CBP Finds Importer Engaged in Evasion by Transshipping Through Cambodia

CBP initiated the Enforce and Protect Act (EAPA) investigation in September 2021. Little Fireflies provided only a one-page entry/immediate delivery form in response to requests for information, failing to provide information pertaining to the entries’ production, sales, transportation or payment, the agency said. After a second request, Little Fireflies again provided insufficient information to CBP, failing to provide purchase orders, commercial invoices, proof of payment for raw materials, transportation documents, foreign customs documentation, factory production records, production capabilities, entry transactions, or the names of their corporate officers, CBP said. CBP then determined that reasonable suspicion existed that Little Fireflies imported Chinese-origin fittings into the United States that had been transshipped through Cambodia. On Dec. 9, 2021, CBP issued a notice of initiation of investigation and interim measures.

CBP noted that "Little Fireflies has multiple connections to China that conveniently position it to facilitate evasion." Yuanshou Zhang is listed as Little Fireflies' director but is also an employee of Chinese exporter Dalian Metal. Several bills of lading for entries indicate that Dalian Metal facilitated the transportation of merchandise for Little Fireflies from their location in Dalian City, China. The issuer of many of the lading bills was Chinese freight forwarder Tianjin Fullrich Forever International Forwarding Co., a favorite partner of Dalian Metal, according to CBP. Little Fireflies claimed that the fittings originated in Cambodia and listed itself as both the importer of record and the manufacturer. However, evidence shows Little Fireflies was a trading company rather than a manufacturer and sourced its materials from HiCreek, a company CBP previously determined to be a transshipment point for Chinese-origin fittings, the agency said.

Granite Plumbing Products LLC, an importer of soil pipe from Little Fireflies, is under investigation in a separate EAPA case (7621). Granite Plumbing and the trading company in this case "both seemed unaware that they purchased merchandise from Little Fireflies," CBP said. Granite Plumbing stated that it ordered soil pipe from Lino and that Lino informed Granite Plumbing that HiCreek produced the soil pipe, CBP said.

Granite Plumbing and the trading company ordered soil pipe and fittings from Lino or Dalian Metal, which in turn obtained the soil pipe and fittings from HiCreek. When this merchandise entered the U.S., Little Fireflies’ name was on the U.S. entry documents rather than Lino’s, Dalian Metal’s or HiCreek’s names, CBP said. "Because this arrangement began shortly before CBP’s EAPA determinations in EAPA 7454 and 7455, it would seem likely that the use of Little Fireflies’ then-unknown name as both the importer and manufacturer of the merchandise was intended to avoid CBP’s interim measures and later its EAPA determination associated with Lino, Dalian Metal, and HiCreek," CBP said.

"The fact that Little Fireflies sourced its fittings from HiCreek -- whom CBP previously determined acted as a transshipment point for Chinese-origin fittings -- and omitted HiCreek’s name from the entry documents is consistent with continued evasion," the agency said.

CBP will suspend liquidation for entries subject to this investigation, until instructed to liquidate. For entries previously extended in accordance with Interim Measures, CBP will rate-adjust and change those entries to type 03 and continue suspension until instructed to liquidate these entries. CBP will also continue to evaluate Little Fireflies’ continuous bonds and will require single transaction bonds as appropriate. CBP or other agencies may pursue additional enforcement actions or penalties, it said.