 Good morning, everyone, and welcome to the North America Consumer Product Safety Summit. Thank you each for coming today. My name is Brittany Wolfolk, and I am the director of the Equal Employment Opportunity Office here at the CPSC. And I'm going to be serving as your emcee today. So as you know, we have a very full agenda today, but before we start, I would like to remind you of a few administrative announcements. So we'll start first with just if everybody could take a look to this direction, the way I'm pointing. That is the exit, just in case there's any emergency. Obviously safety first. So just be aware of that. The next announcement, restrooms. The restrooms are located outside of the entrance next to the elevator banks where you came in. But I want to make sure that everybody is familiar with the fact that due to federal security requirements, all visitors must pass through the security screening anytime you leave this floor. So just like when you came in this morning, if you leave the fourth floor, you will have to go back through the full security to re-enter this hearing room. So just be mindful of that. But since the restrooms are on this fourth floor, you won't need to be rescreened. It's only if you go down to the lobby or something outside of this fourth floor. Because of the security requirements, keep in mind that our breaks are short. So if you do need to leave, be mindful of that because we're striving to be on time throughout the agenda today. Third announcement. Today's summit will be broadcasted online. So feel free to text anyone who's not here and would like to watch the proceedings today. The address is www.cpsc.gov forward slash live, L-I-V-E. Also, in an effort to be tech savvy, if you post on social media today, be sure to include our hashtag. Yes, we have a hashtag. And our hashtag is North America Safety Summit. All one word. So that's North America Safety Summit. And our last administrative announcement is just I wanted to make sure that everybody was aware that our program today will include simultaneous interpretation in English and Spanish. So wireless headphones are available in the rear if anybody by the door, if anybody needed one and did not get one before they had a seat. Please remember that the interpreters can't hear you properly if you're not speaking into the mics or just be cognizant of that and also speak slowly enough that they can keep up with you and interpret correctly. So that might be a little issue for me. So make sure you speak loudly and slowly. And then finally, please avoid the abbreviations and acronyms that are not universally understood and also avoid idioms whose meanings might not be easily translated. So just a couple things to keep in mind to help out our interpreters. So with that, we're going to go ahead and get started with our opening remarks from our three principals and we will start this morning with Ms. Ann-Marie Burkle, Acting Chairman of the CPSC. Thank you very much, Brittany. And good morning, Federal Consumer Attorney Serda and Acting Assistant Deputy Minister Robert Uniro. Welcome again both of you to the CPSC. We are delighted to be hosting this joint summit with both of you. Distinguished visitors, Commissioner Adler, if you wouldn't mind standing up, my esteemed colleague. I believe he's the only commissioner here this morning. He does not really need an introduction but he is such a good friend of the agency and of safety. So I'm so glad you could join us. Distinguished visitors, presenters, esteemed colleagues and those joining us via online. We're delighted to have all of you here this morning. And it is truly my honor to welcome all of you to the fourth North American Consumer Product Safety Summit. These summits have been a key element in the fruitful cooperation among the CPSC, Health Canada, and Mexico's Federal Consumer Protection Agency, Profeco. These summits serve both to illuminate our work as well as to stimulate further progress among our three countries. Previous summits held in 2011, 2013, 2015 have been the foundation of trilateral work that has produced substantive, tangible outcomes benefiting the consumers of all of North America. Since consumer products flow easily across our shared borders, our consumers and other stakeholders benefit from this cooperation to the extent that hazardous products do not find their way into our markets. All three of our countries reap the benefits of our cooperation. I would like to mention just a few of the very practical outcomes from our partnership and we will hear more of these activities throughout the day. Since 2011, we have worked on nearly 800 joint recalls in North America and increasing number of them trilateral, reducing confusion for the consumer and increasing efficiency for governments as well as industry. After our second summit, the three agencies launched the Early Consultation Initiative with the goal of holding technical consultations on unaddressed consumer product hazards that were not yet part of a formal rule review or regulatory standards or any voluntary standards work. Our first exercise to seek consensus on a solution to address the hazards with AC and USB chargers is bearing fruit. You will hear about the results of this initiative later today. We also cooperate on joint outreach to consumers and to industry. Consumer campaigns in English, Spanish and French provide important information about product safety to 450 million people from the Nunavut territory in Northern Canada to the state of Chiapas in southern Mexico because many of the product hazards face the consumers throughout North America and they are common to all of us. In our outreach industry, the three agencies cooperate in joint training aimed at ensuring the industry understands both the common as well as the unique requirements of our three jurisdictions. Feedback on our joint training events have been very positive and we welcome your ideas for any training for future events. Yesterday we held trilateral government meetings. Our staffs were in this very room for several hours yesterday with the assignment of working out further practical assignments and mechanisms for future collaboration over the next years. As you will hear today, the three organizations are now building on solid accomplishments. When our staff reported to us later yesterday afternoon at the end of their meeting, I was so very impressed and encouraged with the progress they made. They took a day-long worth of meetings and they distilled it down to us in a presentation at the end of the day that was very insightful and very informative for all three principles. I will say that the three of us spent the afternoon on Capitol Hill. We had a tour of the Capitol and spent some time in the House floor and had a delightful afternoon seeing our legislature which, as we all know, directly affects what we do here at CPSC. So with that, I'd like to ask my colleague, Rogelio, if you would like to speak and say a few words this morning. Good morning, Denson. I'm going to speak in Spanish. I greet you again with a great recognition of Mrs. Anne-Marie Burkle, who is the president of the Security Commission of consumer products in the United States of America. A great job she is doing this commission recognized throughout the American continent. I also greet with a great recognition of Robert Janiro, Vice Minister of Health of our brother country, Canada. I would like to express, before I say a few words, my great recognition of the working groups that we saw operating the day yesterday. Richard gave us a brief, a rather agile synthesis of what they discussed, of what they talked about, of what they agreed on. And well, I applaud that in the framework of this fourth summit we had already had an important start of the day yesterday, with a reserve of what we will surely advance this work group with the participation of experts on the subject and of private sector employees that are joining us. This fourth summit on the security of consumer products in North America is vital to ensure serious advances, academic advances with scientific support so that our agencies, the three of us, can offer and guarantee greater security to consumers when they use products from our local markets. Here we have heard, since the day yesterday, complaints about harmful products, or tentatively harmful for health. We have heard study proposals. I believe that even, this is a deviation of mine, they will be able to assign responsibilities for the country. And this would seek to efficient the work that we are doing together and, of course, advance with greater efficiency in the very high responsibility that each of our agencies has in their territory. The commercialization of products is today, inextricably and for many reasons, global commercialization. To deny it would be a waste of purpose. Today we see products, goods produced in the East, commercialized by some company in Europe and delivered in its final destination to a Panamanian company. This is the world that is changing and that is wrongfully globalizing. And it is in that sense that I think, Robert, that we should also globalize the actions of the organizations that we are in charge of to guarantee health and the lives of consumers. If the world is globalizing in its tasks, I don't see why we shouldn't globalize the tasks of the health department and the Commission for the Safety of Products of the United States. This would be a job without a doubt regional, but I think, as I said yesterday, that these jobs should have coverage, even atmospheric, and even international cuts. This is the demand that the market imposes on us without a title and with all rigor. In the specific case of this fourth meeting, we feel very happy and very pleased that this meeting is carried out with the two main partners of Mexico. Equally, the United States of North America and Canada are the most important commercial partners in our country, especially with respect to the rest of the world. I must tell you that, just as the world is changing in terms of circulation and transit of goods and services, they are also changing, in my opinion, the attitudes, the visions and the paradigms of the agents involved in the consumption phenomenon. What do I mean? I have been observing that many suppliers of goods and services have taken awareness that if their goods and products are not guaranteed, of course, first and foremost, health and the lives of their consumers, they are out of the market. Beyond prices, beyond performance, beyond utilities, the new supplier has the modern vision of what it means, what it sells, and that its product can reach as far as the most remote corner of the earth. If that vision, and I have found it in many suppliers, is not part of the basic principle that beyond utilities, rentals and preeminence in the market, beyond that, it is first and foremost the health and physical security of its consumers. That change is fundamental. I must also say, I have found in the last decade a new consumer, a more demanding consumer, a consumer that reaches more data that renders