Customs Fines and Penalties
The purpose of U.S. Customs is to enforce federal trade law while minimally interfering with international trade. Its ability to stall global market productivity, as well as permanently impact an industry’s well-being and an individual company’s very existence, is beyond question.
This makes U.S. Customs one of the most powerful agencies in the world. And nowhere is the power of U.S. Customs more overt than in its abilities to seize and forfeit merchandise and thereafter impose civil monetary fines.
Under 19 U.S.C §1592, specific fines and penalties are established which vary in both in monetary amount and in the severity of penalty assessed, depending upon whether or not the importer is found to be negligent, grossly negligent, or perpetuating actual fraud.
Fines
Customs fines can be very high, but there is room for negotiation in most instances. The initial fine termination can be arguably reduced when it can be established that there has already been a prior disclosure of the violation, or where mitigating factors are present.
The most common mitigating factor in getting a customs fine lowered? Proven errors by U.S. Customs itself.
Shared Responsibility of U.S. Government and International Trade Industry
For the past fifteen years, the attitude of the federal government has been that the U.S. Customs Department and members of the international trade industry share joint responsibility for insuring compliance with U.S. import/export requirements.
Companies are seen as responsible for using reasonable efforts to classify and value their merchandise, and otherwise meet trade requirements established under federal law. Their efforts are viewed under the law as essential for U.S. Customs to efficiently operate. Accordingly, when there's a failure to exercise reasonable care in either classifying or placing value upon merchandise, penalties can be imposed upon the company.
Realistic or not, every business involved in international trade crossing U.S. borders is assumed to know all pertinent federal law; all customs rulings and regulations, as found in 19 C.F.R. 1 -199; the entirety of the United States Harmonized Tariffs Schedule (HTS); and standard invoicing requirements. To meet this burden, it’s assumed that companies will obtain advice from experts in the field including customs brokers, attorneys, and the like.
Ignorance of customs law is not a valid legal defense. Failure to meet a customs requirement can result in monetary fines (which can reach $100,000/violation), as well as penalties ranging from seizing the merchandise to serving actual jail-time.
For over a decade, all those involved in international U.S. trade have had to deal with federal law forcing them not only to be in compliance, but to be adept and up-to-date on the latest customs rules and regulations -- in addition to keeping track of all the information needed to successfully run their own operations.
Business planning which encompasses these ever-changing federal laws, rules, and regulations, therefore, has become essential for importers and exporters alike.
What Fuerst Ittleman Provides Its Clientele
- Fuerst Ittleman is constantly monitoring pertinent laws, rules, regulations, and rulings covering a wide variety of industries in order to insure that its clientele are always current on applicable federal trade law. Fuerst Ittleman not only notifies its clientele of applicable laws, it advises them on practical business advantages found within the law.
- Fuerst Ittleman represents both importers and exporters in preparing for, achieving, and maintaining complete compliance with applicable U.S. customs law and regulations -- as well as those of any relevant foreign countries. Fuerst Ittleman works with its client companies before there is any compliance issue -- because the most efficient way to deal with U.S. Customs is to be prepared before you’re ever contacted by them.
For example, effective January 9, 2007, the FDA instituted a final rule to help prevent the spread of "mad cow" disease by establishing recordkeeping requirements for food and cosmetics containing cattle material. Fuerst Ittleman worked with clientele using cattle material in their operations of this change in legal requirements, circumventing any potential noncompliance issue.
- Fuerst Ittleman aggressively advocates for clients facing a potential fine or penalty. Fuerst Ittleman negotiates with the U.S. Customs and Border Patrol on behalf of its clients, as well formally representing them in litigation, as necessary, in both the Court of International Trade and U.S. federal trial and appellate courts.
Fuerst Ittleman also advocates for clients in negotiations and protests involving numerous federal agencies in administrative proceedings. These include the Federal Trade Commission (FTC), the Food and Drug Administration (FDA), Consumer Product Safety Commission (CPSC), Environment Protection Agency (EPA), the Bureau of Alcohol Tobacco and Firearms (ATF), and the U.S. Department of State.
