Trump Executive Order: Strengthening Customs Enforcement Imposes Major New Requirements on Importers

On June 3, 2026, the President signed an Executive Order: “Strengthening Customs Enforcement,” directing U.S. Customs and Border Protection (CBP) to comprehensively overhaul importer eligibility, bonding, disclosure and penalty rules. Most directives carry 90- or 180-day deadlines for agency action, with the heaviest new burdens falling on foreign importers of record (IORs).

Importers should assess their ability to comply with these new requirements. Companies who do not import, but utilize international supply chains, should assess the ability of their vendors to ensure compliance to avoid supply disruptions.

Definition of Foreign IOR Expanded: U.S. Companies of Nonresidents Considered “Foreign”

The Strengthening Customs Enforcement order defines the categories narrowly. A U.S. IOR must be organized under U.S. law, located in the United States, and have controlling beneficial owners who are U.S. citizens or lawful permanent residents at all times (or own a significant amount of U.S. real property). To be “located in the United States,” an entity must at minimum have its principal place of business here, a physical presence where significant business activity is conducted, and sufficient tangible U.S. assets — with forthcoming guidance expressly aimed at shell companies, sham transactions and artificial structuring. Everyone else is a foreign IOR.

Practical effect: many U.S.-incorporated subsidiaries of foreign manufacturers — particularly those with thin domestic operations or foreign controlling ownership — may be treated as foreign IORs under this definition.

New Restrictions on Foreign IORs

• Informal entry prohibited. Foreign IORs will be barred from filing informal entries (a lower cost method) entirely; informal entry will be limited to U.S. IORs.
• No continuous bonds for formal entry without CBP permission. Foreign IORs generally may not rely on a continuous bond to meet entry bond requirements — effectively pushing them to single-entry bonds — unless CBP permits it upon a showing that the revenue is fully protected and compliance is assured.
• CTPAT mandate. Foreign IORs must be validated in CBP’s Customs Trade Partnership Against Terrorism (CTPAT), if eligible, or file entries through a CTPAT-validated licensed customs broker.

New Requirements for All IORs

• Minimum assets and higher bonds. All IORs must maintain at all times a minimum level of tangible domestic assets, bonding, or both, as CBP determines necessary, and minimum required bond coverage will increase. Bonding or sufficient domestic assets will be required for both formal and informal entries.
• Expanded registration data. IORs must report anticipated import volumes, year organized, ownership and beneficial ownership, business affiliations, domestic assets, and any other data CBP deems necessary.
• “Good standing” requirement. CBP will define good standing based on the compliance history of the IOR and its affiliates. IORs not in good standing — including those found to have imported fentanyl, nitazenes, other contraband or precursor chemicals — will be barred from importing or designating a broker to act on their behalf.
• Registry cleanup and risk tiers. CBP will purge inactive IORs and assign risk-based tiers based on compliance history, enforcement actions and audit results.
• Enhanced, recurrent vetting of all parties directly involved in importing — IORs, affiliates, customs brokers, bonded warehouse custodians and freight forwarders.

Disclosure and Certification Requirements

• Certifications of compliance with critical supply chain laws, including sanctions statutes (CAATSA) and the smuggling statute (18 U.S.C. § 545).
• Disclosure of foreign tax and global business identifiers, plus detailed supply chain and production information such as manufacturer product identifiers (model or style numbers) and key specifications (composition, grade, size).
• A new requirement — due within 90 days — mandating submission of documentation the foreign exporter filed with its own customs administration before exporting to the United States.

Enforcement and Penalties

• 50% minimum penalty floor. Mitigation standards will be revised so penalties cannot be mitigated below 50% of the assessed amount absent exceptional circumstances materially impacting national security — a major change for importers facing Section 1592 and related claims.
• No mitigation for repeat offenders and a new minimum liquidated damages floor.
• Aggressive enforcement tools: liquidated damages claims against bonds, restricted in-bond utilization, increased audits, and maximum penalties for brokers who fail to conduct due diligence, repeatedly represent noncompliant clients, or fail to cooperate with CBP information requests.
• Priority enforcement against forced labor violations, misclassification, undervaluation and illegal transshipment, including Enforce and Protect Act (EAPA) investigations.
• Faster seizure and disposal of non-compliant imports: reduced burdens for voluntary abandonment, higher bonds on high-risk shipments, and third-party disposal authority.

Implementation Timeline

• Within 90 days (by approximately September 1, 2026): revised penalty mitigation standards, foreign export documentation requirement, streamlined disposal measures, and transparency requirements including annual enforcement reports.
• Within 180 days (by approximately November 30, 2026): revised IOR eligibility regulations, bonding and domestic asset requirements, the good standing rule, the updated IOR registry with risk tiers, and enhanced vetting procedures.
• Within 45 days: DHS recommendations to the President for customs enforcement legislation.

What Importers Should Do Now

• Assess whether your importing entity would qualify as a U.S. IOR under the new definition — including beneficial ownership, principal place of business and tangible U.S. assets.
• Review bonding capacity and prepare for higher bond minimums and possible single-entry bond requirements.
• Evaluate CTPAT eligibility, or identify a CTPAT-validated customs broker, if you may be treated as a foreign IOR.
• Audit supply chain documentation, beneficial ownership records and compliance history (including affiliates) in light of the good standing and disclosure requirements.
• Reassess exposure under a regime with a 50% penalty floor and no mitigation for repeat offenders — prior disclosure strategy becomes even more important.

If you need assistance preparing for Strengthening Customs Enforcement please let us know. As a law office affiliated with a licensed customs brokerage, we help importers structure compliant entry arrangements, assess bonding and IOR requirements, navigate CTPAT, and respond to CBP enforcement. You can reach us at info@liebermanpllc.com or (202) 830-0300, or contact us here.