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Importing Basics Country of Origin

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					Safe & Compliant Jewelry
        Shipping:
INTERNATIONAL TRADE
       SIMPLIFIED
                   Presenters

Cecilia Gardner, Esq. – Moderator
 CEO, President and General Counsel
 Jewelers Vigilance Committee

Nuccio Fera – Imports
 Supervisory Import Specialist
 US Department of Homeland Security, Customs and
     Border Patrol, JFK Airport

Omari Wooden – Exports
 Foreign Trade Ombudsman
 US Census Bureau
        Presentation: Topics

• Importing Basics
• Exporting Basics
• Country of Origin Markings
 Foreign Trade Regulations
Kimberley Process Overview


        Omari Wooden
      Trade Ombudsman
     Foreign Trade Division
      U.S. Census Bureau



                              4
  Legal Requirements
Census Bureau
Foreign Trade Regulations (FTR)
• 15 CFR, Part 30

Bureau of Industry and Security (BIS)
Export Administration Regulations (EAR)
• 15 CFR, Parts 700 - 799

Customs and Border Protection (CBP)
Customs Regulations
• Title 19 CFR, Parts 1 – 199

State Department
 International Traffic in Arms Regulations (ITAR)
 • Title 22 CFR, Parts 120 – 130

                                                    5
          What is a Shipment?
              (FTR 30.1)


•
                          1
              Tip: The ONE Rule
    ONE USPPI shipping their merchandise, to
•   ONE Foreign consignee, on
•   ONE Carrier moving the product out of the U.S., on
•   ONE day, with
•   Valued over $2,500 per Schedule B number or
    license is required


                                                    6
U.S. Principal Party in Interest
          (FTR 30.3)
The U.S. Principal Party in Interest is the:
• U.S. Person or Entity
• Primary Benefactor (Monetary, or Otherwise)
• Foreign Entity (if in the U.S. at time goods are purchased or
  obtained for export)


Generally that Person can be the:
• U.S. Seller: (Wholesaler or Distributor)
• U.S. Manufacturer
• U.S. Order Party



                                                                  7
   Two Types of Transactions
          (FTR 30.3)

Export Transaction (Standard):
• USPPI files the EEI or authorizes an agent to file the EEI


Routed Export Transaction:
• Foreign Principal Party in Interest (FPPI) authorizes a U.S.
  agent to facilitate the export of items from the United
  States and to prepare and file the EEI




                                                                 8
 Automated Export System

The Automated Export System is the
electronic filing of:
• Export Information


AES Filers are:
• U.S. Principal Parties in Interest
• U.S. Authorized Agents




                                       9
AES Process Flow




                   10
      AES Responses

     Verify
  Compliance
    Warning
                      Fatal
 Informational

Shipment Accepted   Shipment Rejected
   ITN Issued         No ITN Issued




                                        11
  Kimberley Process Overview
• Public Law 108-19 - Clean Diamond Act –
  implemented the Kimberley Process (KP) in the U.S.
  stating that rough diamonds must be controlled via
  the standards, practices, and procedures of the KP.

• U.S. Census Bureau designated as the export
  authority for controlling information on rough
  diamonds that are exported from the U.S.

• Census Bureau validates the KPC – ITN
   – Must be reported in Automated Export System (Exports)
   – Must be reported in Automated Broker Interface (Imports)
        KPC Classifications
• KP shipments must be classified under the
  following Harmonized System Subheadings
  – 7102.10
  – 7102.21
  – 7102.31

• The KP Certificate – is a document that
  participating countries must prepare when
  exporting or reexporting rough diamonds
   Kimberley Process (cont.)

