On April 3, 2020, President Trump signed a memorandum invoking the Defense Production Act to direct relevant federal government agencies to “allocate to domestic use” the following personal protective equipment (PPE):
- N-95 respirators
- Other filtering facepiece respirators (e.g., those designated as N99, N100, R95, R99, R100, or P95, P99, P100)
- Elastomeric, air-purifying respirators and appropriate particulate filters/cartridges
- PPE surgical masks
- PPE gloves or surgical gloves
In response to the presidential memorandum, the Federal Emergency Management Administration (FEMA) issued a temporary final rule (TFR) prohibiting exports from the United States without FEMA’s express approval. The TFR provides that U.S. Customs and Border Protection (CBP) will detain shipments of listed products temporarily, to give FEMA time to determine if the products should be returned for domestic use, subjected to a rated order, or permitted to be exported in full or in part.
When making its determination, FEMA can consult other agencies and consider factors such as the impact on foreign supply chains, as well as humanitarian and diplomatic considerations.
The TFR also excludes shipments by U.S. manufacturers with continuous export agreements with customers in other countries since at least January 1, 2020, so long as at least 80 percent of the manufacturer’s domestic production of covered materials, on a per item basis, was distributed in the United States in the preceding 12 months.
There is also a catchall provision, which allows additional exemptions at FEMA’s discretion. Pursuant to that catchall provision, on April 21, 2020, FEMA announced additional exemptions:
- Shipments to U.S. territories, such as Puerto Rico (where I am from!)
- Exports by nonprofits and NGOs
- Intracompany transfers by U.S. companies
- Exports of materials to be included in medical and diagnostic testing kits destined for U.S. sale and delivery
- Exports of sealed, sterile medical and diagnostic testing kits where only a portion of the kit is made up of listed products that cannot be easily removed without damaging the kit
- Shipments by foreign diplomatic missions
- Shipments to U.S. military facilities and diplomatic posts
- In-transit merchandise
- Exports for which the final destination is Canada and Mexico
- Shipments made by the federal government
In the case of some of these exemptions, exporters must provide a letter of attestation to CBP.
We expect PPE export rules to remain in a state of constant flux, just as is true in China, as we recently pointed out in Will Your PPE Pass China Customs? As change happens, we will continue to keep you informed.
Finally, the allocation process should be distinguished from seizures of PPE destined for domestic use, of which there are numerous reports, and which are bound to raise serious legal issues in the months to come.