Abady Law Firm, P.C. – Customs and Import/Export Attorney Blog
Learn the Basics of Customs and International Trade Policy and Procedure
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Structuring, according to United States Code (USC) laws and regulations, is the attempt by one or more persons to avoid importation/exportation reporting requirements by partitioning a sum of $10,000 or more in currency or other monetary instruments, so that the divided amounts each fall under the reporting threshold. The law is designed primarily to combat criminal enterprises that traffic cash unreported to the IRS.
The official structuring law, as it pertains to entering or leaving the U.S with currency, 31 USC 5324 (c) (3), states the following:
“(c) International Monetary Instrument Transactions.—No person shall, for the purpose of evading the reporting requirements of section 5316—
(1) fail to file a report required by section 5316, or cause or attempt to cause a person to fail to file such a report;
(2) file or cause or attempt to cause a person to file a report required under section 5316 that contains a material omission or misstatement of fact; or
(3) structure or assist in structuring, or attempt to structure or assist in structuring, any importation or exportation of monetary instruments.”
The law says, that you can’t legally divide a sum of $10,000 or more in cash between two or more people in order to make it appear that you each are carrying individual amounts under the reporting requirement. A typical example of structuring involves a family of three traveling together with a sum total of, say, $17,000.
To avoid having to file a report for the $17,000, the family divides the cash amongst them: Dad carries $5,000, Mom carries $4,000, and Son carries $7,000. When they attempt to travel through Customs as a family unit with the cash, though, Customs becomes suspicious. Individually, each family member’s cash amount falls below the reporting requirement, but Customs deems them as a single familial unit under the structuring law. As a result, Customs seizes the entire $17,000.
A second example involves a party of vacationers who has traveled outside the U.S. While vacationing, one of the travelers ends up with $21,000 in gambling winnings from a casino. To circumvent the reporting requirements, perhaps to avoid taxes on the winnings, the travelers split the $21,000 up among them in separate amounts, each under $10,000. As they attempt to pass through Customs, even as individuals, Customs recognizes their affiliation and suspects a structuring violation. Just like in the prior example, each individual’s cash is seized.
Structuring is a federal criminal offense, punishable by up to five years in prison, a fine, or both. Even though the law is in place primarily to combat tax evaders and criminal enterprises, there are times when individuals with legally upstanding and legitimate business/personal intentions can inadvertently become ensnared in a structuring violation.
For more information on structuring violations, contact Abady Law Firm at 800.549.5099. Or, contact via email to speak with a U.S. Customs Attorney if your currency has been seized at an airport or border.
The U.S. Customs and Border Protection (CBP or Customs) works in conjunction with the Food and Drug Administration (FDA) to ensure that products are in full compliance before they are imported or exported to and from the United States. At times, the FDA or Customs may deny the entry of a product if they determine that a good or product fails to meet strict import/export requirements. When this happens, the product is detained for further examination. Depending on the findings of the examination, the FDA may issue a Notice of Action.
FDA Notice of Action
Regulated products must comply with the FDA’s Food, Drug and Cosmetic Act. Any products entering U.S. customs that are found to be or are suspected of being non-compliant are detained for further physical examination. The FDA district office then issues a “Notice of FDA Action.” This notice specifies the nature of the violation and gives the consignee or owner of the product an opportunity to respond and provide evidence as to the admissibility of the product.
Responding to The FDA Notice of Action
While you may feel like venting your frustrations or anger with the FDA or Customs officer who detained your product, it is wise to keep your cool and consult with a Customs law attorney who can advise you on your legal options and your next course of actions. You must act promptly when you receive a Notice of Action because it is time-sensitive.
- Gather all pertinent facts about the detention. Do not respond to the Notice of Action until you have all of the facts.
- Thoroughly review the Notice of Action. It would be a good idea to do this with a Customs attorney so he can explain the violation(s) for which your product was detained and address any questions and concerns you have.
- Note the “Response By” date by which you must submit your response. If you do not respond by the specified date, the FDA will issues another Notice of FDA Action that will refuse admission of the product. You will be ordered to export the product elsewhere or destroy the product within 90 days. Further, it is highly difficult to have the FDA rescind a refusal once one has been issued.
- You response should include a detailed explanation and and any evidence showing that you have taken the necessary measures to bring your product into compliance and have resolved the circumstances that lead to the violation (s). A Customs lawyer can assist you with this.
If you have a good or product that is detained in Customs, plan to import a product and need information on importing requirements and procedures, or you simply need assistance obtaining import documentation, contact a Customs law firm right away.
Don’t wait until your product is tied up in bureaucracy or sitting in an FDA detention center. An import and export attorney will work diligently to make sure your product is in full compliance with all FDA and international requirements to the mutual satisfaction of all parties involved.
For more information about an FDA notice of action or for assistance with any of the issues noted above, contact Abady Law Firm, P.C., at 800.549.5099, to speak with a customs law attorney.
If you find yourself consistently being detained for secondary screenings at U.S. entry ports when returning from international destinations, you should probably contact the Department of Homeland Security’s Travel Redress Inquiry Program (“DHS TRIP”).
