Customs Law

Remember when I said I was trying to catch up? I know it looks like a lie. It's not. I'm just running around on a real work for real people and on real end-of summer efforts to not waste good weather. That said, I am still reading court cases. I'm going to make short work of Spring Creative Products Group v. United States , a decision of the U.S. Court of International Trade. The case involved the proper tariff classification of a craft kit for the making of a fleece throw. The kit contained two 48 by 60-inch fabric panels and materials used to knot them together into a single throw. Most of the kits included a panel printed with a character from a popular cartoon, comic book, or children's movie. Customs and Border Protection classified it as pile fabric of man- made fibers in 6001.22.00. The importer challenged that classification and asserted that the correct classification was as a toy in Heading 9503. The Court of International Trade made a lot of findings of f...

I don't usually do this, but here it is expedient. Rather than summarize Customs and Border Protection's guidance on imports from Burma, I'll just repeat it. I cannot quite figure out where this is placed on the CBP website, but it is called " burma_august2013.doc ." Certain Burmese Rubies, Jadeite and Articles Containing Burmese Rubies or Jadeite Are Prohibited from Importation into the United States In light of the expiration of the Burmese Freedom and Democracy Act of 2003 (the “BFDA”) (Public Law 108-61), as amended by the Tom Lantos Block Burmese JADE (Junta’s Anti-Democratic Efforts) Act of 2008 (the “JADE Act”) (Public Law 110-286), on August 7, 2013, the President issued an Executive Order (“EO”) that prohibits the importation of “any jadeite or rubies mined or extracted from Burma and any articles of jewelry containing jadeite or rubies mined or extracted from Burma.”  This EO amends Executive Order 13310 (July 28, 2003), in relevant part, by revok...

Let me know if this works and what you think. And, as always, it is not legal advice.

About this time in the summer, I am thinking I gotta fly to St. Somewhere for some boat drinks. Unfortunately, that is not in the cards. I'll make due with homemade margaritas and reading Latitudes International Fragrances, Inc. v. United States so that you don't have to go insane. [My apologies to Jimmy Buffett for those five references.] This case has to do with the proper tariff classification of glass bottles imported empty. In the U.S., the bottles were combined with other merchandise to form a scented oil diffuser kit. U.S. Customs and Border Protection classified the bottles in HTSUS item 7013.99.50 as glassware for indoor decoration. That resulted in a still rate of duty of 30%. Plaintiff believes that the correct classification is in 7010.90.50 as bottles for the conveyance of oils, which has a rate of duty of free. Note that both of these provisions are principal use provisions. Consequently, it is the use of the class or kind of merchandise that controls the cl...

When we last left Oscar Outlook, mascot of La Crosse Technology, the United States Court of International Trade determined that several combinations of meteorological instruments and clocks had the essential character of clocks or various weather related instruments for purposes of tariff classification and were not properly classifiable as meteorological instruments. Now we have the Court of Appeals for the Federal Circuit  stating its disagreement with that determination. As background, the Federal Circuit stated that all of the devices at issue in the appeal include  wireless instruments to measure outdoor conditions and a base unit to measure indoor conditions. The devices have an LCD display, a barometer, and a microprocessor. The processor is programmed to analyze historical barometric readings and predict the weather. The forecast shows up on our friend Oscar Outlook in the form of his clothing. And, it is important to note, they all include a clock. The first issu...

I am sorry to report that I have a backlog of decisions to review. So, let's get started. Do you remember United States v. Trek Leather, Inc. ? No? I'm not surprised as I appear not to have bothered to cover the decision from the Court of International Trade. You might want to go back and read that for context. Here, we will discuss the decision from the Court of Appeals for the Federal Circuit. The question presented in Trek Leather is whether a corporate officer, in this case Harish Shadadpuri, can be held personally liable for negligence in relation to a customs entry for which the corporation was the importer of record. In this case, Shadadpuri was the president and sole shareholder of the importer of record and also a 40% shareholder of the consignee for 72 entries of men's suits. Upon entry, Trek Leather (which I will call Trek Leather to distinguish it from the fine people at Trek Bicycle Corp. ) failed to properly declare the value of fabric provided to the fore...

Sometimes, tariff classification by the rules produces results that are completely inconsistent with what a normal, thinking person would expect to be correct. Case in point: HQ H237067 (June 20, 2013) . The ruling, apparently drafted by Ebinezer Grinch von Scroogeheimer of the Regulations and Rulings Unit, considered the tariff classification of a complete, adult sized, and apparently well-made Santa costume known as the Premier Plush Nine Piece Santa Suit. Look at this picture and tell me whether it is a festive article closely associated with a holiday: Of course it is. To the average person and, I might add, the average customs entry writer, the picture would be enough to resolve that issue. Plus, I personally apply the Bubbe and Zayde test. Under my test, if you are unlikely to find the item in the home of an elderly Jewish couple, it is probably a festive article associated with a Christian holiday. The problem is that Customs and Border Protection and importers do not ge...

