Trade News

January 27, 2021

Biden Cancels Keystone XL Permit

President Joe Biden formally has revoked a key permit for the proposed $8 billion Keystone XL pipeline.

Biden’s action was part of a series of executive orders on his first day in office that included revoking “permits signed over the past 4 years that do not serve the U.S. national interest, including revoking the Presidential permit granted to the Keystone XL pipeline.”

As a part of the broader climate order, the Biden administration wrote that the Keystone XL pipeline “disserves the U.S. national interest,” citing challenges surrounding climate and the pursuit of a clean energy economy.

In the order, the administration indicated that its analysis concluded that approval of Keystone XL would “undermine U.S. climate leadership” by undercutting the influence of the country on other nations to take climate action.

In a statement, Prime Minister Trudeau appeared to accept Biden’s long expected move. “While we welcome the President’s commitment to fight climate change, we are disappointed but acknowledge the President’s decision to fulfill his election campaign promise on Keystone XL,” he said.

In opposition, Alberta Premier Jason Kenney said in a statement “The government of Canada must impose meaningful trade and economic sanctions in response to defend our country’s vital economic interests,” Kenney told reporters Wednesday, adding that the province would take legal action if diplomatic efforts failed.

With this first move, many are wondering if this is setting the tone for Canada/U.S. trade relations moving forward.

(Source: Politico, CBC News)

January 26, 2021

Major Ports and Carriers Report Significant Rollover Increases

More than one in three containers shipped globally in December were rolled-over at transhipment hubs, according to new research from data tracking firm Ocean Insights.

Its monthly analysis of container rollovers at the top 20 global ports revealed that the global average had increased to 37% last month, with some hubs seeing far higher numbers.

“Of the 20 global ports for which Ocean Insights collates data, 75% saw an increase in rollover cargo in December, compared with the previous month,” said Ocean Insights’ chief operations officer, Josh Brazil.

During November, the Korean hub of Busan saw a 4% decline in rollovers, attributed to carriers putting on extra loaders to cater for surging demand. However, the port largely lost those gains, with a 3% increase in rollovers, during December.

“This indicates that the levels of cargo are still rising, while the extra loader capacity deployed to meet the raised levels of demand appears to be having little effect,” explained Mr. Brazil.

And it was thoroughly mixed picture at some of the world’s second-tier transhipment hubs: Gioia Tauro and Cartagena saw rollover ratios of 62% and 56% respectively, while Salalah saw 22%.

It was a slightly different picture for carriers, however, with an industry average of 35% of shipments rolled at transhipment ports.

(Source: The Loadstar)

January 25, 2021

Biden Expected To Sign Executive Order To “Buy American”

U.S. President Joe Biden will sign an executive order today instructing the federal government to spend more of its $600 billion procurement budget on U.S.-made products, aimed at boosting the beleaguered U.S. economy.

The order will instruct the Federal Acquisition Regulatory Council to revamp its definition of what it means for products to be made in the U.S. and to increase how much of a product’s parts must originate in the U.S. to be eligible for the Buy American program.

The executive order also aims to eliminate exemptions that allow federal agencies to circumvent the Buy American rules. Waiver requests will also be published on a public website, to be developed in the coming months, so that U.S. companies have an opportunity to compete for contracts that agencies want to award to foreign competitors.

The administration views the changes as key to not only stimulating the current economy, but to rebuilding U.S. manufacturing for the long term.

The order may ruffle the feathers of some U.S. industries and trading partners. American companies have already cautioned the Biden administration that changes to their overseas supply chains are time consuming and, in some cases, factories cannot easily be shifted back to the U.S.

Other countries may see Biden’s proposal as the beginnings of protectionist-minded policies.

(Source: Politico)

January 18, 2021

Canada Announces New Measures to Address Human Rights Abuses in Xinjiang, China

The federal government announced a suite of new regulations intended to ensure that Canadian companies are not complicit in human rights abuses or the use of forced labour in China’s Xinjiang province.

The measures include new requirements for firms that do business in the region and a pledge to ban the export of products from Canada to China if there is a chance they could be used by Chinese authorities for surveillance, repression, arbitrary detention or forced labour.

“Canada is deeply concerned regarding the mass arbitrary detention and mistreatment of Uighurs and other ethnic minorities by Chinese authorities,” Foreign Affairs Minister François-Philippe Champagne said in a news release shortly before leaving the department to become the new minister of Innovation, Science and Industry.

“Nobody should face mistreatment on the basis of their religion or ethnicity,” Champagne added.

UN experts and activists say more than one million Uighurs, Kazakhs and others have been arbitrarily held in prison-like centres for political indoctrination. China claims the centres are intended to combat extremism and teach job skills, but former residents and rights groups say they target Islam and minority languages and cultures.

A coalition of civil society organizations has also accused China of forcing hundreds of thousands of Uighurs and other minorities to pick cotton by hand. The vast western province produces 85% of China’s cotton and 20% of the global supply, which is sold to fashion brands worldwide.

