On April 10, 2020, FEMA issued a temporary rule that prohibits exports of certain personal protective equipment (“PPE”) used to treat the COVID-19 virus from the United States without prior FEMA approval. The temporary rule took immediate effect and will continue in force until August 10, 2020. The temporary rule was implemented in accordance with the Presidential Memorandum issued on April 3, 2020, which provided that scarce or threatened materials should be allocated for domestic use. The following provides a detailed summary of the procedures that will be followed for covered products.
|Covered PPE Products
- N95 Filtering Facepiece Respirators, including devices that are disposable half-face-piece non-powered air-purifying particulate respirators intended for use to cover the nose and mouth of the wearer to help reduce wearer exposure to pathogenic biological airborne particulates;
- Other Filtering Facepiece Respirators (e.g., those designated as N99, N100, R95, R99, R100, or P95, P99, P100), including single-use, disposable half-mask respiratory protective devices that cover the user’s airway (nose and mouth) and offer protection from particulate materials at an N95 filtration efficiency level per 42 CFR 84.181;
- Elastomeric, air-purifying respirators and appropriate particulate filters/cartridges;
- PPE surgical masks, including masks that cover the user’s nose and mouth and provide a physical barrier to fluids and particulate materials;
- PPE gloves or surgical gloves, including those defined at 21 CFR 880.6250 (exam gloves) and 878.4460 (surgical gloves) and such gloves intended for the same purposes; and,
- Additional items in the future that are determined to be scarce and necessary for national security.
|Covered Export Shipments
||The temporary rule targets commercial export shipments valued at $2,500 or more containing more than 10,000 units of covered PPE products.
|Exclusions from the Temporary Rule
- Shipments valued under $2,500 or consisting of less than 10,000 units;
- Intracompany transfers not for sale to third parties;
- Exports to Canada or Mexico;
- Exports to US government entities (e.g., to US military installations overseas);
- Exports by US government agencies;
- Exports by US charitable organizations;
- Exports by critical infrastructure industries for the protection of their workers;
- Exports by the 3M company; and,
- In-transit shipments.
|Exemption from the Temporary Rule
||Shipments made by or for US manufacturers that have had continuous export agreements with foreign customers since at least January 1, 2020 so long as 80% of their products were distributed within the US in the preceding 12-month period.
|Persons Subject to the Temporary Rule
|All persons involved in the export of designated PPE products, including domestic brokers, distributors and other intermediaries.
|Customs and Border Protection (CBP) and FEMA Procedures
- CBP will determine whether an export shipment contains covered PPE products based on information submitted in the shippers’ Electronic Export Information (EEI) filings via the Automated Export System (AES) and physical examination of the products.
- CBP will temporarily detain any export shipment of covered PPE products and notify FEMA of the intended export.
- FEMA will conduct a review and, within a reasonable timeframe after notification, determine whether to: (a) order the return of the shipment for domestic use; (b) issue a rated purchase order for all or part of the shipment under the Defense Production Act (DPA); or, (c) allow the export of all or a portion of the shipment. Factors that will be considered in the review include—
- Need to ensure that scarce/threatened items are allocated for domestic use;
- Minimization of disruption to the supply chain in the US and abroad;
- Circumstances surrounding the distribution of materials;
- Potential hoarding or price-gouging concerns;
- Quantity and quality of the materials in question;
- Humanitarian considerations; and,
- International relations and diplomatic considerations.
|Injunctive Relief and Restraining Orders
||FEMA may apply for injunctions or restraining orders against persons that have or are about to violate the temporary rule.
|Any person who willfully violates the temporary rule may be subject to penalties and imprisonment. A maximum criminal penalty of $10,000 and/or imprisonment for up to one year may be imposed under Section 103 of the DPA. In addition, any person who fraudulently or knowingly exports anything from the U.S. contrary to US law (or facilitates such exports) may be assessed criminal fines and up to 10 years’ imprisonment under 18 U.S.C. Section 554.
If you have any questions relating to FEMA’s temporary rule or other international trade-related issues, please contact Melissa Proctor (firstname.lastname@example.org) or Peggy Chaplin Louie (email@example.com) at Miller Proctor Law PLLC (https://millerproctorlaw.com ).