the commercial and nutritional information of the product that it is going to consume. In other words, we have a more educated consumer in general terms. It is not the total universe of what we would like, but if we find people already concerned with the origins of the product, the nutritional capacity of the product, the security in the use of the product, the means of communication help a lot. In that sense, today in the morning I saw a report, where in the IBC they talked about the dangers that involved buying cell phone chargers without a certificate, M1 or something like that, that if it does not have it, it does not guarantee that it cannot produce an accident that can even generate a fire in the house. That is, everyone is in the task of facing this new range of the most diverse products in the market, creating awareness on both sides of the consumer phenomenon, in profitability and in consumption itself. Anyway, I do not want to go any further. I just want to tell you that together with these works, yes, I think there is a need to think in the stimulus, in the impulse of a new culture of consumption. And we consider that the work on the side that is being carried out today here in the framework of this summit will contribute great ideas and strategies for the consolidation of changes that Mexico is doing in an accelerated way in the world of the consumption of goods and services, basically starting in a very punctual way of health and security as a premise. Thank you very much for your contributions and I hope that your work deserves the applause of the consumer class of our three nations. Thank you very much. Thank you very much, Robert. Thank you. Good morning. Bienvenido and thank you all for being here. It is truly a pleasure and an honor to be here with you today. And I would just like to take a moment to thank Acting Chairman Berkel and her staff here at the US CPSC for hosting this summit and putting it on. So thank you. Although I did work in Health Canada's Consumer Product Safety Directorate quite some time ago, this is actually my first summit that I'm personally attending in my current capacity. And I'm very proud of the work that we as North American consumer product regulators have accomplished since that first summit in 2011. Over the years, our level of cooperation has gone from a strong desire to work together to the development of four joint project teams and an early consultation initiative under the North American Cooperative Engagement Framework. And I'm very pleased with the concrete outputs of these important initiatives. Take, for example, our laboratory cooperation joint project. Thanks to this group's work, our laboratories came together and collaborated on how we test for lead and phthalates and are now gearing up for the next project related to flame retardants. Further, the work that our outreach teams have conducted over the years has resulted in several joint outreach campaigns and events that have drawn stakeholder attention to important consumer product safety issues such as furniture tip overs. Under our customs cooperation joint project team, Canada and the United States conducted a targeted exercise to explore methods of information sharing between us and the U.S. and Mexico also held an import safety surveillance meeting for the same purposes. And then there's our early consultation initiative under which our three countries worked together to arrive at a trilateral consensus on an unaddressed consumer product hazard. For the first time, Health Canada, the U.S. Consumer Product Safety Commission and Mexico's Profeco are simultaneously reaching out to our respective standards organizations to request that they add four additional tests to the current applicable safety standards to address hazards associated with replacement AC and USB chargers. Over the past few years, we've also put in efforts towards developing a memorandum of understanding between our three organizations and that was signed this past February at Iqviso. And that MOU is based on our mutual recognition of the importance of strengthened cooperation and communication. This MOU supports our shared goal of achieving the highest levels of safety for consumers throughout North America. So as we retire the North American Cooperative Engagement Framework, the MOU provides the basis for future collaboration in areas of mutual interest to help prevent the trade of hazardous products within North America. And I believe that this degree of cooperation between our regulators remains unparalleled. We are living in an age where as global trade continues to increase and supply chains become more complex, consumers have an unprecedented access to consumer products, both regulated and unregulated. And while the internet provides access to virtual marketplaces such as eBay or Amazon, it provides access to large amounts of information, some helpful and some potentially harmful. Furthermore, the increased use of e-commerce is effectively erasing our borders. Add to this the increased speed at which products now go from conception to market, and it's an uphill battle for regulators to identify and manage consumer product safety hazards. In light of the age in which we find ourselves, all three of our jurisdictions have moved towards greater openness and transparency. And we continue to look at how we can better communicate with industry and the public to promote trust in our regulatory systems and support informed decision-making. Our new MOU speaks to this desire. As global trade continues to increase and supply chains become more complex, our three organizations through the MOU will continue to work together to access and share more data and information to help target our consumer product safety actions. Consumer product safety is a shared responsibility, and it is essential that we improve cooperation not only among regulators and customs authorities, but also with industry, consumer advocacy groups, and other stakeholders. To this end, I hope that you enjoy hearing how we as regulators work together, and I'm certainly looking forward to hearing from you on such topics as e-commerce and high-energy batteries amongst other items this afternoon. Once again, I would like to thank Acting Chairman Burkle and Federal Consumer Attorney Serda for their ongoing collaboration and willingness to share their country's knowledge and expertise with us, and I'm very confident that we are on the right track at this summit and that it will continue to propel us into the future. Thank you. Merci. Gracias. Thank you very much, Robert. Before we begin our program today, I think I would be remiss if I didn't take this opportunity to ask the staffs, and I'll ask the staff starting with Health Canada to stand up and be recognized for all of your efforts and for your work in the summit as well as in product safety as well. So stand up so we can recognize all of you. And then I would like to ask all of those from Perfeco here to stand up, let us recognize you and thank you for your service. And lastly, I'd like to ask our team from International here at the CPSC who is responsible for and did the Yeoman's job in putting today and yesterday and today together for the summit. If they would stand up and be recognized, I would appreciate that. You all know very well when these events happen, they seem so seamless and so easy, but behind the scenes and in the weeks and months preceding, they're not so easy and seamless. I also want to recognize this morning Iqviso. Belinda May is going to participate and I see Mark Schoem in the background. Iqviso provided us a forum to have our historic MOU signing in February and we greatly appreciate that and we greatly appreciate the work we do with Iqviso. So thank you for being here. And lastly, I want to recognize, I mentioned the presenters in my welcome, but I think it's important for me to say thank you, sincerely thank you. And I know I speak on behalf of my colleagues for making the trip here and for your willingness to share your information and your insights with us. It is, yesterday I talked about communication and engagement. It is the key to success and consumer product safety. So your willingness to come here today and to participate is greatly appreciated and only enhances our North American summit here. So I will stop my comments now and hope that you enjoy the day, that it's a substantive day and we look forward to catching up with you later to this afternoon. Thank you all very much. Enjoy your day. Our first panel today is North American Cooperation. The panel will be moderated by Carlos Ponce Beltran, Deputy Attorney for Telecommunications Perfeco. The three regulatory agencies will report on the activities and achievements of the trilateral joint project teams, including industry and consumer outreach, customs cooperation, laboratory cooperation, early consultations, and joint recalls. Our panelists this morning are Jeff Barrett, Director, Risk Management Bureau, Health Canada, Ramundo Rodriguez Diego, Deputy Attorney for Verification Perfeco. And Tilva Bernal, Program Manager for the Western Hemisphere CPSC. Thank you. Good morning everybody. Excuse me, I'm going to moderate in Spanish. Thank you very much. Welcome to panel number one of this important summit, which will address through our three panelists the topic of cooperation in North America, in the security issues of products. The three agencies present here, Health Canada, Perfeco, and CPSC, will report to you and those who listen to us through the streaming the activities and achievements of the teams that carry joint projects, including related issues with the industry and consumers, customs issues, laboratory cooperation, the issues of the recalls. And for this panel, each of them will have 15 minutes if they can give us space for future questions at the end of the panel. We would appreciate it very much for this meeting to be more interactive and give you that time to talk about the different topics that I have referred to. And to start, we are going to ask Jeff Barrett, who is the director of the risk management office of the security direction of the consumer products of Health Canada, to start with his presentation. Go ahead, Jeff. Thank you very much. Good morning, everyone. My name is Jeff Barrett and I am the director of the Consumer Product Safety Program's Bureau of Risk Management. So this morning I'm pleased to provide an overview of some of our trilateral work across our three joint project teams for consumer outreach, industry outreach, and customs cooperation. All of which follow our commitments that were made at the second North American Consumer Product Safety Summit, where we committed to promote consumer awareness on the use of safe consumer products as well as conduct training and outreach for activities for our industry partners. I think we can all agree that when the same message comes out to all North Americans and our stakeholders, it resonates further when we can provide clarity together and consistency in messaging and it fosters regulatory stability for when we enter we