Port Conditions, Asia
Shanghai: Heavy congestion in all SIPG terminals continue – waiting 3-3.5 days for a berth after port was closed for 57hrs due to bad weather
Qingdao: Increased congestion – waiting time around 1-1.5 days. Pot closed 66hrs last week
Ningbo: Heavy congestion – currently 1-1.5 days waiting for a berth – Port closed for about 69hrs
Dalian:  Moderate congestion comes up due to the port being closed for 96hrs last week due to strong winds and rough seas
Lianyugang: Severe congestion appears this week, the port was closed for 90hrs last week, vessels can expect up to 3-4 days for a berth
Xingang:  Port was closed for 11hrs last week, but port productivity situation remained normal
Manila: Manila South & North port still experiencing congestion , 15 vessels currently waiting for a berth at Manila North and 6 vessels waiting for a berth at Manila South. Terminal CY’s also heavily over capacity which leads to delays of empty returns and use of  external ICD’s a “must”
Bangkok: Berth waiting time continues to be approx. 1 day
Japan:  Nagoya Port is likely to be affected by Typhoon Cimaron on 23rd Aug
Korea:  Port operation is normal at present, however Typhoon SOULIK will shut the ports now for approx. 24–36 hours

CBP Increases MPF Effective October 1, 2018
U.S. Customs Border Protection has announced a 2.151 percent increase of the merchandise processing fee (MPF) effective October 1, 2018 for fiscal year 2019. The assessed rate of .3464 percent of the entered value of merchandise does not change, the minimum and maximum limitations for the MPF have changed. Please find the changes below.

• Formal entry minimum increases from $25.67 to $26.22
• Formal entry maximum increases from $497.99 to $508.70
• Informal entry electronically transmitted to CBP increases from $2.05 to $2.10
• Informal entry manually submitted to CBP increases from $6.16 to $6.29

Additional information can be found through this link:
https://www.gpo.gov/fdsys/pkg/FR-2018-08-01/pdf/2018-16510.pdf

Port Conditions, Asia
Qingdao:     Heavy congestion continues – waiting 1.5-2 days for a berth after the port was closed for 30.5 hours due to bad weather.

Shanghai:    Increased congestion – waiting time 2-2.5 days. TS (Tropical Storm) RUMBIA caused some issues with the draft in the channel, restricting  vessel access and berthing.

Ningbo:       Heavy congestion – at least 2 days waiting for a berth – Port closed for about 59hrs, being affected by TS YAGI and RUMBIA.

Shantou:     Moderate port congestion. Vessels out of window will delay at least 0.5-1 day.

Penang:     Moderate congestion, low productivity due to crane maintenance, berth waiting time is around 0.5 day.

Manila:        Manila South & North port still experiencing congestion – delays of 3-4 days even for vessels on window. The CY’s at the port are also heavily over capacity which leads to delays of empty returns and use of external ICD’s a “must”.

Bangkok:     Berth waiting time continues to be approx. 2 days

Jakarta:       Port congestion has eased, but due to ongoing low productivity in port, waiting 0.5 to 1 day for a berth for ships arriving off window.
 
Surabaya:    Port congestion moderate due to low productivity in port, waiting 1 to 1.5 days for a berth for ships arriving off window.

CBP Increases MPF Effective October 1, 2018
U.S. Customs Border Protection has announced a 2.151 percent increase of the merchandise processing fee (MPF) effective October 1, 2018 for fiscal year 2019. The assessed rate of .3464 percent of the entered value of merchandise does not change, the minimum and maximum limitations for the MPF have changed. Please find the changes below.

• Formal entry minimum increases from $25.67 to $26.22
• Formal entry maximum increases from $497.99 to $508.70
• Informal entry electronically transmitted to CBP increases from $2.05 to $2.10
• Informal entry manually submitted to CBP increases from $6.16 to $6.29

Additional information can be found through this link:
https://www.gpo.gov/fdsys/pkg/FR-2018-08-01/pdf/2018-16510.pdf

China Tariff List Two – Effective Date and Rate announced
Please find the following attachments, for your reference:

1. List 1 (25%, effective July 6th, 2018) Click here 
2. List 2 (25%, effective August 23rd, 2018) Click here
3. Form to Request Exclusion of Product.  Click here– Instructions and form for how to apply for an exclusion to List 1 and List 2 tariffs. Note that the information provided will become publicly available and viewable for comment for a period of 14 days. Decisions on exclusions are anticipated to take some time to process, but would be retroactive, if granted. Generally speaking, it appears that importer must show that equivalent domestic goods are not available, not of sufficient quality, or that imposition of tariffs would cause ‘severe economic harm’ to either the requestor or the US as a whole. Further guidance and decision making criteria has not yet been made available.

