On Friday, March 31, 2017, President Trump signed a new executive order aimed at enhancing antidumping and countervailing duty collection. The order charges U.S. Customs & Border Protection (CBP) to develop an action plan focused on ensuring that importers of goods subject to trade remedy orders provide adequate security to ensure payment of all duties, and to combat trade law violations.
CBP collects duties at the border, including antidumping and countervailing duties. But the agency’s collection efforts can easily be frustrated where importers lack U.S. assets sufficient to satisfy their debts to the Government, and otherwise do not have U.S. customs bonds on file in amounts sufficient to cover their duty obligations. As the Government Accountability Office has previously found, more than $2.3 billion in trade remedies duties went uncollected between 2001-2014. Further, a relatively small number of importers account for a significant quantity of these uncollected duties. The new executive order requires CBP to design and implement an action plan to address this troubling trend.
While the executive order does not provide specifics on what a responsive plan might look like, it states that the plan must be consistent with existing law that directs that importers’ liability for duties be secured through adequate customs bonds, and that directs CBP to perform risk importer assessments aimed at protecting the revenue. Accordingly, CBP’s plan will most probably involve developing methods to identify companies likely to default, prevent repeat offenders from incurring further liability, and ensure that companies importing goods subject to antidumping duties.
The order also directs CBP to work with rights-holders to ensure that intellectual property rights are being enforced at the border. It further requires the Attorney General to work with the Department of Homeland Security to prioritize trade enforcement, and to create recommended processes and procedures toward this end.
The order was welcomed by U.S. manufacturers, who have long complained that the benefits of trade remedy orders, meant to allow them to recover from injuries caused by dumped and subsidized imports, are fatally undermined by under-collection and evasion. Jeff Henderson, president of the Aluminum Extruders Council, an organization of U.S.-based producers of aluminum extrusions, stated that his organization is “deeply grateful that the new administration, and its newly confirmed Secretary of Commerce, Wilbur Ross, are taking concrete steps to fully enforce existing trade remedies and provide domestic producers the relief they deserve.”