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Why the Court of International Trade Punished a First-Time, Small Importer with Over $250K in Fines

antidumping

Importers are facing ever-evolving constraints from U.S. Customs and Border Protection (CBP) decisions now more than ever. Achieving and maintaining compliance through Reasonable Care and proper documentation is pertinent to avoid penalties, seizures of cargo, or criminal charges.

“A Tangled Web of Changing Stories and Disputed Consequences”

On April 22, 2019 the Court of International Trade (CIT) found a one-time importer, Titan Metals, liable for $141,984.98 in penalties plus $146,368.64 in unpaid duties. The case examined the Government’s claims that the small business based in Houston, Texas made false statements and omissions on entry documentation to avoid antidumping duties on imports of steel flanges from India.

In 2003, Titan Metals first imported steel flanges from India with documentation that the goods originated from India and were eligible for the Generalized System of Preferences benefit (free of antidumping duties). Six years later, in response to a CBP penalty notice, the company’s lawyer then claimed the goods were “U.S. goods returned,” to avoid further penalties.

While the CIT acknowledged that Titan Metals is a first-time offender with limited resources as a five-employee company, the falsified documentation and resistance to cooperate with the CBP lead to the penalty of 50% of the legal maximum.

What are Antidumping duties?

Antidumping duties (ADD) were created under the Antidumping Act of 1974 to prevent the sales of goods at a lower price than what the goods would be valued in the country of origin. If it is determined that an imported product is being sold at a less than fair value in the U.S., and an antidumping duty is imposed.

How Do I Avoid These Penalties?

As an importer you must truly understand the scope of the ADD order and cannot only rely solely on the HTS classification to determine if the product imported is subject to antidumping duties.

CBP is dedicated to conducting targeted antidumping analysis and auditing of imported products. Mohawk Global Trade Advisors provides import compliance programs to ensure you are abiding by the expansive CBP regulations. Our experts create customized programs for importers which include:

  • Helping you to understand your responsibilities under Reasonable Care
  • Review and analysis of your existing import compliance program and tariff classifications, including discovery of gaps.
  • Written import compliance manuals customized to your business model.
  • Individual policies and procedures for classification, documentation, valuation, recordkeeping, free trade agreements, and more.
  • Checklists, templates, forms, and other tools to help your staff easily manage and maintain standard processes.
  • Training your key import staff in all aspects of import compliance.

Contact Mohawk Global Trade Advisors today to start building a better import compliance program.

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Mohawk Global Trade Advisors, a division of Mohawk Global Logistics © 2016