have regulators speaking from a single voice. Both the consumer and industry outreach joint project teams began this work in the spring of 2014 and since that time members from all three countries have participated in regular teleconferences to share our outreach activities and to develop joint strategies and initiatives. And staff from all three jurisdictions have taken advantage of major North American trade shows or conferences such as IQUISO that was identified earlier this morning. So to start with for the consumer outreach joint project team the goal of this group has been to coordinate joint outreach activities to consumers and to develop consistent messaging on product safety issues of common interest. We've worked together to align key messaging through educational campaigns joint press releases and social media which has enabled us to not only amplify the message but also extend our outreach to consumers. In 2014 we worked on social media campaigns to support sports safety and coordinated our outreach activities around keeping young children safe from health and safety hazards during baby safety month. And in that same year we worked on a trilateral press event in Ottawa to kick off toy safety week with a high level representation from all three countries. That same day we also announced our first trilateral recall on a juvenile product. Additional activities have also included activities to ensure that all North Americans have a safe holiday season during holiday safety month. And during poison prevention week in March 2015 we worked together to get the message out about laundry detergent pods and child safety requirements. And last year we coordinated outreach on backyard safety in May of 2017. Moving forward the consumer outreach joint project team is beginning to explore new ways where three countries can continue to cooperate on consumer outreach under the new trilateral memorandum which as mentioned was signed this past February at ECFASO. Through the industry outreach joint project team we have worked hard to reach to work with industry stakeholders that sell in all three markets. While we do work hard where possible to align regulations and rules where it makes sense to do so we do recognize that there are sometimes legislative differences and regulatory or rule differences and it's important for us to communicate where these exist and what that means for companies. A good example of this was when we gave our first trilateral presentation again at ECFASO in February 2014 in which we explored the recalls process in Canada, Mexico and the United States which highlighted our work to strengthen regulatory alignment efforts in North America. Since then we have participated in joint panels such as at the Las Vegas ABC Kids Fair in September 2014 and there was a U.S.-Canada presentation at the North American International Toy Fair and again at ECFASO a trilateral panel emphasizing where we collaborate and how that works. We have also organized bilateral Canada-U.S. webinars on toy safety a trilateral webinar on safety requirements and textiles and apparels with an emphasis on products for children and moving forward under the new trilateral memorandum of understanding the industry outreach joint project team will continue to work to coordinate outreach activities to inform industry on the requirements and issues of common interest within North America and I'll just take this opportunity to echo Acting Chairman Burkle's comment earlier this morning that if there are any areas or issues of interest whether that's from a consumer perspective or industry guidance that you think would help certainly we would appreciate hearing what those might be and seeing what possibilities there might be for us to provide those outreach activities for you. The final project team that I'll talk about this morning is our Customs Cooperation Joint Project Team which involves our not only product safety partners but also our borders and custom partners. The focus of our activities have obviously worked along bilateral relationships with Profeco and the US CPSC and ourselves and the US CPSC I will not be able to report too much on our work with Mexico bilateral border work right now and at first of its kind consumer product safety regulators and border officials from the US and Canada held a consumer product safety tabletop exercise. It's happened in July of 2015. Health Canada hosted the exercise and in addition to ourselves and CPSC also included the Canadian Border Service Agency and the US Border Protection Office. When the group met in Ottawa they focused on understanding each other's import processes, comparing targeting methodologies and identifying the best practices as well as inefficiencies in our processes and our communications. During the we also then highlighted what the various business needs that were unique to each country not only between the countries but also within. Which led to a set of recommendations in the spring of 2016 where Health Canada and US CPSC established a targeting exercise using different methodologies to intercept suspected hazardous consumer products. Now this targeting exercise explored the methods of information sharing between Health Canada and US CPSC with the goal of identifying the again the high risk consumer products associated with foreign vendors that were suspected of manufacturing or distributing consumer products. The methods for identifying the product types and the foreign vendors of common interests between the regulatory authorities and it established developing a process to share the results of risk investigation between all the parties and participants in identifying whether there were legislative or regulatory impediments to that process as well as exploring ways that Canada and the US could continue to work in greater collaboration to intercept suspected hazard consumer products and share more information. During this exercise US CPSC and Health Canada collaborated to identify the types of consumer products and companies of interest for the project. Given the similar regulatory and laboratory requirements in the US and Canada for toys for children under three years of age with small parts and with excess lead levels of approximately 90 to 100 milligrams per kilogram of total body weight were considered the best suited candidate product for this project. The selection of companies of interest was based on information that was related to non-compliant companies as noted in the US CPSC Volta list as well as Health Canada's own internal database. Going forward it was recommended that another project will be undertaken following the launch of our Canada Border Service Agency's new risk assessment program and maintenance later on this year. Among other things the system will allow the CBSA the Canada Border Service Agency to identify more effective targets as well as to allow for a combination of targets where HS codes or product identification codes, port codes and country of origin codes can be used together. As reported in the third North American consumer product safety summit the US CPSC and the US Customs Border Protection Agency worked with group with officials from Prefeco and their border agency SAT, their customs agency and staff from the four agencies convened for a week of meetings in the city and visited SAT's targeting facility. There the participants learned about each other's processes and discussed ways to facilitate collaboration and sharing information between the agencies in the same country and outside the country. The customs cooperation joint project team will work to continue to identify the best practices for targeting, sampling and analyzing products at ports of entry and to improve coordination that reaches any of the three borders. So that's a very brief overview, a very kind of a snapshot of the three bilateral trilateral working groups that all will continue to identify best practices for targeting and I think I'll leave it at that. Thank you. Thank you very much. Good morning to all. The work that I want to expose to you today are two things. The work we have done through the laboratory that have been two joint work, the first one had to do with technology and the technology and the second one had to do with technology XRF which is a manual equipment to detect heavy metals in PVC, heavy metals such as aluminum, zinc, brass, silice, tin and plastic. And these could be or the idea or what was agreed was to review both in PVC and plastic that are based on PVC. These works started in April of 2014 and prior to that the equipment was determined the materials that were going to be looked for, the methodology was chosen, a protocol was made so that we were all doing the same test with the same method, with the same methodology. For us it was very important the result since in our country, in Mexico, 90% of the verifications that our inspectors do are in the field. So the manual equipment allows the ease of doing it there whenever this material is homogeneous, it can be measured on a bicycle the part of the painting, if it contains lead. Without the need to take it to a laboratory for a process that would be the case of the tests that are not homogeneous. Why for us it is very important as I mentioned, 90% of the inspections that we do all over the country are done in the field allows us to give precision at that time and see if that product is safe or not safe for consumers. The challenge that we have and the same we found in the next study that I will present that is the one of the TALATOS is how to accommodate that technology to the regulation that we currently have in Mexico. Well, according to our law those who do the tests have to be certified. We can do it in Profeco or it can be a laboratory that is accredited by the Ministry of Economy. The way the great effort that we are making is to strengthen our laws so that we can not have legal gaps that allow if we are to find a problem that cannot be sanctioned because I mentioned the prosecutor in his intervention a part is the detection of the problem but also another part that is not less important is the sanction to that manufacturer or provider that arrives in a probable case to use some painting or to use some system method that is not suitable for the measures that we have standardized to 90 particles per million. In Mexico I think that in some cases the problem is not very far from what you face in the United States or in Canada. We have very old houses that still keep the original painting as well as the furniture that may have some of these heavy metals mainly lead. We have many toys that are the same ceramics we use a lot of clay paints containers for water storage or food storage. So that is the relevance for us to be able to have this technology and that we can take it to the union with the legislation and we can have something that truly belongs to our consumers in Mexico. The next exercise of the tiles was also something new for Mexico and very important. These works started in 2016 and the idea of determining with these techniques the tiles is to