period beginning on October 1 and ending on December 31 of each even-numbered year, otherwise, their registration will be cancelled by the FDA.

Reinspection Fees

Importantly, please note that facilities will be charged reinspection fees by the FDA. Reinspections are follow-up inspections conducted by the FDA after a previous inspection by the FDA where the FDA identified non-compliance issues materially related to food safety. The purpose of the reinspection is to assure the issue has been remedied and food is now safely produced. Fees are adjusted each fiscal year. For FY 2013 (October 1, 2012-September 30, 2013), the fees are $221 an hour if no foreign travel is required, and $289 an hour if foreign travel is required. U.S. Agents will be responsible to assure these fees are collected.

FDA Extension

Because there was a delay in FDA’s implementation of biennial registration renewal for the 2012 cycle, and registration renewal did not become available until October 22, 2012, FDA's guidance document advised that FDA intends to exercise enforcement discretion with respect to registration renewals submitted to FDA after December 31, 2012 for a period of 31 days, until January 31, 2013.

FDA Published 2 Guidance Documents:

Guidance for Industry: Questions and Answers Regarding Food Facility Registration (Fifth Edition). This guidance document contains helpful questions and answers regarding food facility registration.

Guidance for Industry: What You Need To Know About Registration of Food Facilities; Small Entity Compliance Guide. Thus guide was updated to reflect FSMA amendments to the FD&C Act, and discusses: who is required to register pursuant to the Bioterrorism

Suspension of Registration

FSMA also amended section 415 of the FD&C Act to provide FDA with the authority to suspend a food facility’s registration in certain circumstances involving food that has a reasonable probability of causing serious adverse health consequences or death to humans or animals. FDA already used this power and suspended the registration of Sunland, a producer of nuts. The full story may be read here.