A vehicle imported by Ford as a passenger van to save on duties, but then immediately converted to a cargo van after importation, may have been legitimately “tariff engineered” if the seats originally included in the van were suitable for passengers, the Court of International Trade said Oct. 5 as it declined to rule either way (here). With the government arguing instead that the inclusion of flimsy seats was a deceitful ploy to illegitimately get more favorable tariff treatment, the court requested more information on the seats before it comes to a final decision.
Customs Duty
A Customs Duty is a tariff or tax which a country imposes on goods when they are transported across international borders. Customs Duties are used to protect countries' economies, residents, jobs, and environments, by limiting the flow of imported merchandise, especially restricted and prohibited goods, into the country. The Customs Duty Rate is a percentage determined by the value of the article purchased in the foreign country and not based on quality, size, or weight.
False Claims Act whistleblower lawsuits may be filed for failure to pay marking duties on unmarked or improperly marked imports, the U.S. Court of Appeals for the 3rd Circuit said Oct. 5 as it resurrected a whistleblower lawsuit filed by a company founded to investigate customs fraud (here). Reversing the dismissal of Customs Fraud Investigations’ (CFI) lawsuit against pipe fitting importer Victaulic by the U.S. District Court for the Eastern District of Pennsylvania in September 2014 (see 1504290070), the Appeals Court sent the case back down with instructions to allow CFI to amend its complaint to include new evidence of Victaulic’s alleged fraud.
With the major components of ACE nearing completion, the next focus at CBP will be on how best to use its new data tools included in the system, said Deborah Augustin, executive director of CBP's ACE Business Office, while speaking at the U.S. Air Cargo Industry Affairs Summit Oct. 4. CBP will seek to figure out how "to better leverage the data and information that we're using and that we're gaining from the system to facilitate our processes, promote more effective risk management, and keep moving towards the original goal and intent of the single window initiative," she said. The previous reliance on paper made it difficult for CBP to create a "baseline" for "time to release," but ACE will allow the agency to measure that data and figure out where future process improvements may be needed, Augustin said.
Recent court decisions by the U.S. Court of Appeals for the Federal Circuit (CAFC) threaten to close off a crucial avenue for judicial review of CBP ruling revocations and modifications, making it hard for importers to rely on rulings and violating Supreme Court precedent, said a lawyer representing Best Key, a Hong Kong manufacturer of yarn, in a Sept. 29 petition for a rehearing of the hearings by the full Federal Circuit. By directing Best Key to challenge classification via a denied protest, instead of allowing Best Key to challenge it under the Administrative Procedure Act, the Federal Circuit is preventing Best Key from challenging the process under which CBP revoked the ruling, John Peterson of Neville Peterson said in the petition. Best Key claims the ruling revocation process was tainted by the improper participation of its competitors.
An importer of college dormitory furniture, a sourcing firm, and the owner of both companies will pay a total of $1,525,000 to settle charges that they falsely claimed on customs documentation that they were importing office furniture in an effort to evade antidumping duties on wooden bedroom furniture from China, the Department of Justice said Sept 30 (here). In a whistleblower case brought by a former Omni employee, the government claimed Ecologic Industries, Omni Supply Chain Management and Daniel Scott Goldman “conspired with others” to make false statements and misclassified the furniture on entry documentation to avoid paying antidumping duties, DOJ said.
In recent editions of the Official Journal of the European Union the following trade-related notices were posted (here):
Continued antidumping and countervailing duties, policies to counter currency manipulation, and resistance to designating China a “market economy” for AD/CV duty purposes could all help mitigate the impacts of global aluminum overcapacity on U.S. producers, several U.S. industry officials told the International Trade Commission Sept. 29. ITC hosted the hearing as part of an investigation requested in February by the House Ways and Means Committee, expected to be sent to Congress June 24, 2017. The ITC will accept post-hearing briefs and statements for the record until Oct. 7.
CBP released two checklists meant to help prepare filings alleging antidumping or countervailing duty evasion, the agency said (here). New AD/CV evasion enforcement procedures recently went into effect as part of CBP's implementation of the customs reauthorization law's AD/CV provisions in the Enforce and Protect Act (EAPA) (see 1608190014). "These documents are meant only for your assistance in preparing an allegation and should not be included with your submission," CBP said. "Moreover, this information is provided solely for your guidance and neither replaces nor supersedes the law or regulations for EAPA proceedings and use of these does not guarantee an affirmative determination for your allegation." The law requires CBP to provide some technical assistance to small businesses filing such allegations. CBP's "Allegation Receipt Checklist" (here) provides "the criteria for determining 'receipt of a properly filed allegation,’” CBP said. The checklist gives "the necessary information to determine whether the facts provided 'reasonably suggest that the covered merchandise has been entered for consumption into the customs territory of the United States through evasion.’”
International Chamber of Commerce Secretary General John Danilovich presented industry recommendations for a World Trade Organization e-commerce agreement at WTO’s annual Public Forum in Geneva on Sept. 28, the ICC announced (here). The proposal itself recommends that any e-commerce package include capacity building resources for developing economies, and reflect a WTO review of its telecommunications rules to remove non-tariff barriers, as well as a “light-touch” approach to regulation that allows entry of new businesses into the information and communications technology ecosystem, among other things.
In the Sept. 21 issue of the CBP Customs Bulletin (Vol. 50, No. 38) (here), CBP published notices that propose to revoke or modify rulings and similar treatment for the classification of children's fishing rod and reel combinations and refinery modules.