Panel Concludes Automakers May Continue Core Parts “Roll-up” to Meet USMCA’s RVC Passenger Vehicle and Light Truck Requirements
A U.S.-Mexico-Canada Agreement (“USMCA” or “Agreement”) Chapter 31 Dispute Resolution Panel (“Panel”) concluded that automakers may continue to use the longstanding practice of “roll-up” when calculating the percentage of North American-originating materials used in the production of core automotive parts (e.g., engines) that is subsequently factored into the computation for determining the total amount of originating content (the “regional value content” or “RVC”) for passenger vehicles and light trucks.
STB Adopts New Processes to Make Rail Rate Relief More Accessible to Shippers
On December 19, 2022, the Surface Transportation Board (STB) adopted two new processes for shippers to challenge the reasonableness of rail rates: Final Offer Rate Review (FORR) and the Small Rate Case Arbitration Program (Arbitration Program). The STB designed these processes to increase shipper access to rate review for small cases, recognizing that its existing rate-dispute processes pose cost, complexity, and duration challenges that make them unattractive for smaller disputes. Shippers evaluating smaller rail-rate challenges may find that FORR and the Arbitration Program are cost-effective options for addressing unreasonable rail rates.
Karyn is a partner and leader of the firm’s Transportation practice group. Based upon interviews with clients and peers, Chambers USA has recognized Karyn as one of the leading lawyers nationwide who represent shippers in rail transportation matters, and she was also identified for her work in road transportation matters.
Karyn represents multinational corporations, trade associations, and transportation intermediaries, such as 3PLs, NVOCCs, freight forwarders and brokers, in domestic and international matters involving multimodal transportation and logistics services. Her practice covers the carriage of goods by rail, motor, vessel and air carriers. Karyn serves as the general counsel to The National Industrial Transportation League, the nation’s oldest and largest shipper organization.
Karyn’s practice includes a full range of services with a focus on regulatory compliance and counseling; proceedings before the Surface Transportation Board (STB), Department of Transportation (DOT), Federal Motor Carrier Safety Administration (FMCSA), Federal Railroad Administration (FRA), Federal Maritime Commission (FMC), Pipeline and Hazardous Materials Safety Administration (PHMSA), Department of Homeland Security (DHS), Transportation Security Administration (TSA), Customs and Border Protection (CBP), and Federal Aviation Administration (FAA); transportation contracting; transportation security; legislation; and litigation/arbitration of transportation-related disputes.
June 22, 2022
Uyghur Forced Labor Prevention Act Effective June 21: DHS and CBP Issue Highly Anticipated Guidance for Importers
The Uyghur Forced Labor Prevention Act (UFLPA) was passed into law on December 21, 2021, to ensure enforcement of Section 307 of the Tariff Act of 1930, which prohibits the importation of all “. . . goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in any foreign country by convict labor or/and forced labor or/and indentured labor under penal sanctions.” It creates a rebuttable presumption that all products produced in whole or in part in the Xinjiang Uyghur Autonomous Region or by persons designated to the UFLPA Entity List were produced from forced labor and must be denied entry into the United States pursuant to Section 301 of the Tariff Act. The UFLPA’s provisions are effective as of June 21, 2022.
On June 16, President Biden signed into law the Ocean Shipping Reform Act of 2022 (OSRA), a package of U.S. shipping law reforms that address supply chain disruptions, rising ocean shipping costs, and inadequate vessel service. U.S. agricultural exporters and importers of retail goods and raw materials that depend on competitive and efficient international ocean transportation services have faced ongoing challenges in securing timely and adequate vessel space, skyrocketing shipping costs, and inefficiencies in the pickup and delivery of cargo. OSRA increases the Federal Maritime Commission’s (FMC) authority to address the operating practices of the global ocean shipping lines that service our nation’s seaports.
FMC Issues Policy Statements on Private Party Complaints, Including Retaliation Concerns
On December 28, 2021, the Federal Maritime Commission issued three policy statements regarding private party complaints. The statements provide guidance to shippers and other interested parties and are intended to reduce barriers to filing actions at the agency. One specifically addresses shippers’ and other parties’ concerns about retaliation for filing a complaint, concerns that have increased due to ongoing port congestion and challenges impacting the ocean cargo delivery network.
FMCSA Proposes New Driver Hours of Service and Age Limit Pilot Programs
On September 3, the Federal Motor Carrier Safety Administration (FMCSA) proposed a pilot program providing temporary relief from the 14-hour driving window applicable to drivers of commercial motor vehicles (CMVs), and on September 10, FMCSA proposed a second pilot program to allow drivers aged between 18 and 20 to operate CMVs in intrastate commerce.
