CBP’s STRICT ENFORCEMENT OF IMPORTER RESPONSIBILITIES
U.S. Customs & Border Protection (CBP) has announced that it will be closely monitoring the identity of the parties involved in any given shipment, perhaps due to lack of clarity on the invoices from suppliers, or notations made by or on behalf of the importer of record.
In addition, the focus on the textile industry has now shifted to valuation. The following guidelines will help importers understand their responsibilities and will minimize the effect of the increased enforcement measures.
• Our clients give us a Power of Attorney authorizing us to designate them as Importer of Record and act on their behalf before Customs. This written authorization holds us to confidentiality of their information, as well to look out for their best interests in general.
• An Importer of Record has to be a party involved in the transaction (buyer, seller)
• Any actions we take, or documents we present to Customs are on behalf of the Importer of Record;
• Any instructions we receive, must be from the Importer of Record (not their agent, forwarder, buyer, etc)
• Any “importer notations” we make to add crucial information to a Customs document, must be supported by written confirmation from the Importer of Record at all times.
CBP stated that undervaluation of goods from China is thought by CBP to be a huge problem, in part because the textile and apparel industry represents 21% of all importers, 5% of the value of all imports, and 42% of all duties collected.
CBP discourages the use of Delivered Duty-Paid (DDP) transactions and Landed Duty -Paid Transactions (LDP) transactions, as these types of transactions can be abused due to the involvement of “nominal importers” that do not have the right to make entry, and can be involved (either knowingly or unknowingly) in an attempt to import undervalued textiles and apparel.
Other special enforcement initiatives have focused on the misuse of preference program short supply claims. In one investigation, CBP reviewed 110 entries and found $1 million in lost revenue. Inaccurate claims regarding the DR-CAFTA requirement to use U.S. pocketing fabric have also been found; in one investigation $70,000 in lost revenue was discovered.
CBP officials made the following observations regarding its verification of trade preference claims:
Verifications will not require the detention of the merchandise
A sample from the immediate shipment may be required (this required examination)
• CBP will request the affidavit from the mill supplying the yarn and fabric
• CBP will contact the mill regarding the veracity of the document and the information contained on the affidavit including the quantity and type of yarn and fabric.
• CBP does not support the use of blanket certificates.
• Affidavits must contain contact information.
• The yarn producer must prepare the affidavit.
• Affidavits must contains specific information (type of yarn/fabric, should link to other supporting documents; contracts; invoices’ purchase order numbers).
Information on this and other recent developments can be obtained from our technical consulting group.