Tag: enforcement

Panelists:

• Joshua Aikens, Head of Government Affairs, Zonos
• Blake Harden, Managing Director, Washington Council Ernst & Young; former Trade Counsel on the House Ways & Means Committee; and former Senior Attorney in the Office of the Chief Counsel at US Customs and Border Protection
• Sydney Mintzer, Partner, Customs, International Trade, Supply Chain & Distribution, Mayer Brown LLP
• Felicia Pullam, Senior Director, Geo-Commerce, APCO Worldwide; former Executive Director, Office of Trade Relations, U.S. Customs and Border Protection

The panel provided a timely update and a detailed analysis of the Trump Administration’s Executive Order (EO 14411) on Strengthening Customs Enforcement, released on June 3, 2026. Key points raised by the panel:

Firstly, in addition to tariffs, customs enforcement is becoming another major trade issue facing the importing community, including U.S. fashion brands and retailers. According to several panelists, the Trump administration, through the EO, aims to ensure that every tariff owed is collected, companies cannot evade tariffs through customs “loopholes,” and that importers and their brokers are fully accountable for compliance. In other words, customs compliance is increasingly becoming a strategic issue rather than simply an operational one.

Secondly, importers of Record (IOR) face much stricter requirements. Specifically, the EO now requires that an IOR have “minimum U.S. tangible domestic assets, bonding, or both.” One panelist explained that, “I think what will surprise a lot of companies is the definition of US importer of record versus foreign importer of record. The status quo doesn’t draw that distinction…A foreign importer that is a trading company—if a foreign company owns a US trading company, they don’t have a lot of employees, they don’t hold a lot of assets, that company is likely to face significant restrictions that don’t exist today…I think that’s going to surprise a lot of companies who think because they’re an LLC or incorporated in the US that they currently think of themselves as a US company and as a US importer.”

Thirdly, using Delivery Duty Paid (DDP) sourcing may no longer shield U.S. buyers from customs enforcement risks. Historically, many fashion brands and retailers simply purchased products DDP and allowed overseas suppliers to handle importing. However, panelists warned that this approach is becoming much riskier in the context of the new EO. Instead, fashion brands and retailers may need to conduct much greater due diligence over suppliers’ import compliance than in the past. As one panelist noted, “A lot of companies that think they’re doing the right thing. So, for example, a U.S. company that says, ‘I don’t want to import it. I don’t want to be responsible for importing anymore. I’m going to let you, the foreign supplier, figure out how it’s going to get into the United States. I just want to receive it DDP… I just want to get the product.’ Historically, that consignee wasn’t really going to be touched by the customs laws. And I think that’s changing today..in particular because the justice department is able to use US criminal and civil statutes to go after what under the law is essentially conspiracy statute.” Another added that, “…a U.S. consignee who knows it’s paying X dollars for a good… may think they’re getting a good deal but they’re not really looking beyond why is that price so low… historically that was okay and I think it’s less okay now.”

Fourthly, AI could reshape customs compliance. According to the panel, AI could help the government identify fraud, analyze the supply chain, and detect anomalies more effectively and smartly. Meanwhile, for fashion companies, AI could potentially improve compliance, automate product classification, and better collect supply chain information. Relatedly, panelists noted that Customs increasingly expects importers to have comprehensive visibility into their supply chains, including knowing who they are doing business with and maintaining information that can trace products back through the supply chain. One panelist commented that, “I think AI is going to accelerate it. (It) is an expectation that you have more information at your fingertips about your supply chain that you know who is in whether that’s true or not right but the expectation is that you have that information that you share that information that you know who you’re doing business with that you can go all the way back.”  

Additionally, some panelists noted that the Trump Administration may intentionally use higher customs compliance costs as a “strategy” to encourage reshoring and “friend-shoring”. According to one panelist, “I think you have to think about the administration’s longer-term goal, right? So the administration’s longer-term goal is to reshore. They want more U.S. production.” Another added, “I think part of that is enforcement, ensuring the revenue in the short run, but part of that is also trying to encourage U.S. sourcing. And so… even if you’re doing everything right and you’re importing, I think the cost of importing, the burden of importing is increasing. And I think that’s simply because there’s a goal to either source from the U.S. or source from the partners that the administration prefers.”