News / Warning as penalties for non-compliance with US import/export rules increase

The number of penalties for violations of the US Department of Commerce’s import and export rules has spiked over the past six months – and the cost of breaches is set to increase next week.

Among fines set to be hiked are those covering import or export of seafood and wildlife and violations of the foreign trade zone and the 2018 Export Controls Act.

While these increases are relatively minor, in many cases rising by just a few hundred dollars per breach, they come as supply chain and compliance operatives have noted an increase in the number of penalties being levied.

CEO of Tru Identity and customs expert Hugo Pakula said: “It has never been more important to stay ahead of non-compliance – and it has never been more costly [not to comply]”.

Mr Pakula, writing on LinkedIn, added: “These changes go into effect after 15 January, including if the associated violation occurred before [that date].”

Details of the increases were made available by trade law and consultancy Sandler, Travis & Rosenberg, noting the maximum penalty for violating the 2018 act will be raised from $364,992 to $374,474.

While small, export and cross-border ecommerce expert Silvia Carter noted that for shippers, “the rules keep on changing… increasing financial risk”, Kyle Grobler, global trade compliance manager at TE Connectivity, warned companies that the cost of violating these regulations was “just not worth it”, and urged businesses to “foster a compliance mindset”.

He added: “I have seen more fines and penalties over the last six months of my career than ever before.”

The new penalties follow a tri-seal note by the departments of commerce, justice and treasury last March, warning that “malign regimes and other bad actors” could utilise the “increasingly interconnected global marketplace” to undermine US national security.