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Technical Updates

New Audit Tactic by U.S. Customs & Border Protection (U.S. CBP)

It’s in the Mail!

Cole recently learned that U.S. CBP has been sending “Informed Compliance Letters” to importers suggesting that they review their import transactions for compliance.  Within the letter, there is reference to “Informed Compliance Publications” (ICPs).  ICPs are documents published by U.S. CBP in order provide the necessary guidance to the public on the classification of certain goods and other issues (valuation, etc.) for which there is little information or guidance in the HTSUS or the Explanatory Notes (ENs) that can assist with proper classification, etc. such as:

This process is said to give the importer the opportunity to review their transactions to determine if there are any compliance issues that should be voluntarily disclosed before a full audit is undertaken by CBP.

What do you do if you receive an Informed Compliance Letter?

Don’t ignore it! Contact Cole International USA, INC. immediately.  Companies trying to go it alone without full knowledge of what may happen can be drawn into undesirable scenarios with expensive results.  Customs Audits are a very serious business and cannot be treated lightly!  Seemingly innocent requests for information are often the tip of the iceberg, leading to in-depth audits with wide-ranging scope and potential liability.  In many cases this can be prevented through early Cole involvement.  Our U.S. Consulting team will help to interpret Customs letters and identify a correct course of action for your situation. You will be represented by an experienced team that will act in your best interest to minimize exposure to penalties.

New Audit List Released By CBSA

The Canada Border Services Agency (CBSA) has published their mid-year list of commodities and programs on which they will focus their audits (compliance verifications) for the balance of the year.

There are 8 new items on the July, 2016 list as follows:

  • Cell Phone Cases

  • Mountings, Fittings & Similar Articles

  • Stone table & Counter Tops

  • Prepared Meat of Swine

  • Live Plants

  • Interchangeable Tools

  • Air Brakes and Parts Thereof

  • Handkerchiefs, Towels & Related Paper Products

CBSA’s verification priorities are carried over from previous years, so the full list actually contains 40 commodities covering the following 3 program areas:

  • Tariff Classification (36/40 items on list)

  • Valuation (2/40)

  •  Origin (2/40)

For a complete list of CBSA’s verification (audit) priorities, click here 

Cole International works diligently every day to ensure that your company is Customs compliant, but CBSA may still chose to audit your company. Be assured that Cole’s Audit Response Unit is ready and able to assist you through a CBSA audit in the event that it happens.

If you import any of the 40 commodities on CBSA’s list, a deeper discussion may be warranted on how these issues may affect you.  Please contact your Cole account representative at the number you have on file or contact us.

Imports of Truck & Bus Tires into USA, From China

The Issue:

On June 28, 2016 the United States Department of Commerce announced an affirmative decision in the countervailing duty investigation of imports of truck and bus tires from the People’s Republic of China.  As a result, U.S. Customs and Border Protection will be required to request cash deposits on such imports based on preliminary rates as follows:


What is countervailing duty?

What goods are included in this “Truck & Bus Tire” case?

The scope of the investigation covers truck and bus tires. Truck and bus tires are new pneumatic tires, of rubber, with a truck or bus size designation. They may be tube-type, tubeless, radial, or non-radial. Their usual classifications under the HTSUS subheadings are:

  • 4011.20.1015 and 4011.20.5020.

But may also enter under:

  • 4011.99.4520, 4011.99.4590, 4011.99.8520, 4011.99.8590, 8708.70.4530, 8708.70.6030, and 8708.70.6060.

What’s next?

Commerce is currently scheduled to announce its final determination will be announced on or about November 10, 2016, unless the statutory deadline is extended.  If Commerce makes an affirmative final determination, and the U.S. International Trade Commission (ITC) makes an affirmative final determination that imports of truck and bus tires from China materially injure, or threaten material injury to, the domestic industry, Commerce will issue a CVD order. If either Commerce’s or the ITC’s final determination is negative, no CVD order will be issued. The ITC is scheduled to make its final injury determination approximately 45 days after Commerce issues its final determination, if affirmative.

