IACC U.S. Legislative Update and Policy Round Up

IACC Highlights Members’ Trade Priorities

In early March, the IACC submitted a statement for the record detailing a number of rights-holder priorities, in connection with a hearing on “American Trade Enforcement Priorities” held by House Ways & Means’ Trade Subcommittee. The Ways & Means Committee has primary jurisdiction over matters related to trade and customs, and plays a vital role in identifying and addressing concerns related to the enforcement of IP rights at the border.  In our submission, we stressed the need for concrete action to ensure the implementation of several long-standing gaps in our current statutory and regulatory framework, including with respect to customs brokers’ “know your customer” obligations, CBP’s authority to share information and collaborate with rights-holders and other stakeholders in carrying out its IP enforcement mission; we also stressed the importance of the U.S. government’s global support network for rights-holders, including the USPTO’s IP Attaché program, and the Department of Justice’s ICHIP program.  Those priorities will be reiterated in the coming days, as the Senate Finance Committee has scheduled a confirmation hearing for April 30th in connection with the nomination of Rodney Scott to serve as Commissioner of Customs.     

IACC Files Comments in Support of CBP Update to De Minimis Regulations

On March 17th, the IACC submitted comments in connection with a Notice of Proposed Rulemaking issued by U.S. Customs & Border Protection setting out new procedures for the “Entry of Low Value Shipments,” more commonly referred to as “De Minimis” imports.  

As you’re likely aware, CBP has historically taken the view that the costs associated with processing some imports (i.e., to determine whether the shipment is subject to duties and taxes, etc.), may outweigh the benefits – and revenue – accruing from those efforts.  The “de minimis exemption” developed as a means of processing smaller, lower value shipments in a more expedited manner, and with a reduced administrative burden on exporters and importers.  In recent years, the exemption could be claimed for shipments (by a single individual, on a single day) valued at less than $800.   

The present regulatory action was relatively limited in scope, and was intended, to a large extent, to implement lessons learned by the agency during its operation of its Section 321 Data Pilot and Type 86 Test during recent years.  The NPRM also makes some amendments to the existing framework to clarify when the exemption may or may not be available (including a reiteration of CBP’s authority to require formal entry procedures, even in the case of shipments that may otherwise qualify for de minimis treatment).  

Please note however, as discussed below, there have been a number of other recent actions impacting the availability of the de minimis exemption, that we are continuing to monitor.

USTR Publishes Annual Special 301 Report re: Global Landscape for IP Protection

On Tuesday, April 29th, the Office of the United States Trade Representative (USTR) published its annual Special 301 Report to Congress, highlighting global concerns related to the protection and enforcement of IP rights, as well as other market access barriers impacting American businesses.  

Each year, USTR and an interagency team from across the Executive Branch prepare the Special 301 report; that report serves as a roadmap for the Administration’s engagement with international partners throughout the coming year.

The feedback provided by IP owners and their representative associations plays a vital role in the development of the Special 301 report; historically, the IACC has been the single largest voice for trademark owners in the annual process.

The IACC’s submission this year highlighted members’ concerns in 33 jurisdictions, and included recommendations for the placement of 7 countries on the Special 301 Priority Watch List, and an additional 20 countries on the Special 301 Watch List.  

We’d like to thank all of the members who provided input for our comments this year; if you’d like more information about how your company can contribute to this work throughout the year, please reach out to me directly (tjohnson@iacc.org) at your earliest convenience.

The full text of USTR's report is available here.

IACC, AIPLA, INTA, and IPO Offer Support for Reintroduction of SHOP SAFE Act

On the heels of World IP Day, the IACC joined the American Intellectual Property Law Association (AIPLA), the International Trademark Association (INTA) and Intellectual Property Owners Association (IPO) in a letter urging the reintroduction of the SHOP SAFE Act during the 119^th Congress.

That legislation, which has been a priority for a number of rights-holders in recent years, sets forth a variety of best practices related to the protection and enforcement of IP in the e-commerce context; e-commerce platforms that choose not to implement the practices enumerated in the bill could be exposed to contributory liability in connection with sales of counterfeits by third-party sellers on the platform.

IP owners and other stakeholders are continuing to engage with the sponsors of both the House and Senate versions of the bill, and are hopeful that we’ll be able to reach a consensus on several issues that have slowed its progress during previous sessions of Congress.  

Nominations, Executive Orders, and Congressional Activity in Q1

As we cross the hundred day mark of the second Trump presidency, the Administration continues to move at a rapid pace on a number of fronts. Moving into the final days of April, 53 nominees have been confirmed by the Senate – including 21 of 22 Cabinet-level positions. An additional 225 nominations are currently awaiting consideration in the upper chamber.

As is typically the case this early in the term, there have been few major legislative enactments thus far in the 119^th; although over 5,000 bills have been introduced to date, only 5 have been passed by both houses and signed into law. The budget reconciliation process will take center stage over the coming weeks, as the GOP seeks to deliver a signature win to the President early on; leadership has expressed a desire to have a final bill on the President’s desk by Memorial Day.

In the meantime, the Administration has been steadily churning out Executive Orders since January 20th, and shows no sign of letting up any time soon.  You’re undoubtedly aware of some of the actions that have been announced in connection with the implementation of tariffs (and the subsequent suspension of some of those as well).  Some have expressed concerns over adverse impacts to the economy as a result of some of these actions, including the possibility that rising prices and decreasing inventory may create market conditions rife for exploitation by counterfeiters.  As we saw during COVID-related trade disruptions and product shortages, counterfeiting operations are quick to take advantage of consumer demand for products in short supply. 

Two Executive Orders that will surely be of particular interest were those related to: “Regulating Imports with a Reciprocal Tariff to Rectify Trade Practices that Contribute to Large and Persistent Annual United States Goods Trade Deficits,” and “Further Amendment to Duties Addressing the Synthetic Opioid Supply Chain in the People’s Republic of China as Applied to Low-Value Imports,” both of which have significant impacts on the availability of “de minimis” treatment for low-value imports.

The latter EO suspends the availability of the de minimis exemption for small consignments from China as of May 2^nd, while the former indicates that de minimis treatment for goods arriving from other jurisdictions will be suspended once the Secretary of Commerce provides notice that “adequate systems are in place to fully and expeditiously process and collect duty revenue … for articles otherwise eligible for de minimis treatment.”