United States: President Trump Issues Two Executive Orders On Trade And Customs Enforcement, And Trade Deficits

President Trump signed two EOs addressing trade on Friday, March 31: one addressing trade and customs enforcement, including the collection of antidumping and countervailing duties (AD/CVD), and a second requesting an omnibus report on significant trade deficits. While the EOs represent another of the administration's major forays into trade, they set the table for increased enforcement of U.S. trade laws and scrutiny of U.S. trading partners.

Trade and Customs Enforcement EO

The first EO, titled "Establishing Enhanced Collection and Enforcement of Antidumping and Countervailing Duties and Violations of Trade and Customs Laws," addresses a number of trade enforcement issues that have been the focus of President Trump's trade policy. First, the EO addresses the undercollection of AD/CVD. Second, the EO instructs DHS and Customs and Border Protection (CBP) to develop a plan to combat violations of trade and customs laws and prevent the importation of inadmissible merchandise, as well as to increase intellectual property rights protections, which was also addressed in the Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA). Third, the EO calls on the DOJ, in consultation with DHS, to prioritize the prosecution of significant trade law offenses.

Trade Remedy Evasion

Citing $2.3 billion in uncollected AD/CVD as of May 2015, the EO instructs DHS to develop enhanced bonding requirements for certain importers and to make other improvements to the enforcement of U.S. trade remedy laws. The undercollection of AD/CVD has been the subject of congressional interest over the past decade and has resulted in the enactment of new trade remedy evasion provisions under Title IV of TFTEA, which is more commonly referred to as the "Enforce & Protect Act." We expect that the plan will involve provisions from TFTEA requiring CBP to implement a new procedure to investigate allegations of trade remedy evasion. In addition, CBP will likely rely on Section 115 of TFTEA, which requires CBP to establish bonding requirements for importers based on CBP risk assessments.

The EO calls on DHS and the Department of Commerce, among others, to develop a plan within 90 days to provide security through bonds and other enforcement measures for importers who are subject to AD/CVD and who (i) are new importers, (ii) have not fully paid applicable AD/CVD or (iii) have failed to timely pay AD/CVD. While it is unclear what the new additional bonding requirements will look like, there is some historical precedent for enhanced bonding requirements.

CBP attempted to apply similar bonding requirements in the mid-2000s, but suffered setbacks at the U.S. Court of International Trade and the World Trade Organization (WTO). In particular, CBP imposed enhanced bonding requirements on shrimp subject to trade remedy orders starting in 2005. Under the program, importers were required to post a bond—in addition to tender cash deposits for estimated AD/CVD—that represented approximately double the amount of AD/CVD cash deposit due on the entry. The U.S. Court of International Trade, however, found that the requirements violated U.S. law. The WTO also found that the enhanced bonding requirements violated the United States' obligations under the WTO.

The EO also calls for DHS to identify other enforcement measures that could be part of the plan to address trade remedy evasion. We expect that DHS will heavily involve the Trade Remedy Enforcement Division within CBP's Office of International Trade to develop this part of the plan. We expect that the plan will use existing authority for the division to investigate allegations of evasion of AD/CVD and issue Trade Alerts directing a closer inspection of merchandise by port personnel. The plan may also involve the new, judicially reviewable evasion petition procedure that CBP must undertake should it receive such petitions from interested parties, although that process has been criticized by domestic industry.

Increased Enforcement of Violations of Trade and Customs Laws

The EO also addresses increased enforcement of violations of U.S. trade and customs laws, with a focus on the importation of inadmissible and counterfeit merchandise. The EO directs DHS to develop a strategy for combating violations of trade and customs laws and "for enabling interdiction and disposal, including through methods other than seizure" of inadmissible merchandise.

With respect to intellectual property rights, the EO requests that DHS take "all appropriate steps, including rulemaking" to ensure that CBP can share with rights holders "any information necessary to determine whether there has been an IPR infringement or violation." CBP already has the authority to share information about counterfeit and piratical products with rights holders after seizure, and it also amended its regulations in 2015 to promote the sharing of information regarding suspect counterfeit marks with trademark owners prior to seizure [read more here]. Further, TFTEA expanded CBP's authority to share information prior to seizure beyond counterfeit trademarks to piratical copyrights and circumvention devices that are suspected of infringing the Digital Millennium Copyright Act. CBP previously indicated that these regulatory changes are under way, and the EO may expedite the issuance of those regulations. The EO's portion on intellectual property rights also directs DHS to ensure that CBP can share with rights holders "any information regarding merchandise voluntarily abandoned" prior to seizure if CBP reasonably believes that the successful importation of the merchandise would have violated U.S. trade laws.

Since the issuance of the EO, CBP has published a fact sheet indicating that it is leading DHS's efforts to implement the provisions set forth in the EO and that, within 90 days, CBP will develop implementation plans (i) to provide security for AD/CVD liability through bonds; and (ii) to enable the interdiction and disposal of violative goods, with the ability to share information regarding voluntarily abandoned merchandise with intellectual property rights owners.

Priority Prosecution for Trade Law Violations

Finally, the EO orders DOJ and DHS to prioritize the prosecution of violations of trade laws. As a result of the EO, we would expect to see an increased number of cases, both criminal and civil, for U.S. trade and customs law violations, especially as it relates to the evasion of trade remedy orders and the importation of potentially counterfeit goods. Importers should expect to see increased civil, and possibly criminal, prosecutions from an emboldened CBP, especially with respect to customs and trade offenses in Titles 18 and 19 of the U.S. Code.

Trade Deficit Report

The second EO requests a country-by-country report on the causes of U.S. trade deficits. The EO asserts that the United States' annual trade deficit in goods exceeds $700 billion and that the overall trade deficit exceeded $500 billion in 2016. The EO highlights the need for "free and fair trade," the enforcement of trade laws and economic growth. The EO also asserts that the United States has not obtained the full scope of benefits anticipated from numerous international trade agreements and participation in the WTO.

Specifically, the EO requires that, within 90 days, the Secretary of Commerce and the United States Trade Representative must submit a report to the President that will identify foreign trading partners with which the United States had a significant trade deficit in goods in 2016. The report must assess the major causes of the trade deficit, such as differential tariffs, non-tariff barriers, dumping, government subsidization, intellectual property theft, and denial of worker rights and labor standards. The report must also make a determination as to whether the identified trading partner is 'imposing unequal burdens" or "unfairly discriminating against" the commerce of the United States. Additionally, the report must assess the effects of the identified trade relationships on the production capacity of the manufacturing and defense industries, as well as employment and wage growth in the United States. Lastly, the report must identify imports and trade practices that may be impairing the national security of the United States. President Trump could use the data from this report to address trade deficits with U.S. trading partners.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.