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NAFTA 2.0 Changes Focus on Labor Enforcement

Posted By Cindy L. Squires, Esq., 17 hours ago
On December 10th top negotiators from the U.S., Mexico, and Canada gathered in Mexico City to sign an agreement making changes to the U.S.-Mexico-Canada Agreement (USMCA). The Agreement, if ratified, will update the North American Free Trade Agreement. The changes were the result of negotiations in the U.S. between the Trump Administration and key Democrats in the House of Representatives and were seen as necessary to win approval from the House Democratic Caucus.

Changes to the environmental provisions of the agreement include a new commitment that all parties adopt, implement, and maintain seven multilateral environment agreements such as CITES, new mechanisms to monitor whether environmental protections are being applied, and enhancements to mechanisms that ensure only legally harvested and taken flora and fauna are traded through Mexico.

The most far-reaching aspect of the changes has to do with a new enforcement regime for labor obligations under the agreement. Dubbed the “Facility-Specific Rapid Response Labor Mechanism,” all manufactured goods and all services traded between the U.S. and Mexico will be subject to facility-based enforcement of labor obligations within a mandated timeframe.

IWPA urges quick passage of the USMCA agreement to provide certainty to North American businesses that rely on regional trade.

Tags:  CITES  NAFTA  U.S.-Mexican-Canada Agreement 

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CITES COP18 Decisions Will Impact Rosewood, Cedrela, Afrormosia

Posted By Cindy L. Squires, Esq., Friday, October 4, 2019
Updated: Friday, October 4, 2019

I am pleased to report that IWPA’s active engagement at the 18th Meeting of the Conference of the Parties (COP18) of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) resulted in several changes that are important to companies that trade in CITES-listed wood products. For those who may not be familiar with CITES, it is an international agreement that regulates trade in specimens of wild animals and plants to ensure that such trade does not threaten their survival.

Thankfully, the Parties adopted a proposal to fix the flawed Annotation #15 that had negatively impacted trade in musical instruments that contain rosewood species from the genus Dalbergia. The new annotation is the result of three years of negotiations. The new annotation will now exempt finished products up to a maximum weight of the CITES-listed wood of up to 10 kg per shipment as well as finished musical instruments, finished musical instrument parts, and finished musical instrument accessories. That means that while timber exports will require an export permit, finished musical instruments will not. This will dramatically reduce the number of permits that CITES management authorities in countries such as the U.S. must process for finished musical instruments, thus easing the extensive wait times exporters have faced.

The Parties adopted a proposal by Ecuador to list the entire genus Cedrela on CITES Appendix II. Importantly, during consideration of the proposal Ecuador and several other parties that export Cedrela species agreed to make amendments to the proposal that IWPA was advocating to minimize its negative impact:

  1. Only exports from the neotropical range were included in the listing (this is the same range limitation that is currently in place for exports of Genuine Mahogany).

  2. Instead of applying to all products including Cedrela species, including finished products such as musical instruments, the listing was restricted to Annotation #6: Logs, sawn wood, veneer sheets and plywood.

  3. To allow sufficient time for CITES national authorities and industry alike to prepare for this listing, its implementation was delayed for twelve months rather than the normal 90-day implementation requirement. For the subsequent twelve-month period current requirements for those Cedrela species that are currently listed on CITES Appendix III remain in effect. Because COP18 adopted this proposal on August 28, 2019, we anticipate that it will take effect on or around August 28, 2020.

The Parties also added to Appendix II less widely traded species Mulanje Cedar and Mukula.

Additionally, the Parties adopted a proposal that adds the term “transformed wood” to the annotation for Afrormosia. For this annotation, transformed wood is defined by HS code 44.09 so that it includes wood “continuously shaped along any edges, ends or faces…”

IWPA staff is working with U.S. Fish and Wildlife Service staff to prepare resources and guidance that will assist industry in complying with these new listings. One key deadline to be aware of is that, unless a delay was explicitly agreed to as in the case of Cedrela, the changes go into effect in 90 days or on or about November 28, 2019. While USFWS has not communicated the exact dates of implementation as of this writing, IWPA will share this information with members as soon as it is available.

The next Conference of the Parties will take place in Costa Rica in 2022. If you are interested in participating in IWPA’s member-led engagement on CITES issues such as implementation of these changes as well as future proposals to list additional species, please consider joining our Lumber/CITES Committee.

Tags:  Afrormosia  Cedrela  CITES  COP18  HTS 44.09  Ipe  Rosewood  USFWS 

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August CITES Meeting to Go Beyond Species Proposals

Posted By Cindy L. Squires, Esq., Thursday, August 8, 2019
Updated: Friday, October 4, 2019
Frequent readers of Import/Export Wood Purchasing News will recall that my February column provided details about several proposals put forward for consideration at the 18th meeting of the CITES Conference of the Parties (COP18) that, if adopted, would mean additional requirements for trade in species such as Ipé and the genus Cedrela. Since that column there have been several important developments.

First COP18, which was to have taken place in late May and early June in Colombo, Sri Lanka, was postponed due to the tragic Easter bombings in that city. The meeting has been moved to August 17-28 in Geneva, Switzerland. This new timing is important to traders who deal in CITES species because under the convention amendments to the appendices go into effect 90 days after ratification unless different timeframe is agreed to. This means that any new or amended listings agreed to at COP18 could go into effect in late November 2019.

Secondly, Brazil withdrew its proposal to list Ipé on CITES Appendix II. While this proposal cannot be re-introduced at COP18, it is expected that there will be additional debate about sustainable trade in Ipé before the next COP in two to three years.

In addition to the species proposals that garner the major headlines at each CITES Conference of the Parties, there will be a record number of policy proposals that could fundamentally impact the way CITES functions. IWPA staff will be particularly active in the consideration of proposed guidance on how CITES Parties make Legal Acquisition Findings. Some stakeholders want to require Parties to conduct Legal Acquisition Findings for all finished products containing CITES material including chain of custody information for each step of the supply chain. As any wood products trader or manufacturer knows, this process would become prohibitively complex each time a product undergoes any type of sorting or manufacturing, with little or no added conservation benefit.

Additionally, Parties are expected to consider a proposal that would effectively introduce a new term that could be included in CITES annotations for tree species – “transformed wood.” Initially, adoption of this new term would mean that the annotation for Afrormosia would apply to more products under HTS 44.09, and it would increase the likelihood that this new term would be used in future listing changes.

Once decisions are made on these issues at COP18 in Geneva, they will have to be implemented by country Management Authorities such as the U.S. Fish and Wildlife Service’s Division of CITES Management Authority. IWPA staff works closely with USFWS CITES staff on issues of importance to our industry and we are concerned that a crush of new decisions will add to their already considerable policy implementation and permitting burdens.

IWPA will continue to work closely with industry allies to speak clearly and forcefully that any restriction on trade must be carefully tailored to avoid limitations that are unnecessarily restrictive of trade and have clear environmental benefits.

Tags:  Afrormosia  Brazil  CITES  COP18  Sri Lanka 

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