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New Declaration Requirement For Many Imported Nonwovens Could Be On The Horizon



proposed "farm bill" impacted goods containing plants, including nonwovens made from cotton, cellulose or other natural fibers



By Peter Mayberry and Jessica Franken



Published September 22, 2009
Related Searches: INDEX cotton roll goods hemp

As with many pieces of legislation, Congress passed a bill earlier this year that contains provisions that produce unintended consequences.Indeed, the "Food, Conservation, and Energy Act of 2008" (a.k.a. 2008 "farm bill") aims to curb illegal logging activity but is creating a great deal heartburn for many U.S. importers because it contains provisions that make it illegal to import plants or plant products unless they are accompanied by a customs declaration identifying the plant's scientific name, harvesting location and more.

"Plants" and "plant products" are broadly defined under the bill such that just about anything that contains a plant derivative—including furniture, textiles, pigments and dyes, rubber, books and much more – could be included.So many products could be impacted by the measure, in fact, that some government officials are predicting that 30,000 imports coming into the U.S. each day might have to be accompanied by a declaration.

For nonwovens producers, the main concern is that roll goods and converted items that contain fibers made from cotton, cellulose or any material that comes from a plant—i.e. cotton, cellulose, jute, hemp, etc.—may well be subject to declaration requirements. In fact, officials have already said products falling under Harmonized Tariff Schedule (HTS) Chapter 48—which describes paper and paper products and includes things like nonwoven feminine hygiene products and disposable baby diapers—will be required to carry a declaration after July 1, 2009.

As this article went to press, however, there were numerous questions regarding how and when these declaration requirements would be put into place.But considering the potential impacts to importers of nonwoven roll goods and converted items, this article will summarize the issue and provide as much detail as is currently available.

Background

For decades, Congress has authorized subsidy programs and trade policies intended to benefit agricultural and food producers in the U.S. Generally referred to as the "farm bill," this legislation generates a lot of stakeholder interest every four years when it comes up for Congressional consideration.

The 2008 farm bill attracted more attention than usual because, among other things, it contains a provision that amends the oldest wildlife protection statute in the U.S.: the Lacey Act.Initially enacted in 1900 and renewed many times since, the Lacey Act establishes anti-trafficking laws for fish and wildlife. The 2008 farm bill, however, dramatically expanded Lacey's protections, extending them to "any wild member of the plant kingdom, including roots, seeds, parts, and products thereof."

Under the law, imports of these goods will require a declaration identifying the scientific name of the plant, the value and quantity and the country where it was harvested. If the importer does not know the plant species, he will have to identify the plant that may have been used. If the harvesting location is unknown, the importer will be required to list every possible country where the plant could have been harvested.

Failure to comply with the Lacey Act can result in civil or criminal enforcement actions of up to $10,000 and $20,000 respectively. Although the law specifies a December 15, 2008, effective date, the U.S. Department of Agriculture's Animal and Plant Health Inspection Service (APHIS) is delaying enforcement to finish work on an electronic database for filing the submissions.

APHIS is phasing-in the filing requirements based on the specific product category. Beginning April 1, 2009, imports of wood articles (HTS Ch. 44) and various live plants (Ch. 6) will require an import declaration. On July 1, 2009, more products will be added, including wood pulp (Ch. 47); paper & articles of paper (Ch. 48); musical instruments (Ch. 92) and furniture (Ch. 94).More products will be added to the list after September 30, 2009, APHIS says, but there is no specific timeline as of yet.

INDA, Association of the Nonwoven Fabrics Industry's Washington, DC office has sent out several bulletins to association members alerting them to the impending requirements. So far, the most common question we have heard is, "Will my products be impacted?"Unfortunately, the answer is we still do not know. Public officials are still working to define the scope but predict it will be broad, impacting some 85 out of 97 Harmonized Tariff Schedule chapters.

There is no de minimis, meaning any amount of a targeted plant or plant product will trigger the declaration requirement. So far, the only major exemptions are for "common cultivars" and "common food crops" but officials have yet to concretely define what either mean.

The problem is that many highly processed products incorporate wood, plants or byproducts among other non-wood/plant inputs. For example, a dress containing rayon, a cellulosic fiber, would trigger a declaration. A piece of machinery containing a rubber hose would trigger a declaration.

Furthermore, in many of these cases, the importer is several steps removed from the source of the plant or timber in the supply chain, making it that much more difficult, if not impossible, to provide meaningful information on the specific identity and source of the tree or plant.

Moving Forward

To date, officials have offered few additional clues about the law's scope except that they anticipate publishing definitions of "common cultivars" and "common food crops" before April 1, 2009.In a letter to the relevant agencies, several Congressional lawmakers recently called upon regulatory officials to limit the scope of the products covered by the phase-in and to exempt things like cosmetics, textiles, apparel and footwear (Ch. 50-64) from the import declaration requirement during the first two years the law is in force. It is unclear whether the agencies will heed the legislators' advice.

For its part, INDA government affairs staff is working through an industry coalition to delay enforcement of these requirements, and is drafting comments for APHIS consideration.We will also be working closely with INDA member companies that could be impacted by these new requirements should it be necessary to seek a statement of Congressional intent and/or a legislative "correction" that addresses this issue.

To learn more about the new declaration requirements, sign up for stakeholder updates, email specific questions to U.S. officials, view an October 14 briefing and more, please visit: www.aphis.usda.gov/plant_health/lacey_act/index.shtml.