On August, 22, 2016, DHS published the Interim Regulations and a solicitation for comments on procedures for CBP to investigate claims of evasion of antidumping and countervailing orders. Anyone wishing to comment on the Interim Regulations must do so by October 21st. Signed into law through the Trade Facilitation and Trade Enforcement Act (Enforce and Protect Act) or EAPA, this sets forth a formal process for CBP to investigate allegations of evasion. Antidumping (ADD) laws assess duty on imported products that are essentially sold at less than fair market value into the US and materially injure domestic industry. Countervailing (CVD) duties apply to imported products that benefit from a foreign government subsidy, thereby allowing foreign companies an advantage over domestic industry. Examples of evasion would include misrepresenting the true country of origin, or changing the description and tariff classification number in an effort to evade the extra dumping duties.
Under the EAPA, allegations of evasion may be filed with CBP from “interested parties” including importers, foreign producers, exporters or other federal agencies. Investigations under EAPA will be conducted by CBP’s Trade Remedy Law Enforcement Directorate. Equally interesting is if an importer/evader, foreign producer or exporter fails to comply to the best of their ability with a request for information, CBP may consider adverse inferences. Should evasion be found, CBP may suspend or extend the liquidation of entries along with taking action such as assessing penalties under 19 U.S.C 1592 or under any other relevant law.
If the determination is ultimately found to be negative, CBP will liquidate the entries as appropriate, and any evasion determinations are subject to administrative review by request of any party to the investigation.
This congressional action is not surprising following comments by the Government Accountability Office and the academic community that the US has lost billions in uncollected duties. Before importing or exporting products that you feel may fall within the ADD or CVD order, we suggest careful and close review of the Dept. of Commerce scope.
Deringer’s Consulting Group stands ready to answer your questions. To speak with a highly qualified Customs Compliance expert at Deringer, please contact us via email at consulting@anderinger.com or call us at (518) 298-8281 (Champlain, NY)or (734) 641-6852 (Romulus, MI).