I do a lot of training talks for lots of organizations and I am happy to do so. One of my go-to examples for tariff classification is a complete bicycle imported unassembled in a retail box. This is a good way to discuss General Rule of Interpretation 2(a), which tells us that goods imported in an unassembled or disassembled condition will be classified as the finished article if, when imported, it is complete or has the essential character of the complete article. In my bike example, that means that the unassembled bicycle is classified as if it were assembled. What I don't usually talk about in the context of that example is the marking of the disassembled bicycle in a retail box. I am, however, thinking about that because Customs and Border Protection recently published a proposal to revoke the ruling NY N015337 (Aug. 23, 2007) in which it addressed the marking of an unassembled child carrier/seat for a bicycle. The proposal is in the Customs Bulletin starting at page 39 . ...

If you know me professionally, you know I have recently been going on ad nauseam about how there is almost never a dispute as to the facts in a classification case before the Court of International Trade.  As a result, my world view is that parties at the CIT should tee up the legal questions early and get the case resolved without a lot of time and effort going into probing the facts. Now and then, I am reminded that this is not always the case. Today, my reminder comes in the form of Tyco Fire Products L.P. v. United States . Tyco involves glass liquid-filled bulbs used in fire sprinkler systems as triggers holding valves closed. When heated, the liquid expands and eventually breaks the glass bulb causing the valve to open and the sprinkler to activate. Similar bulbs are used in water heaters to keep vent doors open. When heated, the bulb breaks and the vent door closes. That chokes out fire in the water heater. What we are talking about is the red part of this Tyco sprinkler ...

As mentioned, the Federal Circuit has again dismissed efforts by importers to challenge separate and unequal rates of duty on  certain items of apparel. The cases were brought by Forever 21, Rack Room Shoes, and a company called Skiz, which was created for purposes of pursuing this case (more on that later). This has been a tough case all along and the plaintiffs seem to have made a solid effort at getting a successful result. On its face, it seems to be an obvious proposition that a higher tariff on men's apparel than on women's apparel would discriminate against men. Imagine a sales tax in which men paid a higher rate at the cash register than do women. That would never be constitutional and that is similar to how the plaintiffs see this case. Unfortunately, the Court of International and the Court of Appeals for the Federal Circuit have seen it differently. Rather than the tariff being a tax based on the gender or age of the buyer, the tariff is a tax on merchandise imp...

My goal here has never been to be a source of breaking news, but it happens occasionally. In this case, I want to let you know that the Court of Appeals for the Federal Circuit has dismissed appeals challenging the constitutionality of separate and unequal tariffs for certain items of apparel. The decisive utterance of the opinion is: Neither Rack Room nor Forever 21 has pleaded facts sufficient to make plausible their claim that Congress enacted the relevant provisions of the HTSUS with discriminatory intent, and we therefore affirm the dismissal of their claims [by the Court of International Trade]. Skiz's appeal is dismissed for lack of standing. A detailed analysis will follow. For now, you can read the opinion here .

Some of this is old-ish, but still may be of interest. Customs has opened the last three of its planned Centers of Excellence and Expertise . The new CEE are in Atlanta (Consumer Products and Mass Merchandise), Miami (Agriculture and Prepared Products), and San Francisco (Apparel, Textiles, and Footwear). If you are currently participating in a CEE, please post a comment as to how you think it is working and whether you see any benefits yet. President Obama Seeking to Strengthen Enforcement of ITC Exclusion Orders . According to a White House announcement, the Administration has taken a number of steps to improve the enforcement and administration of the patent laws. One such step involves asking the U.S. Intellectual Property Enforcement Coordinator to undertake a review of current Customs and Border Protection and International Trade Commission procedures used to evaluate the scope of an ITC exclusion order for enforcement purposes. This is an interesting issue as it is not alwa...

UPDATE: On rare occasions, this blog generates a more detailed discussion about a particular case. This is one of those occasions. After talking it through with a respected and knowledgeable practitioner, I think a clarification is necessary. That clarification is as follows: This decision got me thinking about test cases and what it means to suspend a case under a designated test case. I used that opportunity to expound on this unique aspect of customs practice. But, in doing so, I did not make it clear that the result in Deckers did not depend on the fact that it had been suspended under a test case. Rather, the plaintiff filed a complaint. That moved the case out from suspension and after which it proceeded along as would any other case at the Court of International Trade. The decision in the test case did not ipso facto control the outcome. Instead, the Court decided the government's motion for summary judgment on the merits, which was also consistent with the decision in the t...

