Month: April 2013

Hong Kong Terminal Strike Update, April 15, 2013

As we come to the 18th day of the the strike at HIT terminals in Hong Kong, we see disputing claims from both sides. HIT is stating a claim that it is running at 86% of its handling capacity, 90% during peak periods this past Saturday. Trade union representatives denied this claim, indicating that the terminal is still hampered by the strike, only handling 15 containers an hour instead of the standard 25 containers an hour before the strike.

Both sides are set to meet again on Tuesday to try to bring a resolution to this dispute. Shipments are still moving out of Hong Kong. However carriers have adjusted their schedules to account for delays in Hong Kong.

-Jimmy Ting

Stricter Enforcement of FDA Food Facility Registration Requirements under the FSMA

We’ve noticed that one byproduct of the new biennial Food Facility Registration requirement is stricter enforcement of registration rules when filing Prior Notice (PN). We have seen FDA cracking down on PN filings. In particular, FDA seems to be taking a close look at actual foreign Food Facility Registration number to make sure that the party

a.) is the actual manufacturer of the product or the facility that actually repacked the product.

b.) has authority to register the Food Facility with FDA.

We have seen two cases already where FDA questioned the authenticity and validity of the Food Facility Registration number of the foreign food facility. In both cases, FDA eventually refused the goods. The products had to be either exported or destroyed.

Keep in mind that the refusal of the product occurs at the time of filing of the PN. This is different from a typical FDA hold that occurs at the time of Customs entry submission. With a hold during the filing of PN, Customs cannot release the goods either. The goods end up sitting at the port accumulating storage charges while the issue is resolved. Most importers are used to being able to receive and hold their shipments while waiting for FDA to release goods. This is not the case with an FDA hold at the PN level.

My recommendation to the importing community is if the shipper is NOT the actual manufacturer OR the repacker of the food product, you MUST get the Food Facility Registration number and information of the actual manufacturer or repacker. FDA has on occasion accepted the name and address of the manufacturer / repacker without the Food Facility Registration number ONLY if the that manufacturer / repacker has already registered with FDA using that same name and address. Unfortunately, there is no system of verifying this with FDA without actually submitting the entry to FDA. This ends up being a great risk. You don’t know if the name address is listed with FDA until you submit the entry. I don’t believe this is a risk that most importers will find worth taking. Therefore it behooves the importer to get the actual FDA Food Facility Registration number of the foreign manufacturer / repacker.

Let me know if you have any questions or comments.

-Jimmy Ting

Impact of Terminal Strike in Hong Kong on the U.S. Import & Export Community

As many U.S. importers and exporters are aware, laborers at Hongkong International Terminal (HIT) have been on strike for the past twelve days.  HIT actually runs five of the eleven terminals in Hong Kong. The result of the strike has been a severe slowdown in operations at the terminals. Vessels are being delays roughly three to four days in Hong Kong as it is taking longer for containers to be loaded and unloaded.

One difference between the terminal strike in Hong Kong and past terminal strikes in the United States is that the HIT terminals actually have not completely shut down. They are still operating, albeit at a reduced capacity. Those familiar with longshoremen related strikes in the United States are used to complete terminal shut downs when terminal workers go on strike. Containers continue to be loaded and unloaded from the vessel, just at a slower pace. A number of carriers are diverting vessels to other nearby ports in China.

Importers with shipments from Hong Kong should double-check on the shipping schedules and prepare for a couple of days delay. They may also want to consider shipping directly from a nearby China port (Yantian/Huangpu) to avoid delays in Hong Kong.

Exporters with shipments to Hong Kong should be prepared for possible delays when the vessel arrives.

-Jimmy Ting