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CBP Enforcement & Penalties »

CBP Enforcement & Penalties

CBP Enforcement & Penalties

When engaging in global trade, you are almost always going to have to have some sort of interaction with the CBP.  The United States Customs and Border Protection was established in 2003 as a subset of the US Department of Homeland Security.  It is the largest agency of law enforcement in the country and is responsible for standardizing and regulating policies for international trade, collecting duties for import, and enforcing trade, customs and immigration regulations.

Enforcement

In regards to the enforcement of international trade laws and regulations, the CBP has the power to examine all imports and exports and seize anything they believe is in violation of their policies. These include materials or substances that are found to be stolen, smuggled, controlled or contraband.

CBP can also seize goods if:

  • The commodity is found to be in violation of health and safety or environmental protection standards.
  • The commodity is marked (intentionally or repetitively) with an incorrect country of origin.
  • The commodity does not have the federally issued license necessary for importation.
  • The commodity or its packaging has a copyright or trademark violation.
  • The documents presented for import compliance are found to be counterfeit.

Penalties

There are three types of civil penalties that fall under Section 592 of the Tariff Act of 1930.  Penalties may be applied to a person who uses fraudulent or false documents, statements, practices or omissions when importing, trying to import or aiding in importation.

The three types of penalties are:

  1. Negligence.  One incurs a monetary penalty of negligence when they fail to act with due care when gathering necessary trade documents and following trade protocols.  The maximum penalty may not exceed 20 percent of the dutiable value of the good.
  2. Gross Negligence.  One incurs this penalty when they perform an intentional act of omission or show wanton disregard for the material facts required for import or export.  The penalty for gross negligence may also be applied if there is disregard for any of the policies and procedures obligated by Section 592.  The maximum penalty is generally 40 percent of the dutiable value.
  3. Fraud.  The penalty fraud may be applied to a person who knowingly present falsified information or make an intentional omission to the US Department of Revenue. The domestic value of the commodity in question is the maximum penalty for this act.

Avoiding CBP enforcement and penalties is not a simple task, as the rules for import and export are complex and constantly changing.  If you have any questions or need help with import or export compliance, please feel free to contact us.

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