WASHINGTON — The U.S. Customs & Border Protection’s reorganization plan has stirred concerns among U.S. textile producers, retailers, importers, shippers and customs brokers.
The agency, a division of the Department of Homeland Security, said it would consolidate several offices into a single Office of Trade by Oct. 15 to oversee trade policy, program development and compliance measurement functions. The industry is concerned over consequences of the consolidation in an agency that enforces trade agreements at points of entry, seizes mislabeled and transshipped apparel and textile goods, enforces quotas and regulates the flow of trade.
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The textile sector maintains that the reorganization raises red flags because it will move textile trade enforcement officials into the new office, but leave import specialists who work in tandem with trade enforcement officials under the jurisdiction of the current Office of Field Operations.
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Cass Johnson, president of the National Council of Textile Organizations, said there would be a disconnect between textile enforcement officials and a dilution of authority that could adversely affect Customs’ seizures of illegally shipped apparel imports. Customs from Oct. 1, 2005, through Sept. 4, 2006, seized more than $100 million in apparel and textile imports that were “misrepresented, smuggled or illegally transshipped to circumvent textile trade laws and regulations.”
The bulk of the seized goods was made in China, shipped to other Asian countries and given false country of origin labels to circumvent a bilateral agreement the U.S. has with China, which restricts apparel and textile imports into the U.S. from China with quotas through 2008, according to Janet Labuda, director of the textile enforcement and operations division at Customs, which will move into the new Office of Trade.
“This is a banner year for us,” said Labuda, referring to the amount of seizures Customs made in the current fiscal year. “We expect to see significant seizures” through 2008, due to the circumvention of the Chinese quotas, she said.
Labuda oversees a staff of 10, which will increase to 12 next month, and directs import specialists at the ports to make seizures of suspect goods, based on analysis of risk-based data and foreign inspections of factories. There were 264 import specialists dedicated to textiles last year.
The textile industry is worried Labuda’s authority to direct import specialists to make seizures or exclude goods from entry could be “stripped” with the consolidation and separation.
“If they move into this new office, [Labuda] will be able to advise import specialists, but cannot direct them,” said Johnson. “Here they are finding enormous amounts of transshipments and illegal trade and they are about to yank the rug out from under the entire program with this reorganization.”
Labuda said in an interview the reorganization wouold present challenges. Asked whether the reorganization would strip her of some authority, Labuda said, “I’m not sure. Obviously, the positions will now be in two different offices and there will have to be a lot of different coordination, and I assume there will be challenges in how they roll this whole thing out.”
She stressed the agency was committed to making the consolidation seamless and effective.
“From my perspective, everything you do in trade is not a singular office issue,” she said. “It is an agency concern.”
Dan Baldwin, assistant commissioner at Customs’ Office of Strategic Trade, who will head up the new office, said, “First off, I’m very confident Janet and textile analysts and policymakers will have same the level of interaction they have today with the import specialist community.”
He said import specialists do not currently report directly to Labuda, but rather to the port director. “There has been a network established to make sure policies are implemented in the right fashion and we will retain the same level of communication,” Baldwin said.
Asked whether seizures of mislabeled or transshipped apparel and textile goods would be adversely impacted by the consolidation, Baldwin said, “Not under my watch.”
Erik Autor, vice president and senior counsel on international trade at the National Retail Federation, said the Joint Industries Group, a coalition of retailers, importers, shippers, carriers, freight forwarders and customs brokers, was preparing to send a letter to Customs Commissioner W. Ralph Basham to lay out their concerns about the reorganization.
Autor said the coalition was concerned about the Office of Regulations & Rulings, which handles commercial compliance, being folded into the new Office of Trade.
“We want to ensure the ORR will continue to maintain independence in issuing legal opinions and not be subjected, as it has been in the past, to political influence in rendering its opinions,” said Autor. “Our main concern is that it not get subsumed in the internal bureaucracy and politics within the bureaucracy.”