The U.S. honey and garlic industries applaud President Trump’s Executive Order issued today instructing Customs and Border Protection (CBP) to develop enhanced procedures to ensure that remedial antidumping and countervailing (AD/CV) duties imposed by the United States are actually collected.
As the Administration has noted, at least $2.8 billion in duties have gone uncollected since 2001, with China accounting for much of the problem. According to a recent analysis by the U.S. Government Accountability Office (GAO), the lion’s share of AD/CV duties that have not been collected involve duties on imports from China of fresh garlic, honey, canned mushrooms, and crawfish. At the time of the GAO report, which included data through Fiscal Year 2014, the total uncollected duties on these four products exceeded $1.4 billion.
“With a whopping $750 million in outstanding duties on orders covering our products from 2001 through 2016, California garlic producers know first-hand the devastating impact of dumped Chinese goods,” said John Layous, Managing Partner at The Garlic Company in Bakersfield, California. “We spent years getting slammed by illegally-dumped garlic, years getting remedial duties in place, years watching importers evade those duties, and still more years watching insurance companies refuse to pay bonds securing those duties. We welcome President Trump’s order to better enforce our trade laws and create a more level playing field for affected domestic industries.”
AD/CV duties are critical tools used to respond to imports to the United States that are either “dumped” at below-market prices or whose producers are subsidized by their home governments. Both practices put domestic producers at an unfair advantage and U.S. trade remedy laws are a critical response. Unfortunately, domestic industries and workers find it difficult to compete when these laws are not enforced fully, including the collection of remedial duties.
“We are encouraged by the Trump Administration’s focus on improving CBP’s duty collection efforts,” said David Allibone of Sioux Honey Association, representing an industry with hundreds of millions of dollars in outstanding duties and associated interest. “It’s no good to go through all the trouble of putting a dumping order in place only to drop the ball on enforcement. I’m hopeful that this executive action leads to the collection and full distribution of moneys owed to America’s beekeepers.”
U.S. garlic and honey producers, along with other domestic industries, have struggled for two decades against unscrupulous Chinese dumpers, U.S. surety companies, and even at times CBP itself to see these duties collected. There are a number of issues involving collection, bonding, and distribution of collected duties and interest under the Continued Dumping and Subsidy Offset Act that the industries look forward to addressing with the Trump Administration as this Executive Order is implemented.
“Uncollected duties undermine and weaken our trade laws,” concluded Kelvin Adee of the American Honey Producers Association. “Failure to collect these penalties at the border means American producers must still compete with dumped honey in the U.S. marketplace. AHPA welcomes the spotlight on this issue and is hopeful the Administration will also address other long-outstanding issues of utmost importance to our industry, including CBP’s distribution of collected duties and interest to injured U.S. producers in accordance with the law.”
U.S. Honey and Garlic Producers are represented by Kelley Drye & Warren LLP.