CBP Takes Action Against XCMG for Evasion of Trade Laws on Imports

CBP Takes Action Against XCMG for Evasion of Trade Laws

U.S. Customs and Border Protection (CBP) has confirmed its final determination of evasion against XCMG North America Corporation, an importer of mobile access equipment from China. The investigation arose from claims made by the Coalition of American Manufacturers of Mobile Access Equipment (CAMMAE), which stated that XCMG, along with its affiliates, was evading antidumping and countervailing duties. They allegedly misrepresented their Chinese imports as being manufactured in Mexico, thereby avoiding significant tariffs imposed by U.S. law.

The investigation by CBP was prompted by evidence suggesting these misleading claims. CBP initiated its inquiry after receiving substantial information from CAMMAE that outlined the potential violations. In a decisive move, CBP announced that XCMG was found to have engaged in activities that constitute evasion of trade laws designed to protect American manufacturers from unfair competition.

Timothy C. Brightbill, co-chair of Wiley's International Trade Practice and counsel to CAMMAE, expressed commendation for CBP’s detailed investigation. He emphasized that strict enforcement of antidumping and countervailing duty orders is crucial, ensuring that American industries receive the legal protection they deserve. He stated, "Vigorous enforcement of antidumping and countervailing duty orders is critical to securing the relief U.S. companies are entitled to by law. CBP's response reflects the seriousness of importers' efforts to evade these orders."

The investigation revealed that during the scrutiny period, XCMG's imports from July 2025 onward would be subject to a proposed duty of 69.31%. This rate is significantly high and emphasizes the agency's commitment to curbing illegal import practices.

CBP's findings also indicated that XCMG had provided untruthful information in various documents submitted during the investigation. Moreover, the agency deemed some of XCMG’s production records as “highly unreliable,” leading to further questions about their compliance.

Evidence was also uncovered that showed XCMG was undervaluing its imports of mobile access equipment to manipulate duty liabilities, a serious infringement of U.S. trade laws. As part of its enforcement strategy, CBP plans to publish a public version of its final determination on its official website to ensure transparency in the enforcement process.

Since December 2021, antidumping and countervailing duty orders have been imposed on imports of mobile access equipment from China. These orders can lead to combined duty rates as steep as 180% for some Chinese producers and exporters. The illegal activities of duty evasion, absorption, and circumvention are under stringent monitoring by CBP and the U.S. Department of Commerce, with severe penalties ready to be enforced. Wiley has committed to maintaining vigilance over unfair trade practices, focusing on the robust enforcement of U.S. trade laws encompassing dumped and subsidized products from China.

The case against XCMG serves as a stern reminder of the importance of adhering to international trade regulations and the implications of failing to do so. For American manufacturers, this is a step in the right direction towards fair trade practices and a competitive marketplace. Unethical practices not only undermine companies that comply with the law but also threaten American jobs and economic stability. As CBP continues to take action against trade violations, the landscape for U.S. importers will undoubtedly evolve, ensuring that fair practices prevail within the market.