The Month in International Trade – January 2022

In this issue:

• Top Trade Developments
  • Crowell & Moring’s International Trade Group Named a Law360 Practice Group of the Year
  • Latest U.S. Trade Actions/Tariffs and Other Countries Retaliatory Measures
  • Latest on Section 301 Product Exclusions
  • Presidential Nominees Join the Bureau of Industry and Security
  • House Introduces Trade Legislation on GSP and MTB as Part of America COMPETES Act
  • Comment Period for UFLPA Opens on January 24
  • UPDATE: [(Close of Comments on Commerce Cyber Rule] Jan. 20, 2022
  • Customs Rulings of The Week
• Crowell Speaks

This news bulletin is provided by the International Trade Group of Crowell & Moring. If you have questions or need assistance on trade law matters, please contact Jeff Snyder or any member of the International Trade Group.

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Top Trade Developments

Crowell & Moring’s International Trade Group Named a Law360 Practice Group of The Year

Crowell & Moring’s International Trade Group has been named a Practice Group of the Year for 2021 by Law360. This marks the fourth year the group has been recognized by the publication with this distinction.

“We are thrilled to be recognized by Law360 with this honor,” said Nicole Janigian Simonian, co-chair of the International Trade Group. “We continue to take pride in the partnerships we have with our clients and the trust they put in us to handle their most important matters.”

In a profile of the group, Law360 noted the firm’s work with Invenergy Renewables “in its ongoing campaign against solar panel duties,” as well as how the firm “steered DuPont through a synthetic roofing imports dispute that risked its access to a $29 billion market.” The publication also highlighted the collaborative nature of the group as a key factor to its success, allowing lawyers from across the firm to come together to offer clients the deepest bench of knowledge and meet their needs.

“The international trade community is in the midst of a turbulent time and our clients look to us to provide advice and stability,” said John Brew, co-chair of the International Trade Group. “As we continue to grow our group, we remain committed to providing top-level client service on a global scale.”

Click here to read the Practice Group of the Year feature profile.

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Latest U.S. Trade Actions/Tariffs and Other Countries Retaliatory Measures

Please click here anytime for the latest actions, covered products rate increases, and effective dates.

For more information, contact: Dan Cannistra, Robert Holleyman, Bob LaFrankie, Ru Xiao-Graham, Sam Boone, Clayton Kaier

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Latest on Section 301 Product Exclusions

Please click here anytime for the latest actions regarding Section 301 Product Exclusions.

For more information, contact: Dan Cannistra, Robert Holleyman, Bob LaFrankie, Ru Xiao-Graham, Sam Boone, Clayton Kaier

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Presidential Nominees Join the Bureau of Industry and Security

Thea Rozman Kendler and Matthew Axelrod joined the U.S. Department of Commerce’s Bureau of Industry and Security (“BIS”) as Assistant Secretaries of Commerce. Both were nominated by President Biden and confirmed by the Senate.

Under the Export Control Reform Act, 50 U.S.C. §4852(a), the President must appoint two Assistant Secretaries of Commerce to assist the Under Secretary of Commerce for Industry and Security. The positions were previously held by President Trump’s appointees Richard Ashooh and Jeffrey Kessler. Mr. Ashooh resigned on July 16, 2020 and his position had been open since that time. Mr. Kessler vacated his position with President Biden’s inauguration.

Ms. Kendler assumed her role as the Assistant Secretary of Commerce for Export Administration on December 20. The Export Administration’s technical professionals control the export of dual-use and military items, analyze the impact of export controls, and support the U.S. defense industrial base. During her confirmation hearing in September 2021, Ms. Kendler pledged to prevent the transfer of sensitive technologies to China, and noted, “I wouldn’t hesitate to impose unilateral controls, if necessary, to keep the United States’ technology out of hands of human-rights abusers.”

Mr. Axelrod began his position as Assistant Secretary of Export Enforcement on December 28. His team of special agents enforce export control laws intended to stop exports of sensitive goods and technologies that could harm U.S. interests.  In his testimony in October, Mr. Axelrod noted, “It is an essential function that helps ensure our adversaries don’t have access to dual-use goods and technologies that they can put to malign purposes like terrorism, weapons-of-mass-destruction proliferation, and human rights abuses.”

The press release from BIS is available here.

For more information, contact: Jeff Snyder, Laurel Saito, Edward Goetz

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House Introduces Trade Legislation on GSP and MTB As Part of America Competes Act

On January 25, 2022, the House Ways and Means Committee released the America COMPETES Act as the House counterpart to the U.S. Innovation and Competition Act. Commonly referred to as the China packages, both pieces of legislation include trade titles which will now proceed to conference following a floor vote in the House. While the renewal of the Generalized System of Preferences (GSP), Miscellaneous Tariff Bill (MTB), and Section 301 Exclusions have received broad bipartisan support, key differences exist between the House and Senate text.

For a comparison of notable provisions as outlined in congressional summaries and the legislative text, please click here.

For more information, contact: John Brew, Aaron Marx, Frances Hadfield, Edward Goetz, Clayton Kaier

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Comment Period for UFLPA Opens on January 24

As an update to our Uyghur Forced Labor Prevention Act (“UFLPA”) post, the public comment period will open on Monday, January 24, 2022.  A Federal Register Notice will be published on Monday and the 45-day comment period will end on March 10, 2022.  The UFLPA was signed on December 23, 2021 and will take effect on June 21, 2022.

