New York-area charities receive 30,000 jackets following Customs seizures

New York Area charities received approximately 30,000 jackets as a result of a joint counterfeit investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) New York and the Nassau County District Attorney’s (NCDA) Office.

The jackets, seized by HSI in 2015, will eventually end up at nearly 100 local charities. In an event held Tuesday by the NCDA’s office, representatives from the charitable organizations, including The Society of St. Vincent de Paul of Long Island, arrived with their empty trucks ready to be filled. Special agents from HSI New York were on hand to deliver the goods.

In December 2015, the HSI executed an arrest and search warrant for intellectual property rights violations at a Manhattan business. The business owner was taken into custody and arraigned. Based on this combined investigation, two cargo containers were identified, each identified as containing approximately 50,000 pieces of counterfeit trademark jackets. The estimated MSRP value for this seizure exceeded $10 million. Each container was subsequently seized.

One charity, The Society of St. Vincent de Paul of Long Island, is known to serve more than 200,000 people each year through an array of services that help people overcome hardship. This number includes adults and children in need, and the donated jackets contribute to their efforts.

The violator entered a guilty plea for the distribution of counterfeit goods and a deal was made for him to pay for the counterfeit trademarks to be removed from the jackets. These jackets were then safety tested and earmarked for donation to charitable organizations.

Commercial Customs Operations Advisory Committee Meeting

The Commercial Customs Operations Advisory Committee (COAC) will meet on Thursday, November 17, 2016, from 12:30 p.m. to 4:30 p.m. EST. Please note that the meeting may close early if the committee has completed its business.

Agenda

The COAC will hear from the following subcommittees on the topics listed below and then will review, deliberate, provide observations, and formulate recommendations on how to proceed:

1. The Trade Enforcement and Revenue Collection (TERC) Subcommittee will discuss the progress made on prior TERC, Bond Working Group, and Intellectual Property Rights Working Group recommendations, as well the recommendations from the Forced Labor Working Group.

2. The Global Supply Chain Subcommittee will provide an update report on the progress of the Customs-Trade Partnership Against Terrorism (C-TPAT) Working Group that is reviewing and developing recommendations to update the C-TPAT minimum security criteria.

3. The One U.S. Government Subcommittee (1 USG) will discuss the progress of the North American Single Window (NASW) Working Group's NASW approach. The subcommittee will also discuss the progress of the Automated Commercial Environment (ACE) Single Window effort.

4. The Exports Subcommittee will give an update on the Air, Ocean, and Rail Manifest Pilots and discuss the progress of the Truck Manifest Sub-Working Group, which is coordinating with the 1 USG NASW Working Group.

5. The Trade Modernization Subcommittee will discuss the progress of the International Engagement and Trade Facilitation Working Group which will be identifying examples of best practices in the U.S. and abroad that facilitate trade. The subcommittee will discuss the startup of the Revenue Modernization Working Group which will be generating advice pertaining to the strategic modernization of Customs and Border Protection's revenue collections process and systems. Finally, the subcommittee will discuss the startup of the Rulings and Decisions Working Group which will be identifying process improvements in the receipt and issuance of Customs and Border Protection Headquarters' rulings and decisions.

6. The Trusted Trader Subcommittee will continue their discussion on their vision for an enhanced Trusted Trader concept that includes engagement with CBP to include relevant partner government agencies with a potential for international interoperability.

Maine Dehairing Open House

Natural Fiber Producers, in conjunction with Saco River Dyehouse is hosting an Open House for fiber producers, textile manufacturers, mill owners & operators, and fiber brokers, and designers. The primary goal of this event will provide an opportunity to observe commercial dehairing firsthand. Attendees will learn how to experience cost savings once heavier fibers, vegetative matter, dirt, and other contaminants are removed. Come and hear how the machine’s gentle action does not break or damage fiber while removing stronger fibers in accordance with industry standards. With the machine in operation during the event, it will become evident how the remaining soft, supple fibers from the commercial dehairing process enhances the tactile experience of wearing natural fibers next to the skin.

Friday, November 4 1:00 – 4:00 Tours & individual appointments 4:00 – 6:00 Presentations; Discussion; Q&A Session

Saturday, November 5 10:00 – 4:00 Tours; Fiber Sampling Demos; Fiber Trials

• Tour the facility

• Participate in a Q & A discussion addressing specific questions and/or concerns about final outcomes, and production. Learn how your net yield can become exactly what is expected!

The dehairing of fiber is known to be a critical link in the foundational chain of high-quality textile processing. The dehairing machine has a proven track record of providing decreased processing costs and increased profitability for fiber producers across the U.S. allowing for the production of the highest quality textiles made in America today. Having demonstrated its capabilities and potential for improving production outcomes, the availability of commercial dehairing services in the U.S., offers producers and manufacturers of yarn and textiles with more options in the marketplace. Manufacturers can now achieve higher profitability through the provision of higher quality yarns and fibers within U.S. borders. Other provisions are attainable for additional cost savings due to the machine’s separating capabilities. One pass through the machine results in “prime” fiber separated from coarser fibers in three stages, each of which has its own commercial viability.

