Many in the trade community are calling on U.S. Customs and Border Protection to take a judicious approach in implementing the customs enforcement overhaul laid out in President Trump’s June 3 executive order.
The EO directs a broad tightening of U.S. customs enforcement, with a strong emphasis on importer accountability and vetting, foreign importer restrictions, disclosure obligations, and higher penalties. The most immediate practical effect will likely be an increase in enforcement, bonding, data submissions, and compliance requirements for importers of record, especially foreign IORs.
The EO directs that many of its changes should be made within six months, raising the possibility that they could be implemented through regulations that take effect immediately upon publication. However, in a July 9 letter, dozens of business organizations and trade associations urged CBP to use “a robust and transparent rulemaking process” that first proposes regulatory changes and provides an opportunity for public input before they are finalized.
The letter argued that such an approach would “ensure that any new framework is legally sound, operationally workable and appropriately targeted at the actors and practices that present the greatest risk.” It would also allow stakeholders to provide practical feedback on compliance timelines (including potential phased implementation), required systems changes (e.g., updating internal controls and modifying data systems), documentation burdens, incremental costs (e.g., training personnel and adjusting compliance processes), and potential unintended consequences on cargo processing, release times, and costs for lawful trade.
A July 14 letter from the U.S. Chamber of Commerce echoed these sentiments. Key provisions in the EO such as the definition of “good standing,” establishing specific minimum bond levels, the scope of disclosure requirements, and the risk tiering methodology “are significant new requirements that will potentially require significant time and resources for U.S. businesses to collect, verify, and report.” These changes could inadvertently harm the broader U.S. business community, the letter said, which should therefore be given an opportunity to comment on them.
Both letters also called on CBP to balance increased enforcement with measures that facilitate lawful trade by, as one letter said, “giving compliant importers and supply chain partners clear rules, predictable and cost-efficient processes, and efficient cargo movement.” The letters noted that programs such as CTPAT and CTPAT Trade Compliance symbolize the “long and successful working relationship” between the federal government and the trade community “in identifying and addressing compliance gaps” and “demonstrate the value of a risk-based approach that helps CBP identify trusted traders, focus resources on higher-risk shipments and preserve the efficient flow of legitimate commerce.”
As the nation’s largest independent customs and trade law firm, Sandler, Travis & Rosenberg is prepared to help you understand and respond to enhanced enforcement measures and their impact on your business operations. Please send a message to tariffs@strtrade.com or contact your STR professional for further information.
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