M E M O R A N D U M
Urgent!
TO: Clients and Friends of the Firm
FROM: John M. Peterson
Neville Peterson LLP
RE: APHIS Bans Use of Untreated Solid Wood Packing Material from China - Effective Date December 17, 1998 ---------------------------------------------------------------------------------
        The Department of Agriculture, Animal and Plant Health Inspection Service (APHIS) has published an interim regulation which bans the use of untreated wooden pallets, crating, dunnage and other wooden packing materials imported into the United States from the People's Republic of China. The ban takes effect for goods imported on or after December 17, 1998.

        Imports from Hong Kong are included in the interim rule and the import ban.

        The rule is being adopted to prevent the entry into the United States of certain exotic pests from China, in particular the Asian long-horned beetle.

Treatment Options

        For goods imported into the United States on and after December 17, 1998, importers will need to certify that the wood has been treated in one of the following ways:

• Heat treated;
• Pressurized with a preservative
• Fumigated

Importers can also use pallets and packing materials composed of materials other than wood (e.g., plastic pallets), but this option is not believed to be economically viable for most goods being imported from China.

        The heat treatment, fumigation or preservative treatment methods used must be among those listed in the treatment schedule set out at 7 C.F.R. Section 319.40-7, or in APHIS' Plant Protection and Quarantine Treatment Manual.

        During the interval between treatment of Chines solid wood packaging material ("SWPM") and the exportation thereof, the packing material must be stored, handled or safeguarded in a manner which precludes any infestation of the material by plant pests.

Import Documentation Requirements

        At the time merchandise from China arrives at its port of first arrival, all SWPM must be accompanied by a Certificate signed by an official of a Chinese government agency stating that the solid wood packing material, prior to departure from China, has been heat treated, fumigated or treated with preservatives using one of the methods noted above.

        Exporters also have the option, but not the obligation, to mark pallets and other wood packing material with a stamp or weatherproof label bearing the words "CHINA TREATED". However, such a marking is not a substitute for the required certificate.

Exclusion from Entry

        If APHIS inspectors determine that a shipment imported from China contains plant pests or SWPM that has not been heat treated, fumigated or treated with preservatives, or that is not accompanied by the required Chinese government certificate, the inspector may refuse entry into the United States of the entire shipment, including the cargo. If an inspector determines that the cargo may be separated from the packing material, so that the packing material may be destroyed or re-exported without risk of spreading plant pests, separation of the cargo may be permitted.

        Excluded packing materials must be destroyed by incineration at the importer's cost.

        Commercial shipments imported from China that do not contain any SWPM must include an importer statement on, or attached to the commercial invoice, and as an attachment to the bill of lading, stating that the shipment contains no solid wood packing material. Any shipment not accompanied by such exporter statement will be subject to inspection for solid wood packing material.

        Importers will bear all costs of APHIS inspections (at a rate of $65 per hour).

Public Hearings: Comments

        APHIS will conduct a public hearing on its interim regulation on October 16, 1998, at the United States Department of Agriculture's Headquarters Washington, D.C. Additional public hearings will be held, on dates to be announced, in Seattle and Los Angeles. APHIS is seeking public comments on its interim regulations. Comments must be submitted in writing no later than November 17, 1998.

        Copies of the regulations are available from our offices.

        Please do not hesitate to contact our offices if you have any questions or require additional information concerning this important rule.

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