Customs Corner
Trade and Customs Updates
MPF to be Adjusted for Inflation in 2024
In a Federal Register notice published on Friday, 28 Jul 2023, US Customs and Border Protection (CBP) announced it is adjusting customs user fees established by the Consolidated Omnibus Budget Reconciliation Act (COBRA) for Fiscal Year 2024 in accordance with the Fixing America’s Surface Transportation Act (FAST Act) as implemented by the CBP regulations.
Therefore, effective 01 Oct 2023, the following fees will increase as follows:
- Merchandise Processing Fee Rate is not changing at 0.3464%
- Merchandise Processing Fee Minimum will change from $29.66 to $31.67.
- Merchandise Processing Fee Maximum will change from $575.35 to $614.35.
- Informal Entry/Release, automated and not prepared by CBP personnel (class code 311a), will change to $2.53.
- Manual, Formal Entry/Release (class code 500) Surcharge will change to $3.80.
- Express Consignment Carrier/Centralized Hub Facility fee will change to $1.27 per individual waybill/bill of lading.
- Commercial Vessel (class code 485) or Commercial Aircraft (class code 495) Passenger Arrival customs fee will change to $6.97 per passenger.
- Commercial Vessel Passenger Arrival from Exempt Areas (class code 484) customs fee will change to $2.44 per passenger.
- The Dutiable Mail fee (class code 496) will change to $6.97.
U.S Department of Homeland Security (DHS) Adds to the UFLPA Entity List
On August 2, 2023 the U.S. Department of Homeland Security on behalf of the Forced Labor Enforcement Task Force (FLETF) announced that three entities will be added to the UFLPA Entity List taking effect on August 2, 2023.
Per the FRN:
This update adds one entity to the section 2(d)(2)(B)(ii) list of the UFLPA, which identifies entities working with the government of the Xinjiang Uyghur Autonomous Region to recruit, transport, transfer, harbor or receive forced labor or Uyghurs, Kazakhs, Kyrgyz, or members of other persecuted groups out of the Xinjiang Uyghur Autonomous Region: Camel Group Co., Ltd.
This update also adds one entity and one subsidiary to the section 2(d)(2)(B)(v) list of the UFLPA, which identifies facilities and entities, including the Xinjiang Production and Construction Corps, that source material from the Xinjiang Uyghur Autonomous Region or from persons working with the government of the Xinjiang Uyghur Autonomous Region or the Xinjiang Production and Construction Corps for purposes of the “poverty alleviation” program or the “pairing-assistance” program or any other government labor scheme that uses forced labor: Chenguang Biotech Group Co., Ltd. and its subsidiary Chenguang Biotechnology Group Yanqi Co. Ltd
The full and updated entity list can be found published on https://www.dhs.gov/uflpa-entity-list .
FDA Announces FY 2024 User Rates
The US Food and Drug Administration (FDA) is announcing the fiscal year (FY) 2024 user fee rates for importers approved to participate in the Voluntary Qualified Importer Program (VQIP); accreditation and certification bodies interested in participating in the Accredited Third-Party Certification Program (TPP); and certain domestic and foreign facility reinspections, failures to comply with a recall order, and importer reinspections. The user fee rates are authorized by the FDA Food Safety Modernization Act (FSMA) and allow the agency to assess and collect fees to cover the FDA’s cost of administering these programs.
VQIP is a voluntary, fee-based program for the expedited review and importation of foods from importers who achieve and maintain a high level of control over the safety and security of their supply chains.
The FY2024 VQIP user fee rate will be effective on August 1, 2023, and supports program benefits from October 1, 2023, through September 30, 2024. Currently, the agency is not offering an adjusted fee for small businesses. Approved VQIP applicants must pay the user fee before October 1, 2023, to begin receiving benefits for the 2024 fiscal year.
TPP is a voluntary program in which FDA recognizes “accreditation bodies” that may accredit third-party “certification bodies.” The certification bodies can conduct food safety audits and issue certifications of foreign food facilities.
The FY2024 TPP user fee rate will be effective on October 1, 2023, and will remain in effect through September 30, 2024.
Please direct any questions regarding VQIP to the VQIP Importers Help Desk at 1-301-796-8745 or FSMAVQIP@fda.hhs.gov. Questions regarding TPP can be sent to FDAthirdpartyprogram@fda.hhs.gov.
Yellow succumbs to a mountain of debt
Yellow, the third-largest less-than-truckload (LTL) carrier in the US, has ceased operations and is getting ready to submit to bankruptcy. After 99 years in business, Yellow Corp is at the end of the road, with a $1.5 billion debt burden and rapid erosion as customers shifted to other LTL providers.
On Sunday a notice at the company’s terminals read: “Dear valued customers and employees, all company operations have ceased.”
The Teamsters union, which represents the majority of Yellow employees, reported it had received legal notice from the company on Sunday that it was ceasing operations and would be filing for bankruptcy.
According to one report, this was confirmed by two Yellow executives whose tenure was terminated last Friday. It had sent notices to non-unionized employees that their jobs were terminated with immediate effect.
“Today’s news is unfortunate, but not surprising,” said Teamsters president Sean O’Brien ion Sunday. “Yellow has historically proven that it could not manage itself, despite billions of dollars in worker concessions and hundreds of millions in bailout funding from the federal government. This is a sad day for workers and the American freight industry.”
Yellow’s bankruptcy would reportedly be the largest to date on the US trucking scene, its market share was around the 10% mark. Its closure eliminates 22,000 unionized jobs and some 8,000 non-union positions.
As the LTL market has slowed down in recent months, analysts reckon there is enough capacity available to absorb Yellow’s remaining clients and their business. Apparently, the outlook is already nudging up pricing in the market, according to shipper reports.
Canada dock workers’ union and employers reach agreement to avert a strike
A dock workers’ union on Canada’s West Coast and port employers have provisionally agreed to a new labour contract, averting an immediate strike, but the agreement needs to be approved by workers who rejected a previous deal.
A compromise solution secured by the International Longshore and Warehouse Union (ILWU) leadership was rejected by its membership on 22 July. The ILWU and the British Columbia Maritime Employers Association (BCMEA) are recommending ratification of the new deal, they said in a joint statement late on Sunday. Terms were not disclosed.
The union, representing about 7,500 dock workers, has agreed not to call a strike until a ratification vote, the Canada Industrial Relations Board (CIRB) said on Monday, adding that the vote must be held no later than Friday.
“We are hoping that this new offer, a solution that’s on the table, will be accepted,” Prime Minister Justin Trudeau told reporters in Hamilton, Ontario, on Monday.
While the terms of Sunday’s agreement are not expected be made public until after the ratification vote, the rejected deal had provided a compounded wage increase of 19.2% and increased retirement payouts in 2026 to C$96,250 ($72,625) for eligible retiring employees, over and above employees’ pension entitlements, according to the employers’ association.
Trade and Customs Reminders & Events
WEBINAR: Continuing Education for Licensed Customs Brokers
03 Aug 2023 1:00-2:00PM ET
The webinar will provide an overview of the new regulations for customs brokers, which mandate a continuing education requirement to maintain an individual license. The webinar will present an implementation overview as well as the next steps for customs brokers to take to meet the upcoming program requirements.