To date, the machine has processed a myriad of natural fibers including Angora (rabbit), alpaca, llama, buffalo, musk ox (qiviut), wool, yak, cashmere, and mohair (goat). New to the lineup is Paco-Vicuna from Jefferson Farms Natural Fibers in Colorado. Much like the fineness of qiviut, the Paco-Vicuna requires settings specific to the needs of the fiber. At this time, Natural Fiber Producers is scheduling several thousand pounds of buffalo, Paco-Vicuna from additional customers, as well as alpaca. In all, it is projected that the machine will process in excess of 60,000 pounds of fiber during the coming year.

Recently, in September, 2016, a returning customer raising musk ox in Alaska, accompanied his yearly harvest of nearly 500 pounds of fiber to Saco River Dyehouse to oversee its processing. After discussing his expectations with the machine’s operator, settings necessary to achieve those goals were established. As the administrator of the Musk Ox Development Corporation in Palmer, Alaska, Mark Austin is happy with the 22% increase in volume. It is however, important to note that settings may differ from one customer to another. Soon after Mark’s qiviut was completed, qiviut from another producer, Geoff Clark of Nunavut, in Northeastern Canada, was processed with different settings to achieve his own goals

The collaborative venture between Natural Fiber Producers and the owners of Saco River Dyehouse, Ken and Claudia Raessler, has been very good. Teamwork between Saco River and NFP representatives has provided customers with satisfying relationship-building experiences. Recently, it was reported that customers were most impressed by the overall knowledge and professionalism of the staff at Saco River Dyehouse, and the ability of NFP representatives to manage customers’ individual needs and expectations.

Natural Fiber Producers and the Saco River Dyehouse are continuing to work through certain logistics of scheduling, fiber staging and storage, as well as scouring and dyeing capabilities. Continued communication and careful monitoring promise to provide customers with achievable and satisfying outcomes in the future. Listening to customer expectations while offering flexibility to meet those needs has become key to meeting targeted objectives.

CBP Relocates Rulings Office

October 28, 2016, ANNOUNCEMENT (81 FR 74918) New Mailing Address for the National Commodity Specialist Division, Regulations and Rulings, Office of Trade

On January 14, 2016, Customs and Border Protection (CBP) published a notice in the Federal Register (81 FR 1960), announcing a temporary change of office location effective January 28, 2016, due to the relocation of the National Commodity Specialist Division (NCSD). In that notice, CBP stated that it would update its regulation once the relocation of the NCSD is complete. The relocation is now completed and a permanent address is established. As such, CBP is revising section 177.2(a) of title 19 of the Code of Federal Regulations (19 CFR 177.2(a)) to reflect the new mailing address. Starting October 28, 2016, all non-electronic correspondence to the NCSD should be sent to the following address:

Director, National Commodity Specialist Division, Regulations and Rulings, Office of Trade, 201 Varick Street, Suite 501, New York, New York 10014.

E-rulings procedures will remain the same and are not affected by the change in office location.

Goodwill Industries and Federal Prison Industries Awarded Army Uniform Contracts

Goodwill Industries of South Florida Inc., Miami, Florida, has been awarded a maximum $18,258,000 modification (P00005) exercising the one-year option of a one-year base contract (SPE1C1-16-D-N001) with one one-year option period for Army combat uniform coats and trousers. The modification brings the maximum dollar value of the contract to $36,516,000 from $18,258,000. This is a firm-fixed price, indefinite-delivery/indefinite-quantity contract. Location of performance is Florida, with a Nov. 1, 2017, ordering period end date, and a Nov. 1, 2018, performance completion date. Using military service is Army. Type of appropriation is fiscal 2017 through fiscal 2018 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania.

UNICOR/Federal Prison Industries, Washington, District of Columbia, has been awarded a maximum $12,315,000 modification (P00006) exercising the first one-year option of a one-year base contract (SPE1C1-16-D-1008) with two one-year option periods for physical fitness uniforms. The modification brings the maximum dollar value of the contract to $24,390,000 from $12,075,000. This is a firm-fixed-price, indefinite-delivery/ indefinite-quantity contract. Locations of performance are District of Columbia, Virginia, Florida and Arizona, with an Oct. 29, 2018, performance completion date. Using military service is Army. Type of appropriation is fiscal 2017 through fiscal 2018 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania.

Dept. of Defense Clothing Contract Awarded

ReadyOne Industries Inc., El Paso, Texas, has been awarded a maximum $74,869,295 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for protective coveralls and ensembles and expedient repair kits. This is a one-year contract with no option periods. This was a competitive acquisition with two responses received. Location of performance is Texas, with an April 30, 2019, performance completion date. Using military service is Air Force. Type of appropriation is fiscal 2017 through fiscal 2018 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE1C1-17-D-1002).

Duty Suspension Request of Interest to Textile, Apparel, and Footwear Companies

The U.S. International Trade Commission began accepting petitions for duty suspensions and reductions on October 14, 2016. Petitions will be accepted through Deceber 12, 2016. By January 11, 2017, the public comment period will open. Comments will be accepted for 45 calendar days.

