Customs Law

On June 14, 2023, the U.S. Court of International Trade approved the voluntary dismissal of a case brought by a group of environmental organizations to force the U.S. government to take action to force Mexico to better implement steps to protect the grievously endangered vaquita. Prior posts on related legal efforts in this matter are here and here . The vaquita is a small porpoise that is endemic to Mexican waters in the Gulf of California. Unfortunately, its range overlaps with totoaba, which is subject to illegal fishing because the totoaba's swim bladder is prized in China for its apocryphal effectiveness in traditional medicine. As a result of illegal totoaba gill net fishing, there are 10 to 13 vaquitas remaining in the world. Unless there are dramatic changes in the bycatch of vaquita, the vaquita is will likely become extinct. The decision is not legally very important because the parties reached a settlement and there was no need for the Court to make important findings o...

The Court of International Trade has issued an order lifting an injunction aimed at protecting the vaquita from illegal fishing by banning the importation of certain fisheries products from Mexico. The vaquita is a critically endangered porpoise that is endemic to the Gulf of California. The order is the result of a favorable settlement between the government and several environmental organizations. That is a good thing. For background on this case, read this post . The Court approved the settlement stating that the Government has changed course, announcing an embargo that embraces the one sought by Plaintiffs in their complaint and preliminarily issued by the court; indeed, it expands its reach. In short, Plaintiffs have achieved the outcome they sought before the court in the suit they filed. Presented for the court’s review is the settlement of the instant litigation as set forth in the Stipulation and Proposed Order of Voluntary Dismissal Under CIT Rule 41(a)(2), Apr. 10...

[Note: I am so disappointed in the Federal Government (exclusive of the judiciary) that I am leaving this pinned here for a while. Advancing that into the future is the only way I could make it stick. The actual publication date is Aug. 18, 2018. Visit the NRDC , Center for Biological Diversity , and Animal Welfare Institute to donate.] Over the years, the Court of International Trade has occasionally had to dip its judicial toes into environmental law. In Natural Resources Defense Council v. Ross , it was asked to do so to help prevent the potentially imminent extinction of the vaquita. Jumping in with both feet, Judge Gary Katzmann issued a fairly dramatic decision that appears to force the government to act consistent with an existing law intended to protect these animals. "Vaquita" is Spanish for "little cow," but the animal in question is only the most distant of evolutionary cousin to the land-dwelling cow. The vaquita is the smallest known cetacean, w...

The NAFTA Marking rules are a giant mystery to many people. Let's assume you are importing evaporator cores from Mexico. The cores are initially produced in South Korea and shipped to the U.S. From here, they are exported to a facility in Mexico that adds fittings and connections before shipping them back to the U.S. Once back here, they are used in the assembly of automotive air conditioners. When returned to the U.S., the cores are not NAFTA originating. You can assume that set of fact because it is what happened in CBP Ruling N014917 (Aug. 2, 2007). So, how do you analyze the origin of the cores? The U.S. has various rules used to determine country of origin. Most products that are not wholly the growth or product of a single country are deemed to originate in the last country in which it was subject to a substantial transformation, i.e. , a change in name, character, or use. See 19 CFR 134.1(b). That section goes on to say " however, for a good of a NAFTA country, ...

This one is pretty straight forward. The only reason I am covering it is that the notion of importing completely prepared pizza from Germany is oddly funny to me. Kind of like getting tacos from Australia. In N261593 (Mar. 11, 2015), U.S. Customs and Border Protection answered a ruling request from Freiberger U.S.A., Inc. asking for the tariff classification of a completely prepared and frozen pizza to be imported from Germany. Four varieties were involved including: flatbread with cream sauce and eleven-inch square. The correct tariff classification is in Heading 1905 which is the heading for: Bread, pastry, cakes, biscuits and other bakers' wares, whether or not containing cocoa; communion wafers, empty capsules of a kind suitable for pharmaceutical use, sealing wafers, rice paper and similar products . . . . I come from Chicago where we like our pizza thick, the way God intended it. Consequently, it makes sense to me that pizza would be treated as a bread product. Sp...

