CBP Reports Textile IPR Seizures, Value of Penalty Actions Both Down So Far in FY 2012
CBP posted its textile and apparel enforcement statistics through the first two quarters of fiscal year 2012. Textiles and apparel seized in the first two quarters for intellectual property rights violations fell about 30% from the same period in 2011. Total value of such IPR seizures fell by about 41%. The value of all types of commercial fraud penalty actions is well above the corresponding period in 2011, even though the number of 2012 actions is about half those in the first two quarters of 2011.
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Textiles and apparel continue to be politically and economically sensitive commodities, said CBP. Complex regulations and the increasing number of free trade agreements (FTAs) and trade preference programs (each with unique requirements) create opportunities for fraud, the agency said. The risk to the industry was seen as significant enough to warrant designation as a Priority Trade Issue (PTI) and therefore focused attention of CBP resources. (See ITT’s Online Archives 12010414 and 12011314 for summaries of textiles and apparel and IPR enforcement as PTIs.)
FY 2012 Statistics
CBP states the below statistics reflect the results of its assertive approach to textile enforcement and efforts combat the threat of transshipment, quota and evasion, and improper/misleading country of origin marking.
Quota and IPR Seizures
CBP provides the following seizure statistics of quota/visa and intellectual property rights (IPR) violations:
| Activity | Q1 | Q2 | 2012 Total |
| Quota/Visa | 0 | 0 | 0 |
| IPR Number | 1,905 | 1,749 | 3,654 |
| IPR Value | $3.38 M | $1.83 M | $5.21 M |
(This represents a 30% decrease in the number of total IPR seizures, of which there were 5,242 from the same period in 2011. The value of these seizures dropped by about 41% from $8.81 million through two quarters in FY 2011.
Commercial Fraud Penalties
CBP provides the following statistics for commercial fraud penalties:
| Q1 | 2012 Total | |
| Number | 10 | 10 |
| Value | $27.7 M | $27.7 M |
(This represents an major increase from the same period in FY 2011, in which there were 21 penalties valued at only $2.8 million. Through two quarters this year, the penalties are already more than the $27.3 million for all of FY 2011 )
Liquidated Damages
CBP provides the following liquidated damages statistics:
| Q1 | Q2 | 2012 Total | |
| Textiles | 387 | 144 | 531 |
| FVE (Entry) | 373 | 130 | 503 |
| FVE (TIB) | 1 | 1 | |
| FVO (Other) | 0 | 0 | |
| FVR (Redelivery) | 13 | 14 | 27 |
(This is an increase compared to the first two quarters of FY 2011, during which there were 303 liquidated damages for textiles, 285 for Entry, 3 for TIB, 0 for Other, and 11 for Redelivery.)
Textile Production Verification Teams (TPVTs)
CBP utilizes TPVTs to conduct on-site verification of foreign textile and wearing apparel manufacturers. These teams review and verify production capability and compliance with the terms of FTAs and trade preference programs. CBP states the TPVT visits help deter circumvention of the preference program requirements, as well as educate foreign governments and manufacturers.
CBP provides the following TPVT illegal transshipment and preference claim statistics:
Illegal Transshipment
| Q1 | Q2 | Q3 | Q4 | 2012 Total | |
| Countries Visited | 0 | 4 | 2 | 3 | 9 |
| Factories Visited | 0 | 66 | 34 | 65 | 165 |
| % Discrepant | N/A | 21% | 26% | 20% | 22% |
Trade Preference Claims
| Q1 | Q2 | 2012 Total | |
| Countries Visited | 0 | 3 | 3 |
| Factories Visited | 0 | 57 | 57 |
| % Discrepant | N/A | 19% | 19% |
Examinations
CBP provides the following examination statistics:
| Q1 | Q2 | 2012 Total | |
| Total Number | 2,158 | 1,510 | 3,668 |
| Discrepant | 273 | 175 | 448 |
| % Discrepant | 13% | 12% | 12% |
Laboratory Analyses
CBP provides the following laboratory analyses statistics:
| Q1 | Q2 | 2012 Total | |
| Number of Samples Tested | 241 | 302 | 543 |
| Discrepant | 125 | 170 | 295 |
| % Discrepant | 51.9% | 56.3% | 54.3% |
Special Enforcement Operations (SEO)
CBP provides the following statistics for SEO:
| Q2 | 2011 Total | |
| Number of SEO Initiated | 2 | 2 |
| Number of SEO Completed | 1 | 1 |
See ITT's Online Archives 12011913 for summary of CBP's FY 2011 textile and apparel enforcement statistics.)