Manufacturers across North America must reanalyze their products to determine whether they continue to qualify for duty-free treatment under USMCA.
New USMCA certificates of origin are required to replace NAFTA certificates of origin.
Many companies must examine their supply chains to confirm continuing eligibility for duty-free treatment.
On July 1, the United States-Mexico-Canada Agreement (USMCA) goes into effect. It will have a significant impact on manufacturers across North America as they reanalyze their products to determine whether they qualify for duty-free treatment.
On May 14, 2020, the Federal Motor Carrier Safety Administration (FMCSA) issued a final rule revising the hours of service (HOS) regulations for commercial motor vehicle drivers that is intended “to provide greater flexibility for drivers subject to those rules without adversely affecting safety.” We provide a summary of the changes to the HOS regulations, which include expanding the short-haul exception and the driving window during adverse driving conditions, requiring a 30-minute break after eight hours of driving time (instead of on-duty time) and modifying the sleeper berth exception.
Government Measures Worldwide in Response to COVID-19
As countries respond to the COVID-19 pandemic, business operations must adapt to changing rules and new restrictions. We are teaming with a group of international law firms to provide and regularly update a chart compiling key measures implemented by countries around the world.
Our chart addresses:
Economic measures, including loan facilities, tax deferrals, stimulus offerings and similar actions.
Labor and employment and employee benefit measures.
Health and safety measures, including travel restrictions, business and other closures, and essential business categories.
Export and import developments, including new restrictions on the export of personal protective equipment (PPE) and medicine and reductions on import duties.
The summary is not intended as legal advice but as a practical resource for companies adapting to the global pandemic.
FMC to Address COVID-19 Port Congestion by Engaging Industry Stakeholders
On March 31, 2020, the Federal Maritime Commission (FMC) issued an order announcing that it will engage supply chain stakeholders to address disruptions that the COVID-19 pandemic may have on cargo movement through U.S. ports. The order authorizes Commissioner Dye to hold discussions with supply chain stakeholders to identify operational solutions to cargo delivery system challenges and to form one or more FMC supply chain innovation teams to support the efforts.
FMCSA Temporarily Extends Commercial Drivers’ Licenses, Permits and Medical Certifications
On March 24, 2020, the Federal Motor Carrier Safety Administration (FMCSA) granted a temporary waiver that effectively extends the validity of commercial driver’s licenses (CDLs), commercial learner’s permits (CLPs) and medical certificates for drivers of commercial motor vehicles (CMVs). The waiver will expire on June 30, 2020.
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), a roughly $2 trillion coronavirus response bill signed into law yesterday, is intended to provide widespread emergency relief for Americans and the country’s economy. In addition to its benefits for individuals, the bill provides aid for small businesses, large corporations, hospitals and public health agencies, and state and local governments. Among its provisions for small businesses are emergency grants and a forgivable loan program for companies with 500 or fewer employees, along with revised rules for expenses and deductions designed to help companies keep employees on the payroll and remain open during the crisis. Large corporations stand to benefit from approximately $500 billion in loans and other funding repayable to the government and subject to public disclosures and other requirements. Community and private health systems will receive help to enable them to better respond to the increasing demands they face. Provisions for state and local governments include direct aid to bolster cash reserves depleted by COVID-19 response efforts, along with Community Development Block Grants, school funding and money for programs for children and families. In this bulletin, we summarize some of the key provisions for businesses.
NHTSA Proposes Easing Certain Regulatory Requirements for Self-Driving Vehicles
On March 17, 2020, the National Highway Traffic Safety Administration (NHTSA) published a notice of proposed rulemaking (NPRM) aiming to remove unnecessary barriers to vehicles equipped with automated driving systems (ADS) and proposing to amend and modernize 11 of its Federal Motor Vehicle Safety Standards (FMVSS) related to crashworthiness and occupant protection.
FMCSA Expands Emergency Regulatory Relief for Truck Transportation of Essential Supplies, Equipment, and Persons
Certain regulations pertaining to commercial motor vehicle drivers and motor carriers are suspended to facilitate COVID-19 emergency relief efforts.
The suspension applies to transportation of essential supplies, equipment, and persons, including shipments of medical supplies, community safety and sanitation supplies, food, and the raw materials used to produce these items.
The suspension ends upon termination of the COVID-19 emergency or April 12, 2020, whichever is earlier.
