Farrow and Shipware are partnering to provide customers one combined service for customs consulting and shipping solutions, the two companies announced in a Feb. 8 press release. Farrow, a customs broker, and Shipware, which helps businesses lower their shipping costs, said they “complement one another’s service” offerings and will provide clients with trade compliance and shipping experts in one place.

Universal Electronics Inc. is streamlining operations, the company said Feb. 6. In response to higher tariffs for its China-made products, the company is moving production to its UEM facility in Monterrey, Mexico, and to a newly assigned contract manufacturing partner in the Philippines. Dougherty & Co. analyst Steven Frankel said the moves “are designed to deliver on management's promise to hold expenses at 2018 levels through 2020.”

SanMar Corp., which imports T-shirts, sweatshirts and polo shirts that are used for fun runs, corporate logos and the like, hasn't been hit with Section 301 tariffs yet, but its executives are anxiously watching trade policy. Melissa Nelson, general counsel for SanMar, said she used to be able to stay away from Washington, D.C., but with the surge of tariffs in the last year, that's no longer true. Even Section 232 tariffs, which you would not think would affect an apparel importer, are increasing costs for them. Nelson explained that SanMar is buying clothes racks for a Jacksonville, Florida, warehouse; she said they're worried about the cost.

Apparel importers may still want to classify their hangers separately from apparel, but should take extra care in light of the potential application of Section 301 tariffs on the hangers, Sandler Travis said in a client alert. CBP has long held that some more substantial, reusable hangers are classifiable in subheading 3923.90.0080 as plastic articles for the conveyance or packing of goods, even when imported together with apparel. That subheading carries a 3% duty rate, though 10% Section 301 tariffs raise that to 13% if imported from China, and that could rise to 28% of no deal is reached on the tariffs by March 2 (see 1812140034). Nonetheless, importers should still perform an analysis on whether that rate would still be lower than the rate applicable to the garment itself if the hangers are less substantial and considered “packing material” not classified separately from the apparel, the alert said.

Descartes Systems Group will acquire a group of companies run by Management Systems Resources, including Visual Compliance and eCustoms, Descartes said in a news release. "Visual Compliance provides software solutions and services to automate customs, trade and fiscal compliance processes, with a focus on denied and restricted party screening processes and export licensing," Descartes said. Visual Compliance has more than 2,000 customers with more than 67,500 subscribers and, like Descartes, is based in Canada, Descartes said. Descartes will pay about $250 million, including working capital acquired, and the acquisition is structured as a combination of asset and share purchases, it said. “The penalties for doing business with sanctioned parties can be far reaching and severe,” said Ken Wood, Descartes executive vice president-product management. “By adding Visual Compliance’s solutions and domain expertise to our existing Descartes MK Data denied parties screening business and Global Logistics Network, we’re in an even stronger position to help our customers navigate the trade compliance landscape while managing the full lifecycle of their shipments.” The deal was brought to Descartes following the recent death of Visual Compliance's founder, Descartes CEO Ed Ryan said during an investor call about the transaction.

Nearly 50 business groups -- mostly not representing metals importers -- sent a letter to U.S. Trade Representative Robert Lighthizer and Commerce Secretary Wilbur Ross suggesting that the tariffs on aluminum and steel in the NAFTA region must be lifted in order for the groups to lobby Congress to approve the new NAFTA, known as the U.S.-Mexico-Canada Agreement. "For many farmers, ranchers and manufacturers, the damage from the reciprocal trade actions in the steel dispute far outweighs any benefit that may accrue to them from the USMCA," the Jan. 23 letter said. The groups -- including the U.S. Chamber of Commerce, the United States Council for International Business, the National Foreign Trade Council and more than a dozen agriculture advocacy organizations -- said the tariffs are hurting steel- and aluminum-consuming companies. They said they want the matter resolved so "we can turn our attention to working with you to gain prompt Congressional approval of the USMCA."

More CBP scrutiny of first sale transactions has followed an increase in the use of first sale valuations in recent months, law firm Sandler Travis said in a blog post. The growth in first sale valuations, which allows importers to value goods at the price sold from a manufacturer to a middle man, is one result of the Section 301 tariffs on goods from China, the firm said. "At a time when volatility in trade policy has left some traditional methods of lowering costs unavailable and is threatening to eliminate others, importers are continuing to use the first sale rule to save millions of dollars in import duties each year," said the firm, which advertises its first sale services in the post.

FedEx Trade Networks, the FedEx division that includes the company's customs brokerage and other services, is being rebranded as FedEx Logistics, the company said in a news release. “We’re adding tremendous value by bringing all of the specialty services we offer under the FedEx Logistics banner,” said Richard Smith, CEO of FedEx Logistics. “The global solutions we offer are dynamic and customizable, and the experience for our customers is more streamlined, more efficient and better represented as a collective competitive offering as FedEx Logistics."

U.S. Chamber of Commerce CEO Thomas Donohue said the same things on trade he's been saying for months -- the tariffs on Chinese goods are paid by businesses, not China; the steel and aluminum tariffs in the NAFTA region have to go; the new NAFTA should be approved -- during his annual State of American Business address. "Now that we’ve struck a deal with Canada and Mexico, the administration must make good on its repeated promise to remove the steel and aluminum tariffs that were imposed in the heat of negotiations," Donohue said in his speech Jan. 10. "This would be an encouraging sign for all of our partners, including those we’re pursuing new market-opening agreements with -- Japan, the EU, and the UK."

BDO is launching a new customs and international trade practice following its acquisition of Global Trade Strategies (GTS), it said in a Jan. 9 press release. The new practice “will help multinational companies navigate the complex rules governing the cross-border movement of goods and services, with the goal of minimizing duty, VAT and excise tax payments, while maximizing corporate customs and trade compliance,” the professional services firm said. Damon Pike, the customs lawyer that founded GTS, will join BDO as a principal and lead the practice. GTS employees have also joined BDO and will be based in its South Florida offices.