As of noon, Wednesday, October 26, 2016, 253 petitions had been filed Among the petitions are several that may be of interest to Agathon Associates' readers:

Num.	Petitioner	Description	HTSUS-8	Chap. 99	Status	Notes
126	Simms Fishing Products LLC	Polyester/Nylon woven fabric	5407.72.00		Pending
129	Simms Fishing Products LLC	Neoprene wading socks	6115.96.90		Pending
130	Simms Fishing Products LLC	Neoprene guard socks	6117.80.95		Pending
132	Simms Fishing Products LLC	Structured pocket pouch for fishing waders	6117.90.90		Pending
160	Aso LLC	Elastic Fabric: 100% Polyester, water-repellent	5407.53.20		Pending
169	Mount Vernon Mills, Inc.	Sulfonated polyethylene terephthalate	3907.60.00		Pending
172	Mount Vernon Mills, Inc.	NBPT	2929.90.50		Pending
174	American Woolen Company	Yarn of combed cashmere or yarn of camel hair	5108.20.80	9902.03.01	Pending
197	PetSmart Home Office, Inc.	Squeaky toys for dogs	6307.90.75		Pending
215	Simms Fishing Products LLC	Neoprene stockingfoot for fishing waders	6307.90.98		Pending
220	PetSmart Home Office, Inc.	Fully Assembled Pet Beds	6307.90.98		Pending
221	PetSmart Home Office, Inc.	Toys for dogs without squeakers.	6307.90.75		Pending
223	PetSmart Home Office, Inc.	Other textile articles for pets nesoi	6307.90.98		Pending
224	PetSmart Home Office, Inc.	Toys for pets other than dogs.	6307.90.75		Pending
226	SUN MOUNTAIN SPORTS, INC.	Golf bag flat with or without rain hood and sling	6307.90.98	9902.23.24	Pending
242	Jagger Brothers	Certain acrylic fiber	5506.30.00		Pending	Similar to 9902.10.22
243	Jagger Brothers	Rayon top	5507.00.00	9902.23.34	Pending
252	School Apparel, Inc.	Acrylic Fiber-Dyed Low Pill Knitting Yarn	5509.32.00		Pending

CPSC’s Children’s Sleepwear Seminar

The Consumer Product Safety Commission ("CPSC") will hold a one-day Children’s Sleepwear Seminar December 1, 2016. The Seminar will focus on testing, certification, and other compliance guidance relating to the requirements for children’s sleepwear. The Seminar will begin at 8:30 AM – 5:00 PM and held in the 4th Floor Hearing Room at the CPSC offices in Bethesda Towers, 4330 East West Highway, Bethesda, MD. Individuals who plan on attending should register for the seminar by contacting Carolyn Carlin, ccarlin@cpsc.gov.

Request for Public Comments Regarding the Interim Environmental Review of the WTO Environmental Goods Agreement

SUMMARY: The Office of the United States Trade Representative ("USTR"), on behalf of the Trade Policy Staff Committee ("TPSC"), invites written comments from the public on the interim environmental review of the proposed WTO Environmental Goods Agreement ("EGA").

USITC Releases Report Concerning Whether Certain Textile and Apparel Articles from Nepal Are Import Sensitive

On October 24, 2016, the U.S. International Trade Commission Releases Report Concerning Whether Certain Textile and Apparel Articles from Nepal are Import Sensitive

As requested, the USITC provided advice on the likely impact on U.S. imports, competing U.S. industries, and U.S. consumers of providing duty free treatment for the following 66 HTS 8 digit subheadings from Nepal:

Certain luggage articles and attaché cases	4202.11.00, 4202.12.20, 4202.12.40, 4202.12.60, 4202.12.80
Certain handbags	4202.21.60, 4202.21.90, 4202.22.15, 4202.22.40, 4202.22.45, 4202.22.60, 4202.22.70, 4202.22.80, 4202.29.50, 4202.29.90
Certain pocket goods	4202.31.60, 4202.32.40, 4202.32.80, 4202.32.95
Certain travel, sports and similar bags, backpacks, and other containers	4202.91.00, 4202.92.08, 4202.92.15, 4202.92.20, 4202.92.30, 4202.92.45, 04202.92.60, 4202.92.90, 4202.99.90
Certain carpets and other textile floor coverings (rugs)	5701.10.90, 5702.31.20, 5702.49.20, 5702.50.40, 5702.50.59, 5702.91.30, 5702.91.40, 5702.92.90, 5702.99.15, 5703.10.20, 5703.10.80, 5703.90.00, 5705.00.20, and 6308.00.00
Certain shawls, scarves, headbands, and blankets	6117.10.60, 6214.10.10, 6214.10.20, 6214.20.00, 6214.40.00, 6214.90.00, and 6301.90.00, and 6117.80.85, 6217.10.85
Certain hats	6504.00.90, 6505.00.08, 6505.00.15, 6505.00.20, 6505.00.25, 6505.00.30, 6505.00.40, 6505.00.50, 6505.00.60, 6505.00.80, 6505.00.90, 6506.99.30, 6506.99.60
Certain gloves	4203.29.50, 6216.00.80

Duty Suspensions Requested for Certain Textile Products

The U.S. International Trade Commission began accepting petitions for duty suspensions and reductions on October 14, 2016. Petitions will be accepted through Deceber 12, 2016. By January 11, 2017, the public comment period will open. Comments will be accepted for 45 calendar days.

