A California state appeals court on Feb. 4 found a customs brokerage can’t enforce a noncompete agreement against its former employee. Hecny Brokerage’s agreement with its longtime employee Madeline Sopko was too broad too meet California’s strict limits on noncompete clauses, and Sopko’s national permit and work with clients nationwide made it too difficult to narrow the noncompete’s geographical scope to fit California’s strict requirements, the court said.
The recent executive order to strengthen e-commerce enforcement is ambiguous, and how CBP plans to heed the order's call to restrict access to importer of record numbers based on customs and intellectual property rights violations is unclear, Sandler Travis lawyer Paula Connelly said. That's because, currently, domestic importers use their tax IDs to register with CBP, and only companies that have no offices in the U.S. file for an importer of record number.
CBP's notice on the coming Section 301 tariff decrease (see 2002040045) and the agency's treatment of List 4A goods in foreign-trade zones are drawing some industry concerns. The CBP notice said the duty rate for goods subject to the tariffs in FTZs is based on “the rate of duty and tax in force on the date of filing the application for privileged foreign status.” CBP's interpretation “is inconsistent with existing CBP precedent and [we] will be challenging it on behalf of our a number of clients,” said Sidley lawyer Ted Murphy in a blog post.
CBP issued the following releases on commercial trade and related matters:
President Donald Trump issued an executive order on Jan. 31 that mandates CBP work toward new criteria for obtaining importer of record numbers, and new consequences for customs brokers that help importers evade those criteria. The order directs the Department of Homeland Security to "issue a notice of proposed rulemaking to establish criteria importers must meet in order to obtain an importer of record number," and says one of those criteria must be that CBP debarment or suspension for reasons related to trade renders an importer ineligible.
The Animal and Plant Health Inspection Service is set to require filing of its “core” partner government agency (PGA) data in ACE beginning Aug. 3, 2020, the agency said in a notice. “On that date, APHIS intends to begin applying Harmonized Tariff Schedule (HTS) flags, which will alert filers who opt to submit data electronically whether APHIS import data is or may be required. Importers or brokers using ACE must enter APHIS-required import data when they receive an APHIS-specific HTS flag in order to complete their entry in the system,” APHIS said.
CBP remains cautious in moving toward continuing education requirements for customs brokers as it continues to examine the issues that derailed a similar effort some years ago, said Brenda Smith, executive assistant commissioner of CBP’s Office of Trade, during a Jan. 29 interview with International Trade Today. CBP recently launched a task force on the subject (see 1910160056), but the agency is considering whether an advance notice of proposed rulemaking (ANPRM) is necessary before issuing an actual proposal, she said.
The following is a selection of articles that appeared in International Trade Today in 2019 covering ruling letters. CBP frequently publishes rulings months after they are issued, so these articles are included based on the dates the articles were published, rather than the date the ruling letter was issued.
Tariffs on French champagne, cheeses, handbags and other products (see 2001060040) will not be coming, several news outlets are reporting, since France has agreed not to impose a Digital Services Tax in 2020 as negotiations continue at the Organization for Economic Co-Operation and Development on a fair way to impose income taxes on companies such as Google and Amazon.
The U.S. Department of Agriculture will hold two meetings with the trade community on implementation of upcoming inspection requirements under the agreement suspending antidumping and countervailing duties on fresh tomatoes from Mexico, the National Customs Brokers & Forwarders Association of America said in an emailed update. One of the meetings will be held in Nogales, Arizona, on Jan. 28; the other will be on Jan. 30 in Otay Mesa, California.