CBP loses court case on enhanced bonding requirements for shrimp importers.

Oct 25, 2010   

The U.S. Court of International Trade has ruled this month that Customs and Border Protection (CBP) unfairly targeted U.S. shrimp importers with its enhanced bonding requirement (EBR). The ruling stems from a lawsuit filed by the National Fisheries Institute (NFI) on behalf of 27 shrimp importers. Previously, the Court had determined that CBP had “arbitrarily and capriciously” singled out U.S. shrimp importers and they had been irreparably harmed as a result of application of the EBR.

CBP had originally adopted the EBR in 2004 to prevent tariff evasion. However, the measure was applied at that time only to shrimp, which had no history of tariff evasion. Shrimp importers had their bonds increased from $50,000 to millions of dollars in some cases. Now, following the Courts ruling this month, CBP has 60 days to cancel all of the bonds or appeal the Courts decision. Once the bonds are canceled, shrimp importers will be able to ask the surety companies to release their collateral securing the bonds. As such, an onerous bonding requirement that singled out one class of importers has now been removed.