As of noon, Friday, October 21, 2016, 167 petitions had been filed Among the petitions are ones relating to:

• #126, Certain Polyester/Nylon woven fabric (HTSUS 5407.72.00),
• #129, Certain Neoprene wading socks (HTSUS 6115.96.90),
• #130, Certain Neoprene guard socks (HTSUS 6117.80.95),
• #132, Certain Structured pocket pouch for fishing waders (HTSUS 6117.90.90), and
• #160, Certain Elastic Fabric: 100% Polyester, water-repellent (HTSUS 5407.53.20).

Agathon Associates can assist U.S. manufacturers and importers in filing petitions or filing objections to petitions.

Upholstered Furniture FTZs Reapproved

On October 20, 2016, the Foreign Trade Zone Board published in the Federal Register (81 FR 72565) Foreign-Trade Zone (FTZ) 158—Vicksburg/Jackson, Mississippi; Authorization of Production Activity; Bauhaus Furniture Group, LLC; H.M. Richards Company, Inc.; Lane Home Furniture; Morgan Fabrics Corporation; (Upholstered Furniture); Tupelo, Mississippi, Area.

On June 17, 2016, the Greater Mississippi Foreign-Trade Zone, Inc., grantee of FTZ 158, submitted a notification of proposed production activity to the FTZ Board on behalf of Bauhaus Furniture Group, LLC, H.M. Richards Company, Inc., Lane Home Furniture, and Morgan Fabrics Corporation within FTZ 158 in the greater Tupelo, Mississippi, area.

The notification was processed in accordance with the regulations of the FTZ Board (15 CFR part 400), including notice in the Federal Register inviting public comment (81 FR 42648, June 30, 2016). The FTZ Board has determined that no further review of the activity is warranted at this time. The production activity described in the notification is authorized, subject to the FTZ Act and the Board's regulations, including Section 400.14. The activity also remains subject to the conditions of B-29-2013, B-21-2013, B-28-2013 and Board Order 1877.

On October 20, 2016, the Foreign Trade Zone Board published in the Federal Register (81 FR 72566) Foreign-Trade Zone (FTZ) 158—Vicksburg/Jackson, Mississippi; Authorization of Production Activity; Southern Motion, Inc.; (Upholstered Furniture) Pontotoc and Baldwyn, Mississippi

On June 17, 2016, the Greater Mississippi Foreign-Trade Zone, Inc., grantee of FTZ 158, submitted a notification of proposed production activity to the FTZ Board on behalf of Southern Motion, Inc., within Subzone 158G, in Pontotoc and Baldwyn, Mississippi.

The notification was processed in accordance with the regulations of the FTZ Board (15 CFR part 400), including notice in the Federal Register inviting public comment (81 FR 42649-42650, June 30, 2016). The FTZ Board has determined that no further review of the activity is warranted at this time. The production activity described in the notification is authorized, subject to the FTZ Act and the Board's regulations, including Section 400.14. The activity also remains subject to the restrictions and conditions established under Docket B-45-2014.

Manufacturer of Kwik Fix, Hammer Tite, and Krylex Glues Settles with FTC, Agrees to Drop Misleading ‘Made in USA’ Claims

Georgia-based specialty chemical company Chemence, Inc. will stop making misleading unqualified claims that its strong, fast-acting glues are made in the United States, under a settlement with the Federal Trade Commission.

Chemence also has agreed to pay a $220,000 judgment to resolve the lawsuit the FTC brought against the company in February 2016.

In its complaint against Chemence, the FTC alleged that the company deceived consumers by making “Made in USA” or “Proudly Made in USA” claims for its cyanoacrylate glue products such as Kwik Fix, Hammer Tite, and Krylex. While Chemence’s claims allegedly implied that the products were all, or virtually all, made in the United States, approximately 55 percent of the costs of the chemical inputs to Chemence’s glues are attributable to imported chemicals that are essential to the glues’ function, according to the FTC. The complaint also alleged that Chemence assisted others in deceiving consumers by distributing its Made-in-USA marketing materials to private-label sellers and third-party websites and storefronts.

The stipulated final order prohibits the company from making unqualified “Made in USA” claims for any product unless it can show that the product’s final assembly or processing – and all significant processing – take place in the United States, and that all or virtually all ingredients or components of the product are made and sourced in the United States. The order permits Chemence to make qualified “Made in USA” claims as long as they include a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients, and/or processing. Chemence also is prohibited from providing others with the means to make deceptive Made-in-USA claims about its products.

Jos. A. Bank Submits FTZ Application

An application has been submitted to the Foreign-Trade Zones (FTZ) Board by the Maryland Aviation Administration, on behalf of the Maryland Department of Transportation, grantee of FTZ 73, requesting subzone status for the facilities of Jos. A. Bank Manufacturing Company, located in Hampstead and Eldersburg, Maryland. The application was submitted pursuant to the provisions of the Foreign-Trade Zones Act, as amended (19 U.S.C. 81a-81u), and the regulations of the FTZ Board (15 CFR part 400). It was formally docketed on October 13, 2016.

The proposed subzone would consist of the following sites: Site 1 (38.5 acres) 500 Hanover Pike, Hampstead; Site 2 (13.5 acres) 626 Hanover Pike, Hampstead; and, Site 3 (3.2 acres) 1332 Londontown Blvd., Eldersburg. The proposed subzone would be subject to the existing activation limit of FTZ 73. No authorization for production activity has been requested at this time.

