Importer pays $3+ million civil penalty to Customs.

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According to an U.S. Customs and Border Protection media release, a company named Satisloh paid $3,320,425 for customs violations.

Satisloh imported machinery used to produce optical lenses but was hit with penalties for violation §19 U.S.C. 1592. Section 1592 allows Customs to issue penalties against importers who enter goods into the US by “false statements” or “omissions”.

We see many importers violate section 1592 because a false statement or omission can occur when describing a good for import, classifying a good by product number (HTSUS number) or providing false information on entry paperwork.

After a violation of section 1592, customs may issue a civil penalty, from there, the importer of record can try to submit an offer in compromise to customs to settle any claims. In this instance, Satisloh settled with Customs for $3,320,425.

If you have received a penalty notice, or notice of seizure or any other Customs action or Form. Contact experienced customs attorney David Hsu by phone/text at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com.

$2.2 million worth of fake Nike shoes seized by Customs.

Image of seized Nike shoes, source: CBP.gov

According to a U.S. Customs and Border Protection (CBP) media release, officers assigned to the port at LA/Long Beach seized over 14,806 pairs of counterfeit Nike shoes that if genuine, carry an estimated MSRP of $2,247,680.

The seizure was multi-agency and included U.S. Homeland Security Investigations (HSI) special agents assigned at the Trade Enforcement Coordination Center (TECC). The shoes were discovered during examination of a shipment from China and were misdeclared as “napkins”.

Apparel, Footwear and Textiles Center of Excellence (AFT Center) import specialists and the trademark owner confirmed the shoes were in violation of Nike’s Air Jordan 1 Off-White, Air Jordan 12, Air Jordan 1 (blue, black, red, white), Air Jordan 11, Air Max ’97 protected designs and trademarks.

If you have had your goods seized by CBP or if they are sending you a civil penalty or you are facing criminal penalties, contact experienced seizure attorney David Hsu at 832-896-6288 or by email at attorney.dave@yahoo.com, dh@gjatradelaw.com.

China’s #2, – Premier Li Keqiang eases trade tensions with the US.

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According to the New York Times, China’s Number 2 official, Premier Li Keqiang speaking at the World Economic Forum in the Chinese port city of Dalian, promised to cut tariffs, loosen restrictions on foreign investments, protect intellectual property rights and allow foreign companies to apply for China’s generous subsidies for research and development.

Speaking during a question and answer session, Li also said that China would allow foreign financial services companies into its market a year earlier than previously promised, and that it would rewrite many rules on foreign investment.

The NYT mentioned the lack of details, and indicated previous vague promises by Chinese officials in the past.

In addition to extending an olive branch to foreign companies, Premier Li’s remarks also sought to calm worries about the relocation of manufacturing overseas as a result of the Section 232 and 301 duties levied against China.

If you have questions how the China duties will impact your business, contact David Hsu by phone/text at 832-896-6288 or by email at dh@gjatradelaw.com, attorney.dave@yahoo.com.

Importer pays $500,000 fine for false claims to evade customs duties.

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Earlier in February of this year, the Department of Justice Office of Public Affairs released news of a settlement by Home Furnishings Resource Group Inc. agreement to pay $500,000 in settlement for False Claims Act allegations.

Background:
Home Furnishings Resource Group Inc. (HFRG) agreed to pay the $500,000 after they were alleged to have violated the False Claims Act on customs declarations in order to avoid paying antidumping duties (ADD) on “wooden bedroom furniture” imported from China.

Customs alleged the Hermitage, Tennessee company did not pay antidumping duties from 2009 to 2014 by misclassifying furniture as “non-bedroom” on import documents. By misclassifying as “non-bedroom”, HFRG did not pay the required ADD on wooden-bedroom furniture.

Why do we have antidumping duties?
Antidumping duties protect American manufacturers against foreign companies who make the same goods at a price below cost and “dump” the products into the US. The Department of Commerce (Commerce) is responsible for assessing whether goods are dumped into the US – and if so, assign an ADD amount to those imported goods.

The addition of a duty for these goods is to protect U.S. businesses and “level the playing field for domestic companies”.

The Department of Homeland Security’s Customs and Border Protection (CBP) then collects these duties – wooden bedroom furntiure’s ADD rate was 216% and non-bedroom furniture was not subject to any duty.

How was HFRG caught?
University Loft Company, a competitor of HFRG, used the whistleblower provision of the False Claims Act, permitting private parties to sue on behalf of the US against those who falsely claim federal funds or, as in this case, who avoid paying funds owed to the government. The act also allows the whistleblower to receive a share of any funds recovered. University Loft Company will receive approximately $75,000.

Do you know anyone violating the False Claims Act?
If you believe an importer has been misclassifying goods to avoid payment of duties, contact David Hsu at 832-896-6288 or by email at attorney.dave@yahoo.com.