see those additives that are used to soften the plastics and give them flexibility and that are associated with risks directly to health as it is the case or it can be the case of cancer. We worked these tests between laboratories both with CPSI and Health Canada we received a capacity in 2017 in Ottawa in the facilities of Health Canada and the result is that we are working on a normativity in Mexico which we did not have but which we will have soon to regulate the presence of the tiles in the consumer articles such as the toys and school articles which is a very important and delicate topic for us the vulnerable population the children the same thing for children for children and the challenge as I mentioned both in the XRF exercise is to in a regulatory framework to for me it has been very easy to see the experience the great work that has been done both in Canada and in the United States in this sense and to be able to grab those best practices that already exist and to be able to take them to Mexico to be able to place them in a normativity and to be able to protect even better the last topic that I want to expose is related to the recalls this is a topic that has worked quite well however it also presents some challenges of the 24 alerts that we have had since 2013 9 of these have been two sets two have been bilateral and simultaneous and 13 have been sets and simultaneous here what I would highlight was the experience that has given us this type of alerts and we mentioned it yesterday in the discussions we had there are some occasions in which the alert is broadcast exclusively in the United States whether because the product is not sold in Mexico so sometimes or we believe that we need a better communication to be able to determine if the product is only sold in Canada or the United States or it is also entering the Mexican market because as it works right now is when we see the alerts in the portals both in the United States and in Canada we send a requirement to the established industry in Mexico most of the times they have answered that this product is not sold in Mexico but I believe that we have a very important opportunity of communication for this same phenomenon that they are currently trading and mainly based on electronic trading yesterday I mentioned that there is a product that can be bought online I am going to give an example of textiles and it enters Mexico for the customs that we are also doing a very important job in strengthening communication we have a personal profit in customs making random jobs but that textile product that can be bought online enters Mexico without the compliance of the rules for clothes that we demand for clothes then it is a great window of opportunity that we have in the three countries to be able to strengthen both communication as well as the exchange of information that was something that our colleagues both in the United States and Canada offered us to be able to share the databases the information that we have and thus be more efficient and effective in the protection that we all have towards our respective consumers that would be all that I have to report today Thank you very much in Raimundo Rodríguez for your broad report on the Coordination Act with the brothers from Canada and the United States and then it is the turn to do its presentation to the management of programs of the Western Administration of the Security Commission of Consumer Products the CPSC of the United States of America our dear friend Tilde Bernal this is the moment to thank the name of the profeco the coordination, the support that has given us and our friends of Canada in this important event and that in representation of Anne Marie Burkle she has done a great job of lashing us so that this event is a very productive and very successful event Tilde Bernal you have the word Thank you very much Good morning everyone fellow panelists and good morning to our principals thank you for your great support for this work that we do here in the international programs and with the support of course of the technical experts and the different offices in each of the agencies I want to tell you that I'm very excited about this early consultation initiative and having the opportunity to have the stakeholders here what the regulators have been working on sometimes we do this in the background and there's a lot of effort to accomplish our missions for the safety of consumers and also to address the request from stakeholders so it's just one example you've heard my esteemed colleagues talk about the other projects so we want to have that conversation with you today and we're very glad that you're here to give us your ideas on future opportunities for collaboration as well so we've heard requests from industry before on what could be done about alignment we know that it creates costs for manufacturers it may create confusion for consumers when there's no alignment on one product safety requirement so we've heard those concerns and requests and we've looked for ways to address that so we had a pilot a few years ago with colleagues from Canada from the European Union and others and we learn a lot from that pilot one of the things we learn is that alignment on already established requirements and regulations is very challenging it is also difficult to align when there is active work on either a voluntary standard or the process of starting a regulation so we put our minds together and we wanted to be proactive so we created this team of technical experts from the three agencies to come up with ideas of products that had some unaddressed hazards so that was basically the first prerequisite to put forward a suggestion so it would be a product that none of the three agencies was working on actively and after some deliberation we decided to start working on AC chargers and USB chargers so we had our experts working together on different things first we looked at the voluntary standards that were available in the three jurisdictions so for example here in the United States we have one, Canada uses another one and Mexico had another one so we looked at the different tests available that were in those voluntary standards then we gather samples, the labs started testing those samples and it was really great to see so much consensus on what the testings were going to be we created a joint document on what each lab was going to do then we came out with a report we came out with a consensus report of those tests and this has never been done before so it's truly historical and really just a great example of the level of collaboration that we've been able to accomplish so I'm happy to report that we're very close to finalizing that project with the AC chargers and USB chargers we will be sending a letter with suggestions to our respective standard development organizations to include tests that we consider would be important to have to increase the safety of those products and address the hazards that we looked at during the testing phase we will continue the efforts within this early consultation initiative it will be early consultation initiative 2.0 and we will look for new products to continue to align and obviously answer the request that we've been hearing from industry on try to align even more so again just want to thank you for being here we hope that this afternoon and will the rest of the day will be very interesting and will create this conversation that we want to have between the stakeholders and the regulators here so thank you thank you very much for this excellent panel my name is Sarah Wilson I'm a lawyer with Covington and Burling here in Washington D.C. I would like to thank you thank you very much for this excellent panel my name is Sarah Wilson I'm a lawyer with Covington and Burling here in Washington D.C. I was very interested in hearing about the testing cooperation efforts and was wondering if you could share with us whether the letter that you just described that will be sent to testing standard setting bodies on AC and UCB Chargers whether that will be made public and if so approximately what frame do you expect if you know and if you could give us some insight if allowable into the four different tests that you plan to recommend well in terms of making it public yes it is our normal procedure to post the letters that we send please for the CPSC so as soon as we send that we will be posting it on our website in terms of timeframe that's a more difficult question to answer because we have to work with the other organizations and we have different processes for clearing documents but what I can tell you is that we are very close to coming to a finalization of that letter so it should be relatively soon in terms of the specific tests that are included I am not the technical person so definitely I don't want to say the wrong thing but I will be happy to follow up with you on that but thank you for your question we will have time for two more questions please your name, your agency please good morning first I would like to say thank you to the three principals for arranging for this opportunity for all of us thank you very well for very insightful comments my name is Belinda May and I am here today because I have two day jobs my first day job is I am a partner at Denton's US LLP thank you I represent industry in the first day job and in my other day job I am here on behalf of Iqviso as well with my colleague Mark Shom who acting chairman Berkel already introduced he is our executive director he is waving yes he is waving and so I am going to say a question on behalf of my first day job and then I am going to say one on behalf of my second so as respects the first you of the forthcoming consensus letter and would ask that that be as available as possible to industry because I believe that it will inform industry's ability to approach you in the future for compliance matters which we are not here really to talk about so much today although nudge-nudge to Carol K who is also smiling in the back so that would be very helpful for us on the industry side I would also like to comment that with respect to compliance that is an area the more that can be done for industry to understand that if a report is filed in one jurisdiction if there were any way to have cross-border reports that would be phenomenal okay now we are shifting to the other day job so at the last episode a panel on Friday morning that was a large audience of hundreds to ask whether there would be interest between not only in North America three agency collaboration on standard but rather the world and 90% of the audience said that they would welcome a process standard for innovative products and we would I'm just saying as president of the episode that we very much welcome the participation of health Canada and the CPSC as we work to create a task force an independent task force to explore this possibility to further reduce historic notions of borders thank you who is going to make a comment Jeff Tillman I can just echo whether it's at ICFASO whether it's at other conferences we attend reporting