Category: Customs & Trade
FDA and CBP to Begin New Pilot Programs
Both the Food and Drug Administration (FDA) and U.S. Customs and Border Protection (CBP) are expected to begin pilot programs to give additional benefits to importers who have secured their supply chains and internal controls this September. On August 20, 2013, the FDA announced it will begin accepting applications to participate in its Secure Supply Chain Pilot Program (SSCPP) which will run for two years, from February 2014 through February 2016. CBP has not yet officially announced, but is expected to announce within the next month, that it will begin a test pilot for its Trusted Trader Program.
Through the SSCPP, the FDA hopes to prevent the importation of adulterated, misbranded, or unapproved drugs by allowing the Agency to focus its resources on imported drugs that fall outside the program and may pose risks. The FDA plans to increase the rate at … Read More »
Drug Import Regulation: On the Brink of Historic Change
On Friday, July 12, 2013, the Food and Drug Administration (FDA) hosted a public meeting to discuss the implementation of the drug supply chain provisions to Title VII of the Food and Drug Administration Safety and Innovation Act (FDASIA). The meeting included a host of speakers that shared their perspective on the best course of action for implementation of Section 713 (Standards for Admission of Imported Drugs) and Section 714 (Registration of Commercial Importers of Drugs and Good Importer Practices) of the regulations. The meeting was also open to public comment from industry, trade, and other stakeholders who shared their perspective. Since then, industry groups, drug importers, and other stakeholders have been preparing comments to guide the implementation process. Final comments on the implementation of Sections 713 and 714 are due by August 12, 2013.
The globalization of the drug supply … Read More »
Agree to Disagree: FDA and Customs Origin and Drug Labeling Requirements
When merchandise is imported into the United States, there is a slew of information required to be reported to United States Customs and Border Protection (Customs) and the Food and Drug Administration (FDA). The information is transmitted electronically, usually by the importer’s designated customs broker. Among the key elements transmitted to Customs and the FDA is the country of origin of the imported product. Unfortunately, the answer to this question is not always easy, and in many cases Customs and the FDA do not agree. While it may not always be possible to reconcile the two agencies’ requirements, compliance with both is nonetheless required.
Country of origin determination and labeling for pharmaceutical products is a prime example of where the FDA and Customs do not see eye-to-eye. The FDA generally defines origin based on the last country of manufacture. Moreover, FDA … Read More »
Tougher Sanctions on Iran: What it Will Mean for Businesses
Tougher sanctions went into effect on October 9, 2012, that broadly expand the extraterritorial reach of the U.S. Government with regard to conducting business with Iran. Most significantly, with the Iran Threat Reduction and Syria Human Rights Act of 2012, any business owned or controlled by a U.S. parent may expose its parent to sanctions for its business activities with Iran.
Significantly, the new law allows for the imposition of civil penalties of up to $250,000, or twice the value of the transaction, for activities completed by any foreign entity owned or controlled by a U.S. parent, if such activities would violate U.S. sanctions laws if they were to be undertaken in the U.S. or completed by a US person. Stated another way, if a U.S.–owned or U.S.–controlled foreign entity enters into a transaction with an Iranian party that the parent … Read More »
A Rose By Any Other Name … May Carry A Higher Duty Rate
As countries work to harmonize international trading rules and develop bilateral and regional Free Trade Agreements (FTA), there remain certain international trade truths that all international traders should understand. Central to those is the principle of tariff classification. No matter the country, all imported products must be classified under the Harmonized Tariff System and will be assessed duty at the corresponding duty rate applied by the importing country. This globally managed system of tariff classification is guided by the World Customs Organization (WCO) and applies to all WCO member states.
International trade truth number two is that all merchandise must be classified, and therefore assessed duty, based on its condition at the time of entry. Tariff classification may be based on a variety of factors, including what a product is, its material composition, how it works, where it is used, and to whom it … Read More »