Highlights of House Hearing on Bill to Require U.S. Agents for Some Foreign Mfrs

H.R. 4678, which was introduced on February 24, 2010, would require foreign manufacturers of certain products that are imported into the U.S. to establish registered U.S. agents who are authorized to accept service of process against such manufacturers.

Highlights of the witnesses’ written statements, Subcommittee member statements, as well as the Subcommittee’s questions and witness answers, include:

Judgments Would Have to be Enforced by Foreign Courts

While many of the Subcommittee members were in favor of H.R. 4678, some characterized the legislation as ineffective, because it does not go far enough and would require the cooperation of foreign courts in enforcing any judgments.

CPSC Attorney Says U.S. Registered Agents Could be Helpful in Some Cases

In his written statement, the Consumer Product Safety Commission Office of Compliance’s Jeremy Baskin, noted that in a few cases, the lack of a registered agent for service of process has hindered the CPSC’s ability to develop information that would help it provide relief to consumers.

Baskin noted that additional authority allowing the CPSC to require foreign manufacturers to designate a U.S. registered agent for service of process could be helpful in some cases -- particularly those involving administrative requests for documents or information.

Baskin suggested that the Subcommittee, as it moves forward with H.R. 4678, provide some additional direction with regard to the range and size of manufacturers that would be subject to the registration process.

Consumers Union Says H.R. 4678 Would Help with Recalls

In its written statement, the Consumers Union testified in favor of H.R. 4678, noting that it would positively impact an agency’s ability to recall consumer products manufactured by foreign entities when the manufacturer does not have a registered agent in the U.S.

According to the Consumers Union, if a foreign manufacturer knows that it cannot be held responsible in U.S. courts for the products it sells, this knowledge likely has a significant impact upon their manufacturing decisions. Deterring wrongful conduct is a significant attribute of the U.S. civil justice system and foreign manufacturers who sell products in the U.S. should not be outside of that system.

The Consumers Union’s statement expresses support for the inclusion of products under the authority of the three agencies mentioned in H.R. 4678 (CPSC, FDA, and EPA), and suggests that the National Highway Traffic Safety Administration (NHTSA) be included in the scope of H.R. 4678. The Consumers Union also suggests that there be a consistent definition of the minimum size of the manufacturer under the bill’s scope.

AAEI Says New Legislation Premature and Would Not Enhance Product Safety

In its written statement, the American Association of Exporters and Importers (AAEI) expressed reservations about H.R. 4678 and stated that the bill would not enhance product safety for numerous reasons, including: (i) federal law already requires the registration of foreign manufacturers in certain high risk industries, such as food, drugs, and medical devices, and H.R. 4678 is unnecessary; (ii) U.S. trading partners will enact similar measures and it would be difficult and expensive for U.S. small and medium exporters to maintain registered agents in all the foreign markets to which they export.

(See ITT’s Online Archives or 06/14/10 news 10061413, for BP summary announcing this hearing.

See ITT’s Online Archives or 03/25/10 news, 10032515, for BP summary on the introduction of H.R. 4678.)