Customs Law

This is a bit advanced, but it is interesting. There are probably people out there who have had the bright idea to double up on duty savings by producing NAFTA goods in a foreign trade zone. If you are doing that, be careful. First, you need to understand FTZs a bit. For those who might not know, an FTZ is a specially designated area that is considered to be legally outside of the customs territory of the United States. FTZs are supposed to be reasonably close to ports of entry and are often divided into sub-zones for different users and purposes. FTZs are usually "granted" to a public or quasi-public entity like a Port Authority. The overall operation is then granted to some private entity. The agency in charge of all this is the Foreign Trade Zones Board though Customs and Border Protection does the heavy lifting on enforcement. The beauty of a foreign trade zone is that importers can move goods into the zone and not make a customs entry until the goods are withdrawn ...

This is one of those off-topic posts I promised. It is about comic books and includes a Star Trek reference. Feel free to move on. Recently, I was in a comic book store. That is not really news. I do that occasionally. I go in with the intention of buying something for the six year old and come out with a few for myself. Don't scoff, it's art and epic literature, really. I have a terrible problem in the comic book store. I get confused. I don't know what to read. I have fond memories of major and minor superheros (no Archie's in my house) from Superman and Spider-Man to Metal Men and Daredevil . So, I am attracted to their recent titles. But, when I flip through them, I realize I have no idea what the heck is going happening. In some cases, I don't even know who the hero is anymore. There have been a number of Flashs and Green Lanterns over the years. Batman's sidekick Robin has moved on to become Nightwing and there is a new kid named Tim Drake living at ...

Corrected for typos: This is in response to Nick who wants to know how disjunctive marking of some goods will fit with a claim under an FTA. My short answer is that Nick is opening up a big can of worms, but there are answers in the FTAs. NAFTA is pretty clear that where fungible goods are commingled before entry, the importer can still make a claim for the originating parts of it if the importer applies one of several acceptable accounting systems to determine origin. Those systems are: Direct Identification: That means, effectively, not commingling the goods and somehow physically segregating (or at least identifying) the originating and non-originating materials. So, you need your supplier to divide the car load of wheat into Canadian wheat and everything else. The Canadian wheat gets NAFTA treatment (including origin marking) and everything else gets non-NAFTA treatment (although you might have to run through the NAFTA marking rules to make sure that the other wheat is not "go...

Here's something else that strikes me as interesting: Avecia, Inc. v. United States (CIT Slip Op. 07-41) . Basically, the issue is whether a protest filed at and denied by the wrong port give the Court of International Trade subject matter jurisdiction to review the denial on the substance. The regulations are clear that the protest should be filed with the port director whose decision is being protested. 19 C.F.R. sec. 174.12(d). The statute requires that "the appropriate customs officer" decide the protest, but it does not specify who that officer is. It could be an officer at another port. Further, the jurisdictional statute giving the court the power to review denied protests doesn't say anything about where that protest had to be filed. From this, the court found that the place of filing regulation was beyond the "metes and bounds" of the subject matter jurisdiction of the court. Customs, through its protest regulations, cannot modify the court...

I've been away, I assume you noticed. But, I was not completely out of touch with the world of customs law. A few interesting things have happened. One thing of note is Customs & Border Protection ruling W968421 (Jan. 9, 2007). It is a marking ruling. I have not discussed marking much in this blog. So, we should look at some background first. All articles of foreign origin imported into the United States must be marked with their country of origin. The marking must be permanent and conspicuous. There are specific requirements for how certain products need to be marked. For example, pipes and similar articles should generally have the country of of origin die sunk or molded into the product. Generally, the product itself should be marked although in some circumstances it is permissible to mark the container. There are lots of exceptions to the marking requirements including goods that will be further processed in the U.S., goods imported by the purchaser, goods too small to be ...