Vigilance! Re-export trade to avoid tariffs? These risks could cost you everything!
U.S. Customs April 15 to start a new origin verification system to crack down on re-export trade and tariff evasion.
The system for imported goods origin determination standards and review process has been completely upgraded.
The regulatory objective is mainly to target the re-export of goods through third countries such as Vietnam, Malaysia and Mexico in order to avoid tariffs.
The new origin verification system requires importers to provide three levels of supply chain traceability information:
Product production process flow chart: a detailed demonstration of the product's production steps and processes, so that the Customs and Excise Department to understand the product's production process and various links.
Raw Material Purchase Invoice: Used to prove the purchase source and cost of raw materials, tracing the raw material supply chain of the product.
Energy use and factory operation details: including the energy consumption of the factory and the relevant records of daily operation, which can assist in judging the authenticity and reasonableness of production.
For key countries (Vietnam, Malaysia, Thailand, Indonesia and Mexico, etc.), U.S. Customs will also implement strict measures:
Mandatory checking mechanism for each ticket: Detailed origin verification will be carried out for each ticket of goods from key countries to ensure that the origin information of the goods is true and accurate.
300% penalty on the amount of duty evasion: If importers are found to be evading duty, a high penalty of 300% of the amount of duty evasion will be imposed to increase the cost of non-compliance.
10-year profit recovery and account freezing: not only the relevant profits of the past 10 years will be recovered, but also the accounts involved will be frozen to intensify the fight against violations.
