Monday, June 13, 2016

Where Have the Blog Articles Gone? We’ve Moved!

News, resources, and more have been moved to our websites and you can find our great content on these two platforms.  The first is our website for the Clark-Esposito Law Firm, P.C. under the "News & Resources" tab.  Here you will find trade and transportation related news along with that typically for the more experienced fashion enterprise.


The second is our website for Fashion Compliance.  The "News & How To's" section centers on the issues the fashion entrepreneur is primarily focused on, which tend to be less complicated matters than the experienced fashion company would likely deal with. That being said, I've seen more experienced companies not have its bases covered with respect to any number of fashion compliance issues, so I encourage and welcome everyone to read on at the other sites!

 Law & Consulting for the Fashion Entrepreneur 

As always, we welcome you to send us any questions you may have via our Contact pages on the websites or email us directly at contact@clarkespositolaw.com.

Thanks and we'll see you on our new platforms!



Tuesday, February 9, 2016

Kenya’s New Customs Rule Mandates Certificate of Conformity When Importing



Kenya now requires a certificate of conformity known as the Pre-Export Verification of Conformity, (or “PVoC") which is required for customs clearance on every importation of finished goods.  The only exceptions to this rule are

     1)     Raw materials for processing into Finished Products
     2)     Spare parts for own use by a manufacturer, and
     3)     Customized machinery not meant for sale.

It should be noted that where an exception is purported as applicable, additional support would be required to substantiate the applicability of the exception.

The PVoC must be available upon a shipments arrival to Kenya.  Where it arrives without the PVoC, or where it is issued with a date later than the shipment’s arrival, it will be presumed that the procedures for the pre-export verification were not followed and the importer will automatically be assessed a 15% penalty on the CIF value.  They will be further required to post a redeemable bond of a similar amount pending the import’s quality verification.

Both the Kenya Revenue Authority and Kenya Bureau of Standards (“KEBS”) have oversight of this new rule, the latter for which administers the “Pre-Export Verification of Conformity to Standards” program for exports to Kenya.  As the purpose is to minimize the risk of unsafe and substandard goods entering the Kenyan market by ensuring that products meet the health, safety and environmental standards for Kenyans, non-compliant goods will be denied entry.

What does this change mean?

In order to avoid delays in the issuance of the PVoC, exporters should contact an authorized verification company as early as possible as it is mandated to be undertaken in the country of origin.  If your company anticipates future exports to Kenya, identifying an appropriate location is a smart way to avoid potential additional delays when it comes time to ship your product.

The companies Société Générale de Surveillance (“SGS”), Intertek International, Messrs Bureau Veritas, and the China Certification and Inspection Group have all been contracted by KEBS to perform the pre-export verifications.  Keep in mind however, that each verifier is assigned certain regions for which it may carry out the verification - as opposed to having a general right for inspecting products originating from any part of the world - so finding an approved one for your region is a prudent first step.

Contacting the local branch of any of these companies where the product is located should be the first step to determine whether it can perform the verification, or if another company should be contacted.

Next Steps

This requirement which previously applied to only a limited class of goods now applies to all finished goods.  If you are uncertain as to how to obtain the PVoC on your current or anticipated Kenya bound shipments, or seek guidance on whether your product may meet one of the exceptions, post your questions/comments below or email clark.deanna@gmail.com.

Tuesday, February 2, 2016

Argentina's New SIMI System Replaces DJAI Import Process


For those of you exporting to Argentina, you know all too well how challenging customs clearance has been with the required prior approval by the Administración Federal de Ingresos Públicos (AFIP- Argentine Tax and Customs Authority) and the submission of a Sworn Affidavit of Intent to Import, commonly known as the “DJAI.”

As announced at the end of December 2015, the newly ushered in “Sistema Integral de Monitore de Importaciones,” (“SIMI” - Integral System of Import Monitoring), has taken the DJAI’s place as Argentina’s new import verification mechanism. 

Unfortunately, despite the termination of the “DJAI,” a registration for an import license remains required for all imports, under 1 of 2 categories - either an “automatic import license,” or a “non-automatic import license.”  Once obtained, these licenses remains valid for 90 days.

The processing and management of these licenses must now be done via SIMI, whose purpose is to also provide the Argentine government with a simple and transparent way to gather statistical information on imports.

Non-Automatic Import License

A non-automatic import license must be applied for where a shipment requires a prior approval.  What determines whether or not a prior approval is needed turns on whether or not the article is included in the tariff of the Mercosur Common Nomenclature (“MCN”) which includes some, but not all, tariff numbers under the following chapters:

Chapters 28, 29
Chapters 34, 36, 39
Chapter 40, 42, 44, 48, 49
Chapters 51, 52, 54, 55, 56, 57, 58, 59
Chapters 60, 61, 62, 63, 64, 65, 68, 69
Chapters 70, 73, 74, 76
Chapters 82, 83, 84, 85, 86, 87, 89
Chapter 90, 94, 95, 96


Depending on the product’s tariff number, 1 of 15 different protocols for procuring the license must be undertaken, each of which requires the submission of data related to the goods itself and the exporter.

Automatic Import License

An automatic import license may be applied for where goods do not require a prior approval.  Such application requires providing no less than 14 data points such as country of origin, FOB values, and product information.

What does this change mean?

The new SIMI system should streamline customs clearance into Argentina given the application of the non-automatic import license and the reduction in goods subject to prior approval.

If you export goods to Argentina, be prepared for the possibility that customs may come back asking questions in relation to the values you have provided as Argentina maintains a database of what it considers to be the import value of certain articles based on the history of values recorded by other prior imports of the same kind.  Moreover, in the case of warranty or replacement parts, Argentina does not recognize that these articles have no value but will accept a lower value than that under a traditional sale.

