U.S. Customs and Border Protection has issued the CSMS message on the Tranche 4 tariffs. The message was issued through email and is not yet available on CBP’s website. For a look at the message, click here. 

The U.S. Customs and Border Protection Office of Trade has released new data on the number of IPR seizures in fiscal year 2018.  The Intellectual Property Rights Fiscal Year 2018 Seizure Statistics show that the number of IPR seizures in FY 2018 decreased by 333 seizures to 33,810 (from 34,143 in FY 2017). However, the total estimated manufacturer’s suggested retail price (MSRP) of the seized goods, had they been genuine, increased to nearly $1.4 billion (from $1.2 billion in FY 2017). 

The table below shows the industries most impacted by the counterfeits – not surprisingly apparel/accessories are at the top of the list, with footwear close behind.     

The report also finds that e-Commerce sales have resulted in a significant increase in the shipment of small packages to the U.S. market.  In FY 2018 there were 161 million express shipments, and 475 million packages shipped through international mail. Over 90% of all intellectual property seizures were products shipped as e-commerce – with a majority falling under the de minimis threshold of $800. 

Steve Francis, Director of the National Intellectual Property Rights Coordination Center, is calling on the  private sector to join the organization’s network of 25 domestic and international partner agencies as part of a campaign designed to heighten public awareness about the dangers of counterfeit goods.

The Citizen Power Initiative for China held a press conference today in D.C. to release a new report, “Cotton: The Fabric Full of Lies.”  The report focuses on forced prison labor in Xinjiang, China in the cotton, textile, and apparel sector.

The report says that Xinjiang province accounts for 84 percent of China’s cotton output and is a primary supplier and exporter of cotton/textile/ apparel products. The report explores China’s long-standing policy to use prison inmates as forced labor and finds Xinjiang has the largest number of prisons and labor camps in China, totaling 85 prisons with an estimate of 500,000 to 800,000 inmates.

According to the findings, prison inmates in Xinjiang are routinely used to reclaim land for cotton fields and participate in other parts of the cotton value chain, up to and including work in garment factories. The report outlines the Chinese government’s strategy to maintain political stability in Xinjiang by expanding Xinjiang’s cotton/textile/apparel industry. Part of the strategy involves the detention of large number of Uyghurs to “re-education camps” to produce manufactured goods. 

During 2018, 2,200 new cotton/textile/apparel companies were found to participate in the forced labor programs, according to the study. The press conference named Lihua Cotton Company, Huafu Fashion, and Lutai Textiles as suppliers that rely on forced labor. 

Based on the report, the Citizen Power Initiatives for China and the Uyghur Human Rights Projects call on the Chinese government to change their unfair practices, and plan to ask the Trump Administration to use their authority to ban imports from Xinjiang that use forced labor. The full report is scheduled to be released by the end of the month and USFIA will share that information when it is available.

Tariffs will reduce U.S. GDP and be costly for consumers, according to the Congressional Budget Office’s Update to the Budget and Economic Outlook: 2019 to 2029. The analysis projects that by 2020, the tariffs implemented since 2018 will reduce U.S. GDP by roughly 0.3 percent and reduce the average U.S. household’s income by $580.  The analysis assumes that tariffs will remain in place through 2029.  

“Tariffs are projected to lower economic output, primarily by making consumer goods and investment goods (such as structures and equipment) more expensive. Uncertainty about future trade policies also reduces business investment. Those economic effects wane after 2020 as businesses make adjustments to their supply chains to mitigate the costs associated with the tariffs,” says CBO. 

According to CBO, the tariffs reduce U.S. economic activity in three ways. “First, they make consumer goods and capital goods more expensive, thereby reducing the purchasing power of U.S. consumers and businesses. Second, they increase businesses’ uncertainty about future barriers to trade. Such uncertainty leads some U.S. businesses to delay or forgo new investments or make costly adjustments to their supply chains. Third, they prompt retaliatory tariffs by U.S. trading partners, which reduce U.S. exports by making them more expensive for foreign purchasers. All of those effects lower U.S. output,” says the study.