The U.S. antiboycott laws and regulations have been around since the era of disco. In stark contrast to fast-moving sanctions and export controls, we rarely see updates to the antiboycott regulations or enforcement strategies. Last October, however, the Department of Commerce, Bureau of Industry and Security (BIS) announced enhancements to its antiboycott enforcement strategy. As part of its implementation of this updated enforcement strategy, BIS has both expanded the scope of required antiboycott reports and flagged antiboycott compliance specifically for government contractors. These moves demonstrate how BIS plans to focus its enforcement efforts on Federal contractors.
Ryan Roberts is a partner in the Governmental Practice in the firm's Washington, D.C. office. He is also a member of the firm's Aerospace and Defense and Retail Industry Teams.
For years, domestic content requirements have been a point of pain and frustration for government contractors. Historically, these regimes typically come in the form of the proverbial stick – that is, provide products and/or services that meet these country of origin requirements, or risk severe consequences (the billions in False Claims Act Trade Agreements Act settlements speak for themselves). But through the Inflation Reduction Act of 2022, Congress has taken a unique approach by authorizing the Department of Treasury to use country of origin as a carrot – offering certain energy facilities bonus tax credits for meeting specified “domestic content” requirements. To create this new carrot, Congress relied heavily on the Government’s prior experience with domestic content regimes – pulling predominantly from the Federal Transit Authority’s (“FTA”) “Buy America” regulations, but with a Buy American Act twist. In doing so, Congress has left the renewable energy industry with more questions than answers on the applicability of the bonus tax credit to their facilities.…
On November 14, 2013, the U.S. Department of Justice announced a False Claims Act settlement with Basco Manufacturing Company, a maker of shower enclosures, for $1.1 million related to misstatements on U.S. Customs and Border Protection (CBP) entry forms. The alleged misstatements were intended to allow the company to avoid antidumping duties (ADD) and countervailing duties (CVD) on aluminum extrusions used in its products that were actually from China, but transshipped through Malaysia in an attempt to avoid the duties. The settlement against Basco does not resolve the entire matter, as Basco was one company of many involved in an alleged conspiracy to conceal the Chinese origin of the aluminum extrusions at issue. Aspects of the settlement highlight certain risks posed by the False Claims Act that compound general U.S. enforcement of trade laws, and a reminder that diversion for inbound products to the United States may be a significant compliance issue for companies to be aware of.
Continue Reading A Peek Around the Curtain: A False Claims Act Settlement for Avoiding Customs Charges