During the week of April 20th, the Senate Finance Committee (“SFC”) and the House Ways and Means Committee (“HWMC”) each introduced its own version of the Trade Facilitation and Trade Enforcement Act of 2015 (“Customs Bill”), a bill largely designed to modernize, strengthen, and streamline trade enforcement and facilitation, as well as provide statutory authorization for U.S. Customs and Border Protection (“CBP”) trade facilitation initiatives, such as the Commercial Targeting Division and the Centers for Excellence and Expertise. The Customs Bill contains numerous provisions related to customs administration, including, but not limited to, provisions which would:
- raise the low value threshold for shipments exempt from duties and fees from $200 to $800;
- amend the drawback statute by incorporating a more objective standard that permits imported goods of one 8-digit Harmonized Tariff Schedule of the United States (“HTSUS”) subheading to qualify for duty drawback provided that goods of the same 8-digit HTSUS subheading are exported;
- ensure that participants in partnership programs (e.g., C-TPAT, ISA) receive commercially significant and measureable trade benefits, including pre-clearance of merchandise for qualified persons that demonstrate the highest levels of compliance with the customs and trade laws and regulations; and,
- establish an “Importer of Record” Program to ensure the collection of sufficient information which allows CBP to verify the existence of the importer requesting an importer of record number.
The Customs Bill also includes provisions targeting the evasion of antidumping and countervailing duty orders, although each chamber’s version of the Customs Bill tackles the issue in a different way. While the Senate version sets deadlines for CBP to handle evasion complaints, the House version shifts the authority for investigating these complaints to the U.S. Department of Commerce.
The two versions differ to an even greater degree as a result of each Committee’s markup of the Customs Bill last week. While the HWMC only approved one amendment to the Customs Bill (relating to the maintenance and distribution of post-liquidation interest that CBP receives from payments collected under a customs bond), the SFC included several controversial additions, including an amendment which would place the administration of the miscellaneous tariff bill (“MTB”) process at the U.S. International Trade Commission. The SFC also approved amendments which would establish an Interagency Trade Enforcement Center and a Chief Manufacturing Negotiator at the Office of the U.S. Trade Representative. The SFC also appended to the Customs Bill a controversial currency manipulation provision, which would permit the U.S. Department of Commerce to initiate an investigation into whether undervalued currency qualifies as a countervailable subsidy. Chairman Orrin Hatch (R-UT) has indicated that the inclusion of this provision, as well as the provision on the MTB process, will complicate matters with the House, whose version of the Customs Bill does not include similar language.
At this time, there is no official word on when either the House or Senate chamber will send the Customs Bill to the floor for debate and consideration. Sources expect that the full Senate will consider a bill extending trade promotion authority (“TPA”) to the President during the first week of May. The Committees marked-up the TPA Bill at the same session that they marked-up the Customs Bill (as well as a bill on trade adjustment assistance and trade preference programs), but it is unclear if Senate leadership will send all four of the trade bills to the floor for consideration at the same time. Similar to what Chairman Hatch said, Ways and Means Trade Subcommittee Chairman Pat Tiberi (R-OH) noted last week that, because the Senate and House version of the Customs Bill include key differences, the Customs Bill will have to go to conference. In addition, sources have noted that because the President and the Republican leadership want to quickly pass the TPA bill, members in either chamber that want to highlight trade issues may end up offering amendments to the Customs Bill, since leadership and the President want to keep the TPA Bill clean and free of controversial additions. This strategy suggests that the Customs Bill will come to the Senate and/or House floors at approximately the same time as the TPA Bill, but the Customs Bill may have a dimmer chance of passing, if more members add controversial amendments to it during the floor debate.