requirements and where they align, where there are some differences being clear on whether that actually triggers a report in Canada and not in the U.S. or both at the same time that's a common theme and I've certainly been talking with my colleagues with Tolga Yelkin director general for the consumer product safety director and that is certainly something that health Canada sees there could be value not just in messaging out but starting to consider whether there might be a helpful product this isn't an elaborate thick tomb of direction but almost a placemat document something that's really practical hands on and so that's certainly a priority for us over this next year to start to look towards other tools like that and in addition once we get that to then be able to not just at ICFASO but we welcome the opportunity at other conferences or trade shows or what have you to help continue that ongoing education that needs to happen. Belinda thank you very much completely agree that you know it is very important to have a good understanding of where do companies go when they need to report and how we can continue to spread the message on the importance of joint recalls and the benefits for all stakeholders we could start with just pointing that you have some emails there that will take you to the right places in each of the agencies and we will continue like Jeff said that conversation on how we streamline the process on for everyone to be able to talk to the agencies and know what the process is going to look like so thank you for that question and comment. If you don't have any more questions we appreciate the participation of Jeff, Tilburn and Wright thank you very much for participating in this panel thank you everybody Thank you Brittany Good morning, as Brittany said, my name is Jim Jahulski I'm the Director of Imports of Valence here at CPSC, I want to welcome everybody here today for our panel on e-commerce I'm going to keep my opening remarks very brief so we can turn it over to our panel to hear from them so e-commerce really doesn't need an introduction for most of us it's become part of our daily life we can order virtually any product online today and have it sitting at our door tomorrow so it really has changed the way a lot of us shop receive products it's really been a monumental change to the way the world works over the last several years just to put e-commerce into perspective a little bit I pulled some data off offline total e-commerce sales in the U.S. for 2017 were estimated at $453.5 billion which was an increase of 16% over 2016 U.S. e-commerce sales are expected to grow to $530 billion by 2020 and worldwide e-commerce sales are expected to be $4 trillion by 2020 so those numbers are a little staggering when you consider you know how much how much commerce was flowing through e-commerce just several years ago so to talk about this subject today we have three very qualified individuals and I want to thank each of them for participating today Doug has come from Seattle Stuart has been around the country was at a conference in California earlier this week and has flown here today specifically for this so I want to thank them and Carlos thank you as well so I'd like to just do a brief bio review the bios of the three and then I'm going to turn it over to Doug and we're going to go in order our plan much like the first panel it's per presenter which hopefully will leave us some time at the end for questions and answers so Doug is Doug Highlands from Zoolily upon graduating from college Doug moved to the west coast seeking fame and fortune instead he ended up working in regulatory compliance he started his career working in trade finance and customs brokerage and then product development for a specialty retailer his current role Doug oversees product compliance for Zoolily LLC an online flash sales e-commerce retailer joining when the company was a startup Stuart Schmidt from UPS as a manager of trade services for UPS supply chain solutions Stuart is a member of the corporate compliance team that ensures UPS compliance procedures aligned with customs and border protection and partner government agency regulations his compliance area of responsibility is primarily the eastern eastern united states in addition to providing consulting services to UPS customers he serves as an internal subject matter expert for trade agreements foreign trade zones anti-dumping countervailing duty and broker importer assessment performance audit programs Stuart has been a licensed customs broker since 1996 a member of the trade support network since 2002 and became a trade ambassador in 2004 he was an early champion of CBP's latest commercial trade processing system the automated commercial environment he is currently a member of the trade support network and co-chair of the international trade data system committee and Stuart and I work together on the international trade data systems work that's done and he is a trade representative to that group as well so Carlos Ponce from Profeco Carlos has been a busy man you notice that he moderated our first panel this morning so and we appreciate him being a part of this as well Carlos holds a law a degree in law and a master's degree in criminal sciences and criminology he is currently the deputy attorney for telecommunications at Profeco Carlos has engaged in various public administration activities at the local, state and federal levels he is the co-author of the 2012 book computer technology law in Mexico and the 2016 supreme court publication entitled the constitution in society and digital economies select topics in Mexican digital law Carlos also has also served as the deputy ombudsman for Profeco since 2015 and the head of the transparency unit at Profeco since December 2015 so we have three very qualified panelists today to talk about e-commerce and without further ado I'd like to turn it over to Doug to talk about the work that Zulily does great, thank you welcome again everybody I'm going to give a brief overview of Zulily, what our company is founded on talk a little bit about how we approach product safety and some of the things that we're hoping to align with our regulators so I'll go ahead and get started for those of you that are unfamiliar with Zulily, hopefully most of you are but just in case you're not we like to call ourselves a fresh, fast and fun retailer we're always looking for something new and different to offer up on our customers on a daily basis and we sell a wide variety of products from women's apparel to kids' apparel to shoes, to toys, to home decor health and beauty products gifts, I mean, you name it it's probably available for sale on our site at any given time we do this by working with a large number of vendors we work with large well-known manufacturers to mom and pop people working out of their garage to everywhere and everything in between we also have a very large merchant organization that's very driven to find the newest and freshest product and always trying to find the latest trend we also have a pretty different business model from traditional online retailers or a traditional brick and mortar store so I love this slide because it just talks about how this company is just very different it's really hard to kind of wrap your head around the fact that the company is only eight years old we're almost at like 1.5 billion dollars in sales and we have a very different really kind of turn on its head business model so what we do is we basically put up what our founder like to say we put up a new site every single day it's like publishing a newspaper every single day is how we refer to it for those millennials in the room a newspaper is how your grandparents get their news just put it into perspective basically what we are is we're a flash sale site so we'll curate these what we call events we'll either have it as a theme like children sleep over with your best friends or going to camp or something that's branded if we're working with one of our large brands anyways we'll put that into what we call a three day event we'll run those products for three days during which point we'll be collecting all of our customer orders when those events are done after three days that event is over we cut a purchase order to our vendor who then ships the products to one of our four FCs including an FC that we just recently opened in China so we are very light on inventory thanks to this model again once those items are received at one of our fulfillment centers we kind of take everything that our customers ordered put it in one package to the best of our abilities to ship it out to our customers so again we're really focused on kind of keeping our startup mentality going and leveraging a lot of our home grown services to really help drive our business and really help my department drive some of our compliance efforts so the way that we manage product safety just thinking about like go forward there it goes, alright so just knowing the large number of vendors that we work with and the large merchant organization that we work with we really have to take a risk-based approach which is I think a pretty common that most people and most regulators will do so we really want to focus our efforts on where the highest risk to the business is so again where we focus our efforts are kind of on our direct import vendors so anything that's crossing a border we will concentrate our efforts on that we also for the e-commerce small package shipments and we do a large number of shipments kind of on a daily basis we'll be shipping things like I mentioned China we'll be shipping from our FC in China directly to our customers in the US or to our customers in Australia we're starting to ship directly from that fulfillment center to other destinations as well we also ship directly from our fulfillment centers in the US kind of across the world to a lot of the countries that are listed up here we take the same kind of risk-based approach to those small package vendors that we do with all of our larger direct import vendors and then we also focus a lot of our efforts of course on product category right so where there's more regulations like children's sleepwear is where my department will spend most of our time working with our vendors and our merchants on compliance then a different type of product that maybe isn't as heavily regulated so we kind of take that approach and then we also apply that similar outlook if you will by jurisdiction so we kind of break it up by our largest markets the United States is our biggest market followed by Canada Australia, EU and Mexico so we take a look at our products we take a look at our vendors and we'll take a look at the rules and those different jurisdictions and make sure that the products are compliant before we'll sell them in those jurisdictions we have some technology built into our systems to leverage our ability to turn those vendors on or off or turn those products off depending on the jurisdiction and then how can regulators help it was actually really interesting to hear previous statements about this