Agathon Associates Files FTZ Application for Claremont Flock

On October 19, 2016, the FTZ Board published in the Federal Register (81 FR 72038) Foreign-Trade Zone (FTZ) 27—Boston, Massachusetts; Notification of Proposed Production Activity; Claremont Flock, a Division of Spectro Coating Corporation (Textile Flock); Leominster, Massachusetts.

Claremont Flock, a Division of Spectro Coating Corporation (Claremont Flock), submitted a notification of proposed production activity to the FTZ Board for its facility in Leominster, Massachusetts within Subzone 27N. The notification conforming to the requirements of the regulations of the FTZ Board (15 CFR 400.22) was received on October 13, 2016.

Claremont Flock already has authority to produce textile flock using acrylic and rayon tow within Subzone 27N. The current request would add polyester tow as a material/component to the scope of authority. Pursuant to 15 CFR 400.14(b), additional FTZ authority would be limited to the specific foreign-status material/component described in the submitted notification (as described below) and subsequently authorized by the FTZ Board.

Production under FTZ procedures could exempt Claremont Flock from customs duty payments on polyester tow used in export production. On its domestic sales, Claremont Flock would be able to choose the duty rate during customs entry procedures that applies to textile flock (duty-free) for polyester tow (duty rate 7.5%). Customs duties also could possibly be deferred or reduced on foreign-status production equipment.

Public comment is invited from interested parties. The closing period for their receipt is November 28, 2016.

The application was filed on behalf of Claremont by Agathon Associates.

NOTE, that we are fully aware that there is domestic production of polyester fiber, including tow. Claremont does not make any broad claim that polyester fiber is not available from domestic sources. Claremont's Application relates solely to a narrow claim that certain polyester tow for use in producing textile flock is not available domestically. Other than Palmetto, which, exited this market in January of this year, U.S. producers of polyester tow have not sold it to the flock cutting industry for some years, rather it is used in the production of staple fiber for use by the yarn spinning industry. Approval of this Application would not, and ought not, be viewed as a precedent opening the way for FTZ procedures to be used in the case of other polyester fibers.

Colombia Rayon Fabric Short Supply Filed

The Committee for the Implementation of Textile Agreements ("CITA") is considering Commercial Availability Request for Certain 100% Rayon Twill Challis, as specified below.

Responses are due by 11:59 P.M. (EST), October 31, 2016.

SPECIFICATIONS: Certain 100% Rayon Twill Challis

HTSUS: 5516.12.0020; 5516.13.0000; 5516.14.0025; 5516.14.0030

Fabric Type: Twill Challis

Fiber Content: 100% Rayon

Yarn Size:

Weft 27-33 denier x Warp 27-33 denier / 97.2-118.8 warp ends x 61.2-74.8 weft filling yarns per square inch (English)

627- 767 warp ends x 394-483 weft filling yarns per square centimeter (metric)

*range represents a +/-10% tolerance.

Weave Type: Twill

Weight: 152 to 168 grams per square meter – this is the equivalent of +/- 5% tolerance of 160 grams per square meter used in due diligence

Width: 55 in to 56 in (English) / 139.7 to 142.24 centimeters (metric)

Coloration Process: Various (including bleaching, piece dyed, yarn dyed, and/or printed)

Finishing Process: Various

Ranges: Ranges in these specifications reflect a tolerance from the target figures of up to five % (equal to range of 152-168 grams per square meter) for fabric weight. Yarn size is a tolerance of ten % (equal to range of 627-767 warp ends x 394-483 weft filling yarns per square centimeter).

Rug Manufacturing Seeks Foreign-Trade Zone

According to a report on centralmaine.com, Flemish Master Weavers ("FMW") of Sanford, Maine, has filed an application to the Foreign-Trade Zone ("FTZ") Board in Washington for authorization to use FTZ procedures in their production of rugs of man-made fiber yarns.

If this story is correct (Agathon Associates could not independently verify it) it would be the company's second attempt at this proposal which could save them around $1 million annually. On March 31, 2016, they submitted a Notification Requesting Production Authority ("Notification"). A Notification is a short document answering four questions. In the case of Flemish Master Weavers, the Notification was two pages long. The Notification requested production under FTZ procedures which could exempt FMW from customs duty payments on foreign status materials used in export production. On its domestic sales, FMW would be able to choose the duty rate during customs entry procedures that applies to area rugs (free) for the polypropylene and polyester yarns (duty rates: 8.0% and 8.8%, respectively) sourced from abroad. Customs duties also could possibly be deferred or reduced on foreign status production equipment.

Authorization for production was opposed by National Spinning Co., Inc., the American Fiber Manufacturers Association, the National Council of Textile Organizations, and the United States Industrial Fabrics Institute. On July 29, 2016, the FTZ Board approved FMW's application, but with restrictions that eliminated most of the value of the authorization. With FTZ procedures as approved, FMW will avoid duty on the imported yarn, but only until the rugs made from the yarn enter the U.S. market. In other words, they got a brief deferral of the duty, plus avoidance of duty on rugs they export outside of the U.S.

