US Import Law Advisory - US Importers May Soon Face Additional Product Safety Requirements

Spurred in part by recent product safety concerns over Chinese-origin food, toothpaste, and toys, federal officials have started several processes that could lead to new import compliance requirements.  Importers of consumer products, food, and beverages should monitor these developments closely and consider now any steps to improve and document product safety measures.

Earlier this month, President Bush issued an executive order establishing an Interagency Working Group on Import Safety.  The Group will be chaired by the Secretary of Health and Human Services and is tasked with “identify[ing] actions...that can be pursued...to promote the safety of imported products.”  Among other things, the Group will study how to ensure that US importers follow “best practices” in:  “selection of foreign manufacturers, inspecting manufacturing facilities, inspecting goods produced on their behalf either before export or before distribution in the United States, identifying origin of products, and safeguarding the supply chain.” The Group's recommendations should be available within 60 working days, unless extended. 

In a similar vein, the acting chair of the Consumer Product Safety Commission recently submitted a working paper to Congress containing her draft proposal for the Product Recall, Information and Safety Modernization (“Prism”) Act.  Provisions of the proposed Prism Act include: making it unlawful to fail to furnish a certificate of compliance with a mandatory standard; requiring importers to report products that do not comply with voluntary or regulatory standards; clarifying that the CPSC has the power to seize or block entry to products that do not meet certain voluntary industry standards; explicit regulation of internet sales by foreign entities to US residents; requiring retailers and distributors to provide names and addresses of suppliers; requiring manufacturers, importers and distributors to provide names and addresses of buyers; prohibiting the sale of recalled products; establishing that violators of CPSC rules may have to forfeit assets and bond imports; and increasing the maximum civil penalties the Commission can impose to $10 million, while creating the power impose administrative penalties of up to $2 million.

In addition to these proposals, the CPSC has, in recent months, repeatedly expressed the importance of improving import safety.  In a statement submitted to the House Energy and Commerce Committee in May, the acting chair of the CPSC noted that two-thirds of the agency’s recalls now involve imported products and that the Commission had already taken several steps to address this issue, including negotiating memoranda of understanding with twelve foreign countries.  The CPSC also stated that it is working with US Customs and Border Protection to “undertake both routine and targeted surveillance and sampling of imported products.”  Finally, the Commission's 2008 Performance Budget Request notes that the CPSC has created an Office of International Programs and Intergovernmental Affairs to "ensure greater import compliance with American safety standards."

Congress has also seen action in this area.  Senator Dick Durbin (D-IL) has introduced legislation that would assess a new import duty on food products to fund inspection and research.  Similarly, Representative Mark Kirk (R-IL) has introduced the Import Safety Act of 2007, which would increase fines for trafficking in unsafe toys or "adulterated or misbranded" food or drugs, and would authorize additional funding for inspecting imported toys and processed food.

None of the above steps have yet led to final rules, but they all suggest growing pressure for some action on the safety of imports.  Depending on their final form, the Working Group's recommendations could give new impetus to the CPSC's proposals, while the legislative proposals could help the CPSC pay for more inspections.  Because any action in this area could have a far-reaching impact, US importers of consumer goods, food, and beverages should closely monitor these developments and comment where appropriate.  This period also provides an opportunity for importers to review procedures for verifying product safety and make improvements where necessary, without the additional cost that often accompanies a rush to conform to new requirements.

If you have any questions regarding US import compliance issues, please contact Greg McCue at (202) 429-6421 and gmccue@steptoe.com.