EC Issues Report on 2008 U.S. Barriers to Trade & Investment, Includes Food Safety, Lacey Act, CSI, Etc.

The report focuses on some key trade barriers and measures that prevent European Union exporters from tapping into the full potential of the U.S. market. It notes some continuing concerns and highlights a number of new barriers introduced in 2008.

The following are highlights of some of the barriers to trade:

New Food Safety Initiative May Negatively Impact EU Exporters

The U.S. is currently considering a number of independent proposals to tighten import conditions for food and beverages and improve the safety of such imports. The outcome of this initiative is unpredictable; however, it is apparent that a few elements may negatively impact EU exporters. These include import inspection fees, country of origin labeling, and mandatory certification of 'high risk foods.'

(The report also notes that the implementation of the food-related provisions of the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 puts severe burdens on trade in food and feed products to the U.S.)

Lacey Act Amendment Requirements are Burdensome

The EC also points to the 2008 Lacey Act Amendment¹ as a barrier concerning registration, documentation and customs procedures, especially the requirement for an import declaration.

With regard to its implementation, the EC supports the phase-in system, but has requested that the U.S. allow at least nine months for each phase-in period. The EC is also concerned that some of the plant declaration requirements, such as value of imports and quantity of the plants, would duplicate information already provided by importers during the customs clearance process.

CSI Screening Causes Significant Costs, Delays for EU Machinery, Etc.

The Container Security Initiative,² as well as its related additional U.S. customs routines, are causing significant additional costs and delays to shipments of EU machinery and electrical equipment to the U.S.

U.S. Did Not Await SFI Results Before Mandating 100% Scanning for Maritime Cargo

The Secure Freight Initiative goes against a modern customs approach of multi-layered risk based controls through effective targeting followed by scanning and/or inspection when necessary and may slow down traffic in ports.

The port of Southampton, UK was chosen to participate in this pilot project to study the feasibility of a 100% scanning approach. However, the U.S. did not await the results of this pilot action before pressing ahead with the Implementing Recommendations of the 9/11 Commission Act of 2007, which mandates 100% scanning for maritime cargo by July 1, 2012.

For the EU and other major partners, the envisaged scanning of all U.S.-bound containers in more than 600 ports from which ships leave for the U.S. would lead to major trade disruptions and an additional administrative burden. It would require major re-structuring of EU ports and place a heavy financial burden on EU business and ultimately its taxpayers.

¹The 2008 Farm Bill (the Food, Conservation, and Energy Act of 2008), effective May 22, 2008, amended the Lacey Act to make it unlawful to import, export, transport, sell, receive, acquire, or purchase in interstate or foreign commerce a broader range of plants, with some limited exceptions, taken or traded in violation of the laws of the United States, a U.S. State, or other countries. It also made it unlawful to make or submit any false record, account or label for any false identification of, this broader group of plants covered by the Act. Finally, it introduced the requirement for an import declaration for plants entering the U.S. and provides for both civil and criminal penalties for failure to comply.

²CSI consists of four elements: security criteria to identify high-risk containers; pre-screening containers before they arrive in U.S. ports; using technology to pre-screen high-risk containers; and developing and using smart and secure containers.

(See ITT's Online Archives or 07/21/09 news, 09072105, for BP summary of 47 groups recommending "business friendly" changes to Lacey Act, etc.

See ITT's Online Archives or 04/03/09 news, 09040325, for BP summary of CBP Acting Commissioner Ahern testifying that 100% scanning by 2012 will be difficult, and CBP is taking a look at what will be possible and useful and will get back to Congress on a clear path forward.)

EU report (issued July 2009) available at http://trade.ec.europa.eu/doclib/docs/2009/july/tradoc_144160.pdf

EU press release announcing the report (dated 07/27/09) available at http://europa.eu/rapid/pressReleasesAction.do?reference=IP/09/1193&format=HTML&aged=0&language=EN&guiLanguage=en