United States: US Customs Issues New Regulations Allowing US Interested Parties To Initiate Investigations Into Importers Allegedly Evading Antidumping And Countervailing Duties

On August 22, 2016, US Customs and Border Protection (CBP) and the Department of the Treasury published a set of interim regulations setting forth new procedures for CBP to investigate claims of evasion of antidumping (AD) and countervailing duty (CVD) orders (the "duty evasion investigations.").1 The interim regulations seek to address a closely watched issue regarding US AD and CVD proceedings: Private parties that may benefit from the collection of AD or CV duties, including relevant US producers and competing importers, are now accorded their day in court, although the process starts with CBP.

On February 24, 2016, President Obama signed into law a new trade act that contains Title IV-Prevention of Evasion of AD and CVD Orders (EAPA).2 The interim regulations were required by section 421 of the EAPA. By way of background, lack of enforcement of AD and CVD orders is widely considered in the United States to be a serious endemic. In May 2012, the Government Accountability Office (GAO) issued a report titled "Management Enhancements Needed to Improve Efforts to Detect and Deter Duty Evasion." This report called for more robust CBP efforts to address AD and CVD order evasion and facilitate oversight of these efforts.3 Recently, in August 2016, another GAO report examined a related issue of non-payment risks associated with CBP's efforts to collect AD and CV duties,4 which quickly gathered the support of a critical federal lawmaker.5 It was against this backdrop that the new interim regulations targeting evasion of AD and CVD orders were issued.

The interim regulations now obligate CBP to investigate private duty evasion allegations that have reasonable factual support. This new mandate to act on private allegations does not take away the agency's traditional enforcement authority. Under pre-existing customs laws, CBP can take enforcement actions against an evasion of AD and CVD orders, which include the assessment of civil penalties against offending importers. In addition, a fraudulent scheme to evade AD duties has led to a criminal prosecution of the offending importer.6 However, AD and CV duty evasion allegations submitted by private parties prior to the implementation of the EAPA did not afford the complaining parties an opportunity to participate in a resultant investigation. Also, CBP used to have no obligation to notify the complaining parties of the outcome of the agency's investigation. Both above-mentioned problems have been addressed in the August 22 interim regulations. Meanwhile, the interim regulations made clear that CBP retains the authority to use information obtained during an EAPA investigation to impose penalties under its traditional civil enforcement tool (19 U.S.C. § 1592). 

The August 22 interim regulations provide for the definition of ''evade'' and ''evasion." In the current context, these terms refer to entering merchandise subject to a US AD or CVD order (the "covered merchandise") for consumption by means of any document or electronically transmitted data or information, written or oral statement or act that is material and false or to any omission that is material and that results in any cash deposit or other security or any amount of applicable AD or CV duties being reduced or not being applied. Hence, falsely reporting the country of origin or physical nature of the goods falls squarely within the ambit of the interim regulations. As to who may make a duty evasion complaint, US producers of a domestic like product are typically who allege wrongful importer actions to evade AD and CVD orders. The new interim regulations also give standing to importers of the covered merchandise who wish to bring evasion allegations against competing importers. These competing importers are included in the definition of "interested parties." A duty evasion investigation may also be requested by a federal agency, including the Department of Commerce or the United States International Trade Commission.

Regarding the new investigation procedures, generally CBP will decide whether a duty evasion investigation is warranted within 15 business days after the receipt of a properly filed allegation. If CBP decides to not initiate an investigation, the complainant will be informed within five business days of that determination. Conversely, CBP will notify all known parties to a duty evasion investigation no later than 95 calendar days after the initiation of the investigation. A CBP determination as to whether duty evasion occurred will be made within 300 calendar days from the date of initiation of the investigation, with a 60-day extension reserved for "extraordinarily complicated" investigations. The parties to the investigation will be notified within five business days of the initial determination by CBP. They also have up to 30 business days after the date of the initial determination to request an administrative review by Regulations and Rulings, Office of Trade, which is a branch of CBP. The final administrative determination issued thereby is subject to judicial review in accordance with section 421 of the EAPA.

In publishing the interim regulations, effective August 22, 2016, CBP also seeks public comments on their contents and requires that all comments be received by October 21, 2016. All parties concerned with a covered merchandise should take notice of the interim regulations bringing private AD and CV duty evasion allegations into the process. Opportunities and risks coexist as CBP tees up its efforts to strengthen the enforcement of AD and CVD orders. The clock is already ticking on taking advantage of the public comment period.


1 Investigation of Claims of Evasion of Antidumping and Countervailing Duties, 81 Fed. Reg. 56477 (Aug. 22, 2016).
2 Pub. L. 114– 125, 130 Stat. 122, 155 (Feb. 24, 2016); 19 U.S.C. 4301 note.
3 GAO, Management Enhancements Needed to Improve Efforts to Detect and Deter Duty Evasion (May 2012, available at http://www.gao.gov/assets/600/590917.pdf.
4 GAO, CBP Action Needed to Reduce Duty Processing Errors and Mitigate Nonpayment Risk (Jul. 2016), available at http://www.gao.gov/assets/680/678419.pdf.
5 House Ways and Means Chairman Kevin Brady (R-TX), Brady Statement on GAO Report on Antidumping and Countervailing Duty Collections (Aug. 15, 2016) (press release), available at http://waysandmeans.house.gov/brady-statement-gao-report-antidumping-countervailing-duty-collections.
6 Mayer Brown Legal Update, The Continuing US Trend to Criminalize Customs Violations (Oct. 30, 2012), available at https://www.mayerbrown.com/The-Continuing-US-Trend-to-Criminalize-Customs-Violations-10-30-2012.

Originally published on August 24, 2016

Learn more about our International Trade and Government Relations practices.

Visit us at mayerbrown.com

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe – Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2016. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions