Everyday businesses face the problems of dealing with Customs seized goods. Importers who have received a Notice of Seizure (or Notice of Information) letter from the Customs and Border Protection (CBP) are often surprised by the action since many businesses rely on logistics companies or other third-party brokers to bring their goods into the United States. For the Importer of Record (IOR), this can mean several things, but usually it is met with panic because it effects the overall supply-chain and can create havoc to their business model—this is especially true for perishable goods and other produce that spoils.
The reasons Customs seized goods of a particular shipment can range from administrative (improper documentation), misclassification, duty reasons, as well as outright restricted products. Each of these reasons is explored below.
While not a true category for a reason to seize property, it is very often the case that a new importer that has no history with Custom’s is attempting to bring goods that have never traveled through this specific IOR. Because of this, a new importer can carry a whole host of compliance issues that warrant inspection and lead to import violations. As with many clients, we recommend a compliance policy that will minimize these delays and help develop a stronger relationship with your port of entry enforcement office.
Prohibited goods can mean anything from controlled substances to counterfeit goods. The US has placed a priority in enforcing goods that infringe on intellectual property rights and have initiated several projects that allow agencies to share intelligence to investigate and prosecute offenders. Some imports can be seized where forfeiture proceedings are later initiated and heavy fines placed against the importer. In other cases, criminal charges are brought by fraudulent actors as well as repeat offenders.
A much larger category of goods that trigger inspections and seizures are restricted goods. These are shipments that fall under quota agreements, consumer safety lists, foreign asset controls, environmental protection laws, as well as food and drug administration (FDA/USDA) regulations. Customs has a duty to make sure the importer is compliant with any licensing and documentation to support the shipment an to assess whether or not specific costs are in order.
Many forgot that some importers try to evade the Customs inspection process entirely. These risky maneuvers equate to smuggling in many cases and can start criminal prosecutions once CBP forwards the investigations to the Department of Justice for consideration.
The initial phase of a Customs seizure begins with a detention. Detentions are formal procedures whereby Customs gives notice to the importer within five days from their decision of which kind of restriction applies that gave them the authority to do so.
During this period, Customs could choose to order a monetary penalty if the defect is corrected, or they may initiate forfeiture proceedings that would deny return of the property. It’s important to know that the steps taken during this period could be critical and in some instances make small problems into large ones. We advise that importers who face the complexities of Custom’s actions seek counsel to minimize delays, costs, and additional frustration.