Reasonable Care: How Much is Enough?

There are many interesting concepts in the world of international trade, but perhaps one of the most discussed is “reasonable care.” The trade community was first introduced to this concept after the passage of the Customs Modernization Act in 1993 where Customs and Border Protection “CBP” ruled that the international trade community needs to be ‘clearly and completely informed of its legal obligations.’  This essentially was a push by the federal government to increase voluntary compliance with international trade law. However, because trade law is so complex and intricate and the rules and regulations are constantly changing, the Mod Act put a greater responsibility on Customs and Border Protection to provide the public with easily assessable information. An increase of voluntary compliance with CBP regulations results in a much quicker and smoother entry process for merchandise entering the commerce of the United States.

An importer may want to know, “How much reasonable care must I exercise?” Well, the answer is quite a bit. An essential responsibility of an importer as it relates to reasonable care is to ask himself some questions. Do I have a set procedure when it comes to my imports? Has a responsible and knowledgeable individual reviewed the customs documents before submission? Am I keeping appropriate records? Do I have a customs compliance program to ensure my entries are submitted correctly?  These are some of the specific topics that must be discussed to be fully compliant with the reasonable care provision. Customs and Border Protection expect that all importers use appropriate due diligence when dealing with: import documentation, country of origin verification, tariff classification, valuation, duty rates, quantity, free trade agreements, and recordkeeping. Importers can establish reasonable care by developing internal audits and controls.

When an importer abides by the principals set forth above, the risk is greatly reduced. CBP has the authority to halt or seize any merchandise that is entered into the United States and may do so upon suspicion that the accompanying paperwork is incorrect. Therefore, it is important that importers know the details of a shipment because the line items that may be overlooked may present a problem when it is time for CBP to review an entry.

If you would like additional information on whether reasonable care or if you have any other Global Trade Compliance matter please contact Allyn at (239) 489-9900 or you can email us at AllynCustoms@allynintl.com. Incorporated in the State of Florida in 1992, Allyn International is a boutique provider of logistics, corporate tax, and global trade services. Our in-house Customs team has 6 licensed customs brokers on staff in the U.S. and Europe.

Allyn Contributor: Ryan Smith

 

About Allyn International

Allyn International is dedicated to providing high quality, customer centric services and solutions for the global marketplace. Allyn's core products include transportation management, logistics sourcing, freight forwarding, supply chain consulting, tax management and global trade compliance. Allyn clients range from small local businesses to Fortune 500 firms. Allyn conducts business in more than 20 languages and has extensive experience in both developed and emerging markets. Highly trained experts are positioned throughout North and South America, Europe and Asia. Allyn’s regional headquarters are strategically located in Fort Myers, Florida, U.S.A., Shanghai, P.R. China and Prague, Czech Republic. For more information, visit www.allynintl.com.

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References:

United States, Congress, “What Every Member of the Trade Community Should Know: Reasonable Care.” What Every Member of the Trade Community Should Know: Reasonable Care, Informed Compliance, Sept. 2017. www.cbp.gov/sites/default/files/assets/documents/2017-Dec/ICPResCare2017revision.pdf.

Selby, Hank. “What Is Reasonable Care?” Shipping Solutions Export Document Software - Home Page, www.shippingsolutions.com/blog/what-is-reasonable-care.