China recently requested industry and government feedback as it prepares to revise its measures on organic product certification, which could impact the types of organic goods China can import, according to a U.S. Department of Agriculture Foreign Agricultural Service report released April 30. The request for pre-draft revisions comments is “unique,” the USDA said, adding that China is asking for comments through a “written questionnaire” because it cannot conduct field visits due to the COVID-19 pandemic. The comment deadline is May 11. China did not notify the World Trade Organization about previous revisions to its organic product certification rules last year, the USDA said.
Exports to China
Some companies are concerned about the possibility of the Commerce Department issuing major export control actions during the COVID-19 pandemic, which they say will compound economic hardships caused by the mitigation response to the highly contagious disease. In interviews, industry officials said they are unsure about their ability to manage sweeping regulatory changes even as they acknowledge that a moratorium on export control actions is unlikely.
China said it has joined 17 other World Trade Organization members to create a temporary dispute settlement system (see 2004150013) to solve trade issues despite the paralysis of the WTO’s dispute settlement body (see 2001240027). The temporary body will ensure “consistency and predictability” of rulings, China said in an April 30 notice, according to an unofficial translation. The “ultimate goal” of each participating WTO member is to “restore the normal operation of the appeal body,” China said.
China adopted new cybersecurity review measures that may impact purchases of foreign technology, according to an unofficial translation of an April 27 notice from China’s Cyberspace Administration. The rules, which will take effect June 1, require certain “critical information infrastructure operators” to undergo a review when importing goods that may impact China’s national security, the notice said. That review includes the submission of a “declaration form,” an “analysis report” on the impact of the purchase on China’s national security, procurement documents and “other materials,” China said. The review will “generally” be completed in 45 days. The rules could place foreign technology products at a “disadvantage” in the Chinese market, according to an April 27 report in The Wall Street Journal. Industry is also worried the review procedure could justify excluding U.S. businesses from Chinese supply chains, the report said.
The Commerce Department Bureau of Industry and Security is working on guidance to help industry comply with the expanded licensing requirements for exports to China announced earlier this week (see 2004270027). The guidance will address new restrictions on exports intended for military users and uses, said Matt Borman, Commerce deputy assistant secretary for export administration. The rule expands the definition for military end-use and will cover military end-users in China, placing more of a compliance burden on industry.
China announced it will temporarily waive interest on deferred payments for “processing trade goods sold domestically” between April 15 and Dec. 31, according to an April 27 report from the Hong Kong Trade Development Council. The measure is aimed at supporting the “development of processing trade” and to ease pressure on foreign trading.
Rep. Brad Schneider, D-Ill., said that many of his colleagues think “that we can pull back and do everything ourselves,” and that he thinks they may look at the shortages during the COVID-19 pandemic response as evidence that reshoring is the way to go. “You will see more capacity building in the United States, and that makes sense; the idea we can do it all ourselves is pure folly.” Schneider, who was speaking on a webinar hosted by the Washington International Trade Association on April 28, also thinks there needs to be redundancy in supply chains, and more warehousing and less “just-in-time” delivery.
The Commerce Department amended the Export Administration Regulations to expand licensing requirements for exports, re-exports and transfers of items intended for military uses in China, Russia and Venezuela, according to a notice. The rule expands the licensing requirements for exports to China to include military end-users as well as military end-uses, broadens the list of items subject to the licensing requirement and review policy, and expands the definition for military end-use. The rule also “creates a new reason for control” and review policy for certain exports to the three countries, and added new Electronic Export Information filing requirements.
The Commerce Department is considering restricting the number of destination countries that are authorized to receive certain U.S. re-exports that are controlled for national security reasons, the agency said in a notice. The proposed rule would amend the license exception for Additional Permissive Reexports (APR) by removing nations in Country Group D:1, including China, from being eligible to receive those re-exports, Commerce said. The rule would remove APR license eligibility from more than 20 countries. Comments are due June 29.
China announced requirements for importing U.S. avocados, according to an unofficial translation of an April 26 notice from the country’s General Administration of Customs. The notice contains new phytosanitary requirements for the imports, which took effect April 26.