In granting FMW limited authorization, the Board also informed FMW that have the option of re-filing, using the more extensive Application for Production Activity. It appears, from the news account, that they have opted to re-file, using that longer, 41-question, application.

To learn if your company can save money using FTZ procedures, contact David Trumbull at david@agathonassociates.com for an initial free consultation. In his FTZ work David works closely with Glenn Page of FTZ Solutions.

Introducing: Foreign Trade Zone Solutions

On Thursday, October 13, 2016, Glenn Page of FTZ Solutions, and David Trumbull of Agathon Associates, appeared as subject matter experts on behalf of Gino Marconi, Director of Ports and Harbors, Pease Development Authority (Foreign-Trade Zone #81) at the Fourteenth Annual Governor's Advanced Manufacturing and High Technology Summit, held in Concord, New Hampshire. Page and Trumbull conducted one-on-one discussions with New Hampshire manufacturing companies regarding the potential for cost savings using FTZ procedures for production, warehousing, and distribution activity. Recently the team assisted a textile manufacturing in Massachusetts to save $200,000 per year, and hire 20 new workers, using FTZ procedures.

Above Glenn Page of FTZ Solutions, and David Trumbull of Agathon Associates. Photo credit: Marilyn Page.

Edinburgh Woollen Mill in Court over 'Pure Cashmere' Mislabelling

Following a tip from the Cashmere and Camel Hair Manufacturers Institute, Scottish officials arranged for independent laboratory analysis of textile products sold at Edinburgh Woollen Mill and labeled as 100% cashmere. The laboratory analysis contradicted the labeling claim, and the business is now facing a court case in Scotland over mislabeling. Read more at www.theguardian.com.

Reminder Start Filing MTB Petitions Friday

YOU MAY BE ABLE TO SAVE MONEY ON IMPORT DUTIES.

The process is called the Miscellaneous Tariff Bill ("MTB") and was around since the 1980s. The way it worked was companies would go to a senator or representative with a list of requests for duty suspensions. A bill would be filed for each requested suspension. Then, months later, after an investigation by the International Trade Commission ("ITC"), all the requests filed by all the senators and members of congress would be put into one huge bill which, by rule, could pass only by unanimous consent. The result, for the successful requests, was a two year suspension in the collection of duties. Congress did an MTB every two years, so the suspensions always got renewed.

Then the system broke down over partisan politics. No MTB has been passed in years and the last the duty suspensions expired at the end of 2012.

Now there is a new non-political systems. Members of congress cannot file for duty suspensions. Rather a company (or more likely a company's lawyer, lobbyist, or consultant) files directly with the ITC which then conducts an investigation into each request and then gives congress the list of all the request that qualify, which then gets voted as the MTB (I’m leaving out some dull steps in between).

There are three criteria the ITC looks at--

1. Is it non-controversial, meaning are there no domestic producers of the product or a like product who will oppose.

2. Is the total annual tariff revenue lost to the U.S. treasury no greater than $500,000. That cap is applied per item. So in the case of the 11 items listed below they do that calculation 11 times, it’s not an over all number. Even if a single item goes over the $500,000 you can still get a reduction in duty. Say something has 10% rate of duty and total suspension of duty would cost the government $1 million, what they would do is lower the duty to 5%, to make the total industry savings $500,000.

3. It must be “administrable” meaning when goods are presented for entry and claim duty free under the MTB, Customs has to be able to examine the merchandise and determine whether it is. So you cannot do an MTB based on end use.

The new ITC system asks for more information than the old congressional one, so there is some burden. The window for filing for duty suspensions opens Friday, October 14th, and continues for 60 days. For more information, or to find out how your could benefit from a duty suspension under the new MTB procedures, contact David Trumbull at david@agathonassociates.com.

CPSC to Hold Children’s Sleepwear Seminar

On Thursday, October 20, 2016, the Consumer Product Safety Commission will hold a one-day Children’s Sleepwear Seminar. The Seminar will focus on testing, certification, and other compliance guidance relating to the requirements for children’s sleepwear. The Seminar will begin at 8:30 AM – 5:00 PM and held in the 4th Floor Hearing Room at the CPSC offices in Bethesda Towers, 4330 East West Highway, Bethesda, MD. Individuals who plan on attending should register for the seminar by contacting Carolyn Carlin, 301-504-7889, ccarlin@cpsc.gov.

Spider Thread in the News

"In the future, everything you wear could be made of synthetic spider silk," according to this article about Agathon Associates' client, Bolt Threads in Business Insider

2016 Wool Symposium

For the love of place: hear from Fibershed community members near & far as we come together to understand the true cost of soil to soil textiles and clothing. What goes into making a sweater? Hear perspectives on the cost of raising sheep from members who manage landscapes from small parcels to large grazing operations, including Jill Hackett, Jaime Greydanus, Carleen Weirauch, Aaron Gilliam, and Ryan Mahoney.

From shearing to sweater, listen to a discussion on the cost of knitwear with designers ranging from bespoke garments to mechanized production on the latest technology, including Myrrhia Resneck, Emily Cunetto, and Marlie de Swart.

Reserve tickets today to enjoy engaging presentations and the launch of exciting new projects and resources. Stop by mid-day to see hands-on demonstrations and support Fibershed Producers directly in the Marketplace, both of which are free & open to the public.

