SOLAS  New Container Weighing Requirements

Change is on the horizon in the shipping industry, and it is important to make sure you are staying informed. Effective July 1st, 2016, changes adopted by the International Maritime Organization (IMO) regarding verified container weights will become effective. These changes were first introduced at the 2014 Safety of Life at Sea (SOLAS) Convention, but it is now time for implementation. The full text of the applicable SOLAS regulations can be found here

These regulations initially came about as a result of safety issues within the shipping industry. There were problems regarding overweight/underweight containers, misreported freight, poor weight distribution within containers, and more: see “Safety and Shipping Review 2014“. Ideally these changes will help accomplish a reduction in loss of containers from vessels, increased assurance to all parties within the supply chain, and overall improved safety.  These new requirements will apply to all 171 IMO member countries, as well as the three associate members of this organization.

The responsibilities of the shipper (as designated by the bill of lading) under these new regulations are particularly important. The shipper will now be required to verify the gross mass of each container via a signed document; this document must be physically signed (stamps will be unacceptable), and the form must be submitted in time to be used by the master and terminal representatives in the ship’s stowage plan.  The shipper has the option of submitting the container weight via the shipping instructions to the line, or in a specific communication such as a weight certificate. Regardless of submission method, the weight included must be designated as the “verified gross mass” and authorized by the accompanying signature. The shipper is able to determine whether they would prefer to weigh the contents of the container prior to or after loading, but the critical designation is that estimated weights are not permitted. The equipment used to weigh contents must meet national certification requirements, and the party verifying container weight is not permitted to use weight provided by a previous party. Click here for the Implementing Guidelines issued by MSC

The execution of enforcement for this new requirement will be put on the shoulders of the carriers. Essentially, carriers are highly encouraged to refuse to load containers for which a signed weight verification is missing. Refusing to carry these containers will encourage shippers to abide by the new requirements set forth by SOLAS. As July is only a few months away, it is important for shippers to begin proactively planning how they will adjust their processes to abide by these new requirements.

 

If you are in need of additional resources or more information, please visit the following link: http://www.worldshipping.org/industry-issues/safety/faqs.

 

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Importer Tips to Avoid Misclassification of Goods

            When importing goods into the United States the importer of record (the owner, purchaser, or a licensed Customs broker) must file entry documents with Customs at the port of entry.  Among the information contained in the entry documents are the merchandise descriptions and tariff classification information. Many importers rely on their suppliers or Customs brokers to accurately classify their goods, but sometimes the importers don’t supply enough information for Customs brokers to accurately classify.  What’s more, importers are often not aware that it is they, not the Customs broker, who are responsible for any errors or omissions in entry documents.

           When mistakes occur on entry documents, for example, misclassified goods, Customs will require importers to pay any difference in duty and will likely assess fines and penalties. Here are a few measures you can take to help you avoid any errors in misclassifying goods on your entry documents and avoid supplemental duty payments as well as fines and penalties:

  • KNOW YOUR PRODUCT!
    • This is probably one of the most common oversights of importers. If the importer does not know all the details pertaining to their product then those acting on their behalf cannot be expected to know them either.  Importers should obtain photographs of the product where possible, specific details such as whether (for example) an auto part is a bearing or a wheel hub assembly that includes a bearing, the manufacturer (not just the seller), etc.  We have found certain trading companies involved in heavily regulated articles without being aware of mulitple agency jurisdiction at the time of entry, to the importer later dismay.
  • Retain an expert
    • Seek out the help of a licensed Customs’ broker with experience in entering your particular product or an attorney knowledgeable in Custom’s regulations.  This does not mean rely on the expert to tell you about your product. #1 is always to know your product thoroughly yourself.  This way you can provide the expert with a full, complete, and accurate description of it so he or she can then help you with compliance.  An expert can provide you with the correct questions to ask your seller or manufacturer so you ensure either that the product is correctly classified or with proof that you have taken reasonable care in performing due diligence to correctly classify your product.
  • Due Diligence and Reasonable Care
    • Clients often come to us saying they have never been asked for certain information. The fact is that transactions and merchandise may be handled differently at different ports, and Customs may not ask the exact same questions in every situation.  The general information will likely be the same, i.e. documents to prove origin of your product, production documents, transport/sale documents, etc.; however, your particular product may present a unique situation for Customs that may require it to seek alternate or differing information.  Even within the same port, an officer may request information that another officer doesn’t. Always discuss your importations with an expert or a Customs’ import specialist in advance so you know what to expect. 
  •  Informed Compliance
    • This responsibility is shared between CBP and the importer where CBP provides effective communication of its requirements to the trade community and importers are required to conduct their business in compliance with U.S. laws and regulations.   The Tariff schedules are available to the public, as well as many other publications discussing specific products and topics. You can also request an opinion on classification or a binding ruling on classification from Customs.  An import specialist in the port of entry can provide you with more information, as can your retained expert.
    • The following are questions (verbatim) posed by Customs’ in its informed compliance guide “Importing into the United States:  A Guide for Commercial Importers” to assist importers in using reasonable care[1]  to ensure proper merchandise classification:

Questions by Topic:

Merchandise Description & Tariff Classification[2]

Basic Question: Do you know what you ordered, where it was made, and what it is made of?