H.R.-2158 , the Expedited Departure of Certain Snake Species Act, has been introduced in to Congress. The intent of the law is to create a Lacey Act exemption allowing for the expedited shipment of invasive snake species out of the U.S. Speaking as someone who watches a fair amount of Animal Planet, I hope this becomes law.

May 19 was Tariff of Abominations Day, a holiday I created for customs and trade compliance people. I hope you enjoyed yourself. If you are wondering what I am on about, please read this post from May of 2008 . And, if you are sufficiently Nerdist to get the reference, it has nothing to do with Emil Blonsky . Credit: Marvel Comics

The Court of International Trade's recent decision in EOS of North America v. United States  has a few interesting bits of legal analysis in it. The underlying facts of the case are simple enough. The EOS imported devices called "laser sintering machines." In more common terms, these are advanced 3D printers used to rapidly produce metal and plastic prototypes and other custom products from powdered raw material. A computer in the system interprets a three-dimensional mathematical model of the finished object and then directs a laser to melt the powder in a patter that corresponds to a thin layer of the finished object. When that layer is complete, the surface is recoated with powder and the laser melts the next layer of material. In this way, known as additive manufacturing, the system build up a possibly quite complex three-dimensional object. If you want to know how this cool technology works, watch this video: The dispute here is whether these machines are pro...

When last we considered the tariff classification of Ugg Classic Crochet boot , the Court of International Trade held that the boots are "of the slip-on type" and, therefore classifiable in HSTUS item 6404.19.35. Ugg appealed to the Court of Appeals for the Federal Circuit, which has now affirmed the CIT . First, a note on usage. The Federal Circuit almost uniformly refers to the Court of International Trade as the "Trade Court." I wonder why that is. I am not aware of any practitioners who appear before that Court using that phrase. I think the common usage is either "CIT" as the shorthand or "Court of International Trade" in full. But, I like "Trade Court" and think I will adopt it (within the limits of satisfying Google that this is a place to find information on the Court of International Trade). Second, in this case, the majority decision decided to refer to HTSUS item 6404.19.35 as "subheading 19.35"). That is very muc...

Remember my post on the question of whether a fit model can testify on the question of whether a shelf bra provides support for her bosom? Sure you do, it's a classic of the customs blog genre. The Court of International Trade has now decided the relevant cases, which are Lerner New York, Inc. v. United States and Victoria's Secret Direct v. United States . Starting with Victoria's Secret, the issue was whether the article of clothing was properly classified as tank top or similar garment, which is the classification proposed by Customs and Border Protection. Plaintiff argued that the top was either a brassier or an unspecified "other garment." The garment was described on the invoice as a "basic tank" with "shelf bra." I am no expert on fashion, but a little time on Bing leads me to believe that this is similar to the garment in question: According to the Court: The shelf bra is formed from two pieces of fabric (front and back) ...

As you likely know, Ford Motor Company has been battling with Customs over whether it is entitled to duty refunds pursuant to post-entry NAFTA claims it made without submitting a completed NAFTA Certificate of Origin from the exporter within the required one-year period. This issue has been the subject of a number of prior posts. To catch up on it, read here , here , and here . This case follows the remand to the Court of International Trade, in which that Court considered the specific NAFTA-based requirements that an importer provide a copy of the certificate of origin with a post-entry claim made under 19 USC 1520(d). Ford had argued that is can make the claim without the certificate of origin and provide it subsequently because 19 CFR 10.112 provides: Whenever a free entry or a reduced duty document, form, or statement required to be filed in connection with the entry is not filed at the time of the entry or within the period for which a bond was filed for its production, bu...

Cutter & Buck, Inc. v. United States is one of those increasingly rare cases in which the Court of International Trade had to determine the value of imported merchandise. In this case, the question was whether Customs and Border Protection should have deducted international freight charges from the transaction value of imported merchandise. The normal process for this importer was to have the goods shipped FOB, which means that the buyer takes delivery when the goods are delivered on the ship (the old phrase was across the rail). Under FOB shipping terms, the purchaser is responsible for the cost of international freight. As a result, the invoice price does not include international transportation. The shipments at issue were not shipped in the ordinary course. Instead, they were late shipments under which the seller agreed to cover the cost of international freight. The relevant INCOTERM was CFR. Under this term, the seller is responsible for contracting for the freight neces...