November 19th, 9:30 – 5:30 PM in Point Reyes Station. Click here for more information.

Monday is Columbus Day in America

Monday, October 10th, is a federal holiday in the United States. National, state, and local government offices will be closed. Observance of the holiday by the private sector varies from region to region.

Monday we celebrate Columbus Day in honor of his historic voyages that opened communication, commerce, and migration between the Old World of Europe and the New World of the Americas. Columbus' voyages of discovery led directly to Spanish settlements in the New World that became, with time, the many Latin-American nations of South, Central and North America and the islands of the Caribbean. The United States, today a sea-to-sea continental nation with citizens and residents whose ancestors lived in every corner of the globe, likewise traces her beginnings to Columbus. As early as 1738 "Columbia" had entered the English tongue as a name for the 13 British colonies in North America that became our original 13 States. Yes, from the birth of our nation it was understood that it all started with Columbus. That's why Columbus matters.

"The governor shall annually issue a proclamation setting apart the second Monday in October as Columbus Day and recommending that it be observed by the people, with appropriate exercises in the schools and otherwise, to the end that the memory of the courage, perseverance and spiritual fervor of Christopher Columbus, discoverer of America, may be perpetuated." --Mass. Gen. Laws, Chapter 6, Section 12V. (Emphasis added.)

The second Monday in October is also Thanksgiving Day in Canada.

FTZ Report Shows Program Under Utilized in New England

Last week the Foreign-Trade Zone Board released the 76th ANNUAL REPORT of the Foreign-Trade Zones Board to the Congress OF THE UNITED STATES.

Foreign-trade zones are secure areas under supervision of U.S. Customs and Border Protection (CBP) that are considered outside the customs territory of the United States for the purposes of duty payment. Located in or near customs ports of entry, they are the U.S. version of what are known internationally as free trade zones. Authority for establishing these facilities is granted by the Foreign-Trade Zones Board under the Foreign-Trade Zones Act of 1934, as amended (19 U.S.C. 81a-81u), and the Board’s regulations (15 C.F.R. Part 400). The Executive Secretariat of the Board is located within Enforcement and Compliance of the U.S. Department of Commerce in Washington, D.C.

During Fiscal Year 2015, the FTZ Board received and docketed 85 requests, and issued 87 decisions. The FTZ Board’s decisions included the establishment of four new foreign-trade zones, the reorganization or expansion of 22 zones under the alternative site framework (ASF), as well as decisions on 54 applications and notifications for new or expanded production authority. Under delegated authority, the FTZ Board Staff processed an additional 181 requests that included minor boundary modifications and scope determinations.

There were 186 FTZs active during the year, with a total of 324 active production operations. Over 420,000 persons were employed at some 2,900 firms that used FTZs during the year. The value of shipments into zones totaled nearly $660 billion, compared with $798 billion the previous year. About 63 percent of the shipments received at zones involved domestic status merchandise. The level of domestic status inputs used by FTZ operations indicates that FTZ activity tends to involve domestic operations that combine foreign inputs with significant domestic inputs.

Warehouse/distribution operations received nearly $228 billion in merchandise while production operations received over $431 billion (65 percent of zone activity). The largest industries accounting for zone production activity include the oil refining, automotive, electronics, pharmaceutical, and machinery/equipment sectors.

Exports (shipments to foreign countries) from facilities operating under FTZ procedures amounted to over $84 billion.

Main Foreign-Status Products Received in U.S. FTZs

WAREHOUSE/DISTRIBUTION OPERATORS	($ million)	PRODUCTION OPERATORS	($ million)
Vehicles	33,269	Oil/Petroleum	64,822
Consumer Products	12,781	Consumer Electronics	15,890
Consumer Electronics	11,153	Vehicle Parts	13,605
Electrical Machinery	10,954	Pharmaceuticals	6,416
Oil/Petroleum	9,665	Machinery/Equipment	6,104
Textiles/Footwear	8,907	Petrochemicals	2,606
Machinery/Equipment	7,731	Chemicals	1,498
Other Electronics	5,915	Other Electronics	1,316
Other Metals/Minerals	4,850	Plastic/Rubber	724
Pharmaceuticals	3,615	Aircraft/Spacecraft	722
Vehicle Parts	2,457	Other Metals/Minerals	513
Optical, Photographic and Medical Instruments	777	Consumer Products	448
Beverages/Spirits	733	Electrical Machinery	422
Plastic/Rubber	638	Optical, Photographic and Medical Instruments	314
Iron/Steel	479	Textiles/Footwear	209
Food Products	311	Advanced Fiber Materials	75
Tobacco Products	278	Fragrances/Cosmetics	67
Wood/Paper	175	Dyes/Pigments/Paints	67
Rail Cars, Parts & Equipment	153	Food Products	54
Stone/Plaster/Cement/Ceramics	126	Beverages/Spirits	54
Petrochemicals	118	Ships/Boats	45
Chemicals	103	Stone/Plaster/Cement/Ceramics	41
Fragrances/Cosmetics	95	Vehicles	39
Aircraft/Spacecraft	87	Iron/Steel	27
Advanced Fiber Materials	36	Arms/Ammunition	18
Arms/Ammunition	8	Wood/Paper	9
Dyes/Pigments/Paints	3	Rail Cars, Parts & Equipment	7
Ships/Boats	2

FTZ Procedures Under Utilized in New England

Connecticut

FTZ 71, WINDSOR LOCKS, no activity.

