Proposed Registered Agent Declaration Should be Rejected, According to NCBFAA President
Phone: (310) 607-8000
Phone: (202) 223-6222
|For Immediate Release
Washington, DC: The recently proposed declaration by a U.S. importer regarding registered agents in the U.S reveals a poor understanding of existing supply chains and should be rejected, according to National Customs Brokers & Forwarders Association of America, Inc. (NCBFAA) President Jeffrey Coppersmith. President Coppersmith made his comments in a letter to Congressmen Sander Levin and Dave Camp discussing proposed changes to HR 4678, the Foreign Manufacturers Legal Accountability Act.
The amendment would require a declaration attesting to the importer's belief, after appropriate inquiry, that the foreign manufacturer of the imported product has a registered agent in the U.S. to accept service of process in state or federal court.President Coppersmith’s concerns center on data access as well as penalties. “[This requirement] assumes that the U.S. importer knows the identity of the manufacturer,” he wrote. ”Yet, in most cases, the foreign manufacturer is not necessarily known.” It further assumes that the supply chain is a transparent, linear process when, in fact, it “is a complex, multi-layered network of trading companies and suppliers where products are sourced and consolidated from multiple countries and multiple manufacturers.”
While the supplier may be known to the U.S. importer, the actual manufacturers may be multiple parties (depending on shipment complexity) removed from the importer, thus making identification extremely difficult, if not impossible.
Because this data element - the identity of the actual foreign manufacturer - is seldom readily available, or even known in many instances, the requirement to provide it would work a major hardship on import process participants, especially “small and medium-sized companies who do not necessarily have sufficient leverage with the supplier to demand this information.”
Without being able to identify the manufacturer or know if there is an agent, the importer has to choose between filing what may be an erroneous declaration and filing no declaration at all. Either way, the importer is subject to penalties leaving him to incur the penalty or send the product back.
“This legislation also fails to consider the inadvertent, but highly detrimental, impact on U.S. exporters, who very likely will face similar requirements from US trading partners,” noted President Coppersmith. “This legislation has the very real potential to harm US businesses and consumers in ways that are not completely understood…[and] it will hamper the trade process – both imports and exports – at a time when we need to do just the opposite.”
“And for all this,” he concluded, “it will not even provide meaningful redress to the public, since serving notice on a registered agent provides no ability to enforce a subsequent judgment.”
Headquartered in Washington, DC, the NCBFAA represents nearly 870 member companies with 100,000 employees in international trade - the nation's leading freight forwarders, customs brokers, ocean transportation intermediaries (OTIs), NVOCCs and air cargo agents, serving more than 250,000 importers and exporters. Established in 1897 in New York, NCBFAA is the effective national voice of the industry. Through its various committees, counsel and representatives, the Association maintains a close watch over legislative and regulatory issues that affect its members. It keeps them informed of these and other related issues through its weekly Monday Morning eBriefing and various meetings as well as conferences throughout the year.
* * * * *