  1. Have you provided a complete, accurate description of your merchandise to CBP in accordance with 19 U.S.C. 1481? (Also, see 19 CFR 141.87 and 19 CFR 141.89 for special merchandise description requirements.)
  2. Have you provided CBP with the correct tariff classification of your merchandise in accordance with 19 U.S.C. 1484?
  3. Have you obtained a CBP ruling regarding the description of your merchandise or its tariff classification (see 19 CFR Part 177)? If so, have you followed the ruling and apprised appropriate CBP officials of those facts (i.e., of the ruling and your 28 compliance with it)?
  4. Where merchandise description or tariff classification information is not immediately available, have you established a reliable procedure for obtaining it and providing it to CBP?
  5. Have you participated in a CBP classification of your merchandise in order to get it properly described and classified?
  6. Have you consulted the tariff schedules, CBP informed compliance publications, court cases or CBP rulings to help you properly describe and classify the merchandise?
  7. Have you consulted with an expert (e.g., lawyer, customs broker, accountant, customs consultant) to assist in the description and/or classification of the merchandise?
  8. If you are claiming a conditionally free or special tariff classification or provision for your merchandise (e.g., GSP, HTS Item 9802, NAFTA), how have you verified that the merchandise qualifies for such status? Do you have the documentation necessary to support the claim? If making a NAFTA preference claim, do you have a NAFTA certificate of origin in your possession?
  9. Is the nature of your merchandise such that a laboratory analysis or other specialized procedure is advised for proper description and classification?
  10. Have you developed reliable procedures to maintain and produce the required entry documentation and supporting information?

 For more information on correct classification or if you are currently facing an issue with CBP regarding misclassified goods, you can reach us via email at smorrison@customscourt.com or nmooney@customscourt.com or by phone at (850) 893-0670 or toll free at (800) 583-0250.


[1] Reasonable Care is not easily definable since each import transaction has different facts and circumstances.  Visit CBP’s Importing Guide for more in depth information as to how you can ensure you are meeting your responsibility to import using “reasonable care.”

[2] U.S. Customs and Border Protection, “Importing into the United States:  A guide for Commercial Importers”, CBP Publication No. 0000-0504, revised November 2006, http://www.cbp.gov/linkhandler/cgov/newsroom/publications/trade/iius.ctt/iius.pdf, last accessed May 30, 2012.

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Customs Seizure Benefits Florida

In August 2008, a piece of America’s aviation history, the Douglas AD-4N Skyraider*, reentered its home territory under false pretenses, which ultimately led U.S. Customs and Border Protection (CBP) agents to seize the aircraft nearly a year later.  Import and export of military aircraft and other defense articles generally requires a license or permit under the Arms Export Control Act that neither the pilot or owner of the aircraft provided to CBP officers upon the plane’s arrival in Port of Buffalo, N.Y. from France.  Rather, the pilot provided false information to CBP in order to enter the country without the appropriate authorization.

The scheme may have worked had the aircraft’s 20mm cannons not been discovered in October 2008 at the Port of Savannah, Ga hidden inside containers being imported by the aircraft’s owner, Claude Hendrickson, president of Dixie Equipment in Woodstock, Ala.  Upon this discovery, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HIS) unit launched an investigation into the circumstances surrounding the importation of the cannons, which revealed the unauthorized entry of the aircraft earlier that year.

Under 22 U.S.C. §2778(b)(2) “Control of Arms Export and Imports”, no defense article (as designated by the President on the United States Munitions List) may be imported or exported without a license, whether for export or temporary or permanent import from either the Department of State or the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).  In this case, the importer would have required a license for importation from the ATF because the importation of the U.S. Munitions List Category 8 aircraft was permanent (as opposed to temporary import licenses, which are granted by the State Department).

The process of obtaining a permit from the ATF for importation of arms, ammunition and implements of war begins with an application Form 6, which must be signed, dated, and contain very specific information regarding the importer, foreign seller and shipper, and specifications of the article to be imported.  The regulations set forth in 27 C.F.R. §447.42 list the requirements in more detail.  Importers will generally have an answer from ATF on their permit within four to six weeks provided the importer properly completes the Form 6.  Once the importer receives the permit, it will be valid for one year from the issuance date, and the importer must then complete a Form 6A, “Release and Receipt of Imported Firearms, Ammunition and Implements of War”  in order to obtain release of the article from CBP upon its arrival into the United States.**

As a result of Mr. Hendrickson’s not following these guidelines for importing his aircraft, the plane and its log books, cannons, and other parts are now on their way to the National Naval Aviation Museum in Pensacola, Florida.

*This aircraft is an American single-seat attack aircraft that was used by both the U.S. and French military from the 1940s through the 1980s.  http://en.wikipedia.org/wiki/Douglas_A-1_Skyraider

**This is a simplified explanation of the arms licensing and permit procedure.  For more information on importing munitions, please visit the following website:  http://www.atf.gov/firearms/how-to/import-firearms-ammo-implements-of-war.html.  It is also highly advisable for importers to seek the advice of professionals engaged in the import and export of arms and munitions as well as the advice of legal counsel.

For more information see the following:

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