FTZ 76, BRIDGEPORT, no activity.

FTZ 162, NEW HAVEN, no activity.

Maine

FTZ 58, BANGOR, no activity.

FTZ 179, MADAWASKA:

• Production: Evergreen Trading Co. LLC (Fragrances/Cosmetics), $25-50 million.

FTZ 186, WATERVILLE, no activity.

• Flemish Master Weavers (Textiles/Footwear) was approved in 2016, but effectively limited to warehousing/distribution and production for export.

FTZ 263, AUBURN, no activity.

FTZ 282, BRUNSWICK, no activity.

Massachusetts

FTZ 27, BOSTON:

• Warehousing/Distribution: 14 companies, $500-750 million.
• Production: AstraZeneca (Pharmaceuticals), $1-5 million.
• Production: Claremont Flock was approved in late 2015 and actived in 2016.

FTZ 28, NEW BEDFORD:

• Warehousing/Distribution: 1 company, $100-250 million.
• Production: Acushnet Company (Textiles/Footwear), $70-100 million

FTZ 201, HOLYOKE, no activity.

New Hampshire

FTZ 81, PORTSMOUTH:

• Production: Millipore Corporation (Advanced Fiber Materials), $100-250 million.

Rhode Island

FTZ 105, PROVIDENCE & NORTH KINGSTOWN:

• Warehousing/Distribution: 1 company, $1-5 million.

Vermont

FTZ 55, BURLINGTON:

• Production: Wyeth Nutritionals, Inc (Food Product), $0-0.5 million.

FTZ 268, BRATTLEBORO, no activity.

FTZ 286, CALEDONIA, ESSEX AND ORLEANS COUNTIES, no activity.

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David Trumbull, Agathon Associates, has over twenty years of experience assisting U.S. manufacturing companies to save money through informed use of the U.S. Customs regulations. He has worked with companies to file Foreign Trade Zone applications. David has also testified as an expert witness at the Foreign Trade Zone Board in Washington, DC. He is a Licensed Customs Broker (Lic. No. 30179) and was, from 2007 to 2013, an official advisor on manufacturing trade policy to the administrations of presidents George W. Bush and Barack Obama.

Glenn Page, New England Global Advisors, spent over 30 years with U.S. Customs and Border Protection, (CBP). While assigned to the Portsmouth, NH office of CBP he managed oversight for U.S. Customs of Foreign Trade Zone 81, which included Millipore Corporation and Westinghouse Electric.

Glenn and David recently worked together with Claremont Flock in obtaining and utilizing Foreign Trade Zone procedures.

Glenn can be reached at 603-957-8247 or glenn@neglobaladvisors.com

David can be reached at 617-237-6008 or david@agathonassociates.com

Army Camouflage Parka Contract Awarded

Coachys and Associates, Roswell, Georgia, has been awarded a maximum $12,499,907 firm-fixed-price contract for camouflage parkas. This is a one-year base contract with two one-year option periods. This was a competitive acquisition with five responses received. Locations of performance are Georgia and Tennessee, with a Sept. 28, 2017, performance completion date. Using military service is Army. Type of appropriation is fiscal 2016 through fiscal 2017 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE1C1-16-D-1087).

U.S. Department of Defense contracts for clothing and textiles are general subject the the Berry Amendment, which was originally passed by Congress in 1941 to promote the purchase of certain U.S. goods. The Amendment was included in subsequent defense appropriations act until it was made permanent in Fiscal Year 1994 by section 8005 of Public Law 103-139. It was subsequently codified as 10 U.S.C. 2533a in 2002 by section 832 of Public Law 107-107.

The Berry Amendment applies only to the U.S. Department of Defense ("DOD"). As implemented in the Defense Federal Acquisition Regulation Supplement ("DFARS"), it generally restricts DOD's expenditure of funds for supplies consisting in whole or in part of certain articles and items not grown or produced in the United States or its possessions.

The restrictions apply to:

• food;
• clothing;
• tents, tarpaulins, or covers;
• cotton and other natural fiber products, or wool;
• woven silk or woven silk blends;
• spun silk yarn for cartridge cloth;
• synthetic fabric or coated synthetic fabric;
• canvas products;
• individual equipment manufactured from or containing any of the listed fibers, yarns, fabrics, or materials;
• certain specialty metals; and
• hand or measuring tools.

The Berry Amendment applies to all funds "made available" to the Defense Department. That includes Department of Defense procurement for a Foreign Military Sale ("FMS") where the funds were provided by the customer country.

When the Berry Amendment applies to aquisition of textiles or clothing, it applies to the final product, as well as all fiber components. For example, Navy peacoats of wool must be made in the U.S.A., of fabric woven in the U.S.A., of yarn spun in the U.S.A., of wool from sheep that grazed on U.S.A. soil.

Clients of Agathon Associates can learn more about the Berry Amendment at www.agathonassociates.com/textile-pri/berry/index.htm. You will need to enter your username and password. If you do not know your username and password email David Trumbull at david@agathonassociates.com.