Exposure to Loss

An importer must be able to document the accuracy of all information filed on entry. Inability to do so, or simple errors resulting in a duty underpayment or erroneous declaration, will expose a company to the loss of previously granted duty exemptions and exposure to penalties.

What We Do

• Keep you out of a penalty situation by analyzing your import operations, looking especially for areas where violations commonly occur.
• Avoid penalties where a violation has occurred by properly presenting the matter under Customs’ prior disclosure guidelines.
• Interface as your attorney with the Customs agents assigned to the case if an investigation has commenced and it is too late to make a “prior disclosure.”
• Negotiate with Customs at the local and Headquarters level to have the case dismissed or the penalty reduced to the lowest amount possible.
• Litigate in the Courts should we be unable to reach a settlement with Customs. We are generally able to reach successful conclusion with Customs and avoid the expense of litigation.

More Details

An importer is strictly liable for the accuracy of all information stated on documents filed with Customs or back-up what Customs requires the importer to maintain. Such information includes identification of country of origin, price paid to the seller, value of assists, commissions, tariff classification and eligibility for free entry under the various Free Trade Agreements or other duty exemptions. The importer must also be able to document the accuracy of such information. Failing to do so means exposure to penalties. In classification (duty rate) and valuation errors, these range from the assessment of the duties owing plus and additional 200% for simple negligence, 400% for gross negligence, and 800% for civil fraud. Where Customs believes the fraud extreme, it can also seek criminal penalties. All penalty assessments can be contested and if not cancelled, substantially mitigated through an appropriate administrative petition or if necessary by legal action in the courts

In cases involving goods imported in violation of quotas that are imposed on various commodities, or goods not marked in accordance with Customs or FTC labeling rules, the goods are subject to recall. If the merchandise had been distributed before receipt of notice of a marking problem from Customs, liquidated damages can be assessed in an amount equal to the full FOB value of the merchandise and in extreme cases triple that. All penalties can be reduced, or mitigated, if properly handled. Also, they can be avoided entirely if the importer finds the error itself, properly discloses the matter, and pays duties that are owed before Customs initiates a formal investigation.

Contact Us for More Information

You are welcome to call us to review any area of concern. Contact Stephen M. Zelman, Esq., at 1+ 212.245.6100 for a telephone consultation, with no obligation for any fee. E-mail at stephenzelman@gmail.com.