Toy Safety Enforcement at the Ports CPSC and CBP at the U.S. Ports Webinar presentation date: June 12, 2013

June 12, 2013 Slide 2

Question and Answer Period

Please keep all questions general … details about specific issues will not be addressed.

To communicate with the webinar moderator at any time during this session, please select either of the following options:

– Send a question using the “Q&A” drop down menu near the middle of the LiveMeeting navigation bar

– Start a private chat by double-clicking on “Stacy Leistner – TIA Administrator” in the list of participants under the “Attendees” drop-down menu

To submit a question for review during the open dialogue, use the “Q&A” drop down menu near the middle of the LiveMeeting navigation bar

Download a copy of the presentation slides from the “Handouts” drop down menu (the graphic looks like three sheets of stacked papers) on the right-hand side of the LiveMeeting navigation bar

June 12, 2013 Slide 3

Objective

During this one-hour webinar – part of an ongoing series of TIA education updates – toy industry stakeholders will gain an overview of Consumer Product Safety Commission (CPSC) and U.S. Customs and Border Protection (CBP) enforcement activities at the ports and insights for toy companies regarding the inspection process, trade facilitation and future enforcement plans.

June 12, 2013 Slide 4

Today’s Presenters

MODERATOR Rebecca Mond

Director, Federal Government Affairs

PRESENTER Carol Cave

Associate Executive Director Office of Import Surveillance

U.S. Consumer Product Safety Commission

CPSC and CBP at the U.S. Ports Slide 5

U.S. Consumer Product

Safety Commission

This presentation was prepared by CPSC staff, has not been reviewed or approved by, and may not reflect the views of, the Commission.

CPSC and CBP at the U.S. Ports

CPSC and CBP at the U.S. Ports Slide 6

Office of Import Surveillance

• Director • 3 Supervisory Compliance Investigators

(East, West, Central) • Two (2) International Trade Specialists (CTAC) • Twenty-one people stationed at 15 major ports

(various modes) • Will expand to other ports as soon as budget

resources permit; meanwhile, Field personnel continue to cover other ports as necessary

CPSC and CBP at the U.S. Ports Slide 7

Coordination with Customs

• Border Interagency Executive Committee (BIEC)

• Joint audits of importers (informed compliance)

• Importer Self Assessment (ISA) Product Safety

CPSC and CBP at the U.S. Ports Slide 8

ITDS/ACE

• Systems and Process integration with CBP

• “Single Window” Concept

• CBP has moved to a more “agile” development

scheme

• Future deliverables on the system by CBP

– PG Messaging

CPSC and CBP at the U.S. Ports Slide 9

Entry Review Process in FY 2011

CPSC and CBP at the U.S. Ports Slide 10

CPSC’s Risk Assessment Methodology (RAM)

• What is it?

• What can it target?

• What does it target?

• What puts you as an importer/manufacturer at

greater risk?

CPSC and CBP at the U.S. Ports Slide 11

Entry Review Process with CPSC RAM

CPSC and CBP at the U.S. Ports Slide 12

FY 2012 Violative Import Samples by Hazard Description

12

CPSC and CBP at the U.S. Ports Slide 13

Navigating the CPSC/CBP Import Process

• CPSIA • Prohibited Acts (15 USC 2068)

– Import any product not in conformity with rule, standard or ban – Import any product subject to a voluntary corrective action taken by

manufacturer, Commission has notified the public and manufacturer knew or should have known

– Fail to furnish certificate or present false certificate of conformity – Unauthorized use of a safety mark

• Imported Products (15 USC 2066) – Product refused admission shall be destroyed unless … – Upon application by importer, Secretary of the Treasury permits the

export in lieu of destruction

CPSC and CBP at the U.S. Ports Slide 14

CPSC – Import Procedures

• CPSC Sampling and Detentions – Specific statutory authority for sampling (15 USC 2066, 15 USC 1273)

– Detained merchandise remains under CBP custody

• CPSC Issues Notices of Detention

– Compliance Investigator or Field Investigator will issue

– Notice will describe the suspected violation and the statute governing that

suspected violation; CPSC officer contact information will be on the Notice

– Notice issued to importer with copies to Customs broker and CBP

– Deal directly with CPSC

CPSC and CBP at the U.S. Ports Slide 15

CPSC – Import Procedures

• Detentions – Time Frames – Detention notices to be issued as soon as possible after

sampling/examination – Recipient of Notice has 5 business days to provide information to help

resolve the detention; extensions can be granted – Policy is to try to resolve detentions within 30 days

• Detentions of shipments under both CBP and CPSC authority

– Detention notifications will be issued by both agencies – If CBP seizes that will resolve the CPSC detention but not final CPSC

action (Letter of Advice could be issued) – If CBP resolves its detention in favor of the importer, it will not release

the merchandise without resolution of the CPSC detention

CPSC and CBP at the U.S. Ports Slide 16

Reconditioning

• If it appears that a consumer product can be modified so it would not need to be refused admission, the CPSC may permit the product to be delivered from customs custody under bond to give the owner or consignee that opportunity

• If it turns out the product cannot be modified or the owner/consignee is not acting satisfactorily, CPSC may direct CBP to demand redelivery

CPSC and CBP at the U.S. Ports Slide 17

CPSC – Import Procedures

• Conditional Release of Merchandise – CPSC can allow conditional release of merchandise under