I'm probably going to be repeating a lot of things that have already been said this morning but the first thing thinking about all of the small parcels that are sending not only by our company but by any basically online retailer and a lot of I think brick and mortar are starting to get into this as well but we would really love some clarity on the small parcel rules there's clearly a lot of focus on this area amongst a lot of the different regulators and a lot of the different jurisdictions but I feel like there's a great need for some clarity on how product safety rules will be applied to the small partial shipments how customs regulations how are they going to enforce intellectual property there's a whole lot of again I think there's a whole lot of clarity that could be could be very helpful to companies such as mine I threw up the incident reporting this has been mentioned a couple of times this morning a little more clarity among the different jurisdictions about what triggers an incident report and what doesn't and kind of following that streamlining some of the recall processes amongst the jurisdictions we've had a lot of I think we've done a really good job with the CPSC and Health Canada to kind of streamline that if we could continue those efforts amongst other jurisdictions that would be really helpful because there's a lot of these products like you just don't know like they mentioned this morning on one of the panels I think they mentioned in Mexico they didn't know if a bicycle would actually one of the products hadn't been sold there I'm pretty sure that it was sold there maybe not by probably not by our company but there is a retailer that probably shipped that to a customer in Mexico and a good thing if you will one of the really good things about this e-commerce space is the companies have the data we know everything that we've sold to everybody and where it's shipped all of this information is available so it's all available and we can share that information it's just how do we streamline that process so that we don't have to continually submit the same information in different formats to different regulators so some clarity on that would be very helpful the other one I have on here is Parity which has also been talked about this morning I was really happy to hear them talking about taking a look at testing for lead and phthalates you can look at some test reports and if that product is being sold across different jurisdictions I mean I've seen 20 page test reports for toys with all kinds of different phthalate and lead testing methods called out on the test report really looking forward to seeing how that can be streamlined and having some parity among the different types of testing protocols same with documentation there's a lot of I think opportunities for the agencies to streamline and have some parity on documentation requirements across the different jurisdictions and kind of just generally with labeling and marketing there's a lot of paperwork that's generated in this area and everybody understands the intent to do the right thing in this area but again it's the more that we can streamline some of that documentation and testing requirements the better off it'll be and I think longer term it'll really help enforcement in this area I just wanted to close out by saying for me, for me in particular I think it's a very exciting yet very anxiety in producing time because there's new markets and new products that are coming onto these new market places on a daily basis and it's really hard to keep up with the speed that things are moving at these days so it's best for all of us to cooperate together to figure out what we can do to kind of wrap our arms around this because the world is moving very very very fast and we need to be able to keep up with it thank you thanks doc yeah I mean I agree with that sentiment 100% about how fast things change I know one of the challenges that CPSC faces and I think the US federal government and probably other governments as well is that these packages are moving so fast and there are so many of them how do you get the right data to be able to do risk assessments so that you're not stopping shipments unnecessarily I mean I think that's a challenge that we all face and I think working together with the trade to be able to address that issue is going to be very important moving forward so thank you very much doc I'd next like to turn it over to Stuart Schmidt from UPS thank you working now thank you very much I appreciate very much the opportunity to be here and share some of our ideas and our challenges and how we can work with the regulations you had mentioned that the the challenges you order today and it delivers to your door tomorrow right the piece that you left out there was that it may be coming from Zulily in China and it still gets there tomorrow so and that's where UPS steps and tries to as a carrier those uniform rules and uniform documentations that Doug talked about will be beneficial and we'll walk through that here so a little bit about UPS most of you I'm sure have heard of us we are the world's largest package delivery company we deliver about 19 million packages per day on a normal day now that will double at Christmas time so it is a it's a huge undertaking and again streamlining that those processes and the regulations and uniformity you know through the region is would only benefit that that represents about 3% of the world's gross domestic product on a daily basis right so it's a huge endeavor and 6% of the U.S. commerce goes through our system every day we do serve more than 200 countries around the world and so it really is a challenge to and a benefit to us to speak to groups like this and to help us understand and work together to streamline and facilitate the processes so let's talk a little bit about e-commerce and the macro overview Jim talked mentioned a little bit this morning about the growth one thing that I will say about e-commerce is that I understand that this is a North American conference but e-commerce is worldwide so we talked about the growth just within the United States of e-commerce but this slide represents the growth that is going on around the world and the reality is that e-commerce as we have already mentioned it can come from anywhere even though it's going to the North American region it can come from anywhere and will come from anywhere in the world so one of the other questions that I do get asked a lot is what is e-commerce really so how do you define e-commerce and when I really boil it down to the fact that to me it's catalog sales so we think back to the Sears, Roebuck you know, catalog days and I never ordered from them, I'm not that old but but I do understand that at one point in time you can actually buy a house through the Sears catalog and have it delivered to your lot and you would build it right now I don't know that Zoo literally has a house on their catalog site and I don't think Amazon does yet but virtually everything else is out there that you can order and have delivered to your home so you know a lot of people think it's very low value it's clothing or textiles or toys which is a vast majority of it but it can be very high value product as well so internet use is growing across the world there are certain areas that are just now that have less than 50% access we don't really think about it in that fashion but it's just starting to pick up in some particular areas and particularly in China Alibaba announced today that their sales in China grew from 62% quarter over quarter so it's just huge right it's just huge trade facilitation and e-commerce plays a critical role in the growth and the health of everyone's economy and trade facilitation plays into that getting that product from the fulfillment center to the consumer in a timely fashion in a compliant fashion is a key to keeping that growth moving forward so let's talk a little bit about what the market demands so as the average consumer when you're sitting at your computer getting ready to hit that buy button what do you expect right so our surveys tell us that you want something that's easy and seamless you want to hit that button you want it to show up at your door the next day don't really care how it gets served for the most part if you want to be able to track and trace it you want to be able to do that you want to know where it is in the process when is it going to arrive at my door and you also want it to be affordable right so all those things have to come together for us as consumers in order to make the e-commerce engine work what do the sellers need the sellers need a localized checkout so they want to know if they're ordering a product in Mexico how much is that going to cost me duties taxes fees to get to my door if I'm in Canada the same the same scenario if I'm in the United States I want to know what is my end cost going to be before I hit that buy button so and that is also true for the international fulfillment Doug talked about these fulfillment centers and really another new term but really a deviation on what we used to call distribution centers so now these are fulfillment centers right so we have people from around the world sending goods into the United States or Canada or Mexico into these fulfillment centers and then from there there's a website that gets that people can access you may go to Zulily directly you may go to Amazon you may go to eBay but those goods ship out of these fulfillment centers into the various countries around the world so in many cases the retailers you know have never seen the products they don't know you know what they look like and they just know that they're selling them you know how to describe them but they've never touched them or felt them so that that becomes a big challenge from a regulation standpoint and then finally you want border clearance delivery and then you also want to be able to have returns and refunds in a quick fashion if you order something that comes the door you don't like it you want to be able to send it back and get credit for that particular product or exchange it for something else that you may like better pretty much describe it for you okay so trade facilitation plays a real key into that role most of that work has to be done on a pre-arrival process so in order for us to pick up something in China and deliver it to you the next day we have to know what that product is what it contains we have to get all the paperwork that's going to go to for that country whether it's Mexico, Canada, United States each one is just a little bit different in their regulations and what they require at the time of entry so that is a you know that's a huge barrier to a huge challenge to keep it up front and get all that information prior to that cargo even moving but we are so that makes us an avid supporter of the single window and a single window for those that are not familiar with that term is that having all regulatory agencies in one place looking at the same data set and making it what we would call an admissibility decision am I