Your client (an importer) informs you (its broker) that, for the last 3 years, it has falsely reported the country of origin on certain entries covering shipments of shoes. The importer tells you that it has declared Mexico as the country of origin for the shoes and has claimed North American Free Trade Agreement (NAFTA) preference on the entries when the correct country of origin of the shoes was Japan. U.S. Customs and Border Protection (CBP) is validating the country of origin of the shoes. CBP has recently advised the importer, in writing, that CBP has reason to believe that the reported origin of the shoes is false and that CBP has commenced an investigation on the issue. Would you advise the importer to consider filing a Prior Disclosure?
A. Yes, disclose all of the entry numbers involved and appropriate documentation before CBP issues a penalty.
B. No, most of the entry summaries are liquidated and CBP will not be able to accept and process any monies tendered.
C. Yes, CBP may consider the prior disclosure valid since the importer voluntarily declared the violations out of good will.
D. No, the importer has knowledge of a commencement of an investigation.
E. Yes, disclose all of the entry numbers and appropriate documentation plus tender the actual loss of duties, taxes, and fees or actual loss of revenue plus interest so CBP can consider it a valid prior disclosure.
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The Answer is: D
Citation: 162.74(a)(1)
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