Trade lawyers talking about changes to NAFTA's rule of origin said they're fairly optimistic the trade deal rewrite will be ratified in Congress in 2019. But aside from the auto sector, which has a multiyear transition period, they're concerned that by the time ratification comes, there won't be time for importers and exporters to adjust by Jan. 1, 2020, when the replacement agreement is supposed to be in force.

A California man was recently arrested for illegally exporting cesium atomic clocks to Hong Kong without obtaining the required Bureau of Industry and Security License, the Massachusetts U.S. Attorney’s Office said in a June 27 press release. Alex Yun Cheong Yue allegedly bought the clock from a U.S. reseller by misrepresenting its end-use, and was attempting to buy another clock when the reseller requested to tour Yue’s non-existent California facility to verify the end-use, causing Yue to abort his plans to export a second clock.

There is significant tension and disagreement between the Defense and Commerce departments about the reach of U.S. export controls, said Jamie McCormick, a staffer for House Appropriations Committee Republicans, June 27 at the American Association of Exporters and Importers Annual Conference in Washington. McCormick said the confusion surrounding foundational technologies among U.S. industry leaders may stem from the original passage of the Export Control Reform Act of 2018, adding that he believes the executive branch does not agree on a definition for foundational technologies. “I’m not certain that at the time they passed the bill that the executive branch could say with any certainty what they meant by foundational technologies,” McCormick said.

The U.S.-China trade war “is taking its toll, especially on China,” eMarketer reported June 25, cutting its 2019 outlook for China and the U.S. As a result, China won't surpass the U.S. in total retail sales this year, as expected, and won't, based on current conditions, until 2021, when it's forecast to pass the U.S. by $93 billion. EMarketer forecasts China retail sales will hit $5.3 trillion this year, up from $5.1 trillion in 2018 vs. U.S. retail sales of $5.5 trillion this year, up from $5.3 trillion. Slowing auto sales are the main drag on the Chinese economy, it said. The U.S. “is not immune to the effects of retaliatory Chinese tariffs,” the research firm said, cutting its previous outlook for U.S. retail sales growth from 3.2 percent to 3 percent, amounting to $5.47 trillion. By share, the U.S. has 21.9 percent of the global retail market vs. China at 21.1 percent, but China’s e-commerce market -- “by far the largest” globally at $1.93 trillion -- is three times that of the U.S.; that forecast is “largely unchanged.” Despite the slight slowdown this year, it said, U.S. e-commerce sales are expected to exceed 10 percent of total retail sales for the first time, with e-commerce growing 14 percent to $586.9 billion.

The European Union and Vietnam will sign a new free trade agreement June 30 that will eliminate almost all tariffs on goods traded between them, the European Commission said in a June 25 press release. The agreement will also address non-tariff barriers between the two countries, and will include requirements for customs and trade facilitation, as well as labor rights and environmental protection.

In the June 26 edition of the Official Journal of the European Union the following trade-related notices were posted:

Mexico’s Secretariat of Finance and Public Credit recently issued its General Foreign Trade Regulations for 2019. Published in three separate parts in the June 24 Diario Oficial, the new 2019 version includes changes to provisions on suspension of import and export permits, and requires from Dec. 1 that importers transmit value declarations electronically through the Mexican single window, according to a summary of the changes from the Mexican Confederation of Customs Broker Associations (CAAAREM) posted by trade consultancy AJR Comercio. The Mexican agency published Annexes 1-A and 22 to the new regulations the following day. Among new provisions of the annexes are changes to guidelines on how to fill out Mexican import and export declarations (i.e., pedimentos) related to a field for declared value, according to another CAAAREM circular.

Canada needs to step up its meat export certification system, China's Foreign Ministry spokesperson Geng Shuang said during a June 26 press conference. Asked about a temporary ban on Canadian meat, Shuang said that Chinese customs found "ractopamine residues in pork products exported from Canada to China." During a subsequent investigation, China found "the official veterinary health certificates for the batch of pork exported to China were counterfeit and the number of those forgery certificates was up to 188," he said. "These forged certificates were sent to the Chinese regulatory authorities through Canadian official certificate notification channel, which reflects that the Canadian meat export supervision system has obvious safety loopholes."

The Canada Border Services Agency published some rate of duty reductions included in the Canada-European Free Trade Association Free Trade Agreement and the Information Technology Agreement Expansion, in a new customs notice. The Canada-EFTA duty reductions apply to these subheadings:

Canada issued multiple new regulations related to Canada’s accession to the United Nations Arms Trade Treaty in the Canada Gazette, Part II. Among those is the new permit for the export of Arms Trade Treaty items to the U.S. meant to "provide a streamlined permitting process for the export of most ATT items." The regulations also include a brokering control list, brokering permit regulations, and regulations specifying activities that do not constitute brokering. The regulations will take effect on Sept. 1, according to another notice. The regulations were proposed in March (see 1904150033).