What Is “Reasonable Care” in U.S. Import Compliance?

Reasonable care means that the importer must take appropriate steps, precautions, and due diligence to ensure that all required information provided to CBP is accurate, complete, and timely.

This includes compliance with:

• Proper classification (HTSUS)

• Valuation

• Country of origin marking

• Recordkeeping

• Use of free trade agreements

• Admissibility (e.g., FDA, EPA, etc.)

• Licensing and documentation

🛃 Legal Source:

The duty of reasonable care was codified in 19 U.S.C. § 1484(a) via the Mod Act of 1993. It shifted greater responsibility onto importers to:

• File accurate and complete entry data

• Be proactive in understanding and complying with import laws

✅ Examples of Exercising Reasonable Care:

• Consulting with a licensed customs broker or trade attorney

• Using CBP's Informed Compliance Publications

• Requesting binding rulings from CBP

• Conducting internal audits and training

• Maintaining records as required by 19 CFR §163

What Happens If You Don’t Exercise Reasonable Care?

Failure to exercise reasonable care may result in:

• Penalties under 19 U.S.C. §1592 (negligence, gross negligence, or fraud)

• Cargo delays, seizures, or exclusions

• Loss of privileges (e.g., denied participation in trusted trader programs)

• Increased CBP scrutiny or audits (e.g., Focused Assessments)

Find CBP resources on reasonable care as follows:

✅ Reasonable Care Checklist (CBP):
https://www.cbp.gov/sites/default/files/assets/documents/2020-Feb/icprescare2017.pdf

In plain terms, exercising "reasonable care" means importers must take active responsibility for complying with U.S. customs laws — they can't claim ignorance or rely entirely on third parties. CBP expects importers to ask questions, document decisions, and seek expert help when needed.

Why Consult a Trade Attorney or a Licensed Customs Broker?

Importers and exporters are responsible for complying with complex and evolving U.S. trade laws. Errors can lead to costly penalties, shipment delays, or legal exposure. Consulting a professional helps businesses:

• Ensure accurate tariff classification and valuation

• Navigate import/export regulations (CBP, BIS, FDA, EPA, etc.)

• Understand recordkeeping, licensing, and audit requirements

• Mitigate enforcement risks (e.g., penalties under 19 U.S.C. §1592 or EAR violations)

• Implement internal compliance systems

Key differences from consulting a trade attorney versus a licensed customs broker have been summarized below:

Trade Lawyer:

• Credential: U.S. licensed attorney (JD, bar passage)

• Legal Privilege: Attorney-client privilege applies

• Scope of work: Legal analysis, penalties, rulings, litigation

• When to Consult: Legal exposure, strategy, disclosures

• Representation: Can represent in court & legal matters

• Specialization: Broad (customs, export controls, sanctions, etc.)

  Licensed Customs Broker:

• Credential: Licensed by CBP after passing broker exam

• Legal Privilege: No legal privilege

• Scope of Work: Entry filing, classification, valuation

• When to Consult: Routine import filings, classification help

• Representation: Can interact with CBP but not in court

• Specialization: Limited (import operations, CBP procedures)

Why Does Attorney-Client Privilege Matter In Trade Compliance?

Attorney–client privilege matters in trade compliance because it provides confidential legal protection to sensitive communications between a company and its trade counsel — something that does not exist when working with non-attorney professionals like customs brokers or consultants.

Here’s why that matters, especially in the context of import/export law:

✅ What Is Attorney–Client Privilege?

Attorney–client privilege is a legal doctrine that protects communications between a client and their attorney made for the purpose of seeking or providing legal advice. These communications are confidential and cannot be disclosed to third parties, including courts or government agencies, unless the client waives the privilege.

🔍 Why It Matters in Trade Compliance

1. Internal Investigations & Voluntary Disclosures

If your company discovers a potential violation (e.g., incorrect HTS classification, OFAC sanctions breach, EAR export issue), discussing the situation with a trade attorney ensures:

• The investigation remains privileged

• CBP, BIS, or OFAC cannot compel the attorney to disclose findings or internal communications

• You can openly assess risks and options (like prior disclosure or mitigation) without fear of self-incrimination

2. Mitigating Penalties (e.g., 19 U.S.C. §1592)

When dealing with CBP penalty notices or seizures:

• A trade attorney can prepare a privileged legal defense

• Sensitive assessments (e.g., “we knew but failed to correct”) won’t be discoverable

3. Developing Compliance Programs

If you ask a trade attorney to review or design a compliance program:

• Their advice is protected by privilege

• You can explore gray areas (e.g., FTA eligibility, drawback strategy, classification logic) without risk of those discussions being used against you

4. Strategic Legal Advice

Advice about how to comply with the law, interpret regulations, or structure transactions to reduce risk is legal advice — and thus protected if given by an attorney.

⚠️ No Privilege with Customs Brokers or Consultants

Licensed customs brokers are highly skilled in operational compliance but:

• Their communications with you are not protected

• Emails, memos, or advice from brokers can be subpoenaed or used by CBP/BIS in enforcement