Since mid-June 2010, the Consumer Product Safety Commission (CPSC) has begun issuing detention notices directly to importers for possible violations of its laws and regulations. CPSC’s new procedures result from Congress’s passage of the Consumer Product Safety Improvement Act (CPSIA), as well as a significant increased budget authorization from $80 million to $136 million by 2014. Passage of the CPSIA followed a rash of health and safety problems associated with imported Chinese goods, particularly children’s toys containing lead paint. Previously, US Customs and Border Protection (CBP) had issued detention notices that included CPSC violations. As a result of CPSC’s new practice, importers faced with CPSC violations can now expect two notices: one from CPSC and one from CBP.
- CPSC’s first priority in issuing detention notices is to target goods intended for children, which require specialized testing for lead and phthalate content under the CPSIA. The CPSIA defines a children’s product as an item designed or intended primarily for use by children 12 years of age and younger. So far, reports from the field indicate that seized goods are being released almost immediately after the proper documentation is produced to show that the goods are not of a type requiring specialized testing under CPSIA.
- CPSC inspection and detention procedures are not only applicable to CPSIA, but to all statutes enforced by the CPSC, including the Consumer Product Safety Act itself (CPSA), the Federal Hazardous Substances Act (FHSA), the Flammable Fabrics Act (FFA), the Poison Prevention Packaging Act (PPPA), the Refrigerator Safety Act (RSA), the Virginia Graeme Baker Pool and Spa Safety Act, and the Children’s Gasoline Burn Prevention Act. They are all enforceable now by CPSC inspectors at ports of entry.
- The posting of CPSC inspectors at ports involves close cooperation with CBP. As laid out in an April 26, 2010 Memorandum of Understanding between CPSC and CBP, CBP has given CPSC access to the Import Safety Commercial Targeting Analysis Center (CTAC), allowing CPSC inspectors to identify incoming products and use hand-held XRF (X-ray fluorescence technology) units to immediately scan for lead content. The agreement also granted the CPSC power to contact importers directly; in the past, the CPSC could contact importers only through the CBP.
- Containers are being seized at both air and sea ports, requiring importers and customs brokers to produce general conformity certificates for all products and product testing compliance certificates for products specifically identified under the CPSIA
- CPSC has not yet drafted regulations outlining its detention notice procedures. However, it will post questions and answers on its website to provide importers with more information. In the meantime, CPSC has already instituted new procedures at US ports of entry. CPSC issues its own notice of detention, including a description of the alleged violation, its statutory basis, and the contact information for the CPSC inspector who examined the goods. Importers receiving a notice have five business days to respond with the required certificates (general conformity and/or testing certification) showing compliance with product safety requirements. Until required certificates are produced, the goods will remain under CBP’s custody and control during, unless CPSC and CBP agree to conditional release, requiring a bond. If goods granted conditional release are found to be in violation of product safety laws, CPSC will issue a Notice of Recovery requiring the owner to redeliver the goods or risk liquidated damages based on treble the value of the goods.
- Importers face higher penalties for goods violating consumer protection laws. The CPSIA increases the maximum penalty for violating CPSC safety standards from $8,000 to $100,000 for each violation and from $1.8 million to $15 million for a related series of violations. In 2009, CPSC began to impose higher penalties, including a penalty of $2.3 million for Mattel for lead paint in children’s toys. Target, Inc. paid a penalty of $600,000 for similar charges, as well.
Despite the new budget and policies, CPSC currently has only a small number of inspectors at each of the ten largest ports in the United States. Nevertheless, CPSC inspectors are reportedly quick to release goods when the proper documentation has been produced. The key for importers is to have the proper documentation handy when importing consumer goods.
Food Safety Modernization Act Moves Ahead
After months of negotiations, the Senate finally reached an agreement on the The Food Safety Modernization Act (S 510) over the August recess, providing groundwork for the full Senate’s consideration this month. The bill already passed the House, however, if the new Senate bill is passed, it will need to be reconciled with the House bill. The Senate version released by a bipartisan group of Senators includes the following provisions:
- The amendment requires importers to verify the safety of imported food by allowing FDA to require certification for high-risk foods, and to deny entry to food from foreign facilities refusing inspection. FDA would also create a voluntary importer program to provide importers with certifications of safety for their food suppliers in exchange for a user fee;
- Provides FDA with additional resources to hire new inspectors and requires FDA to inspect food facilities more frequently;
- Gives FDA the authority to order a mandatory recall of a food product if the food will cause serious adverse health consequences or death and a company has failed to voluntarily recall the product upon FDA's request;
- Enhances surveillance systems to detect foodborne illnesses; and
- Requires FDA to establish a pilot project to test and evaluate new methods for rapidly tracking foods in the event of a foodborne illness outbreak.
While there have been several fits and starts for the Food Safety Modernization Act, Congress appears committed to passing the bill this September, citing the recent outbreak of illnesses due to Salmonella-contaminated eggs.