Canada already bans the importation of goods produced through forced labour as part of its obligations under CUSMA.

The new regulations also require that Canadian companies in the Xinjiang market sign a declaration acknowledging that they are aware of the human rights situation in the province and pledging to conduct due diligence on Chinese suppliers to ensure they are not knowingly sourcing products or services from companies that use forced labour.

Global Affairs Canada also issued a business advisory warning Canadian businesses of the legal and reputational risks they face by maintaining supply chains associated with forced labour.

Click here to read the full notice from Global Affairs Canada.

(Source: CBC News)

January 14, 2021

Safe Food For Canadians Licence Renewals

Some Safe Food for Canadians (SFC) licence holders will need to take action now to ensure they renew their licence before it expires. Some SFC licences expire on January 15, 2021 while others will expire in the days and weeks that follow.

If you have an SFC licence, it can be renewed online through your My CFIA account. It is recommended that you submit your request for renewal as soon as possible to allow sufficient processing time — up to 120 days before the expiry date of your licence. Your renewed SFC licence will be valid for two years from the original expiry date.

If your licence expires, your business will no longer be permitted to conduct licensed activities in accordance with the Safe Food for Canadians Act and may be subject to enforcement actions and removal from export eligibility lists. You will then need to apply for a new licence and be issued a new licence number, which may further disrupt your business activities including the ability to request export certification.

If you have any questions, or would like guidance on the renewal process, please reach out to Carson.

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January 13, 2021

CBSA Releases 2021 Trade Compliance Verification Priorities

Canada Border Services Agency has released its first round of 2021 Trade Compliance Verifications. Businesses that import goods listed as an audit priority could be subjected to a CBSA trade compliance audit, which could result in potential financial penalties if the verification uncovers instances of non-compliance.

Origin

Bedding and drapery (Round 2)
Harmonized System Number(s): Various goods of Headings 63.01, 63.02 and 63.03. USA origin.

Valuation

Apparel (Round 3)
Harmonized System Number(s): Chapters 61 and 62
Footwear (Round 2)
Harmonized System Number(s): Chapter 64

Tariff

Spent fowl (Round 2)
Harmonized System Number(s): Headings 02.07, 16.01 and 16.02
LED lamps
Harmonized System Number(s): Heading 85.39
Furniture for non-domestic purposes (Round 3)
Harmonized System Number(s): Headings 94.01 and 94.03
Batteries (Round 4)
Harmonized System Number(s): Heading 85.06
Footwear ($30 or more per pair) (Round 4)
Harmonized System Number(s): Heading 64.03
Articles of apparel and clothing accessories (Round 3)
Harmonized System Number(s): Heading 39.26
Parts of lamps (Round 4)
Harmonized System Number(s): Heading 94.05
Pasta (Round 3)
Harmonized System Number(s): Heading 19.02
Cell phone cases (Round 2)
Harmonized System Number(s): Headings 39.26, 42.02 and 85.17
Pickled vegetables (Round 4)
Harmonized System Number(s): Heading 20.01
Gloves (Round 2)
Harmonized System Number(s): Headings 39.26 and 42.03
Safety headgear (Round 4)
Harmonized System Number(s): SubHeading 6506.10
Bags (Round 2)
Harmonized System Number(s): Heading 42.02
Import permit numbers (Round 2)
Harmonized System Number(s): Chapters 2 and 4
Other mountings and fittings, suitable for furniture (Round 2)
Harmonized System Number(s): Heading 83.02
Air heaters and hot air distributors (Round 2)
Harmonized System Number(s): Heading 73.22
Flashlights and miners’ safety lamps (Round 2)
Harmonized System Number(s): Heading 85.13
Stone table and counter tops (Round 2)
Harmonized System Number(s): Heading 94.03
Disposable and protective gloves (Round 4)
Harmonized System Number(s): Subheadings 3926.20 and 4015.19
Parts of machines and mechanical appliances
Harmonized System Number(s): Heading 84.79
Other chemical products
Harmonized System Number(s): Heading 38.24

Click here to view the full notice from CBSA.

Clients who import these goods are advised to reach out to their Carson representative, or get in touch using the button below if they have any questions or concerns.

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January 11, 2021

CBSA Investigating Upholstered Domestic Seating From China And Vietnam

The Canada Border Services Agency is launching investigations to determine whether certain upholstered domestic seating from China and Vietnam is being sold at unfair prices in Canada.

The investigations are the result of a complaint filed by Palliser Furniture Ltd. (Winnipeg, MB) and supported by Elran Furniture Ltd. (Pointe-Clair, QC), Jaymar Furniture Corp. (Terrebonne, QC), EQ3 Ltd. (Winnipeg, MB) and Fornirama Inc. (Montréal, QC).