CBP bond pending results of examination and testing – Merchandise cannot be distributed while under

conditional release – Case-by-case consideration

• Redelivery of Merchandise – Redelivery notice issued by CBP. Must be within 30 days

after the end of the conditional release period – Redelivery could lead to seizure, destruction or exportation – Failure to redeliver results in assessment of liquidated damages

against importer (bond principal) and surety

CPSC and CBP at the U.S. Ports Slide 18

CPSC – Import Procedures

• Request for a Hearing – CPSA violations only – Importer/owner/consignee can seek a full hearing under

the Administrative Procedures Act – Product will remain under Government custody at

importer’s expense during the pendency of the hearing Custody of goods remains with CBP

CPSC and CBP at the U.S. Ports Slide 19

Destruction or Export

• Products refused admission must be destroyed unless, upon application by the owner, consignee or importer of record, the Secretary of Treasury permits export in lieu of destruction

• If the product is not actually exported within 90 days of such approval, it must be destroyed

CPSC and CBP at the U.S. Ports Slide 20

Cost of Destruction

• All expenses of destruction (including salaries, storage fees, travel, per diem, etc) shall be paid by the owner or consignee

• If expenses of destruction are not paid, they become a lien against future imports by the same owner or consignee.

CPSC and CBP at the U.S. Ports Slide 21

CPSC – Import Procedures

• Exportation/Destruction – Importer may ask to export or destroy at any time – Per agreement, exportation or destruction at importer’s

expense and must occur under Government supervision • Seizure

– CPSC can request CBP to seize the product under Tariff Act authority

– If seized, then CBP takes over the process – Fines, Penalties and Forfeitures Office issues notices; CBP

has authority to remit the forfeiture upon terms and conditions deemed appropriate

– CPSC can suggest disposition but cannot compel it

CPSC and CBP at the U.S. Ports Slide 22

CPSC – Import Procedures

• Assessment of liquidated damages – Three times the entered value of the shipment (cannot

exceed bond amount) – CPSC does control the mitigation decision for liquidated

damages claims (16 CFR 1500.271(b))

CPSC and CBP at the U.S. Ports Slide 23

How are potential violations investigated?

• Common Sense Approach – Counterfeit versus Safety Defect

• Pre-screening of products containing lead for rapid decision making of shipment

• Importer Inspections (sometimes jointly with CBP) • Domestic visits to retailers, wholesalers and

consumers

CPSC and CBP at the U.S. Ports Slide 24

Enforcement

• Yearly Programs Coordinated with CBP for routine

enforcement of Mandatory standards

– Rule sets developed in partnership with CBP

• Local Operations formulated based on port specific

activity

• Targeted Exams

CPSC and CBP at the U.S. Ports Slide 25

Informed Compliance

• Joint Programs by class of product • Joint Inspections

– Provides specific guidance on CPSC regulations – Provides specific importation requirements for future

activity with Customs

• Informed Compliance Inspections (ICI)

CPSC and CBP at the U.S. Ports Slide 26

Importer Self Assessment- Product Safety

• Allows companies to apply for a program that labels them “low-risk”

• Provides benefits – Expedited testing – Conditional release of goods

• Good Importer Practices • Where to I get more Information?

– www.cbp.gov

CPSC and CBP at the U.S. Ports Slide 27

Quarterly Import Stoppage Report

CPSC and CBP at the U.S. Ports Slide 28

Quarterly Import Stoppage Report

CPSC and CBP at the U.S. Ports Slide 29

Avoiding the Pitfalls That Could Delay Entry

• Make certificates readily available • Ensure goods are classified appropriately • Ensure accurate entry type code • Include product detail on invoice • Make sure 3rd party testing body is accredited by

CPSC • Sign up for ISA and ISA-PS • Utilize the quarterly stoppage report

CPSC and CBP at the U.S. Ports Slide 30

Pitfalls (continued)

• Ensure the correct citation to each CPSC product safety regulation or statutory requirement to which the product is being certified on the certificate.

• 15 (j) Rule enforcement – Hair Dryers – Drawstrings

• Mitigate your risk

CPSC and CBP at the U.S. Ports Slide 31

Thank You

Carol Cave Associate Executive Director Office of Import Surveillance

U.S. Consumer Product Safety Commission

ccave@cpsc.gov

June 12, 2013 Slide 32

Question and Answer Period

Please keep all questions general … details about specific issues will not be addressed.

To communicate with the webinar moderator at any time during this session, please select either of the following options:

– Send a question using the “Q&A” drop down menu near the middle of the LiveMeeting navigation bar

– Start a private chat by double-clicking on “Stacy Leistner – TIA Administrator” in the list of participants under the “Attendees” drop-down menu

To submit a question for review during the open dialogue, use the “Q&A” drop down menu near the middle of the LiveMeeting navigation bar

Download a copy of the presentation slides from the “Handouts” drop down menu (the graphic looks like three sheets of stacked papers) on the right-hand side of the LiveMeeting navigation bar

June 12, 2013 Slide 33

Resources

www.toyassociation.org – Knowledge Network

(education and training services)

– Members Only Bulletins (Legislative, Safety, etc.)

– Industry Facts (research, reports and statistics)

– Press Room (news items on standards, legislation and more)

www.ToyInfo.org – Consumer-facing website

Thank you for participating!

For more information in TIA’s Knowledge Network, please visit: www.toyassociation.org