A little known provision of the new Farm Bill has escaped widespread attention but may significantly affect the flow of wood products from Asia, South America, and elsewhere by increasing importers' regulatory burdens and risks. In short, Congress is hoping to force importers to vet their supply chains and avoid sourcing illegally-taken timber, either directly or through downstream products.

Section 8204 of the Farm Bill. Under the long-standing Lacey Act, it has been unlawful to traffic in fish or wildlife that are taken, possessed, transported or sold in violation of any foreign law. Section 8204 expands the Lacey Act to further restrict trade in illegally-taken plants (including trees) and plant products (including paper, flooring, furniture, etc.). Congress' stated goal in amending the statute is to target imports of illegal timber (i.e., logs harvested and/or exported in violation of local laws) as well as downstream products made from illegal timber. Under a strict liability standard, goods imported in violation of the Lacey Act are subject to forfeiture (regardless of whether the importer knew or should have known that the goods were taken illegally). Also, importers found to violate the law can face civil fines and criminal prosecutions.

New Certifications. Under Section 8204, within 6 months of the Farm Bill becoming law, importers of plants and plant products (except for packaging products, unless the packaging material itself is being imported) will be required to file declarations with U.S. Customs and Border Control (CBP). The declarations must specify the scientific name of any plant contained in the importation; a description of the value of the importation and the quantity of the plant; and the name of the country from which the plant was taken. When the exact species of plant is not known, the importer will be required to provide the name of each species of plant that may have been used to product the plant product. And when the plant product is commonly taken from more than one country, and the actual country is not known, the importer is required to list every country from which the plant may have come. The new certification provisions will be enforced by CBP, whereas forfeitures, penalty proceedings, and prosecutions will also involve the Agriculture and Justice Departments.

The Principle Targets. Although the Lacey Act, as amended, will cover a broad range of plants (e.g., wild herbs or grasses), timber and wood products are likely to be the principle targets. Environmental groups are likely to push for enforcement for wood and products from Southeast Asia (in particular, Indonesia), Central and South America, and Africa, as well as products undergoing processing in third countries such as China. At the same time, U.S. industry and labor organizations are likely to target wood products such as paper, flooring, and furniture from Asia, since those products are already the subject of intense trade disputes. However, enforcement decisions will rest entirely with the U.S. government, as there are no statutory provisions according to which citizens could seek to enforce the law against importers.

For further information, please contact:

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

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