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Tariff Collections Jumped, Trade Facilitation Improved in FY 2019, CBP Says

Friday, January 31, 2020
Sandler, Travis & Rosenberg Trade Report

U.S. Customs and Border Protection further reduced import processing times in fiscal year 2019 even as it saw a significant increase in the amount of import tariffs it collected, according to the agency’s annual trade and travel report.

Tariffs. In FY 2019 CBP processed $2.7 trillion in imports equating to 35.5 million entries and more than 28.7 million cargo containers. It collected $80.7 billion in duties, taxes, and other fees on those imports, including $71.9 billion in duties, a 73 percent annual increase. Much of this increase is attributed to Section 201 safeguard tariffs on washing machines, washing machine parts, and solar panels ($716 million collected in FY 2019, $1.47 billion collected as of Jan. 29, 2020); Section 232 duties on steel ($4 billion/$6.67 billion) and aluminum ($1.1 billion/$1.96 billion); and Section 301 tariffs on goods from China ($29 billion/$44.89 billion).

Rulings. CBP issued 21 percent more rulings and saw a 22 percent increase in decisions on entry process-related cases as Since proper classification, valuation, and country of origin became increasingly important with the rise in additional duties.

Trade Remedies. At the end of FY 2019 CBP was enforcing 503 antidumping and/or countervailing duty orders, 33 more than the previous year, and had collected about $1.9 billion in AD/CV cash deposits. Entry summary reviews resulted in the recovery of nearly $122 million in AD/CV duties owed, up nearly 86 percent from FY 2018; monetary penalties for fraud, gross negligence, and negligence of AD/CV requirements totaled more than $80.5 million; and audits identified approximately $20.4 million in owed AD/CV duties, with $4.8 million collected to date.

CBP received 38 new allegations of AD/CV duty evasion under the Enforce and Protect Act, initiated 36 EAPA investigations, took interim measures in 31 investigations, and issued final determinations for seven investigations. EAPA investigations covered a wide range of commodities, including garlic, diamond sawblades, aluminum extrusions, refrigerants, plywood, glycine, steel wire garment hangers, pencils, wooden bedroom furniture, oil country tubular goods, and stainless steel flanges.

Forced Labor. CBP is currently enforcing 36 active withhold release orders (including six orders issued in FY 2019) and four active findings related to allegations that imported goods were mined, manufactured, or produced wholly or in part from forced labor.

IPR. At the end of FY 2019 CBP was enforcing 18,735 active recorded copyrights and trademarks and had seized 27,599 shipments with intellectual property rights violations.

Product Safety. Since the establishment of the Commercial Targeting and Analysis Center in 2010 more than 100,000 shipments of unsafe consumer and industrial goods, violative food and drug products, and other contraband have been prevented from entering U.S. commerce. In FY 2019 CTAC facilitated efforts that led to 7,211 seizures of products posing health and safety risks, 595 seizures because of wildlife trafficking violations, and 22 seizures of illicit importations of cultural property.

Automated Commercial Environment. In FY 2019 ACE reduced processing times by 690,000 hours for the trade community and 1.9 million hours for CBP and yielded an estimated economic benefit of $537 million for the trade community and $106 million for CBP, up 38 percent and 200 percent, respectively, from FY 2018.

Inspections. CBP officers used 320 large-scale non-intrusive inspection systems at land and sea ports of entry in FY 2019 to perform approximately 6.6 million examinations resulting in 3,016 seizures, a 21 percent annual increase.

CTPAT. The 11,600 certified members of the Customs Trade Partnership Against Terrorism accounted for 54 percent (by value) of cargo imported into the U.S. in FY 2019. CBP completed more than 2,200 validations to certify that CTPAT members both implemented and followed the highest level of supply chain security measures, and CBP enforcement actions led to 96 suspensions and 120 removals. On the other hand, CTPAT members saved $70.2 million from reduced examination rates and CBP saved almost $600,000 in travel expenses by accepting 338 authorized economic operator certificates from foreign partners.

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