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Textile shipments at high risk, priority trade issue
Textile and wearing apparel shipments account for 43 percent of the duties U.S. Customs and Border Protection (CBP) collects.
CBP designates textiles as a priority trade issue, placing increased scrutiny on these shipments than with other commodities. Textiles are responsible for CBP’s largest duty loss, primarily from non-compliance with free trade agreement regulations.
Last year, CBP seized more than $10 million in improperly described textile and apparel shipments. Some companies tried to avoid safeguard quotas from China by describing cotton merchandise as ramie.
During late 2005, CBP hired 45 additional employees to strengthen textile law enforcement efforts and conducted more than 2,000 additional examinations to identify smuggling and
improperly described merchandise. In February 2006, CBP
made 25 seizures, amounting to $4 million in illegal textiles attempting to enter the country. In addition to continuing enforcement efforts, CBP is initiating special operations to detect and deter fraudulent activity.
CBP personnel are also visiting high-risk foreign factories. Some factories were closed or refused CBP team admission, and others had evidence of engaging in illegal transshipments.
Because of the high-risk nature of textiles, CBP may require importers to post a Customs bond equal to the following:
Single transaction bonds: If textiles are subject to quota or visa, the STB must be for three times the value. If no quota or visa, STB
remains at value plus duty.
Continuous bonds: There are no special regulations pertaining to continuous bonds for textile shipments, so continuous bond amounts can be
determined based on the current formula of 10 percent of annual duties, taxes, fees plus AD/CVD duties plus open/paid claims. However, in
certain instances CBP has issued bond sufficiency letters on textiles requiring a CTB for 2 percent of the annual values imported. Even though
all continuous bonds are filed with the National Finance Center (NFC), CBP ports have still issued bond sufficiency letters for textile accounts
requesting the CTB amount be increased to 2 percent of imported values.
On textile shipments in excess of a broker’s standard underwriting authority, we do require a signed bond application and indemnity from the importer. We ask our customs broker's clients to provide complete details on the application so we can provide quick bond approvals. We also ask our customs broker's clients to be aware of these concerns on textile shipments so importers can be properly underwritten to avoid losses.
For further information, contact Mark Graf, Surety Manager or Andriana Davis, Product
Manager at Avalon’s corporate headquarters. Mark Graf can be reached by phone at 847-700-8071 or at
mgraf@avalonrisk.com. Andriana Davis can be reached at 847-700-8087 or at
adavis@avalonrisk.com. Please do not hesitate to contact one of our nine regional offices throughout the United States.
To view a directory of Avalon’s office locations, please
visit our Web site at
www.avalonrisk.com.
Source:
http://www.cbp.gov/xp/cgov/newsroom/fact_sheets/trade/
textiles_priority.xml
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