CBP LA & Cleveland Issue Reminders on "Zero Tolerance Policy" Regarding Gate Outs

(A "gate out" is defined as a container/cargo that has been targeted by CBP for terrorism or enforcement inspection that is released without authorization from CBP.)

Some Cargo Being Released Prior to Authorization Despite Zero Tolerance Policy

According to the LA Public Bulletin, CBP continues to experience instances in which cargo targeted for terrorism or enforcement inspection has been released without CBP authorization or examination despite the implementation of CBP's Zero Tolerance Program regarding "gate outs."

(The Cleveland Area Port Pipeline states that within the past two months, there has been an upswing in violations related to the release of cargo without authorization or examination.)

CBP LA is reminding vessel carriers, non-vessel operating common carriers (NVOCCs), and marine terminals that positive control must be ensured for all containers selected for CBP inspection.

"Gate Out" Incidents to Incur Civil Monetary Penalties

According to the LA Public Bulletin, civil monetary penalties are being assessed for each "gate out" incident against all culpable parties and mitigated on strengthened guidelines, as defined in CBP Decision 06-34, "New Guidelines for Mitigation of Penalties for Merchandise Delivered from the Port without CBP Authorization or Examination; Public Safety." (See BP Note for details of CBP Dec. 06-34.)

CBP Cleveland states that civil monetary penalties will be assessed under the provisions of 19 USC 1595a(b) (penalty for aiding unlawful importation) for the introduction of articles into the U.S. contrary to law against every person who is any way connected with violations relating to "gate out" activity.

Violations Could Trigger CBP Enforcement Actions

In addition to penalty actions, the LA Public Bulletin states that enforcement activities may be conducted against the violator, including stationing CBP officers at terminal exit ports to ensure compliance with CBP policy.

The Cleveland Area Port Pipeline adds that violations will incur civil monetary penalties, which are subject to severe mitigation guidelines, in addition to possible enforcement actions.

(See ITT's Online Archives or 06/19/07 news, 07061905, for BP summary of CBP announcing vessel Automated Manifest System (AMS) changes to mitigate "gate out" issues. See ITT's Online Archives or 08/10/07 news, 07081005, for BP summary of additional information on vessel AMS changes that mitigate "gate out" issues.)

LA Public Bulletin (LA07-019, dated 08/17/07) available via email by sending a request to documents@brokerpower.com

Cleveland Area Port Pipeline (07-93, dated 08/15/07) available via email by sending a request to documents@brokerpower.com

BP Note

CBP Dec. 06-34 provides guidelines for the mitigation of penalties for merchandise delivered from the port without CBP authorization or examination, or both, if CBP considers that such removal or delivery places public safety at risk.

According to these 2006 guidelines, if CBP considers that the removal or delivery of the merchandise places the security, health, or safety of the public at risk, the penalties assessed may be mitigated to an amount equal to the lesser of: (1) 75% of the domestic value of the merchandise removed or delivered without authorization and/or examination, or (2) a flat sum that escalates from $10,000 to $75,000 (depending on whether it's the first, second, etc. violation).

If CBP does not consider that the removal or delivery of the merchandise places the security, health, or safety of the public at risk, penalties may be mitigated to between $2,500 and $20,000 in accordance with the guidelines which appear in T.D. 99-29, as amended. In the past, such penalties were often mitigated to $2,500.

(See ITT's Online Archives or 12/06/06 news, 06120605, for BP summary of CBP Dec. 06-34.)