Centers of Excellence and Expertise. Apparel, Footwear and Textiles Center Overview
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1 Centers of Excellence and Expertise Apparel, Footwear and Textiles Center Overview 1
2 Why Centers? Respond to the dynamic trade environment Bring all of CBP expertise together on a single industry at the national level Deliver greater consistency and harmonization Align CBP processes with modern business practices Enhance industry-based knowledge Implement manage-by-account practices Textiles Intellectual Property Rights Revenue Trade Agreements/ Preference Programs Anti-Dumping Countervailing Import Safety Duties (ADCVD) Agriculture Trade Complexity 2
3 What are Centers? Virtual organizations that leverage technology to bring work to the Center Coordinated from a strategic location Aligned by key industry sectors Bring existing expertise together to authoritatively facilitate trade Provide a single point of processing for participating importers Serve as resource to the broader trade community and to CBP s U.S. government partners 3
4 Goals of Centers 1. Facilitate legitimate trade through effective risk segmentation - Utilize account based methods to process trade - Expand partnerships - move more importers to trusted trader status - Develop and implement comprehensive strategies to manage risk 2. Increase industry-based knowledge within CBP - Advance bi-directional education to raise industry knowledge - Engage industry groups and key stakeholders - Bring all of CBP s expertise to bear on a single industry in a virtual environment 3. Enhance enforcement and address industry risks - Leverage industry to identify issues of mutual interest to provide CBP with targeting, enforcement, and/or intelligence information Trade Intelligence - Coordinate enforcement efforts by industry to address unique risks 4
5 Enforcement Focus on areas of risk 1. Intellectual Property Rights 59% of all FY 12 IPR seizures Undermine domestic producers IPR Seizures 50% 40 % 25% 11 % 8 % 0% Handbags/Wallets Wearing Apparel Footwear 2. Trade Agreements 14% of imported value claims preferential treatment False preferential claims undermine trade agreements 3. Revenue Duty collected by CBP on textile and apparel goods still accounts for more than 40% of all duties Misclassification and undervaluation are schemes to evade high duty rates on textiles and footwear 5
6 How Centers Operate Previously ACME Apparel was importing into 60 Ports of Entry (POE), with 60 ports conducting reviews. Center Operations Instead of 60 ports making decisions on ACME Apparel entries, they would now be reviewed by the Apparel, Footwear & Textiles Center of Excellence which will be coordinated from San Francisco, CA. 6
7 Benefits of Centers 7 CBP Benefits Trade Benefits
8 Current and Future Centers San Francisco 2 6 Los Angeles 1. Agriculture & Prepared Products 2. Apparel, Footwear & Textiles Chicago 3. Automotive & Aerospace 4. Base Metals 5. Consumer Products & Mass Merchandising 6. Electronics 7. Industrial & Manufacturing Materials 8. Machinery 9. Petroleum, Natural Gas & Minerals 10.Pharmaceuticals, Health & Chemicals* 4 Detroit 3 5 Buffalo 7 10 Atlanta New York * Current CEEs Laredo 8 9 Houston 1 Miami 8
9 Center Schedule Year FY 2012 Spring 2013 Summer 2013 Center Pharmaceuticals, Health & Chemicals Electronics Automotive & Aerospace Petroleum, Natural Gas & Minerals Base Metals Industrial & Manufacturing Materials Machinery Agriculture & Prepared Products Apparel, Footwear & Textiles Consumer Products & Mass Merchandising 9
10 Center Myths- Participation I m not C-TPAT or ISA, the Centers aren t for me. Under the Center test notice issued in the upcoming Federal Register, preference will be given to C-TPAT/ISA accounts, but it is not required to be managed by a Center. I m not filing in ACE, I can t be part of the Centers. Participants and filers can transmit the necessary documentation electronically via the ACE portal, the Document Image System (DIS), but also via to the Center. 10
11 Center Myths- FRN I m automatically going to be part of the Center s managed accounts. You must volunteer! A new test notice will be published in the Federal Register seeking importers to volunteer to participate in the six new Centers. It will describe the process and procedures for volunteering to participate in the Centers. To receive centralized processing benefits from the Center, you must volunteer. Even for importers that don t volunteer the Centers will be available to assist them, and all members of the trade community. The Centers will address an entire industry, and be a source of definitive information for questions or concerns related to that industry. In this way, the Centers are available to all importers. 11
12 Center Myths- Operations I m going to have to change where I import because of the Centers. No. The Centers are virtual. CBP will leverage technology to bring the work to the Centers, regardless of where the entry of merchandise occurs. I import products in multiple industries, I m going to have to apply to every Center. No. The Centers are "industry focused, and account based." Importers will have the opportunity to volunteer for the Center that best fits their business. The assigned Center will be the primary point of processing for all entry summaries, regardless of the commodity that is entered. 12
13 Apparel, Footwear and Textiles Import Highlights $131.6 billion in textile, footwear & wearing apparel products come into the U.S. (5.5% of all imported value) Top 5 countries of origin account for 66% of these imports China ($58.5 billion) Vietnam ($9.6 billion) India ($6.5 billion) Indonesia ($6.2 billion) Mexico ($5.8 billion) Over 64,800 entities import textile and wearing apparel 378 entities are ISA (23.9% of imported value) 3,144 entities are C-TPAT partners (62.1% of imported value) 13
14 Apparel, Footwear and Textiles - Import Value $100 $80 $79.7 B Billions $60 $40 $24.0 B $27.9 B $20 $0 Small Medium Large < $10M $10M - $1B > $1B 14
15 Apparel, Footwear and Textiles - Importer Universe 100.0% 97 % Percent of Import Value 80.0% 60.0% 40.0% 20.0% 0.0% 18.2 % 60.6 % 2.5 % Percent of Importers As a percentage of all accounts, small sized importers represent the largest number-- but the medium sized businesses account for the majority of total value imported 21.2 % Small Medium Large 0.02 % 63,213 importers 1,628 importers 16 importers 15
16 What Now? Apply to be part of the Apparel, Footwear and Textiles Center under an upcoming Federal Register Notice Contact: Dora Murphy, Apparel, Footwear and Textiles Center Director San Francisco Field Office U.S. Customs and Border Protection (415) x
17 17
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