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The Internet and Informed Compliance

By Joseph Mattera

What is "Reasonable Care?"

With the passage of the MODACT, the relationship between importers and the Customs Service has changed. "The Act shifts the legal responsibility ... to the importer and requires importers to use reasonable care to assure Customs is provided accurate and timely data."

In the current edition of the "Importer Audit - Compliance Assessment Team" (the so-called CATKIT), Customs has a section entitled "Reasonable Care Guidelines". In this section it states the following:

"Despite the seemingly simple connotation of the term 'reasonable care' this explicit responsibility defies easy explanation."

Nowhere is this more evident than in the area of locating and retrieving the information needed to make "informed" decisions on import transactions.

As a firm involved in the import process, you should be developing an informed compliance program. Not considering how to get access to relevant information would be leaving a gap in your program that could have significant legal and financial consequences.

What Are Your Responsibilities?

Customs states that:

"Importers and their agents are responsible for familiarizing themselves with the Customs Regulations, administrative rulings, interpretations and publications as well as the statutes, tariff schedules (including interpretative or explanatory notes), and judicial decisions which govern their import transactions."

Let us look at what Customs has said about the importance of using rulings and publications. Again we must turn to the "Reasonable Care Guidelines" for insight. In discussing "Informed Compliance" publications it states the following: "It is strongly recommended that importers always make sure that they are using the latest versions of these publications" and "failure to follow (them) will generally constitute the failure to exercise reasonable care..."

What Can You Do?

The Internet is a very important resource, but it does not have everything you need. For example, most websites do not have older (i.e. pre-1994) documents. Therefore, relying on a web search alone is not enough. How current is the information on the web is also a concern, as is the reliability of the information. The Internet, however, should be an integral part of your compliance program.

The Customs website and Customs Electronic Bulletin Board (which is now a part of the website) are vital for keeping abreast of Customs actions. Other sources of your program included the Customs Regulations, Customs Bulletin and Decisions, Customs Valuation Encyclopedia, and the Federal Register.

The regulations, directives, alerts, publications, etc. of the other agencies involved in trade regulation (e.g. FDA, EPA, OTEXA), etc.) are, of course, not covered by the Customs publications, so consider also what other resources you must acquire to access this information. The other agencies' websites are an excellent starting point, but do not contain everything.

Importers and their agents are encouraged not to limit themselves to just these resources. It is also strongly recommended that a program to track issues and monitor information sources be developed and implemented as a integral part of your day-to-day operations.

Remember that failure to exercise reasonable care constitutes negligence under 19 U.S.C. 1592!

Joseph Mattera, former import specialist and librarian for U.S. Customs and the U.S. Court of International Trade, now provides research and information services to the trade community. He can be reached at (718) 935-1746; email: ITIRESOURCES@worldnet.att.net


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