Regulated Wood Packaging Material Customs Violations

In 2007, Customs & Border Protection began enforcing requirements that regulated wood packaging material imported into the United States mandating that it meet certain requirements. Although an “old” issue, importers still run afoul of these requirements and get themselves into trouble. These requirements have the effect of limiting the risk that wood packaging material imported into the United States will introduce foreign insects into the U.S. ecosystem that could be harmful to the environment and U.S. industries, particularly the lumber industry and native tree populations in our forests.

What is wood packaging material, and what is regulated?

First, it should be noted that there is a distinction between wood packaging material and regulated  wood packaging material. Wood packaging material is just wood or wood products, excluding paper products, used in support, protecting, or carrying a commodity, including dunnage. 7 CFR 314.40-1.

Regulated wood packaging material  is defined as:

Wood packaging material other than manufactured wood materials, loose wood packaging materials, and wood pieces less than 6 mm thick in any dimension, that are used or for use with cargo to prevent damage, including, but not limited to, dunnage, crating, pallets, packing blocks, drums, cases, and skids.

7 CFR 314.40-1.

Although not really made clear in the regulations, for purposes of enforcement Customs probably considers manufactured wood materials to woods like plywood, fiber board, whiskey barrels, wine barrels, and veneer. Regulated wood packaging materials include materials like dunnage, crating, pallets, packing blocks, cases, skids, and other wood that is dry and loose (as in the case of sawdust or wood shavings) and is not less than 6mm thick (as in the case of certain shims).

What must be done to wood packaging material so that it is compliant?

The requirements can be complicated in certain situations, and there are a limited number of exemptions, especially for trade with Canada and Mexico. But generally speaking, the wood must be treated and marked. 7 CFR 319.40-3. The wood must be marked in a “in a visible location on each article, preferably on at least two opposite sides of the article, with a legible and permanent mark that indicates that the article meets” the requirements of the law. The mark looks something like shown below, but the letters and numbers will vary depending on the circumstances (i.e., origin and type of treatment).

WPM Mark
WPM Mark

The means of treatment is set out in 7 CFR 305, and consists of heat treatment or a type of fumigation through chemical treatment with methyl bromide.

What if regulated wood packaging material is untreated or unmarked?

If your wood packaging material is regulated wood packaging material, meaning that there is no exception to the treatment and marking requirements, then it is violative wood packaging materials if it is not both marked and treated. A violation can either be because the treatment was not done, because the mark is not present, or because the mark is illegible. Even if the wood is actually treated but is not stamped, it is still violative. Even if you somehow know for a fact that the wood is not infested, it is still violative.

As such, it is most likely that you will be required to immediately re-export the wood packaging material out of the country. This will be done through the issuance of an Emergency Action Notification that gives you a certain period of time to re-export your entire shipment.

After receiving a notice of the presence of a violative wood packaging material, whether verbally or through an Emergency Action Notification, it is important to move very quickly. Failure to be obey the deadline given in the Emergency Action Notification can result in additional penalties.

Is there an alternative to re-exporting my merchandise?

It is possible to get permission from the Port Director to separate the violative wood packaging material from the commodity (e.g., separate the merchandise from its pallets), and re-export only the violative wood packaging material and enter the commodity. However, that is a complicated process with its own legal procedures, involving meeting certain requirements, demonstrating certain safeguards, paying certain costs, and filing an Application to Separate Violative Wood Packaging Material directly with the port director.

Obviously, this Application to Separate can be granted or denied. Filing of the application does not suspend the time period in which you must comply with the Emergency Action Notification to re-export. And if denied, you will still need to re-export. So, application to separate should prepared and filed as soon as possible. If the application is not successful, you will be re-exporting your commodities.

What are the ramifications of importing, or attempting to import, violative wood packaging materials?

Apart from the requirement to re-export the materials and your merchandise, and the costs associated with that come from your supply chain and your inventory problem, there are penalties that can be imposed by Customs for this type of violation.

Customs will usually send a Notice of Penalty or Liquidated Damages to the importer involved with the wood packaging material violation for violations of 7 CFR 319.40 as being an importation, or attempted importation, contrary to law under 19 USC 1595a, or as commercial fraud or negligence under 19 USC 1592. As in the case with all customs penalties, there are guidelines for reducing the amount of money customs seeks in penalty. This can only be done by filing a petition for mitigation.

What do I do next?

If you have been informed that you wood packaging material is in violation of the law and needs to be re-exported, immediately call or e-mail office at (734) 855-4999 and we can prepare an application to separate violative wood packaging material so that, if it is granted, you do not have to undergo the time and expense of re-exporting the merchandise you are trying to import.

If you have received a notice of penalty or liquidated damages and are being told you must as a result of the violation, immediately call or e-mail our office at (734) 855-4999 and we can prepare a petition for mitigation of the penalty amount.

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