going to allow that to go to the customer or am I going to hold that so we want to make sure that you have all the information it's your fingertips directly to make that decision and we want you to be able to make that decision in a split second and it's either yay or nay move on you know so in terms of transportation what we would call an exceptions holds are exceptions, holds are expensive so we will work to everything that we can do in order to keep that cargo moving I like to say that we don't really care what it is that you want we just want to be able to we want you to tell us what it is that you need and we want to have an electronic way of delivering it to you so that you can make that decision we think that trusted trader programs are key to this c of e-commerce that we're going to talk about here in a minute trusted trader means that you have worked with Zulily you understand that Doug has a compliance process in place they have explained it to you have reviewed that they show you what how they do and how they make sure that they meet product standards you know around the world so that you feel very comfortable in making that admissibility decision when you see something from Zulily whereas you might you know look at something you know from you know Tom's fix-it-shop a little bit differently than you would because you would know nothing about them so trusted traders worldwide they're authorized economic operators those types of programs we think are critical for to help you do your job better we would also support post clearance audits so that you know for those items that that do find a you know that make it into the commerce that you would like to have back you know we would be able to assist you and help you in that particular fashion so you know really it's all based around risk management it's not a risk avoidance concept so we understand that and and would like to think that risk management is a better way a better way of looking at the e-commerce piece rather than risk avoidance so that and we've broken the risk into four different categories as you can see you know there's correspondence and documents those types of things there's very little risk and certainly from your aspect there's none from from consignments that are a low value we talked about low value consignments there's a duty tax threshold that you know that you may or may not be interested in you know you're not interested in that particular piece and then there's consignments with the formal declaration but all these are based on values right whether it requires a formal entry an informal entry or no entry you want to make sure that product meets your standards and that's not necessarily based on value so all these things go into the regulatory process and how we can work together to make sure that we're you know providing a swift clearance and helping you meet your goals and at the same point in time that consumer who wants just hit the easy button to come you know and hit their door so you know so what is the problem then so we've talked about this surge in import volume we've talked about the surge of new competition for domestic retailers one of the terms that we have that we would use is called MSMEs and I'm sure that none of you have heard what that acronym means but it's micro small and medium-sized businesses right so we have the Zoololies of the world who have this you know compliance department in place they know what all the rules are they research them and then we have the folks that are sewing together fabric in a sub-Saharan African nation who have no idea what our consumer product safety rules are and they just know that they can put up a website and sell that particular textile into the US right so it runs a broad spectrum so that's a huge risk from a regulatory standpoint they have a very low understanding of the rules and they're very inexperienced not only with the transportation piece but with the documentation or what they really need to do then there's also the bad actors so there's the people who want to avoid taxes and duties and have illegitimate trade and other security threats so we need to participate and work together so we can help identify those because that doesn't benefit anybody anywhere so our recommendations is that we would have a coordinated simplified approach that would be a serious question from the last panel about having a uniform set of rules, set of documents the closer we can get to those standards not only for product but also for documentation and transportation the better off we think that we are so establishing common simplified entry thresholds would be extremely beneficial for all of these elements what is it that you need to make sure that that product that you can say yes this can come into the country no this cannot come into into our jurisdiction however we can make that decision what do you need in order to make that decision and move forward and then we also want to work together to establish that returns procedure so I often ask people I don't import and so my question is do you export and they say yes and I said then you're an importer by default no matter what country you're in you're going to get something back so you are an importer governments need to so we would like to work to help you address your needs to assess risks of illegal and illicit shipments and such as ourselves and cargo airlines we've invested billions in ways of helping you do your job and we would encourage you to take advantage of that whether that's advanced data security and compliance programs but there are still some loopholes I don't expect that we will ever close them all but we can continue process improvement moving forward you know e-commerce occurs everywhere so Doug talked again about being innovative with products so some people consider drop shipments an innovation but who hasn't now sat there and hit the buy button but I don't want it to come to me I want it to go for my mom for mother's day this weekend so you may not know who that end party is as receiving that particular product or who purchased it just because of the visibility rules postal services is wonderful as they are they are many of them are exempt from these advanced data rules so it makes it another challenge for regulators to come in and make sure that they're making the proper admissibility decisions and then again just identifying all the players that are involved who are those bad actors we're abiding by the same rules and trade we would be delighted to work together with you in order to move that forward thank you thank you Stuart you used a couple terms that really resonate with me and I think with us here at CPSC and those are risk management and trade facilitation I think listening to Doug and listening to Stuart is a delicate dance here where you have a seller a retailer you have a carrier who needs to get the product and everything needs to work in concert for it to go smoothly I'd like to now turn to our third panelist and I guess the third aspect of e-commerce is really the government oversight of this and the safety aspect of it Carlos I'd like to turn the mic over to you I'm going to speak Spanish with the mic thank you Jim greetings to Doug and Stuart in my presentation I divide it into two parts the first one I put in context some important data of Mexico and the second one some cooperation plans that we have in e-commerce focused on risk risks that we can have in the reception of products through small or big packages for us it's very important to explain Doug and Stuart about the recommendations for the government because as I mentioned yesterday Mexico is at this moment processing a voluntary standard for e-commerce from a series of events that have been focused on the authority of different aspects of e-commerce on the one hand fraud on the other hand the bad practices of e-commerce and of course we haven't seen the rise of packages with dangerous products the first point I want to mention is that since two or three years ago there has been an attractive country for e-commerce we didn't have any internet buyers and everything happened after the creation of a modern system of telecommunications through a legal reform very broad of the current government that from one day to another connected to millions of Mexicans we are 120 millions of inhabitants in my country of which in the last three years we achieved a record that of those 120 million 97.2 data of a month connected to the internet that means that they are exploring the new mexican internet new activities in the past the internet was dedicated to the entertainment today 3 out of 4 users of internet in Mexico have made a purchase online they are becoming a new alternative for the industry in general retail or wholesale or of any type and here you have the recent amount with 17 billions of dollars of activity in a year is the only economic sector in Mexico that grows double digit 20-30% each year and it is important to say that this eruption of e-commerce in Mexico represents today a very interesting question 86% of those who make a purchase online in Mexico we feel satisfied and we feel satisfied of the purchase made in such a degree to make another in the next 3 months we have to say that Profeco receives only 1500 complaints a year I repeat, in a country where 3 out of 4 internet users make a purchase we only received 1500 complaints last year what they tell us that soon there is a good in e-commerce not only in the matter of fraud in the matter of fraud that is to say the bad use of e-commerce in another agency that is dedicated to the topic registered last year in a quarter of a year 2.4 million complaints by fraud by the bad use of e-commerce but I focus on what we have here 1500 complaints the report that we have 2017 is that 8% had to do with the arrival of dangerous products that is, bad manufacturers or their updates of some of their components generate a risk for people what is our complicated scenario that 67% of those who make a purchase that we already mentioned we do it in stores in marketplaces outside of Mexico that is, 52% we buy here in the United States 29% in China and 6% in Japan the rest in other parts of Europe and America and obviously this generates a problem of jurisdiction that is, as we do not have a digital market national content our challenge is complicated at the moment to make the compliance necessary with the virtual stores I do not know if Zulily has offices in Mexico but most of the stores in which we work except exceptions do not have an office of complaints within Mexico and what we are living if it is true that in this table and we said yesterday the B2B exists starts to occur the social commerce where apparent consumers become suppliers at the same time in Mexico by definition a common person who sells his shoes on the internet is not subject to the law of protection to the consumer because that person is not a supplier so they are disguising as consumers that occasionally do an event to get impunity of the rules of protection to the consumer in Mexico in this moment in which