Last week U.S. lawmakers announced that they had come to a deal on a U.S. Customs and Border Protection bill that would streamline import duties on goods destined to be re-exported and allow articles exported from the U.S. to be commingled for the first time, according to the Journal of Commerce. The bill also toughens U.S. trade law enforcement and rules against currency manipulation.
This is the first overhaul of Customs in roughly 15 years and one that many have said is long overdue.
The legislation, agreed to by lawmakers from parties and both chambers of Congress, reconciles two bills introduced in the House of Representatives and the Senate earlier this year. Overall, the bill reauthorizes the U.S. Customs and Border Protection agency to streamline trade rules that aim to keep importers from avoiding U.S. anti-dumping and countervailing duties; add new protections for intellectual property rights and provide more tools to identify and address currency manipulation.
Drawback, or the amount of excise or import duty remitted on imported goods that the importer re-exports rather than sells domestically, has also been streamlined under the bill. The legislation would standardize the time frames for filing drawback and modernize claimant record-keeping requirements. Drawback claimants would have to retain records for five years after liquidation. Drawback claims would have to be filed electronically and no later than five years after the date on which the merchandise is imported or, if the claim is based on merchandise imported on more than one date, the earliest date.
The legislation also grants duty-free treatment to any exported product returned to the U.S. within three years of being exported and certain U.S. government property returned to the country. Articles exported from the U.S. are also allowed to be commingled and the origin, value and classification of such articles may be accounted for using an inventory management method for the first time.
This bill should be especially beneficial to North America trade, where “some people use warehouses or distribution centers in Canada and Mexico along the border and goods are moving in and out all the time”, said Nicole Bivens Collinson, president of international trade and government affairs at the Washington law offices of Sandler, Travis & Rosenberg
The bill also increases the de minimis threshold on the value of goods that can be imported by one person on one day free of duty and tax, something Collinson says is “good for e-commerce and business.”
The deal stops short of sanctions on currency manipulation, but does allow the U.S. to bar countries from trade deals and government procurement contracts if they artificially devalue their currencies to gain a competitive advantage through cheaper exports.
The negotiated bill would also grant preferential treatment for some imports coming out of Nepal, in the wake of an earthquake earlier this year that devastated the developing South Asia nation.
Although Congress must still pass the new deal announced, most on Capitol Hill and inside the trade industry are optimistic that Customs reauthorization will reach President Obama’s desk before the year’s end. The hope, for many, is that the legislation will ring in a new era, in which U.S. lawmakers are more attentive to changes and evolutions in international trade.
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