On March 18, 2020, the Federal Motor Carrier Safety Administration (FMCSA) issued an Expanded Emergency Declaration suspending enforcement of its hours-of-service, driver qualification, and other regulations set forth at 49 C.F.R. Parts 390-399 for commercial motor carriers and drivers providing direct assistance to emergency relief efforts.
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The Coronavirus Threatens U.S. Company Supply Chains - Practical Tips and Contract Considerations to Manage Risk
The risk of coronavirus transmission from imported goods is currently considered highly unlikely
U.S. businesses should engage in contingency planning, including evaluating alternative sourcing and the potential future need for increased transportation capacity
Disruptions may affect contracts between U.S. businesses and Chinese suppliers, and U.S. businesses and buyers of finished goods
Transportation contracts should be reviewed for minimum volume commitments and capacity protections
There are growing concerns that the Coronavirus (“COVID-19”) outbreak will have a serious negative impact on the global economy. U.S. businesses that depend on Chinese suppliers may soon be facing product shortages and supply chain disruptions. This bulletin (i) addresses whether U.S. businesses need to be concerned about the possible exposure to the virus from goods imported from China, and (ii) identifies contractual considerations to help companies manage potential supply chain risks based on their relationships with Chinese suppliers, customers and transportation providers.
FMCSA Seeks Information on CMV Driver Detention Times During Loading and Unloading
Last month, the Federal Motor Carrier Safety Administration (FMCSA) issued a request for information concerning commercial motor vehicle (CMV) driver detention times during loading and unloading. The request for information follows several studies examining the issue of CMV driver delays during loading and unloading and their impact on roadway safety and the economy.
FAA to Seek Comments on Measures to Address Drone Risks
The FAA will be seeking input on measures to mitigate public safety and national security risks presented by drones.
Recent events demonstrate that drones pose safety and security risks to airports, sporting events, and other sensitive infrastructure and public events.
Entities concerned about the risks of drone operations or about how safety and security limitations would impact their drone operations should submit comments.
The Federal Aviation Administration (FAA) recently announced that it would solicit comments on regulatory measures to address public safety and national security risks posed by drones, which could result in the FAA limiting drone use or imposing onerous drone design standards. Thus, drone users and manufacturers, as well as businesses and other entities for which drones pose a safety risk, such as airports and power plants, should consider providing feedback to the FAA on appropriate measures to mitigate drone safety and security risks.
FMC Issues Final Report on Demurrage and Detention Practices
In December 2018, the Federal Maritime Commission (FMC) issued its Final Report in Fact Finding Investigation No. 28: “Conditions and Practices Relating to Detention, Demurrage, and Free Time in International Oceanborne Commerce” (Final Report). In it, the Fact Finding Officer, Commissioner Rebecca F. Dye, sets forth her findings throughout the investigation’s phases and makes recommendations related to demurrage and detention practices that would improve the performance of the U.S. freight delivery system.
FMCSA NPRM on Motor Carrier Safety Fitness Determinations
The Federal Motor Carrier Safety Administration (“FMCSA”) published a Notice of Proposed Rulemaking (“NPRM”) in the Federal Register on January 21, 2016 setting forth proposed rules for determining the safety fitness rating for interstate motor carriers that is based on on-road safety data and the results of safety investigations. Comments from interested parties are due on March 21, 2016 and reply comments are due on April 20, 2016.
FMCSA Prohibits Coercion of CMV Drivers, Extends Jurisdiction
On November 27, 2015, the Federal Motor Carrier Safety Administration (“FMCSA”) issued a final rule prohibiting motor carriers, shippers, receivers, and transportation intermediaries from coercing drivers to operate commercial motor vehicles (“CMV”) in violation of the FMCSA safety regulations and the federal Hazardous Materials Regulations (“HMR”), and prohibiting operators of CMVs from coercing drivers to violate certain FMCSA commercial regulations. The rule includes procedures for a driver to report an incident of coercion and for investigation and action by FMCSA in response to such reports.
In the fall of 2014, the US Federal Maritime Commission (“FMC”) conducted four forums “to hear firsthand the problems that stakeholders in the U.S. intermodal system were facing as a result of problems brought on by contemporary developments in liner shipping.” The forums were located at the Ports of Los Angeles, Baltimore, Charleston, and New Orleans, respectively, and resulted in the publication of two FMC reports. On April 3, 2015, the FMC released a Commission’s staff report specifically addressing detention, demurrage and free-time. Subsequently, in July, the FMC issued a more thorough report discussing the major themes arising from the fall 2014 port congestion forums. These reports are summarized briefly below.