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TradeCompliancelegalitiescanbecomeanightmarecapableofdrowningacompany'sstock value,leadingtolawsuits,publiclackoftrustinthecompany,andeventualiquidation.An overturneddecisionbyagoverningbody,especialywhenitcomesfrom thefactthata companyfolowedduediligence,enhancesthecompany'sreputation.
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Recently,theU.S.CustomsandBorderProtection,CBP,overturnedapenalty,including$7.5 milionport-isuedpenaltyand$3.7miliondutydemand.Thepenaltywasisuedtoa CanadiancompanytheyclaimedmadefalseNAFTAtarifpreferenceclaims.
ncompanywas,atfirst,accusedoffiling1,766entriesofgoodsthatcontained U.S.sourcedinputs,andclaiming‘duty-freetreatment’underNAFTA.Thecompanyonthe otherhandclaimeditreliedonthecertificatesisuedbytheinputsupplier.Theportclaimed thatthecompanyshouldhaveconsultedwithaCBPexpertorcustom brokerbeforeaccepting theinputsupplier’sisuantbutdidnot.Theportalsoclaimedthatthecompanyhadno customscompliancepolicyinitssystems.
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swererefutedbytheCanadiancompanyonthegroundsthatthey(thecompany), hadanin-depthunderstandingofNAFTArequirementsandexercisedreasonablecareinline withCBP’sFebruary2004compliancepublication,andhadinfactworkedwithcustom brokers andCBPonalNAFTArelatedcomplianceisues.
CBPHeadquartersreviewedtherefuteandconcludedthatthecompanydidnotviolate 19USC1592.Thecompanyinturnsavedahorendousamountofmoneythatwould havebeenlostshouldtheCBPfoundthem non-compliant.
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