The above statement also applies to travelers who:
- Often face problems at ports of entry
- Were delayed or denied entrance on an airplane
- Were denied or delayed when trying to enter or exit U.S. ports of entry or border checkpoints.
- Feel that they have been improperly or unfairly: denied, delayed, or required to undergo additional screening at national transportation hubs.
The reasons for these additional screenings can be anything from being confused with someone else, or past convictions. Fortunately, for those who fall into any of the above categories, there are steps you can take to ease your entry and exit through these ports.
Step 1: Figuring out why you are repeatedly selected for additional screening
If you do not understand why Customs and Border Protection (CBP) keeps singling you out for additional screening, you should to find out why. That task is not particularly difficult since the Freedom of Information Act (FOIA) allows you to request copies of all information CBP has on you. The information on DHS databases go as far back as 1982, so by submitting a FOIA request on CBP.org, you should be able to pinpoint why you are being targeted at entry ports.
Step 2: Correcting erroneous information on your DHS files
Once you figure out why you are often made to undergo additional screening by CBP, you can file an inquiry through DHS TRIP to have incorrect information corrected. It’s a straightforward process that only requires a computer and internet access.
Simply head to the online form, and fill out the required information.
If you found erroneous information in the copies you received from your FOIA request, you should address that in the appropriate part of the form. Make sure you include details and any other information that can help clear things up.
You’ll also be required to send in copies of some documents with your inquiry like your passport. Copies of these can be sent via snail mail or scanned and sent to TRIP@dhs.gov.
Once your inquiry is accepted, you will be sent a Redress Control Number. This allows you to check up on the status of your inquiry and for booking flights once your inquiry has been resolved.
So, if you find yourself getting consistently singled out at U.S. entry ports and would like to avoid more of the same in the future, the above steps should point you in the right direction. However, you should note that resolving issues on your DHS files does not automatically exempt you from additional screening in the future. The selection process for determining which travelers are singled out depends on many other factors like random selection and travel patterns.
Generally speaking though, a positive outcome from your DHS TRIP inquiry should make it a lot easier for you to enter and exit U.S. ports. One should seek the advice from an attorney to increase the probability of success through the DHS TRIP.
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It’s not always a good thing to be “on the list,” particularly if you’re on the black list. One such black list is the FDA’s Import Alert list. Being placed on this can mean big problems for a company, and it requires the assistance of a professional customs attorney to petition for removal.
What is the FDA’s Import Alert List?
Basically, if a company is placed on this list, it means the FDA is providing a warning to importers around the world that the company’s products present safety concerns. If an Import Alert is placed on products or a company, it can mean not only big headaches, but also significant costs.
The FDA is able to automatically detain said products at the border, also known as Detention Without Physical Examination (DWPE). Although many products flagged with an Import Alert can still be imported into the U.S., it becomes a very expensive process for importers, lowering the amount of money they’re willing to pay for the flagged products.
If the FDA opts to refuse a shipment as a result of the importer doing nothing about an automatic detention, the shipment is either exported or destroyed. It’s also possible for the FDA to request Customs seize the detained products.
A few examples of reasons are placed on these lists are because of pesticide and contaminant residues and the presence of salmonella.
The FDA has set-up a comprehensive Import Alert page allowing users to search by company name, country and other criteria.
If a company is placed on the FDA’s black list, it can’t be removed until sufficient evidence is produced, showing the merchandise meets FDA compliance requirements.
Removal from the Import Alert List
The exact methods used for removal from the Import Alert list are directly related to the reason a company was placed there to begin with. If a food finds its way to the list as a result of misbranding, the FDA requires that at least five consecutive shipments enter the U.S., with at least one of those being audited for compliance by the FDA. It’s also worth noting these shipments can’t be made over one day or any other unreasonably short period of time.
In addition to the auditing process, it’s necessary that a Petition be filed directly with the FDA, requesting removal from the list. Important information included in a Petition include the specifics of the products in question, their entry numbers, and a variety of other relevant documentation.
A Petition isn’t just a cut and dry process. It has to be persuasive, and convincingly show the problem has been completely remedied.
While there are instructions provided by the FDA demonstrating how the removal process works, most people find success through the assistance of a qualified and experienced customs attorney. A customs attorney such as www.customsesq.com (Abady Law Firm, P.C) helps their client make a convincing case for removal, and they can also guide them through the lengthy and extensive paperwork and documentation required during the process.
Not only is the company charged with showing the problem has been fixed for current shipments, but it’s also responsible for outlining how a future problem will be avoided.
If your company is losing money as the result of placement on the FDA’s Import Alert list, contact us. Our import/export attorneys can provide you with the counsel you need to regain your profits and be removed from this highly detrimental list.
Please see article by Virtual-Strategy Magazine entitled Less than 3% of Companies on FDA Import Alert Red Lists Petition for Exemption Read more: http://www.virtual-strategy.com/2014/11/05/less-3-companies-fda-import-alert-red-lists-petition-exemption#ixzz3IEOALsE6
For more information about this blog post, please contact Abady Law Firm, P.C. and speak with our customs attorney at (800) 549-5099. Also visit www.customsesq.com to chat with a customs lawyer — who has insight into the FDA import alert list — about your company’s import situation and to schedule a consultation. To chat with us, click the bottom right corner tab of our homepage.
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