U.S. Customs and Border Protection prevented importers from evading $287 million in antidumping and countervailing duties through its enforcement authority under the Enforce and Protect Act in fiscal year 2020, a 500 percent increase from FY 2017, according to a new report. CBP is also currently using EAPA to investigate 59 duty evasion schemes.
For more information on AD/CV duty evasion, please contact Kristen Smith at (202) 730-4965.
EAPA, part of the Trade Facilitation and Trade Enforcement Act, gave CBP a significantly expanded role in investigating AD/CV duty evasion and the authorities to match. Any interested party, including competing importers and federal government agencies, may submit allegations that AD/CV duties are being evaded; e.g., by misrepresenting the goods’ true country of origin, submitting false or incorrect shipping and entry documentation, or misreporting the goods’ physical characteristics.
CBP has broad authority to conduct investigations of these claims and can impose initial remedial measures that could interrupt a supply chain in as little as 90 days. Any final determination of evasion may be met with not only AD/CV duties but also other enforcement measures such as civil or criminal investigations.
To combat “the ever-evolving schemes to evade U.S. trade laws,” CBP states in its report that it uses EAPA in the following ways.
- pause final billing to thoroughly vet an importer’s transaction history over an entire year before determining the final payment owed
- conduct onsite visits in foreign countries to determine firsthand if fraud is occurring
- leverage new “adverse inference” authority to legally pursue entities that fail to provide information regarding product compliance, which helps ensure importers cooperate in evasion investigations
- hold importers accountable for understanding the origins of their supply chains
CBP adds that the majority of AD/CV duty evasion investigated under EAPA in FY 2020 involved Chinese goods transshipped through Cambodia, the Dominican Republic, India, Malaysia, Laos, Taiwan, Turkey, Thailand, or Vietnam. Some of the most common evasion schemes include illegally shipping goods through a third country or attempting to undervalue or misclassify goods upon entrance into the U.S.
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