Trade Spotlight Archives
Truth & Consequences
Are import entry filing errors affecting your bottom line?
"Importers are expected to familiarize themselves with their supply chains and exercise reasonable care with their import practices."
The constant change and complexity of importation keeps U.S. Customs faced with many challenges today. Customs 2007 Year in Review reported that there are 317 active U.S. ports of entry where over 190,000 vessels dock annually. Customs must track more than 10 million cargo containers and process over 31.4 million entry documents each year. Even with these considerable challenges, Customs still reviews 100% of all container shipping information.
The U.S. Census Bureau reports that over 8% of all import transactions contain one or more errors. The Mod Act of 1993 puts all reporting liability on the importer of record. Importers are expected to familiarize themselves with their supply chains and exercise reasonable care with their import practices. With that, Customs brokers are not held accountable for compliance reporting issues.
Has your company been subject to these costly reporting errors?
A large camera maker, imported $60 million worth
of duty-free camera equipment that was incorrectly labeled “Made in Hong Kong” when in fact the equipment was made in China. The camera maker settled with Customs out of court with a $20M fine.Check out the search engine “CROSS” which allows importers to search Custom’s rulings database. Here you can search by tariff number and the results will display any ruling specific to that tariff number. Customs and Border Protection’s website has had a nice makeover this summer and has implemented helpful tools.
Another Importer's Customs broker failed to fill out duty-free forms for client merchandise. Because of the Customs broker’s error, the telecommunications provider was incorrectly assessed an 8.5% duty rate. Customs agreed that the error was a mistake of fact, correctable under § 1520(c)(1),but because the importer could not explain why the broker failed to do his job, the duty rate was not reversed and the company had to add legal expenses to an already burdensome import duty.
The Customs broker for an importer of LCD screens, assigned the wrong tariff number, resulting in a
$6M penalty to the company. CBP rejected the company’s “reasonable care” defense that reliance on a customs broker to classify merchandise correctly is sufficient to establish that an importer exercised reasonable care.
TRG Direct is a web based self filing system that allows importers to clear their customs entries without the assistance of a customs broker. Our customers choose to file direct because it enables them to control the entry filing process and avoid the consequences of reporting errors.
Take control of your entry filing and to avoid those costly errors.