we are building is standard that in some way are the most dangerous products are sending through UPS DHL etc because they are not regulated or controlled worries us, we put it on the table because it is a theme beyond the e-commerce the C2C can generate a problem and destroy electronic commerce and obviously the growth data are important for us if we connect the topic of e-commerce in Mexico and I repeat I am putting this information in the spirit of international cooperation so that our standard does not come out of the aspirations that North America has for fomentary electronic commerce but at the same time to regulate those issues that come out of our hands in Mexico for example the packaging industry companies like UPS grow every day they generate more than 180 million of monthly shipping of which 12 million are packages the packaging industry in Mexico of the messageries the dark companies grow 30% every year it is another industry that in Mexico has had an important boom with the value that you are seeing here in pesos almost 11 million dollars of that volume of packages that national or international companies move in the country 20% of them are e-commerce that is our challenge, our focus should be in Mexico to watch that 20% of packages that arrive regardless of others of the normal stores do not come out of the law in Mexico there are regulations for the packaging companies that they cannot send flammable products waste weapons but we do not have compliance to be able to watch the great volume here, sorry to make the rankings Stuart but in Mexico that is, the Mexican government is the leader in the distribution of packages that is, it moves 28% almost 30% what are we doing with them we have to start these new practices of surveillance of packages for some reason mail from Mexico is having an important role in the distribution of e-commerce packages in our country because the law allows it to be easier cheaper, faster the income of products in Mexico for example additionally, the Mexicans we bought on Amazon by normal entry through mail and that facilitated the e-commerce companies the customs, surveillance and import the rankings here the data are public and obviously before the information of UPS, of HL we see that these companies are going to grow before the growth of e-commerce and of course we must be very close to the companies to generate compliance for consumers said before I would like to comment what is our judgment our big challenges the first is when we talk about third-party or marketplaces we are already having a lot of problems in the control of packages here I am going to give an example the e-commerce company in Mexico called Mercado Libre is bigger in our country even than Amazon this company only moves 1.6 million packages a month and you will understand the challenge that generates us to identify where the same and how they come this marketplace this system not only operates direct sales of V2B, but of SITUSI and obviously the proposals that we are doing for our next regulation it has to do with auto-regulation code of ethics and obviously I am very interested in the proposals made by UPS that we can collect for our new norm control of packages I must say and this is already part of the agencies that we collaborate with in the USA that our new standard should be ready on October 12 of this year so any suggestion, recommendation or collaboration to integrate this device will be well received the second challenge that we have is how to innovate the risk management of e-commerce here we have internally created and innovated a series of warnings for people and we are in a complicated situation for the nature of our consumers we have appreciated and we agree a lot with the OCD that electronic warnings the warnings that are made through apps are not enough and that is there are even postures in our country that we are trying to analyze to see their cost, efficiency and value that the warnings come back in paper we are very concerned about the information to the consumer and how we will be clear to all the principles of the policies of the consumer from the security point of view we are working on a paperless system of contracts of the terms and conditions however here there is still a conservative position that insists that the warnings are in paper and a third challenge that we have is the international issue it is very difficult for Mexico to limit the jurisdiction of the digital markets as I mentioned at the beginning 67, almost 70% of the purchases that we make the Mexicans online are foreign stores and I put on the table at the time of the regular e-commerce claims we do not have what representative to cover and of course is to appeal to the companies of packaging and messaging to make them solidarily responsible of that process and obviously our judgment would be just a process of sanction to the messenger so we want at this moment in which we are doing this voluntary standard to collect all these proposals all these ways of guaranteeing the protection of the consumer the terms and conditions are clear that there is short notice on the matter of security and that we have to recognize inclusive to the virtual communities where to our judgment we must take them a new philosophy a new way of communicating the old things that they are buying through the networks without further ado with great interest what my partners of the panel have contributed to the generation of this new standard for Mexico thank you we have now just a couple minutes unfortunately for questions I was hoping that we might have a little bit more time but we would like to open the floor up for questions if I could just remind you of the microphone so that we can have the questions translated as well but let's see if we can take questions for a couple minutes do we have any from the audience hello thank you to the panel for sharing all this information with us it's really invaluable my name is Steve Burkhart I'm general counsel for BIC Corporation the pen, lighter, shaver business it's very obvious as the great effort all of you are taking to share information among your agencies when you talk about hazardous products being shipped I'm thinking of hazmat products being shipped and how those I understand aren't necessarily your jurisdiction but I'm wondering if the sharing efforts you all are involved in cross over that are then dealing with hazmat shipments because it seems to me the speed of e-commerce necessarily works against hazmat compliance so I'd appreciate your thoughts on that thank you I can jump in just real quick I mean from a US government perspective I think I think sharing information in the e-commerce arena is a big challenge I think just at a basic level sharing information about packages that are coming in that are de minimis is a challenge I think then when you drill down even further to start looking at individual requirements like hazmat it becomes even more of a challenge and I think that's something from a US government perspective that we need to work on very closely and I think working with the trade as it relates to that is going to be a very important aspect of that I think as Stuart specifically mentioned I mean UPS has a lot of data that's available and I think part of the part of the you know the challenge here is how can the government and the trade work together on information exchange to be able to identify high risk shipments and be able to interdict them in some way so I don't know if Carlos I think that well in Spanish a very important question for the question for exchange information is also the coordination with the companies in Mexico we managed to celebrate three agreements with the three main associations that have to do with the trade first we made a agreement with the internet association where it's an association it's a chamber where it's Google, Amazon, the banks airlines where it's a series of companies are in package and messaging companies that agreement allows us to also receive information from the private sector for us to be able to manage it and exchange it we made an agreement with another association called Mexican sales association where traditional retail stores have been added because today they have found an important bet I even mentioned it here I mentioned it with Tilburn Mexico through the economy we made an agreement with Alibaba for example with the company with the object that the information the good practices and the effort they make not violent, the Mexican rules of security and we were very concerned the oriental market with the desire to generate protection for us the Mexican prophet UPS with its lily with Amazon with the desire to generate good practices always when we exchange information and this information is what we use to determine new policies and thanks to these agreements we have enough data to generate a standard and a standard that we aspire to be useful for the rest of Latin America thank you Brittany, just on time I'm sorry I was just going to add just a couple things here and I think that HAZMAP presents a good illustration of the challenges of uniformity so there's this base concept of hazardous materials that are shipped around the globe and pretty much uniform minimum standards however it becomes challenging from a trade perspective is that those those standards and are manipulated by certain regulatory agencies in various countries whether it's just transiting through that country or not you have to adhere to their standards so it becomes a challenge to make sure that that particular package you know the routing going back to what I had talked about about the pre-processing information you know we have to know how that good is being routed so and then from there then it goes back to the shipper to state that they have to meet all these countries rules in order to make sure that it gets to the United States so again that concept of uniformity it becomes very important in the in the world of e-commerce in the world of product safety thank you Stuart so I think we are out of time at this point so I want to thank our panelists for their participation in their insight today thank you for the questions and I'll turn it back over to Brittany so we are at lunch now the very important time of the day so just a few things just to note as we prepare to break for lunch there's a lot of places close by for lunch within walking distance and if you don't want to walk too far there's actually two cafes downstairs on the ground floor level of this building and the building directly across the courtyard area in the front just a reminder we will return and start on our third panel right at two o'clock so if everybody is mindful of the security parameters if you're leaving the fourth floor again you'll have to go through screening and since I'm assuming that the majority of you will be doing that make sure you kind of gauge your time to ensure that you can get back and get through the security in enough time so that you can get back on to this space so again thank you and we will see everybody back here at two o'clock