Importers Are Fully Liable For Customs Duties

Every importer should be aware of these two sentences found in the U.S. Customs regulations concerning the payment of Customs Duties. Many importers pay their duty to their Customs Broker or even their Freight Forwarder, and in 99% of the cases, the broker or forwarder makes sure those duties are paid to Customs in a timely fashion. But on occasion the duty is not paid as required, and when this happens the importer may not learn of the violation until they receive notice from Customs of a penalty that they must pay. It happens infrequently, but when it does importers have been left in a real financial bind, not even having to pay the duties again to Customs directly, but also facing penalties that can be into the thousands of dollars.

"If you are the importer of record, payment to the broker will not relieve you of liability for customs charges (duties, taxes, or other debts owed CBP) in the event the charges are not paid by the broker. Therefore, if you pay by check, customs charges may be paid with a separate check payable to the “U.S. Customs and Border Protection” which will be delivered to CBP by the broker."

So what does this verbiage from the Regulations (19 CFR 111.29(b) mean, and what should importers do to protect themselves from financial loss? These two sentences spell out the fact that even if you pay your duties to a third-party like a Customs Broker or Freight Forwarder, if that third-party fails to pay those duties to Customs, your company as the importer of record is required to pay them. This could mean paying the duties twice, then having to take legal action to recover the duty that was paid to the third-party. It can be a real nightmare.

Importers should strongly consider setting up ACH Duty Debit with US Customs. This free program allows the importer to pay the duty directly to Customs, not through a third-party, eliminating the danger of non-payment. Best of all, importers approved for ACH Duty Debit can pay their duties to Customs once per month, in the month following the date of entry, meaning importers can enjoy interest-free "float time" of up to 45 days on their duty payments.

Contact me if you have questions regarding this program. Email me at [email protected].