As we reported in prior Alerts, Congress amended the Lacey Act to require importers of virtually all products containing wood to declare the genus, species and country of origin of the wood used in the products (as well as other information) (Wood Products Subject to New U.S. Import Rules, 2008) and the Animal and Plant Health Inspection Service (APHIS) has proceeded to implement the declaration requirement by establishing a staggered schedule according to which importers must present the Lacey Act declaration, depending upon the classification of the product under the Harmonized Tariff Schedule of the United States (HTSUS) (Implementation of the Lacey Act’s New Declaration Requirement for Wood Products, 2008). APHIS, which is cooperating with U.S. Customs and Border Protection (CBP), had planned to require the Lacey Act declaration on April 1, 2009, for all imported products classified under HTSUS Chapters 6 or 44. APHIS and CBP still plan to require declarations beginning April 1, but for a narrowed scope of products. As shown by the import data below, imports from Canada, China, and Brazil are expected to be the most affected in 2009 by the new declaration requirement.

The Revised Implementation Schedule. In October 2008, APHIS issued a Federal Register notice proposing to implement the declaration requirement on April 1, 2009, for products classified under HTSUS Chapters 6 (live trees) and 44 (wood/wood products), and on July 1, 2009, for products classified under HTSUS Chapters 47-48 (wood pulp and paper), 92 (musical instruments), and 94 (furniture). This past February, however, APHIS significantly reduced the number of products subject to the declaration requirement, and it pushed the July 1 implementation date to October 1.

Now, products classified in HTSUS Chapter 6 will not be subject to the declaration requirement, either on April 1 or any other date in the foreseeable future. Moreover, for HTSUS Chapter 44, APHIS is splitting the implementation into several phases. The declaration requirement will apply on April 1, 2009, for approximately half of the four-digit headings in HTSUS Chapter 44, but the implementation date will be delayed for the other half until October 1, 2009 (except for heading 4421, which will be delayed until April 1, 2010). Similarly, only a portion of HTSUS Chapter 47 will be subject to the declaration requirement on October 1, 2009, whereas the implementation for Chapters 48 and 94 has been delayed until 2010 at the earliest.

Imports Affected By Current Implementation Schedule. The tables below show import data from 2008 (by value) for the HTSUS headings in Chapters 44 and 47 that become subject to the new Lacey Act declaration requirement on April 1 and October 1, 2009:

These import data show that although a significant value of imports will still be subject to the declaration requirement in 2009, the revised schedule did cut by more than half the value of imports that would be subject to the requirement this year. By reducing the current impact, APHIS and CBP may be intentionally lessening the burden now in order to give time for Congress to revise the Lacey Act declaration requirement (e.g., by establishing additional statutory exceptions). These import data also show another, perhaps unanticipated, cost of the wide-ranging scope requirement: Although there is little or no concern about illegal logging in Canada, nearly half of the Lacey Act declarations collected by CBP and APHIS (at least by value) will be for products from Canada. Rather than targeting entries by specific importers, of particular species, or from listed regions or nations, Congress imposed a universal declaration requirement, and CBP and APHIS will therefore dedicate significant resources to collect declarations on at least $10 million in imported wood products from Canada per year.

For more information, please contact:

Daniel Wendt, dwendt@milchev.com, 202-626-5898

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