It is therefore important that valuations remain consistent both for customs entry purposes as well as in the event a customs challenge related to the value, and hence the duties and taxes paid to the government, needs to be resolved.

It should be noted that Argentina customs has been known to look to historic import data and customer price lists of third party companies when making a challenge in an effort to collect higher tax and duty revenues. 

Next Steps

Exporting to Argentina and experiencing shorter customs clearance times may be possible with some advance preparation.  If this is something you would like to explore, post your questions and/or comments below. 

Monday, January 25, 2016

2016 Customs Compliance Best Practices and Updates


During last week’s ACI customs conference held in Washington DC, I had the pleasure of presenting with two seasoned trade professionals, Ken Weigel of Alston and Bird LLP and Chris Colford of Mitsui & Co. (USA), on advanced topics in classification and compliance considerations. 

In addition to nuances between the classification of a part that involved the same construction but had a different way of being installed, myself and Chris focused on other governmental agency (“OGA”) requirements, and the importance of understanding the impact that a product’s classification could have on packaging, labeling, and shipping requirements, as well as other necessary declarations, whether upon importing into the US or when importing into another country.

Key takeaways of reoccurring themes across panels centered on the following.

   1.    Emphasizing the importance of compliance to upper management. 

Trade compliance is complicated and the costs involved can make it a subject that management may want to run away from.  No surprise.  Taking the explanation beyond the mere necessity to do so however, and showing the value that the investment in a compliance program brings to a company in whatever form it may, e.g., in terms of risk mitigation, reputation building, duty savings benefits etc., is key.  If your company does not already have a Compliance Steering Committee, key organizational partners on this team include the Finance, Trade Counsel and the Transportation/Logistics roles.

   2.    Communication across the organization. 

This is important for not only for compliance purposes but also for cost savings.  I’ll give you two examples.

Example 1.  Is a low duty rate better than a free one?  Obviously it’s not, which is why where a company’s invested in the set up of importing under a free trade agreement ("FTA"), it’s imperative that the Purchasing Dept. be aware of this effort so that they don’t opt for buying a cheaper product from a country other than the one (or ones) eligible under the chosen FTA as the resulting duty liability could end up being greater than the cost savings of sourcing from that other country.

Example 2.  The Marketing Dept. wants to highlight every feature in a big way, which is a good thing as that is what they are tasked to do.  The problem is, if what they are promoting about the product is not actually truthful, the company can run into some issues of misleading advertising claims, which could lead to penalties and fines, but it can also lead to unnecessary spending in order to change the already-paid-for marketing that needs to be redone.  Bottom line - make sure your departments are communicating with one another.

   3.    Conduct internal and vendor audits.

From sampling methods to managing expectations, the importance of reviewing the efficacy of internal processes and reexamining vendor performance to ensure compliance with contractual terms was highlighted across the conference panels.

Recommendations included to:

      a)    Put expectations into the service provider’s contract and to conduct an annual validation of them

      b)   Conduct a day+ long seminar to train them

      c)    Request necessary “proofs” on areas where questions could come back for verification by your business, e.g., certain export documents or a NAFTA certificate 

Key takeaways aside, there were some other areas of interest which included the much talked about Trans-Pacific Partnership Agreement or “TPP,” and the questionable likelihood that it will actually come to fruition this year given that we are in an election year (and no one wants to have to vote on it), along with the usage of the Centers for Excellence and Expertise (CEE) and the notice that all importers will be tied one of the CEEs across the country by the end of 2016 based on the type of goods imported, at least that is what they are aiming for according to Susan Dalpe of CBP. 


Lastly worth noting, while not all of the efforts for usage of the “single window” for import/export communications with the government are on track for timely implementation, one that is very much on track is that of the transition from the Automated Export System (AES) for export filings to that of US Customs Automated Commercial Environment (ACE).

Questions/comments?  Post below or email me at clark.deanna@gmail.com

Tuesday, January 12, 2016

Deanna Shares Her Eco-Fashion Predictions for 2016 on "Ecouterre"


It's a new year and that means it's time for new predictions by 35 Eco-Fashion "movers and shakers," including my own, as published by Ecouterre.  What do you see on the horizon?  Post below and let me know!

Saturday, January 9, 2016

Join Me at ACI's Import Compliance Conference Jan. 22, 2016 Where I'll be Speaking on Classification



I'll be speaking on a panel at this event on advanced classifications on January 22, 2015.   You can enjoy a 10% discount when you register as my guest:

Guest Discount
Colleagues and cohorts may use code S10-823-823L16.S. The discount is 10% off the regular price. Here is the event information page, and here is the registration page.

In addition to my presentation, ACI has provided that:

The agenda will cover the most critical compliance issues impacting your import operations. The program has been uniquely designed to delve into your most pressing compliance issues through practical insights, case studies, Q&A and hands-on exercises. Key sessions include:
  • Advanced Topics in Customs Valuation- Focus on Post-Entry Price Adjustments, Related Party Transactions, Assists and Other Complex Issues that Can Lead to Costly Mistakes

  • Advanced Topics in Classification – How to Decipher Intricate Classification Issues

  • Statistical Sampling in Prior Disclosures: Understanding the Methods and Benefits while Avoiding Common Errors

  • How to Properly Classify and Value Goods Related to Research & Development

Look forward to seeing you there!

Wednesday, January 6, 2016

Wishing You a Stellar 2016!


This is going to be an awesome year and I look forward to enjoying it with all of you.  Happy new year!