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In an important recent decision, the U.S. Court of Appeals for the Federal Circuit ruled in the case, Royal Brush Manufacturing, Inc. vs. United States Dixon Ticonderoga Company, that Customs and Border Protection (CBP) violated the Fifth Amendment right to due process of Royal Brush by providing only redacted versions of reports that CBP utilized in making its determination that antidumping duty (ADD) evasion occurred in connection with an Enforce and Protect Act (EAPA) investigation. The EAPA investigation centered around pencils shipped from the Philippines to Royal Brush in the United States. CBP concluded that the pencils were of Chinese origin and were transshipped via the Philippines to avoid paying the ADD under case A-570-827 for Cased Pencils from China. However, in making this determination, CBP relied on reports from a verification visit made to the Philippine factory. When Royal Brush requested copies of the reports, production number data and photographs taken at the factory were redacted due to CBP deeming this information to be confidential business information. CBP stated that there was no provision in the EAPA law itself that empowered them to issue a protective order which could have allowed release of the confidential information. Royal Brush then filed suit in the Court of International Trade (CIT).
The CIT ruled in favor of CBP, then Royal Brush appealed. The appellate court stated in its decision: “In short, the law is clear that, in adjudicative administrative proceedings, due process includes the right to know what evidence is being used against one.” The decision further stated: “As best we can make out, the government’s argument is that due process does not require public disclosure of confidential business information relied on in adjudication but only requires disclosure to affected parties under protective orders… We are aware of no case supporting any such extraordinary theory, and it is untenable on its face. The right to due process does not depend on whether statutes and regulations provide what is required by the constitution.” The case was remanded back to the CIT for CBP to provide Royal Brush the redacted information and give them an opportunity for rebuttal.
In legal circles, it is believed that this decision could also have an impact on CBP’s investigations under the Uyghur Forced Labor Prevention Act as CBP often does not release the evidence that it has compiled to the party whose cargo is being detained, which may now lead to court challenges of those decisions.
On February 11, 2025, the President issued a proclamation regarding the importation of steel and aluminum articles, increasing tariff rates to 25% from all countries. As part of that proclamation, it was announced that there would be expanded 25% tariffs to include key downstream products (derivatives) for both steel and aluminum. The Annex containing those products has been drafted and is expected to be officially published in the Federal Register on February 18, 2025.
Key Points:
• There are 167 new codes for steel downstream products (derivatives) subject to the 25% tariff referenced in this proclamation (covering 4 different chapters of the HTSUS).
• There are 123 new codes for aluminum downstream products (derivatives) subject to the 25% tariff referenced in this proclamation (covering 11 different chapters of the HTSUS).
To read the draft Federal Register, and access our Excel listing of HTS affected, click the links below:
For February, we are highlighting Jacquelyn Bakker, our CHB Manager in the JAS Chicago office. Jacqulyn started her career in the industry in 2012 in an accounting role before moving into the brokerage side in 2014. In her words, that’s when she “found my niche.” Jacquelyn joined JAS in 2018. After being named as the Brokerage Supervisor, Jacquelyn decided to take on the “daunting task” of obtaining her broker’s license. After 3 months of studying, Jacquelyn was able to pass on the first try! Jacquelyn manages a team of 6 entry writers in our Chicago branch and CHB manager. Jacquelyn is detail oriented and attentive to the needs of her clients internally and externally!
Jacquelyn has a 19-year old daughter, loving fiance and 2 dogs at home. She enjoys family time BBQing in the summer, taking the dogs for longs walks, playing Pokemon Go with family and seeing movies in the theater.
Jacquelyn is yet another great example that People Make the Difference!
CBP is leading global efforts in combating forced labor by imposing import bans on goods produced with forced labor. This has inspired international action, including the European Union’s adoption of similar measures and the inclusion of forced labor prohibitions in the USMCA. CBP’s actions have also driven labor reforms, notably in Malaysia, which launched a National Action Plan on Forced Labor and ratified an international protocol to combat forced labor. These advancements demonstrate CBP’s significant influence in shaping global supply chain accountability and driving positive change.
Read more about it by checking out the link below:
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