• Resources
  – KP Rough Diamond Statistics
    www.KimberleyProcessStatistics.org
  – State Department Conflict Diamonds
    www.state.gov/e/eeb/diamonds
  – Main Kimberley Process
    www.KimberleyProcess.com
  – U.S. Kimberley Process Authority
    www.uskpa.org



                                         14
         For More Information
• FTD Call Center: 1-800-549-0595
   • Select 1 – AES Assistance
   • Select 2 – Commodity Classification Assistance
   • Select 3 – Regulations Assistance

• Fax:             301-763-6638
                   301-763-4670
• Secure Fax:      301-763-8835

• Email:     ASKAES@census.gov
             ftdregs@census.gov
                                                      15
           For More Information
Census:
  AES
  http://www.census.gov/aes
  Regulations
  http://www.census.gov/foreign-trade/regulations/
  Foreign Trade Blog
  http://blogs.census.gov/globalreach/
CBP:
  Appendix A – Commodity Filing Response Messages
  http://www.customs.gov/xp/cgov/trade/automated/aes/tech_docs/

                                                             16
     Country of Origin Markings:
               Topics

•   The Law
•   Marking Requirements
•   Exceptions
•   Penalties
•   Example
The Law: Country of Origin

U.S Customs requires that every article of
 foreign origin entering the U.S. must be
     marked with the country of origin
The Law: Purpose of Markings



 To inform the ultimate
purchaser in the U.S. of
 the country where the
   article was made
The Law: What is the Country of
           Origin?
• The country of manufacture, production, or
  growth of the article
• The last country in which a “substantial
  transformation” took place
• Assembled Products: country in which the
  article was fully assembled
     The Law: Who is the Ultimate
             Purchaser?

• The last person in the U.S. who receives the article
  in the condition in which it was imported, e.g.
  – Manufacturer: if the article is destined for “substantial
    transformation” in a jewelry-making process in the U.S.
  – Consumer: if the article will go to market without first
    going under “substantial transformation” in the U.S.
 The Law: What is a “Substantial
       Transformation?”
• A manufacturing
  process that creates a
  new or different article
  with a different name,
  character and use.
• This changes the
  country of origin
• Ex: Polishing a rough
  diamond
     Marking Requirements

• Permanent
  – Deliberate act required to destroy, remove or
    alter
• Legible
  – Adequate size
  – Clear enough to be read easily by a person
    with normal vision
     Marking Requirements

• Conspicuous
  – Visible with a casual handling of article
  – Will not be covered by subsequent
    attachments or additions
  – Visible without removing or changing
    positions of any parts of the article
Marking Requirements: Forms of
          Markings

• The BEST form of marking is on the
  article itself
  – Branding
  – Stenciling
  – Stamping
  – Molding
 Marking Requirements: Forms of
           Markings
• Other forms acceptable if legible and conspicuous
  when item reaches the ultimate purchaser
• Tags: attached in conspicuous place and must
  remain on article
• Adhesive Labels: not recommended
• Immediate container okay if:
  – Article cannot be marked without damage
  – Marking article itself would be prohibitively
    costly
Exceptions: NO Marking Needed


• If article will be processed in the US by the
  importer in manner that obliterates mark
  – But not for purpose of concealing origin

• Article is readily identifiable
  – Clearly gives information about origin, e.g:
    “Tahitian Cultured Pearls”
Marking Requirements: Watches

• There are special, more detailed marking
  requirements for watches and watch cases
• Rules can be found in the U.S.
  Harmonized Tariff Schedule
  Penalties for Non-Compliance

• Unmarked or improperly marked articles
  are subject to additional duties
• Alteration with intent to conceal country of
  origin marking:
  – Fines up to $100,000; and/or
  – Imprisonment for up to one year
                      Example
• Finished rings imported from Thailand
• In the U.S. rings will be boxed and shipped to retail stores
• Who must be informed of country of origin?
              Ultimate Purchaser
• Who is Ultimate Purchaser of rings in this case?
              Consumers
• “Made in Thailand” marking required on rings at port of entry?
              Yes
Need Assistance? Have Questions?

• The Jewelers Vigilance Committee can
  help
• Contact Us:
   – 212-997-2002
   – JVCLegal.org



   No part of the information in this presentation constitutes legal advice
212-997-2002
jvclegal.org

				
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posted:8/15/2011
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