New U.S. Customs Rules to Impact Importers of Record
On June 3, President Trump signed an Executive Order directing the Department of Homeland Security and U.S. Customs and Border Protection (CBP) to tighten eligibility requirements for importers of record, increase disclosure obligations, strengthen bonding requirements, and expand customs enforcement.
CBP and DHS must develop implementing regulations, guidance, and policies, with several actions required within 90 to 180 days. Companies importing goods into the United States should begin reviewing their importer structures and documentation now.
IMPORTER-OF-RECORD ELIGIBILITY AND BONDING REQUIREMENTS
Every formal and informal customs entry must identify an importer of record (IOR), the party legally responsible for the entry. Under the new order, IORs will be required to maintain a minimum level of tangible U.S. assets, customs bonding, or both. CBP will establish the specific thresholds and increase minimum bond coverage requirements.
Importers should expect to document their financial standing, U.S. presence, ownership structure, and import activity more formally than before.
ADDITIONAL IMPORTER DISCLOSURES
IORs may be required to provide CBP with additional identifying and business information, including:
- anticipated import volumes
- year of organization
- ownership and beneficial ownership disclosures
- business affiliations
- domestic asset disclosures
CBP may require additional information as part of the revised registration and vetting process.
NEW "GOOD STANDING" AND VETTING REQUIREMENTS
Per the order, CBP must establish a good-standing standard for IORs based on factors such as compliance history, enforcement actions, and payment of customs liabilities. CBP will also update the IOR registry, remove inactive IORs, create risk-based importer tiers, and implement recurrent vetting procedures for entities involved in import activity.
ADDITIONAL RESTRICTIONS FOR FOREIGN IORS
The order introduces heightened requirements for foreign IORs. The definition is based on factors including U.S. organization, physical presence, beneficial ownership, and domestic assets. Further CBP guidance will be needed to determine how the definition applies to specific corporate structures.
Foreign IORs will be prohibited from filing informal entries. For formal entries, foreign IORs generally may not rely on continuous bonds unless CBP determines that revenue and compliance risks are adequately protected. They must also either be CTPAT validated, if eligible, or use a CTPAT-validated and licensed customs broker to file entries.
EXPANDED SUPPLY-CHAIN DOCUMENTATION
Importers should expect additional disclosure and certification requirements related to their goods and supply chains. The order references information such as:
- manufacturer product identifiers
- model or style numbers
- composition, grade, and size
- production methods
- foreign tax and global business identifiers
- documentation submitted to foreign customs authorities before exportation to the United States
CBP will issue further guidance regarding the specific data elements and certifications required.
INCREASED ENFORCEMENT AND PENALTIES
The order directs CBP to increase audits, enforce liquidated-damages claims against customs bonds more aggressively, restrict in-bond activity where appropriate, and prioritize enforcement of forced labor, misclassification, undervaluation, and illegal transshipment.
CBP must also revise its mitigation standards to establish a penalty floor of at least 50% of the assessed penalty, absent exceptional circumstances, and eliminate mitigation for repeat offenders. Customs brokers may also face maximum penalties for failures involving due diligence, repeated representation of non-compliant clients, or untimely cooperation with CBP.
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