This is the last of the cases I have in my cue. General Mills, Inc. v. United States  is one of those cases only a lawyer would love or would hate, depending on which side of the dispute you happen to be. The problem for General Mills is that it wants the Court of International Trade to review a ruling in which Customs and Border Protection determined that Brussels sprouts from Belgium that were packaged with frozen butter sauce chips in Mexico are not entitled to duty-free entry to the United States under the North American Free Trade Agreement. Part I: The Ruling Let's start with with ruling, so that I can also call this my Ruling of Last Week 17. The relevant ruling is HQ H212296, which is in the January 29, 2014 Customs Bulletin  starting at page 89. The NAFTA portion of the ruling is in dispute and is interesting. Keep in mind that the imported product is just frozen Brussels sprouts from Belgium packed in pouches in Mexico with frozen butter chips. The finished p...

Union Pacific Railroad has been fighting the good fight with U.S. Customs and Border Protection over whether it is liable for penalties for illegal drugs imported via railcars that were being used by unrelated Mexican railroad companies. UP's role was to forward the electronic manifest data to CBP and pick up the railcars after CBP clearance. Keep in mind that CBP does not accept electronic manifest transmissions from Mexican railroads. In an interesting opinion , the Eighth Circuit Court of Appeals has held that CBP lacks the authority to penalize UP for the actions of Mexican drug cartels on railcars UP neither owned nor controlled. According to the opinion, UP has no railroad operations in Mexico and no control over the Mexican railroads involved. It has no ability to control employees of the Mexican railroads and no authority to secure or search trains inside Mexico. When a train arrives at the border, CBP inspects it and sends the Mexican locomotive and crew back to Mexico. ...

Those who are responsible for NAFTA compliance are very familiar with the NAFTA Certificate of Origin and the Preference Criteria to be recorded in Field 7.  The criteria are used to indicate to the importer as well as to the customs authorities in the country of importation exactly how the goods qualify as originating. Under the NAFTA, there are six possible preference criteria with preference criterion B being the most common. When Customs sees a B in Field 7, it knows that the finished good contains non-originating material and that the good qualifies as originating because the non-originating materials made a qualifying change in tariff classification as a result of production in North America and, if applicable, the finished good satisfies the Regional Value Content requirement. That is all simple enough under NAFTA. But, under the subsequent free trade agreements, no one ever specified a coding system for the preference criteria. As far as I am concerned, the lack of a unif...

It is not often that case at the Court of International Trade takes on the flavor of a courtroom drama. It does happen, such as in the case of international intrigue and an an importation gone wrong . Recently, the Court decided another case that has the possibility of being turned into the most boring legal thriller ever, which is a step up from the usual customs case. By way of background, it is important to know that not everything that transits the United States actually enters the commerce of the nation or is subject to a customs entry. One exception to the normal consumption entry process is the entry for transportation and exportation. See 19 USC § 1553(a).  Under this process, merchandise arrives at a port in the United States and is transported under bond to another port for export. The bonded carrier has certain responsibilities to prove exportation and, if it can't, then it risks being responsible for the duties owed and possible penalties. That was the situation in...

Here is one I missed. Sorry, I'll be catching up. In Rogelio Salazar Cavazos v. United States , the issue was whether the Court of International Trade had jurisdiction to review a denied claim for NAFTA preferential treatment for candied peanuts imported from Mexico. Customs classified them in a tariff provision carrying a 131.8% rate of duty, which did not make the importer happy. The importer protested the classification . After liquidation but before the protests were denied, the importer filed NAFTA post-entry claims. These claims were timely, within one year from the date of importation. Customs and Border Protection subsequently denied the NAFTA claims as well.   Plaintiff did not protest the denial of the NAFTA claim . The importer then filed a summons in the Court of International Trade seeking review of the denial of the NAFTA claim. The United States moved to dismiss on the grounds that there was no denied protest relating to the NAFTA claims. The impor...

The KORUS presidential proclamation is out, just in time for the March 15 implementation. The real meat of implementation will be new General Note 33 to the Harmonized Tariff Schedule of the United States. You can find the HTSUS modifications here. For those of you exporting textiles to Mexico and who read Spanish, here is a notice allegedly modifying the labeling requirements. The new Export Enforcement Coordination Center (E2C2) is open for business. Please do not confuse it with C2E2 , which is much more fun