Note: an application for exclusion can only be made for the effective List 1 and List 2 tariffs, NOT yet for List 3. It is anticipated that, like List 1 and List 2, a similar request for exclusion process will become available upon final announcement. We will forward at that time.
NOTE: List 3 – proposed 10% or 25%, no final rate or effective date announced yet – comment period extended through September 5th 2018

Important Sect 301 China Tariff Update

In the most recent and concerning developments in the “China Tariff War”, yesterday President Trump instructed the US Trade Representative’s office to consider a proposal to raise the proposed duty on products included on Section 301 List 3 from 10% to 25%.
As many know, “List 3” includes over 6,000 HTS line items including items from virtually every HTS chapter.
Many companies with products falling on List 3 were concerned with an increase of 10%.  However, an increase of 25% could have serious consequences for these companies.
There is no definitive decision on whether this will move forward.  However, the public comment period for the 301 List 3 has now been extended from August 30 to September 5.  In addition, the deadline to request to appear at the public hearing has been extended to August. 13.
The requirements for filing public comments were published in the Federal Register on July 17.  If you need a copy, please contact the office.
The USTR notice will be published in the Federal Register, likely in the next few days.
USTR Rpresentative Lighthizer’s statement is below:
“On June 18, the President directed me to identify $200 billion worth of Chinese goods for additional tariffs at a rate of 10 percent, in response to China’s decision to cause further harm to U.S. workers, farmers, and businesses by imposing retaliatory duties on U.S. goods.  I initiated this process on July 10.
“This week, the President has directed that I consider increasing the proposed level of the additional duty from 10 percent to 25 percent.  The 25 percent duty would be applied to the proposed list of products previously announced on July 10.
“The Trump Administration continues to urge China to stop its unfair practices, open its market, and engage in true market competition.  We have been very clear about the specific changes China should undertake.  Regrettably, instead of changing its harmful behavior, China has illegally retaliated against U.S. workers, farmers, ranchers and businesses.
“The increase in the possible rate of the additional duty is intended to provide the Administration with additional options to encourage China to change its harmful policies and behavior and adopt policies that will lead to fairer markets and prosperity for all of our citizens.
“The United States has joined forces with like-minded partners around the world to address unfair trade practices such as forced technology transfer and intellectual property theft, and we remain ready to engage with China in negotiations that could resolve these and other problems detailed in our Section 301 report.”
Interested parties may address this possible increase in the level of the additional duty in their comments on the proposed action.  The proposed list and process for the public notice and comment period is set out in the Federal Register notice issued on July 10 and published in the Federal Register on July 17.  To view the July 17 notice, including the list of proposed products to be subject to additional duties, click here.  In light of the possible increase of the additional duty rate to 25 percent, the close of the written comment period is extended from August 30 to September 5, and the due date for requests to appear at the public hearing is extended to August 13.  These modifications to the comment period will be set out in a notice to be published shortly in the Federal Register.
In addition, the public comment period for products on List 2 closed last week.  This list is under final review by the USTR’s office and could be published at any time now.   The products on this list are subject to 25% duty.  Keep in mind that this process could move very quickly.
If you have questions or need assistance with any of the Section 301 tariff issues, please contact our office.

Paula M. Connelly, Esq.
Law Offices of Paula M. Connelly
100 Trade Center
Suite 660
Woburn, MA 01801
781-897-1771
www.connellycustomslaw.com
Paula M. Connelly is a principal in the Law Offices of Paula M. Connelly, a law firm specializing in Customs and international trade matters. She has been practicing law since 1991 and prior to working as an attorney, worked as a licensed Customs broker for several customs brokerage companies in the Boston area. She has over 20 years experience in Customs and International Trade matters and works with numerous importers and exporters in addressing and resolving import and export compliance issues.

