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EPA

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VW to pay HIGHEST CBP PENALTY EVER, $1.45 Billion!

posted by Jennifer Diaz January 19, 2017 0 comments

Screen Shot 2017-01-18 at 11.48.28 AMOn January 11, 2017, the U.S. Customs and Border Protection (CBP) and the Attorney General announced the largest criminal and civil settlement ever against Volkswagen (VW) that totaled $4.3 billion. The breakdown of the settlement was $2.8 billion for the criminal penalty and $1.45 billion for a combined civil penalty for both the CBP and the Environmental Protection Agency (EPA). Volkswagen agreed to plead guilty to three felony criminal counts and pay the $2.8 billion dollar penalty. The $1.45 billion combined settlement was for EPA’s “claim for civil penalties against VW in connection with VW’s importation and sale of these cars” as well as CBP’s claim for customs fraud.

CBP’s part of the $1.45 billion settlement dealt with a violation of 19 U.S.C. §1952, which “prohibits persons, by fraud, gross negligence or negligence, from entering or introducing, attempting to introduce, or aiding and abetting the entry or introduction of merchandise into the commerce of the United States, by means of statements or acts that are material and false, or by means of omissions which are material”.

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EPA Compliance Webinar November 30, 2010, by NCBFAA

posted by Customs & International Trade Law Blog November 18, 2010 0 comments

The National Customs Brokers and Forwarders Association of America (NCBFAA) is hosting a webinar on the topic of "EPA Import Compliance – What To Do When Things Go Wrong".

The webinar will focus on the practical import compliance policies and procedures of both the U.S. Environmental Protection Agency (EPA) and U.S. Customs and Border Protection (CBP) for the importation of mobile source equipment such as non-road and marine spark ignition engines in motorcyles, generators, and lawn mowers. 

An introduction to the EPA’s enforcement of the Clean Air Act through its regulations will be discussed.  Learn about ‘EPA Certificates of Conformity,’ ‘ EPA Administrative Settlement Agreements,’ and the proper use of EPA Form 3520.

Real-life examples of detentions and seizures by CBP will be used, along with a step by step "how to" resolve seizures and penalties by CBP and settle civil penalty cases with the EPA.

Registration may easily  be done on-line by clicking on this "Register Now"  link, or by calling Brian Barber, Director, NCBFAA Educational Institute, at (202) 466-0222.

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Pep Boys Paid $5 Million to Settle Case with EPA for Illegal Importation of Motor Vehicles and Generators

posted by Customs & International Trade Law Blog June 18, 2010 0 comments

Now that summer is here, air conditioners and generators are on our minds.  It is likely the AC unit or generator that was installed in your home or office was imported into the United States, and made in China.  The EPA has very specific requirements regarding the importation of generators and  motor vehicle engines, including ATVs, snowmobiles, motorcycles, and anything else with a non-road spark ignition engine.  EPA is concerned about enforcing emissions standards under the Clean Air Act, and so should you.

EPA regulations regarding the importation of motor vehicles are enforced by U.S. Customs and Border Protection, which will stop, examine, and seize any engine not exactly complying with detailed EPA requirements, including proper labels displayed on the engine part.  All such importers should be aware of, and timely, accurately and completely submit EPA Form 3520-21 (EPA Declaration Form for Vehicles and Equipment Subject to Federal Air Pollution Regulations).  Failure to do so will result in the seizure of the imported merchandise by U.S. Customs, and penalties against the importer up to $37,500 per vehicle/engine in violation.  Seizures are resolved by filing a Petition with the appropriate U.S. Customs’ Fines, Penalties, and Forfeitures Office, and by negotiating and then signing an Administrative Settlement Agreement with the Air Enforcement Division of the EPA.

The aggressive enforcement of EPA’s regulations of 40 CFR Parts 86 and 90 were demonstrated in the recent settlement by Pep Boys which has agreed to pay the EPA $5 million, implement a corporate compliance program, and export over 15,000 non compliant vehicles and generators.

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Importer Pleads Guilty to Smuggling Freon

posted by Customs & International Trade Law Blog December 5, 2009 1 Comment

On November 20, 2009, in Federal Court in Miami, Florida, Mr. James Garrido and the company he controlled, Kroy Corporation, pled guilty to charges related to their illegally smuggling into the United States certain restricted ozone-depleting substances, in violation of the Clean Air Act enforced by the U.S. Environmental Protection Agency.

Chlorofluorocarbons (CFCs) are ozone depleting substances and include CFC-22 which is otherwise known as R-22 or popularly known by its trademark name, Freon, owned by DuPont.  CFC-22 is a widely used refrigerant for residential heat pump and air conditioning systems.

In 1988, the United States ratified the Montreal Protocol on Substances that Deplete the Ozone Layer. By ratifying the Protocol, the United States committed to a collaborative, international effort to regulate and phaseout ozone-depleting substances. The United States amended the Clean Air Act (CAA) in 1990 to include Title VI, Stratospheric Ozone Protection. The Clean Air Act established a schedule to phase out the production and importation of CFC-22.  Individual companies are licensed annually by the EPA to import specified maximum quantities of CFC-22.  By 2030, the CFC-22 will be completely phased out.

Neither Mr. Garrido nor Kroy Corporation were ever licensed by the EPA to import CFC-22.  They imported approximately 420,000 kilograms of CFC-22 valued at about $4 million over 2 years in violation of  18 U.S.C. section 545(smuggling).  They intentionally misdescribed the CFC-22 on documentation presented to U.S. Customs and Border Protection as another refrigerant, R-134A, which did not require any special license from the EPA. As stated in the press release by the United States Attorney’s Office for the Southern District of Florida:  “Except for a small quantity of legal refrigerant strategically placed in front of the contraband, the shipment contained CFC-22 and were accompanied by false documentation.”

The case was investigated by Special Agents from the Miami offices of the EPA and the U.S. Immigration and Customs Enforcement (ICE).  Sentencing will take place on February 11, 2010.  Mr. Garrido could be sentenced to 20 years imprisonment, and a criminal fine of $250,000 for each of the three counts to which he pled guilty.