President Donald Trump signed a major executive order on June 3 aimed at aggressively fortifying U.S. customs enforcement. The directive fundamentally alters requirements for Importers of Record (IORs), introduces severe compliance exposure for customs brokers, and specifically targets the operational capabilities of foreign-based importers.
The order instructs U.S. Customs and Border Protection (CBP) to overhaul its current vetting, bonding, and penalty frameworks to block noncompliant trade lanes.
Major Structural Shifts for Importers
The executive order introduces several new hurdles designed to increase transparency and financial accountability at the port of entry:
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Stricter Financial & Data Thresholds: IORs will face significantly higher continuous and single-entry bonding requirements, alongside expanded data-sharing mandates.
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Mandatory Documentation: Importers must provide additional underlying supply chain documentation and formal certifications verifying the legitimacy of their shipments.
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The “Good Standing” Mandate: CBP is directed to instantly prohibit imports from any IOR that fails to maintain “good standing”—effectively creating a real-time compliance gate.
Heavy Restrictions on Foreign Importers
In a bid to close enforcement gaps associated with non-resident compliance, the order severely curtails the rights of foreign IORs:
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Informal Entries Banned: Foreign importers are completely prohibited from filing informal entries (typically used for low-value shipments under $2,500).
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Formal Entry Restrictions: The directive orders CBP to heavily restrict the ability of foreign entities to file standard formal entries, shifting the regulatory burden toward domestic representation.
Escalated Liability for Customs Brokers and Agents
The directive shifts immense compliance pressure onto trade intermediaries, ordering “enhanced vetting procedures” across the board for importers, customs brokers, and freight forwarders.
The most disruptive elements of the order target broker due diligence and penalty mitigation rules:
Maximum Broker Penalties
CBP has been instructed to issue the maximum allowable financial penalties against customs brokers who fail to meet strict compliance baselines. Explicitly targeted behaviors include:
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Failing to conduct thorough due diligence on clients.
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Repeatedly representing noncompliant importers.
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Failing to cooperate in a timely manner with CBP Requests for Information (such as CF-28s or CF-29s).
Removal of Mitigation Flexibility
Crucially, the order establishes a rigid penalty “floor” set at 50% of the maximum statutory penalty. CBP field offices and headquarters will be legally blocked from mitigating penalties below this threshold. This represents a drastic departure from historical guidelines, where trade participants could frequently negotiate minor settlements for first-time or administrative errors.
