Fourth Quarter Global Commerce Update

December 18, 2012 | The following is a summary of international trade topics of interest to the toy industry during the fourth quarter of 2012. [Read the complete quarterly update online.]

MERCOSUR (Mercado Común del Sur – Common Market of the South) Update
On December 7th, the Common Market Committee of the Mercosur nations of Argentina, Brazil, Paraguay, Uruguay and Venezuela voted against a proposal from Brazil to permanently increase the duty on toys for all Mercosur countries to 35%, up from the common rate of 20%. The Committee voted to extend until December 31, 2014 a current ruling that allows individual Mercosur members to increase their duties up to 35% if they choose. Effective November 15, 2012, Argentina announced that it was increasing duties on toys to 35%, presumably to protect domestic producers during the holiday season.

CBP Centers of Excellence and Expertise (CEE)
Customs and Border Protection (CBP) has announced the roll out in 2013 of six new Centers of Excellence and Expertise (CEE). When fully implemented, the 10 Centers will ensure a more predictable Customs enforcement environment and lead to better trade facilitation for each industry sector. The Consumer Products & Mass Merchandising CEE will be based in Atlanta.

Automated Commercial Environment (ACE)
The Automated Commercial Environment (ACE) is the commercial trade processing system used by the U.S. to automate border processing, enhance border security and foster our Nation’s economic security through lawful international trade and travel. As of October 1, 2012, CBP has successfully transitioned both sea and rail manifests to the Automated Commercial Environment (ACE.)  ACE now operates as the only CBP-approved electronic data system.  ACE’s e-Manifest: Sea and Rail began its pilot phase in August 2011, and in November 2011 CBP began accepting e-manifests from trade users in the ACE system. 

Importer Self-Assessment (ISA) Program
As of October 5, 2012, importers who have successfully undergone a Customs and Border Protection (CBP) Focused Assessment (FA) within the last 12 months audit are eligible for automatic transition into the ISA program without further CBP review provided they are a U.S. or Canadian importer, are a C-TPAT member, agree to develop a risk-based self-testing plan, and otherwise comply with ISA program requirements. 

The opportunity for automatic transition into the ISA program is also available for those U.S. importers that, within the last 12 months, have successfully completed a Compliance Improvement Plan (CIP) following an FA, and have been deemed to pose an acceptable risk after CBP follow-up.  Such importers will also not be required to undergo an ISA application review meeting, but will remain required to otherwise comply with the program requirements, as outlined below, one of which is membership in C-TPAT.

Simplified Entry/Air Cargo Advance Screening (ACAS)
CBP’s recently initiated Simplified Entry pilot program allows importers to file, prior to arrival, a simplified entry consisting of 12 required data elements and 3 optional data elements, instead of the typically-required 27 elements that are usually filed post-takeoff. The program is available only within the air cargo environment, but CBP plans to institute similar programs in the ocean and rail environments. 

Currently, there are a limited number of participants and ports in the pilot program.  The initial participating ports were Indianapolis, Chicago and Atlanta.  In August 2012, the program was expanded to four West Coast ports (Seattle, San Francisco, Oakland and Los Angeles,) and in September 2012, six additional ports (Dallas/Ft. Worth, Houston, Miami, Newark, JFK and Boston) will be added to the program.  While the program is only in its initial phases, by August 2012, more than 11,800 Simplified Entries had been filed for more than 400 importers of record.

Trade Intelligence
CBP is in the process of developing actionable trade intelligence under its Private Sector Intelligence Liaison Office (PSILO) concept.  PSILO representatives include security, customs compliance and sourcing personnel, and are meant to provide CBP with insight into enforcement issues related to intellectual property right, anti-dumping and countervailing duties, trade preferences, and industry-wide developments. PSILO is not co-located with CBP.  Instead, representatives may be located in the United States, abroad or near source countries.  PSILO interacts “virtually” with CBP, by means of email, phone and conference calls.

Changes to the European Union’s GSP Program
On October 4, 2012, the European Union (E.U.) approved a regulation amending its Generalized System of Preference (GSP) program.  The new program, which will go into force on January 1, 2014, will remove high and upper-middle income countries from the preference scheme and instead provide trade benefits to lower income countries.

The full quarterly update can be read online; for additional information and regular updates, please see the Global Commerce section of the Toy Industry Association (TIA) website or contact Rebecca Mond, TIA director of federal government affairs (202.344.4554).