 A Challenge to Shippers Who Would Never Dream of Controlling the Insurance
Shippers who rely on suppliers to furnish cargo insurance or who rely on their carriers to take responsibility for losses may be in for a big surprise. Protecting your investments by insuring your goods provides peace of mind.
Buying CIF: Who’s really responsible if your product is lost or damaged in transit? According to internationally accepted trade terms, referred to as Incoterms, suppliers selling “CIF” (Cost, Insurance, Freight) are responsible for arranging cargo insurance. But just because your supplier has the obligation to arrange insurance under CIF terms, it doesn’t mean that they are ultimately responsible if your product is lost or damaged during transit. The ultimate burden of loss falls upon you, the buyer. This is why many experts recommend importers change their buying terms to EXW, FOB, FCA, CFR or similar terms in order to control the selection, and thereby the quality, of insurance coverage.
How much is that insurance really costing you? Foreign suppliers and their forwarding agents often tack on placement fees to the insurance costs. Those added fees often inflate the cost of insurance well beyond market pricing for the same coverage purchased in the United States. Find out how much you’re really paying and then compare quotes received from BOC International.
Is the coverage your supplier purchased for you adequate? Importers relying on their suppliers to arrange insurance run the risk of having inadequate insurance coverage. Cargo insurance policies can vary widely in levels of coverage, deductibles and special restrictions. Ask your supplier for a complete copy of the insurance policy or for a certificate of insurance detailing all the policy terms and conditions
What’s the financial health of your supplier’s insurance company? Recent financial and catastrophic events have exposed the vulnerability of insurance companies to sudden economic devastation. Importers are encouraged to make certain their suppliers use insurers with a favorable financial rating supplied by a respected financial rating service. A.M. Best, Standard & Poor’s and Moody’s are among some of the world’s most respected. BOC’s insurance company, underwriters at Lloyd’s of London, has an A.M. Best financial rating of A (Excellent).
How will your claim be handled? If insurance is arranged overseas, will you be forced to  deal with an inexperienced, sub-contracted independent adjuster unfamiliar with the assessment of transportation related losses? Ask your supplier for a list of insurance claims adjusters contracted by the insurance company. Adjuster and surveyor networks approved by Lloyd’s of London and AIMA are among the most credible. BOC has a vested interest in your insurance needs and will directly handle cargo claim documentation requirements to ensure prompt processing and timely settlement.
Every Shipper Needs Cargo Insurance
Global trading involves risk; however, broad insurance coverage minimizes your financial risk. Don’t leave your livelihood up to chance! Statistics show that one ship sinks each day and you will experience a General Average loss every eight years. If you are depending on the carrier to cover losses, their responsibility is limited by law as follows:
Ocean Carriers  $500 per shipping unit
A shipping unit may be defined as one ocean container.
Air Carriers  $9.07 per pound
Truckers  $.50 per pound
The insurance we offer is competitively priced and insures approved merchandise against physical loss or damage from external causes. By purchasing cargo insurance, you can avoid inconvenience and frustration. Contact your BOC Representative at 617-345-0050 for your free quote.

Transpacific Network Service Updates
US Pacific Northwest
Dear Valued Customer,
We are reaching out to you to inform you of changes to our Transpacific – US Pacific Northwest services. Due to rising costs and overcapacity in the market, we have made adjustments to our TP2, TP8 and TP9 services.  Our existing TP1 service, serving Vancouver and Seattle, will be removed from our product offering.
Please find the updated service rotations:
TP9 Service

• First port of call changed to Vancouver
• Second port of call changed to Seattle and removal of Prince Rupert
• Addition of Yokohama, Kaohsiung and Xiamen
• Removal of Nansha from rotation
• Westbound rotation to maintain direct coverage of Yokohama and Kaohsiung

The first effective sailing will depart from Kaohsiung the week of August 20-26.
TP9 Eastbound: Kaohsiung > Xiamen > Yantian > Ningbo > Shanghai > Busan > Vancouver > Seattle
TP9 Westbound: Vancouver > Seattle > Yokohama > Busan > Kaohsiung > Xiamen > Yantian > Ningbo > Shanghai
TP8 Service

• Addition of Prince Rupert
• Addition of Shanghai
• Removal of Ningbo

The first effective sailing will depart from Xingang on the week of August 20-26.
TP8 Eastbound: Xingang > Qingdao > Shanghai > Busan > Yokohama > Prince Rupert > Long Beach > Oakland
TP8 Westbound: Prince Rupert > Long Beach > Oakland > Xingang > Qingdao > Shanghai > Busan > Yokohama
TP2 Service

• Addition of Ningbo
• Removal of Shekou

The first effective sailing will depart from Singapore on the week of August 20-26.
TP2 Eastbound: Singapore > Vung Tau > Yantian > Ningbo > Shanghai > Long Beach > Oakland
TP2 Westbound: Long Beach > Oakland > Busan > Shanghai > Ningbo > Chiwan > Singapore
We would like to take this opportunity to say thank you for doing business with us. If you have any questions, please feel free to reach out to your local sales or customer service representative. You will find contact details of our local offices on maerskline.com.

Sincerely,
Your Maersk Line North America Team