As required by the UFLPA, the U.S. Department of Homeland Security, on behalf of the Forced Labor Enforcement Task Force (“FLETF”), is seeking comments on how best to ensure that goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part with forced labor in China are not imported into the United States.  A non-exhaustive list of questions from the Federal Register Notice for commenters is provided below:

• What are the risks of importing goods, wares, articles and merchandise mined, produced, or manufactured wholly or in part with forced labor in the People’s Republic of China, including from the Xinjiang Uyghur Autonomous Region or made by Uyghurs, Kazakhs, Kyrgyz, Tibetans, or members of other persecuted groups in any other part of the People’s Republic of China? 

• To the extent feasible, as part of the assessment of risks, what mechanisms, including the potential involvement in supply chains of entities that may use forced labor, could lead to the importation into the United States from the People’s Republic of China, including through third countries, of goods, wares, articles and merchandise mined, produced, or manufactured wholly or in part with forced labor? 

• What forms does the use of forced labor take in the People’s Republic of China and the Xinjiang Uyghur Autonomous Region? For example, what “pairing assistance” and “poverty alleviation” or other government labor schemes exist in the People’s Republic of China that include the forced labor of Uyghurs, Kazakhs, Kyrgyz, Tibetans, or members of other persecuted groups outside of the Xinjiang Uyghur Autonomous Region? What similar programs exist in which work or services are extracted from Uyghurs, Kazakhs, Kyrgyz, Tibetans, or members of other persecuted groups under the threat of penalty or for which they have not offered themselves voluntarily? 

• What goods are mined, produced, or manufactured wholly or in part with forced labor in the Xinjiang Uyghur Autonomous Region or by entities that work with the government of the Xinjiang Uyghur Autonomous Region to recruit, transport, transfer, harbor, or receive forced labor?

All comments and material submitted will be available online.

For more information on the UFLPA and actions addressing human rights and forced labor abuses, contact our team.

For more information, contact: John Brew, David Stepp, Jeff Snyder, Frances Hadfield, Laurel Saito, Martin Yerovi

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Update: [(Close of Comments on Commerce Cyber Rule] Jan. 20, 2022

On January 12, 2022 the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) issued a federal register notice delaying the effective date of new controls on cybersecurity items and an accompanying new license exception. The rules are now set to take effect on March 7, 2022.

The new controls were published in an interim final rule on October 21, 2021, please see our earlier client alert on this. Broadly speaking, they cover (a) items, including software, for the generation, command and control, or delivery of intrusion software and (b) internet protocol (IP) network communication surveillance equipment. BIS delayed the implementation to give industry additional time to comply with the new restrictions as well as update internal compliance procedures, and to provide BIS itself time to provide additional guidance on the rule. BIS may also consider some modifications to the rule, but is not reopening the comment period and these modifications based on the latest comments will most likely be made, if at all, sometime after the new effective date for the interim final rule.

For more information, contact: Kate Growley, Clif Burns, Alexander Urbelis, Chandler Leonard

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Customs Rulings of The Week

• Classification of Pet Collar Accessory Adapted for Use with Airtag Tracking Device

https://www.cmtradelaw.com/2022/01/customs-ruling-of-the-week-classification-of-pet-collar-accessory-adapted-for-use-with-airtag-tracking-device/

• Classification of A Cooling Wristband from China

https://www.cmtradelaw.com/2022/01/customs-ruling-of-the-week-classification-of-a-cooling-wristband-from-china/

• Country of Origin of LiteCure Deep Tissue Laser Therapy Units

https://www.cmtradelaw.com/2022/01/customs-ruling-of-the-week-country-of-origin-of-litecure-deep-tissue-laser-therapy-units/

• Classification of Plastic Cutting Boards

https://www.cmtradelaw.com/2022/01/customs-ruling-of-the-week-classification-of-plastic-cutting-boards/

 

For more information, contact: Frances Hadfield, Martín Yerovi

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Crowell Speaks

Crowell & Moring International’s President and CEO Ambassador Robert Holleyman and Deputy U.S. Trade Representative Ambassador Sarah Bianchi discussed the future of the trade relationship between the U.S. and China, the Biden Administration’s upcoming Indo-Pacific Economic Framework, and numerous other topics at the Washington International Trade Association’s annual conference. View the full discussion below. #WITC22 #IndoPacific #GlobalTrade #BidenAdministration Closing Plenary with Ambassador Sarah Bianchi, Deputy U.S. Trade Representative - 2022 WITC

February 4, 2022 – Export Compliance Daily (subscription required) quotes associate Brian McGrath in an article regarding response times from the Bureau of Industry and Security (BIS) for license applications involving the agency’s military end-use and end-user rule. McGrath says he has seen mixed results from the agency, but that BIS has been helpful when responding to exporter questions about the rule.

February 3, 2022 – A video interview with partners John Brew, co-chair of the International Trade Group and Tom Lorenzen, co-chair of the Environment & Natural Resources Group, is featured on SupplyBrainDrain. Brew and Lorenzen discuss how well companies are doing in adhering to their ESG promises, based on the results of the firm’s recent ESG Survey. To watch, click here: Are Businesses Living Up to ESG Requirements?

January 13, 2022 – The Wall Street Journal* quotes partner Carlton Greene, former chief counsel at the FinCen (Financial Crimes Enforcement Network), in an article regarding a class-action lawsuit filed in New York federal court against DeFi service PoolTogether. Greene says it’s an open question on how courts and regulators are going to respond to the unique features of DeFi. (“Crypto-Savings Lawsuit Puts Principles of DeFi to the Test”) *subscription required

January 3-4, 2022 – Law360 and Law360 Pulse* - Ambassador Robert Holleyman, president and CEO of Crowell & Moring International and former Deputy U.S. Trade Representative, explains why 2022 will be very telling about what the actual U.S.-China strategy looks like and potential scenarios moving forward (“4 Pressing Trade Policy Questions Looming in 2022”).