Counselor® PromoGram®
August 25, 2009

Promotional Products Involved In Customs' Controversy?
U.S. Customs & Border Protection (CBP) has re-classified a promotional product commonly manufactured and intended for babies, ruling it a non-toy. The product, called baby paper, is produced by Pennsylvania-based Artistic Toy (asi/37122) and is now subject to a 7% import duty. Invented seven years ago, baby paper is a cloth-like square, made from material that makes a crinkly noise when touched. "I respect that the government has a job to do, but I don't see how they can be the experts on toys," says Jim Socci, president of Artistic Toy. "It's been a frustrating process."

Socci first learned of the change last week after two of his product shipments from China were stopped. "It's my understanding that Customs has new teams in place trying to identity and classify products," says Socci. "Now I have to let my customers know that they have to pay this tax."

Besides baby paper, CBP field agents have also recently re-classified an Artistic colorful plush toy shaped like sperm. The CBP has determined the product is also not a toy and is subject to the duty. According to a U.S. Customs' official, greater scrutiny and emphasis is being placed on imported toys as agents work to correctly categorize products. "It's definitely become a high-profile industry and we're putting more focus on toys," says Jim Forkan, national import specialist for CBP. "Field agents look at how a product is constructed and who it's intended for." Forkan, who wouldn't comment on specific items, says agents define a toy as an item intended "for the amusement of children and adults, with no specific age-appropriate guidance."

Any company can appeal a CBP product ruling, which is reviewed within 90 days. It is unclear if additional promotional products will be re-evaluated and made subject to an import tax.

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