As we transition to the holidays and the season of giving, the NAFTZ is hoping to find a few goodies in its stocking this year. To no surprise, among the critical items on our list is UFLPA. As everyone is hopefully aware, at the end of October, the NAFTZ received a response from Eric Choy, Executive Director of the Trade Remedy Law Enforcement Branch of the Office of Trade at U.S. Customs & Border Protection. That letter was in response to the Association’s previous communication by which we expressed our strong opposition to CBP’s decision to not allow for the storage of goods under review for forced labor compliance within a foreign-trade zone. That position reversed the agreement previously reached with CBP whereby FTZs could be used for that express purpose.

In CBP’s latest response, Executive Director Choy focused on additional considerations that had not been presented to the NAFTZ previously. The first argues against the use of FTZs on the basis that UFLPA implementation has significantly expanded the number of shipments under review which renders use of an FTZ unwieldy. The second focuses on the 60 mile/90 minute “rule” to argue that because FTZ operations are not located near the ports of entry, they create burdensome administrative challenges in enforcing UFLPA requirements. Finally, Executive Director Choy also targeted the fact that companies utilize proprietary inventory control systems which CBP believes are not readily accessible for compliance and tracking purposes.

The NAFTZ responded to Executive Director Choy in short order, addressing the weaknesses and inaccuracies in CBP’s position and requesting further engagement on this important issue, an offer which, to CBP’s credit, they readily accepted. Further discussions are on-going not only with CBP, but with our sister Associations who support the NAFTZ’s position and we will continue to update the Membership on developments. In the meantime, please keep us informed of your own particular experiences with UFLPA so we can continue to build out our argument as to why CBP’s position should be reversed.

Dashing through the … USTR-know

In other Agency News, the NAFTZ has engaged in meaningful discussions with USTR regarding several issues impacting the FTZ program including the detrimental provisions contained in USMCA as well as ensuring the NAFTZ is engaged before any legislative change adverse to the FTZ program goes into effect. We appreciate USTR (and CBP’s) continued engagement and acknowledgement of the importance of the FTZ program to the U.S. economy and we will carry that message forward to Congress during our Virtual Fly-Ins being conducted this week. For more on the Fly-Ins, check out the article from Melissa Irmen, our Director of Advocacy and Strategic Relations.

Happy Holidays to those celebrating and we are looking forward to a prosperous 2024!

By: 

Shannon Fura, Page Fura, P.C.
NAFTZ Chair