US Seeks Nearly $56K From Importer for Material Omission When Entering Tire Shipments

The U.S. brought a complaint against a tire distribution company Aug. 20, seeking payment of a $55,882.98 penalty for the importer’s initial failure, in 2019 and 2020, to pay cash deposits for two tire entries (United States v. Franco Tire Distribution Inc., CIT # 24-00161).

Importer Franco Tire Distribution entered two shipments, one on Aug. 21, 2019, and one on Oct. 2, 2019, that were subject to antidumping and countervailing duty orders on Chinese-origin truck or bus tires. Franco correctly filed the entry paperwork but failed to pay the $27,941.49 due as a result of the orders, so CBP rejected the entries, again asking that the payments be made. Franco handed over the proper sums on Nov. 17, 2019, and Feb. 19, 2020, 30 and 19 days, respectively, after being informed of the omission by CBP, the U.S. said.

Because of the error, Franco incurred a $55,882.98 penalty at the culpability level of negligence, the U.S. said. CBP later halved that penalty to $27,941.49.

“Franco Tire Distribution, Inc. did not seek guidance from Customs and Border Protection through the pre-importation ruling program, did not file a protest on the entry’s rejection, and did not request advice or rely on advice from its broker,” CBP said in its decision to mitigate the initial $55,882.98 penalty.

That payment was due April 4, 2024, 30 days after the mitigation was announced, the U.S. said. In March, Franco requested a 30-day extension “and a proposed a payment rate of $1,000.00 per month,” it said. CBP told the importer that it would not be possible to grant an extension without a waiver of the statute of limitations, though it did provide Franco an additional 15 days “for mailing and processing,” the government said.

“Franco Tire Distribution, Inc. did not respond and the time for payment elapsed,” it said.

As a result, it said, it is seeking the original $55,882.98 penalty from the company.