Case Study: Customs Compliance & Broker Management Drives Big Savings and Resolves Issues
December 4, 2023
About the Client:
Aprio engaged with a manufacturer that imports various types of chemicals used to make secondary batteries for electric vehicles.
The Challenge:
After the client imported chemicals from China to create battery products in the States, US Customs and Border Protection (CBP) determined that the products were subject to an anti-dumping and countervailing duty (AD/CVD) of over 360%. Unfortunately, the Customs broker did not notify the client about the additional AD/CVD, and it failed to update the import declaration and pay the additional duty. CBP issued a penalty of 100% of the value of the merchandise to the client as a result of its late response to and payment of the AD/CVD amount.
The Solution:
After developing a plan of action with the client, Aprio reviewed the import declaration and the applicability of the AD/CVD, which led to a surprising finding: the chemicals imported by the client fell outside the scope of the AD/CVD.
What’s more, Aprio found that the client misclassified the chemicals and paid a higher normal duty for importation, including the Section 301 “China” tariff. Not only did Aprio help the client claim a refund for the improper duty, but the team also challenged the penalty by filing a petition for mitigation with CBP. Aprio also established an import compliance manual for the client to help streamline more effective broker management and communication.
The Result:
Thanks to Aprio’s diligent review and remediation efforts, the client received a duty refund that amounted to over 375% of the value of its products. CBP also reduced the penalty to 1% of the value of the merchandise.
Aprio’s knowledgeable and experienced Customs and Tariffs advisors deliver proactive international tax and trade services in more than 60 languages. We offer proven results and facilitate open communication to help businesses overcome the sometimes-costly challenges of importing and exporting tangible products.
To get connected with Aprio’s Customs & Tariffs Team, please contact:
Jay Cho, J.D.
Director, Customs & Tariffs
770-353-7136
jay.cho@aprio.com
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About the Author
Jay Cho
Jay Cho is an international trade advisor and a lawyer by training who helps multinational companies better navigate US import and export complexities. He specializes in providing compliance risk management and strategies to help clients save on duty fees. With a decade of experience on both the consulting and legal sides of international trade, Jay is also well-positioned to offer guidance on many different customs enforcement matters, including customs inquiries, verification requests, audits, investigations and penalty cases.