Cole International will continue to update you on the case as it progresses.  If you have any specific questions, please contact your Cole account representative.

More Information:

Microbeads Officially a “Toxic Substance”

The Issue:

Microbeads have officially been declared a Toxic Substance by the Government of Canada.  They are now item # 133 on Environment and Climate Change Canada’s Toxic Substances List.  As such, the import, export, manufacture and sale of microbead containing personal care products will be controlled and eventually prohibited.

What are Microbeads?

Microbeads are manufactured for specific purposes, including for use in personal care products (such as scrubs, bath products, facial cleaners, toothpastes). They may also be used in other consumer uses including cleaning products and printer toners and in industrial products such as abrasive media (e.g., plastic blasting), industry (e.g., oil and gas exploration, textile printing, and automotive molding), other plastic products (anti-slip, anti-blocking applications) and medical applications.

What’s the harm?

Microbeads from ‘down the drain’ (personal care) products are released into the aquatic environment after wastewater treatment. They are contributing to the significant and increasing plastic litter in our lakes, rivers and oceans which harms aquatic life.

Coming into force Schedule:

The regulations applying to microbeads are proposed to come into force as follows:

  • December 31, 2017, prohibiting the manufacture and import of microbead-containing personal care products, including cosmetics, that are used to exfoliate or cleanse, excluding non-prescription drugs and natural health products.

  • December 31, 2018, prohibiting the sale or offer for sale of microbead-containing personal care products, including cosmetics, that are used to exfoliate or cleanse, excluding non-prescription drugs and natural health products.

  • December 31, 2018, prohibiting the manufacture and import of a microbead-containing non-prescription drug or natural health product that is used to exfoliate or cleanse.

  • December 31, 2019, prohibiting the sale or offer for sale of a microbead-containing non-prescription drug or natural health product that is used to exfoliate or cleanse.

What do you need to do?

If you are an importer or exporter of the above products, be aware of and prepare for their eventual prohibition.   If you don’t know whether or not your products contain microbeads, please contact Cole International so that we can assist you or put you in touch with the appropriate Government department.  

More Information:

SIMA – Preliminary Decision, Large Line Pipe

The Canada Border Services Agency (CBSA) has issued a Preliminary Decision on the “dumping or subsidizing” of following goods:

Description of Goods
Usual HS Classification
Country of Origin (or export)
Certain Welded Large Diameter Carbon & Alloy Steel
Line Pipe
(Large Line Pipe)
  • 7305.11.00.21
  • 7305.11.00.29
  • 7305.12.00.20
  • 7305.19.00.21
  • 7305.19.00.29
China (Dumping & Subsidizing)
Japan (Dumping)


What is Dumping? Dumping occurs when goods are sold to importers in Canada at prices that are lower than the selling price of comparable goods in the country of export, or are sold to Canada at unprofitable prices, thereby causing potential “injury” to Canadian industries.

What is subsidizing? Subsidizing occurs when goods imported into Canada have benefited from foreign government financial assistance (i.e. grants, tax incentives, loans at preferential rates) thereby causing potential “injury” to Canadian industries.

What is “injury”? A critical factor is whether the dumped or subsidized imports are causing injury or threatening to cause injury to the Canadian industry.  Injury may be shown by: lost sales, reduced prices, lost market share, decreased profits, etc.

Preliminary Decision Details:
  • Dumping has occurred from China and Japan, temporary (provisional) duty detailed in the link below will be imposed on goods released from Customs on or after June 22, 2016.
  • Subsidizing has occurred from China, temporary (provisional) duty detailed in the link below will be imposed on goods released from Customs on or after June 22, 2016. 

Rates of Provisional Duty:

More Information:

Additional information about the investigations will be available in a Statement of Reasons that will be available within 15 days on the CBSA's website at  If you have questions on the specifics of your account and the potential application of the above, please contact your account representative at Cole.


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