A U.S. Court of International Trade judge in New York has ruled that U.S. Customs and Border Protection (CBP) unfairly targeted U.S. shrimp importers with its enhanced bonding requirement (EBR), the National Fisheries Institute of McLean, Va., announced on Friday.
This month’s ruling stems from a lawsuit NFI brought in 2005 on behalf of 27 of its shrimp-importing members. In August 2009, the judge determined that CBP of “arbitrarily and capriciously” singled out U.S. shrimp importers and that they had incurred “irreparable harm as a result of the continued unlawful and discriminatory application” of the bonds.
CBP — the U.S. government’s No. 2 revenue-generating agency — adopted the EBR in mid-2004 to prevent tariff evasion. But the measure was applied to only shrimp, a product with no history of tariff evasion at the time. The U.S. government didn’t enact antidumping tariffs on shrimp imports from Thailand, Vietnam, China, India, Ecuador and Brazil until late 2004 and early 2005.
Consequently, shrimp importers went from paying a USD 50,000 bond annually to a bond totaling hundreds of thousands, if not millions, of dollars, money that’s tied up for a year or more.
Following this month’s ruling, CBP has 60 days to cancel all of the bonds or appeal the verdict. Once the bonds are cancelled, the plaintiffs will be able to ask that surety companies release their collateral, according to NFI.
“Customs now has the chance to do the right thing and act quickly to implement the Court’s decision,” said NFI President John Connelly. “This case has dragged on for nearly five years and this ruling is as definitive as it gets.”
All Supply & Trade stories >