APA Advisory - China Efforts to Reclassify Certain Consumer Fireworks to 1.3G

September 10, 2020

TO:                , 

SUBJECT:   APA Seeks DOT Intervention to Resolve Potential Shipping Crisis

In recent weeks, Chinese fireworks manufacturers have relayed to their U.S. customers the possibility of China adopting the UN default transport classification which conflicts with the U.S. Department of Transportation’s reliance on APA Standard 87-1 for the classification of fireworks.  Under the UN default classification, numerous products which are currently classified as 1.4 G consumer fireworks would instead be classified as 1.3G display fireworks. The largest category of consumer fireworks potentially impacted are cakes with inner diameter over 30mm / 1.2”.

Needless to say, the reclassification of certain 1.4G products to 1.3G would create a myriad of transportation and logistic issues, complicating an already precarious shipping climate.

APA International Director, Cindy Cheung, Inter-Oriental Fireworks, reports that despite Chinese customs permitting the classification of these fireworks as 1.4G for years, it has recently conveyed the following proposed changes:

1. Loading inspection will change from being at loading port (Yue yang) to Shanghai port. In the event discrepancy are identified at the Shanghai port, it will be very costly to correct the problem. 

2. Fireworks manufactured for export must adhere to the requirement of China’s GB Standard. This means only factories with the permitted license will be allowed to produce that caliber. For example, Grade C factories can only produce 30mm and under inner diameter cakes, and only Grade A factories can produce 50mm+ inner diameter cakes.

3. All cakes with 30mm / 1.2” and larger in diameter, will be allowed to be labeled as 1.4G ONLY IF THEY ARE PACKED IN APPROVED WIRE BASKETS and undergo UN6C tests to verify that 1.4G classification. Without the wire basket or testing verification, these products will be classed as 1.3G.

Under these changes, in order for U.S. fireworks companies to import these cakes as 1.4G, the items must be tested and packaged in approved wire baskets, which would add substantially to costs. Because a good portion of the 300g and 500g cakes sold in the US market consist of tubes larger than 30m, these new proposals by Chinese Customs could cause severe negative impacts for the U.S. consumer fireworks market.

According to Ms. Cheung, Hunan Customs fully expects factories and exporters to comment on these changes. Most Chinese factories have already provided feedback, noting that they already have confirmed orders and that production is underway to fulfill those order. Despite their requests to delay this decision until next April, Customs set a September 1 effective date for these changes. 

Making the situation even more complex is the additional requirement that UN0431 items must be manufactured and exported by factory and export companies with a “civil explosive” license. Presently there are no fireworks factories or fireworks exporters having such license.  

A summary of the new requirements can be viewed by clicking here.

APA Engages PHMSA for Assistance
Understanding the negative impact these new requirements would create, in early September APA’s Executive Director Julie Heckman requested a meeting with high ranking officials at the U.S. Department of Transportation, Office of Pipeline & Hazardous Materials Safety Administration to brief agency decision makers on the China’s reclassification of certain consumer fireworks. 

Yesterday, Ms. Heckman along with APA’s President Mike Collar and Transportation Committee Chairman Steve Pelkey met with PHMSA officials virtually.  A lengthy discussion was held regarding the challenges of importing such a large volume of consumer fireworks as 1.3G including the need for companies to obtain a Hazardous Materials Safety Permit, increase financial responsibility (insurance) of $5M and adhere to ATF licensing, recording keeping and storage magazine requirements. Additionally, it was noted that the lack of ocean carriers and port restrictions for 1.3G would create significant trade barriers.

We are pleased to report that PHMSA is fully committed to working with APA to resolve this classification matter. Additionally, officials have stated their desire to work with the APA on developing short-term interim measures to aid the industry if importers need to import consumer devices as 1.3G.

Action taken so far includes PHMSA’s International team engaging the U.S. Embassy, their United Nations and Maritime counterparts as well as China’s AQSIQ (counterpart to CPSC) to push for acceptance of APA’s Standard 87-1 because it is equivalent in safety to the UN Standards and that the U.S. classification of consumer devices as 1.4G under APA 87-1 is appropriate for all consumer fireworks in the United States. 

Moving Forward
This morning Mr. Pelkey and Ms. Heckman met with PHMSA officials to discuss the possible need for a Special Permit to allow consumer companies to re-label cartons as 1.4G if they are imported with 1.3G markings as currently required by China Customs. Additionally, we discussed the possibility of dual labels containing the markings for China along with the U.S. markings. We will continue this dialogue as PHMSA focuses on engaging the U.S. Embassy and China United Nations delegation.

There have been recent rumors that China Customs may issue a grace period until December 31 to allow devices up to 50mm to transit as 1.4G which would give U.S. importers an opportunity to get some products out of China before the reclassification  We urged PHMSA to encourage their Embassy and UN contacts to support a grace period.

We will continue to keep the APA membership apprised of any significant developments in China as well as update you on the ongoing association efforts to work with PHMSA and other appropriate agencies to resolve this matter and /or develop long-term solutions.  

Advisory #2020-42