The complainant alleges that as a result of an increase of the volume of the dumped and subsidized imports from these countries, it has suffered material injury in the form of lost market share, lost sales, price undercutting, price depression, declining financial performance and reduced capacity utilization.

The CBSA and the Canadian International Trade Tribunal each play a role in the investigations. The CITT will begin a preliminary inquiry to determine whether the imports are harming the Canadian producers and will issue a decision by February 19, 2021. Concurrently, the CBSA will investigate whether the imports are being sold in Canada at unfair and/or subsidized prices, and will make preliminary decisions by March 22, 2021.

Currently, there are 125 special import measures in force, covering a wide variety of industrial and consumer products, from steel products to refined sugar. These measures have directly helped to protect the Canadian economy and jobs.

(Source: Newswire)

January 8, 2021

U.S. Suspends French Tariffs Over Digital Services Tax

The United States is holding off on imposing tariffs on French cosmetics, handbags and other imports in retaliation for a digital services tax Washington says will harm U.S. tech firms, while it investigates similar taxes elsewhere.

The U.S. Trade Representative’s office said the 25% tariffs on imports of the French goods, which are valued at around $1.3 billion annually and were due to go into effect on Wednesday, would be suspended indefinitely.

Washington had announced the tariffs in July after a U.S. investigation showed a French digital services tax (DST) unfairly singled out U.S. companies such as Google, Facebook, Apple, and Amazon.

France and other countries view digital service taxes as a way to raise revenue from the local operations of big tech companies which they say profit enormously from local markets while making only limited contributions to public coffers.

USTR said suspending the action against France would allow Washington to pursue a coordinated response in 10 investigations into similar taxes in India, Italy, Britain and other countries. It gave no timeframe for further action.

European leaders and industry groups welcomed the news, saying it would allow more time for talks on a global taxation solution to bear fruit.

(Source: Reuters)

January 6, 2021

Shippers and Forwarders Claim Carriers Breach Contracts to Demand Higher Rates

As Asia-Europe container spot rates continue to skyrocket, shippers and freight forwarders are accusing carriers of breaching short- and long-term contracts to “charge whatever they want”.

In a joint letter to the Competition Directorate of the European Commission (EC), the European Freight Forwarders Association (CLECAT) and European Shippers’ Council (ESC) have protested about the “damage” the carriers’ behaviour is “causing to trade growth at a time of economic recession”.

According to the letter, the complaints relate to “violation of existing contracts, the establishment of unreasonable conditions concerning the acceptance of bookings and unilaterally setting rates far in excess of those agreed in contracts”.

The associations said they would meet with the EC “early in the new year” and “encouraged” it to “take actions similar to those of competent authorities in other parts of the world”.

Chinese regulators are said to be renewing their carrier investigations and, in the U.S., the Federal Maritime Commission has written to liner lobby group the World Shipping Council expressing its concerns that U.S. export cargo is being refused in favour of carriers repositioning containers directly back to Asia to cater for bookings offering considerably higher revenue.

CLECAT and ESC allege that carriers are increasing rates “whenever they see fit, notwithstanding the specific rates and charges agreed”.

They warn that the “adverse consequences of carriers’ practices” are being felt equally by small and big businesses alike in Europe including retail, fashion, automotive, cosmetics and IT businesses, while some with limited financial reserves could be forced to close.

Meanwhile, the North Europe component of the Shanghai Containerized Freight Index (SCFI) closed the year 266% up at $4,286 per teu, some three times higher than 2020 annual contract rates.

It’s not only in Europe that shippers are feeling the pinch – soaring freight rates are a major problem for shippers around the world struggling to maintain supply chains, the SCFI recording massive spikes in spot rates on a weekly basis across transpacific, African, South American, Australasian and intra-Asia trade.

Spot rates from Asia to Santos are currently around 270% higher than a year ago and, for the myriad network of intra-Asia services, rates are an extraordinary 440% higher than this time last year.

(Source: The Loadstar)

January 6, 2021

CBP Alerts Customs Brokers to New Aluminum Import Licensing Requirement

U.S. Customs and Border Protection has notified customs brokers and the trade community that most imports of aluminum products will require an aluminum import license for each entry starting January 25, 2021.

The new licensing system, which is available on the Commerce Department website, will open for pre-registration on January 4. Customs brokers, importers, and other license applicants will need to register for an account to create a license.

The list of aluminum products subject to the new licensing requirement is available here. The aluminum import license number obtained from Commerce for each shipment, as well as the License Type Code 28, must be reported on the corresponding entry summary or electronic equivalent in ACE.

CBP recommended the Trade “to plan accordingly and obtain any licenses needed for entry in advance from the Commerce website.”

The new aluminum license system will use the same platform as the steel licensing system (SIMA), so users with an existing steel license account do not need to create new accounts.

Click here to read the final rule concerning the aluminum license, which includes details about the new system such as license requirements and the platform for the license application.