October 1, 2008

The Farm Bill, H.R. 2419, will establish a new import declaration requirement for "plants and plant products" impacting a wide range of imported products containing wood, paper, and other materials. The new law amends the Lacey Act of 1981, governing imports of illegally harvested wood and wood products from endangered species. Although there has not been a release of HTS numbers impacted yet, U.S. Customs and Border Protection (CBP) has estimated that these provisions could affect one third of the Harmonized Tariff Schedule, including wood, cork, pulp, paper products, certain apparel, umbrellas, furniture, games, toys, sporting equipment, cookware, and picture frames.

Until the Secretary of Agriculture conducts a review and promulgates a regulation which may modify the following requirements or limit them to specific plant products, a declaration relating to plant or plant products must contain:

1. Scientific name (i.e., genus and species) of any plant contained within the shipment
   
2. The plant species country of origin (i.e., the country where the plant was harvested, cut, logged, or removed),
   
3. A description of the value of the importation and quantity (including the unit of measure) of the plant/plant product. Failure to comply with the plant declaration requirement could result in civil fines of up to $10,000 and criminal prosecution. In addition, violations could result in the suspension or revocation of any licenses/permits authorizing the import of plant products, such as a Protected Plant Permit, which authorizes an individual to import, export, and re-export protected plant species.
   
4. Average percent recycled content without regard for the species or country of origin of the recycled plant product (in addition to the information for the non-recycled plant content otherwise required by 16 USC 3372(f)), for paper or paperboard plant products that include recycled plant product.

Under the preliminary plan, which still needs to be approved by key lawmakers and committees on Capitol Hill, the act would be implemented in stages, as follows (partial list):

• Voluntary participation will begin December 15, 2008 until March 31, 2009. Submission of the paper plant declaration will be voluntary. After April 1, 2009, importers will be expected to file information electronically; however the paper option will still be available. During the period leading up to April 2009, USDA and CBP will meet with industry groups and disseminate information about the compliance program as it is developed.
  
• Initial enforcement is expected to be limited to the most obvious wood and plant-related items, such as flooring, furniture, paperboard and plywood. Enforcement of wood byproducts will be deferred until the scope of the Lacey Act can be administratively or legislatively narrowed. Federal agencies are looking for guidance from Congress related to the scope of the declaration requirement, including:
  
  • What products are regulated
    
  • Whether or not agencies have authority to set de minimis standards under which products with only trace amounts of covered plants or plant products would be excluded from the declaration requirement
    
  • Agency authority to define packaging materials. Packaging materials are exempt from the requirement
    
  • Declarations associated with informal entry
    
• Full enforced compliance is not expected until January 2010.

CBP is researching the possibility of converting a legacy software program used by the U.S. Fish and Wildlife Service to interface with the agency's automated trade processing system and serve as the IT pipeline for transmitting the new import declaration. Establishing the pipeline is estimated to cost close to $500,000 and maintaining the database and collecting information is estimated to require millions of dollars. At this time no funding has been provided.
The Animal and Plant Health Inspection Service (APHIS) is considering an effort to get a provision to limit the mandatory paper filing to a smaller range of line items under the Harmonized Tariff Schedule (HTS), or to institute a de minimis requirement, below which such filings would not be required.