Tag: customs regulations

Coming Reforms to CBP Regulations

A few weeks back, the Commercial Customs Operations
Advisory Committee (COAC), met in Washington DC. COAC is a 20-person committee that was established by Congress, and it “provides advice and recommendations to CBP and the Department of the Treasury on the commercial operations of CBP and trade-related interdepartmental functions.”

The press release for the event gives us some insight into the ongoing work to reduce and simplify the regulations used by U.S. Customs & Border Protection. The end-result could be 35% reduction to the text of the regulations:

Updating the regulations was a collaborative effort. “We had subject matter experts go section by section through the regulations and identify the pain points, the problems, the language, whatever the difficulty was,” said James Swanson, director of cargo, security and control in CBP’s Office of Field Operations. “This was a big effort. But it was important to industry and quite frankly, it was important to me. It makes it easier to enforce and easier to identify what the regulations are. We expect to reduce the overall size and text of the regulations by about 35 percent,” he said.

They also issued a regulatory reform issue paper, that goes into a little more detail on non-public regulation reforms:

  • Revenue modernization
  • Modernizing the vessel arrival process to be automated and streamlined
  • Updating the regulations to account for eBond functionality in ACE
  • Free Trade Zone modernization (also a COAC working group)
  • Advance Electronic Data for international mail
  • Export manifest modernization
  • Changes to the in-bond process (also a COAC working group)
  • Bonded warehouse modernization
  • Liquidation process modernization
  • Updating regulations for ACE functionality

ACE is among the most exciting things to happen with CBP for a customs practitioner in a long time; it streamlines (i.e., makes paperless) the protest filing process. That, coupled with the online publication of the bulletin notices of liquidation, makes life much easier and much more efficient for us customs lawyers.

Updating the regulations for ACE functionality and liquidation modernization should prove to be the most enticing changes to the regulations for practitioners.

New regulations allow importers to obtain seized merchandise samples from imporations of suspected counterfeit products. Here, a box of counterfeit contacts are pictured.

Seized merchandise samples from CBP

U.S. Customs & Border Protection amended their regulations concerning intellectual property, trademark, and copyright to give importers a greater opportunity to test the genuineness of their importations by obtaining seized merchandise samples from CBP. 19 CFR 133.21(d), effective October 19, 2015, provides as follows:

Disclosure to importer of unredacted photographs, images, and samples. CBP will disclose to the importer unredacted photographs, images, or an unredacted sample of imported merchandise suspected of bearing a counterfeit mark at any time after the merchandise is presented to CBP for examination. CBP may demand the return of the sample at any time. The importer must return the sample to CBP upon demand or at the conclusion of any examination, testing, or similar procedure performed on the sample. In the event that the sample is damaged, destroyed, or lost while in the possession of the importer, the importer must, in lieu of return of the sample, certify to CBP that: “The sample described as [insert description] and provided pursuant to 19 CFR 133.21(d) was (damaged/destroyed/lost) during examination, testing, or other use.”

CBP’s written comments about this new regulation confirm that the request for seized merchandise samples goes beyond the detention into seizure and beyond by stating: “if an importer does not identify a need for a sample until after CBP seizes goods as bearing counterfeit marks the importer may request a sample at that time.” Disclosure of Information for Certain Intellectual Property Rights Enforced at the Border, 80 FR 56370, 53674.  This new regulation specifically envisions the sample leaving CBP custody (by stating CBP can demand “return” at any time or after examination and testing; further, that the merchandise could be “damaged, destroyed, or lost while in possession of the importer”).

This new regulation totally changes the game importers face who have had merchandise seized for alleged counterfeit marks. Previously, samples or pictures of the seized merchandise were not available to the importer administratively, but only to the trademark owner. The old system left the importer at the mercy of CBP and the trademark owner, who alone could assess the authenticity of the marks. The only way to get samples was through (often impossible/impractical cooperation) from FP&F at CBP, or to file a claim to have the seizure tested before a district court judge, with all the rights to discovery that thereby attach.

Now that samples are available, the importer can obtain samples and perform its own examination or testing and provide evidence contrary to the determination of CBP or the trademark owner. The availability of sample, in our opinion, greatly levels the playing field when it comes to challenging a seizure made by CBP, or when challenging a later penalty proceeding. The possibility of a penalty for a seizure is a great reason to request and obtain a sample as a routine practice before the products are forfeited and destroyed.

Are you trying to get seized merchandise samples from CBP?

The detention, seizure, and forfeiture of merchandise bearing allegedly counterfeit trademarks is a long process, and fraught with procedural missteps for anyone who is not an attorney. You need the advice of a customs lawyer, not this article (which is not legal advice).

If you have products detained or seized because they are suspected of bearing counterfeit trademarks, can contact us for a seizure consultation by clicking the contact buttons on this page.