CBP Issues Implementation Instructions for U.S.-Canada Softwood Lumber Agreement

(The SLA 2006 was signed on September 12, 2006 and entered into force on October 12, 2006. See ITT's Online Archives or 10/18/06 news, 06101805, for BP summary.)

Scope of Products Subject to Agreement

CBP states that the scope of the SLA 2006 is limited to those softwood lumber products first manufactured into an eligible product of one of the Harmonized Tariff Schedule (HTS) subheadings listed in SLA 2006 Annex 1A.

(Trade sources indicate that the written scope description in Annex 1A should also be consulted as to scope. Annex 1A also provides written descriptions of many (but not all) of the exclusions from the scope. Article X of the agreement contains additional exclusions.

These sources add that SLA 2006 Annex 1B should also be reviewed, as it is a concordance listing both brief article descriptions and U.S. and equivalent Canada tariff numbers for products that are in the scope, as well as certain exclusions.)

CBP has previously stated that the SLA 2006 HTS subheadings subject to the Export permit requirement are HTS 4407.10.00, 4409.10.10, 4409.10.20, 4409.10.90, 4409.10.05, 4418.90.45.90, 4421.90.70.40, and 4421.90.97.40.

Entry Requirements

According to CBP, importers of SLA 2006 products must provide the following information at time of entry summary filing:

Region of origin of first manufacture. The identified Canadian Regions, provided for in SLA 2006 Annex XXI, will be entered in the "Country of Origin" field on CBP Form 7501. CBP notes that a separate breakout is provided for British Columbia (BC)-BC Coast and BC Interior. The code to identify this separate breakout will be XD for BC Coast and XE for BC Interior. (For SLA 2006 purposes, CBP has previously stated that the province code 'XC' (for British Colombia) should not be used.)

Alpha code for shipment date or exclusion. An Export Permit number must be provided for softwood lumber products listed in SLA 2006 Annex 1A. Preceding the eight-digit Export Permit number will be an alpha code representing the Date of Shipment or an exclusion from SLA 2006 export measures.

CBP states that the first 12 letters of the alphabet represent the 12 months of the year (e.g., "A" represents January, "B" represents February, etc.). The letter codes for exclusions are as follows: "M" for Maritimes; "N" for Nunavut; "W" for Northwest Territories; "X" for Excluded Companies; and "Y" for Yukon.

"P88888888" if not within scope, but falls under listed HTS tariff number. According to CBP, for softwood lumber products that are not within the scope of the SLA 2006, but fall under a HTS number that is listed in Annex 1A, filers should input the following alphanumeric number in the Export Permit field: P88888888.

"P88888888" if date of shipment prior to October 12th. For shipments of softwood lumber products with a date of shipment prior to October 12, 2006, filers should input the following in the Export Permit field: P88888888

(These instructions replace earlier CBP instructions which stated that nine 8s (888888888) should be used for shipments prior to October 12, 2006. See ITT's Online Archives or 10/19/05 news, 06101905 for BP summary of CBP's earlier message.)

MLB original certificate of origin. Importers are required to submit a paper CBP Form 7501 along with the original Maritime Lumber Bureau (MLB) Certificate of Origin for Softwood Lumber Products claiming an exemption from export measures on logs originating in the Maritimes or Maine.

Exclusions from Export Measures on Softwood Lumber Products

CBP states that exclusions from Export Measures on Softwood Lumber Products are provided for in Article X of the SLA 2006 (also see Annexes 1A and 1B). The Article X exclusions are:

Softwood Lumber Products first produced in the Maritimes from logs originating in the Maritimes or Maine, that are: (a) exported directly to the U.S. from a Maritime province, or (b) shipped to a province that is not a Maritime province, and reloaded or further processed and subsequently exported to the U.S. An original MLB Certificate of Origin must accompany these products.

First produced in the Yukon, Northwest Territories or Nunavut from logs originating therein.

Produced by companies listed in SLA 2006 Annex X.

No De Minimis Provision in the SLA 2006

According to CBP, there is no de minimis provision in the SLA 2006. All shipments of softwood lumber products, regardless of value, must have an Export Permit, unless these shipments fall within the provisions under the exemptions listed above.

Termination of the SLA 2006

CBP states that the SLA 2006 shall remain in force for seven years after the effective date and may be extended by agreement of the parties for an additional two years.

CBP notes that the SLA 2006 may be amended at any time by the U.S. and Canada in writing.

ACS Program Updates for Electronic Transmission of Export Permit Completed

CBP states that the program updates to the Automated Commercial System (ACS) to allow for the electronic transmission of the Export Permit number have been completed.

In addition, CBP sources state that the NAFTA origin problem is scheduled for correction on October 25, 2006. (See ITT's Online Archives or 10/23/06 news, 06102310, for BP summary on NAFTA problem.)

(See ITT's Online Archives or 10/19/06 news, 06101925, for BP summary of the interim rule establishing entry requirements for Canada softwood lumber products.

(See ITT's Online Archives or 10/23/06 news, 06102310, for BP summary of CBP additional instructions for subject merchandise.)

CBP memorandum (posted 10/19/06) available at http://www.cbp.gov/linkhandler/cgov/import/international_agreements/free_trade/canada/sla2006_imp_inst.ctt/sla2006_imp_inst.doc

BP Note

Readers should note that CBP doesn't monitor for scope exclusions; it is up to the exporter and importer to tell CBP if any products are excluded from the scope.

(Excluded products do not require a Canadian-issued export permit number, nor are they counted toward any threshold that might trigger a Canadian - imposed quantity limitation or export tax.)