CBP Importer Sanctions List: What Importers Should Know About Unpaid Customs Bills

25 minutes ago

4 min read

With nearly 10 years of Customs brokerage experience, we recently encountered something we had never personally dealt with before: an importer appearing on U.S. Customs and Border Protection's (CBP) Importer Sanctions List.

When most people hear the word “sanctions,” they may immediately think about OFAC sanctions or restricted parties. That is not what we are referring to here.

CBP importer sanctions can affect an importer's ability to obtain the immediate release of merchandise when the importer is substantially or habitually delinquent in paying Customs bills.

Our experience with this situation reinforced an important lesson: resolving the immediate problem is only part of good Customs compliance. The procedures established afterward can be just as important.

What Is the CBP Importer Sanctions List?

Under 19 CFR § 142.26, an importer that is substantially or habitually delinquent in paying Customs bills can have its immediate delivery privileges suspended.

The regulation provides for written notification to the importer at the port where the importer is substantially or habitually delinquent. If all delinquent Customs bills are not paid within 10 working days after receipt of the notice, the suspension may be extended to all Customs ports.

If the delinquent Customs bills are paid within the prescribed period, the regulation provides for reinstatement of the suspended privileges.

The important takeaway is that an unpaid or unresolved Customs bill from a previous transaction can affect future imports.

When Unpaid Customs Bills Affect Future Imports

We recently worked with an importer who had outstanding Customs bills that needed to be addressed.

Rather than wait for upcoming shipments to arrive and risk unnecessary delays, we contacted CBP's Revenue Division to determine what outstanding bills needed to be resolved.

We worked with the importer to address the past-due amounts. Once the outstanding amounts were paid, we also worked to reestablish the importer for ACH Debit with Customs.

But resolving the outstanding bills was only one part of the process.

We also reviewed how future Customs transactions would be handled and established additional procedures with the importer.

Fix the Problem—Then Fix the Procedure

One of the most important conversations we had with the importer was about the importance of paying Customs bills on time and promptly addressing correspondence from CBP.

We also established an advanced review process for entry summaries before entries were transmitted to Customs. This gave the importer an opportunity to review what would be declared to CBP and provided an additional layer of oversight before transmission.

The purpose was not simply to resolve the sanctions issue. It was to establish better controls for future transactions.

That experience reinforced several best practices that other importers can learn from as well.

Best Practices for Importers

Take CBP correspondence seriously. A shipment may already be delivered, but Customs matters associated with the entry can continue long after release.

Assign responsibility for Customs matters. Someone within the company should be responsible for receiving, reviewing and acting on CBP correspondence and bills.

Communicate with your Customs Broker. If you receive a Customs bill or notice you don't understand, send it to your Customs Broker promptly. Depending on the circumstances, Customs counsel or another specialist may also need to be involved.

Know what is being declared in your name. Importers should understand the information being transmitted to CBP under their importer number. When additional oversight is appropriate, reviewing entry information before transmission can provide another internal control.

Monitor outstanding Customs obligations. Don't allow an unresolved bill or notice from an older shipment to become a problem when the next shipment arrives.

Look beyond the immediate problem. When a compliance issue occurs, determine why it happened and whether a change in procedure could prevent it from happening again.

Compliance Is a Team Effort

A Customs Broker can establish procedures, explain requirements, identify potential problems and help an importer navigate the Customs process. But those procedures require participation from everyone involved.

If documents need to be reviewed before an entry is transmitted, there must be enough time for that review. If CBP correspondence is received, it needs to be shared promptly. If Customs bills become due, they need to be addressed.

That is why we believe:

Your team is only as strong as the procedures you establish—and your willingness to follow them.

Customs compliance works best when the importer and Customs Broker operate as a team with clear expectations, good communication and procedures that both sides are committed to following.

The Power of Good Procedures

Even after years in the Customs brokerage industry, there will always be situations we haven't encountered before.

Experience is valuable, but so is knowing when to research an issue, contact CBP, ask questions and develop a solution.

In this case, the immediate objective was to resolve the importer's outstanding Customs bills and restore the ability to move forward. The longer-term objective was more important: help the importer establish procedures that could prevent the same situation from happening again.

For importers, the lesson is simple:

Don't wait for your next shipment to discover that a previous Customs issue is still unresolved.

Stay on top of CBP correspondence, communicate with your Customs Broker and build compliance procedures that continue working after the shipment is released.

That's the Power of Good Advice!

This article is provided for general educational purposes and does not constitute legal advice. Customs requirements and procedures may vary depending on the facts and circumstances of a particular transaction.