On June 3, 2026, President Trump signed an Executive Order (EO) entitled “Strengthening Customs Enforcement.” The EO directs the Department of Homeland Security (DHS) and U.S. Customs and Border Protection (CBP) to undertake a sweeping set of actions to tighten and escalate customs enforcement, addressing specifically importer of record (IOR) eligibility, foreign IOR restrictions, disclosure requirements, and penalty standards.
Enhanced IOR Requirements
The EO directs DHS to revise importer eligibility regulations to require that an IOR maintain at all times a minimum level of tangible domestic assets, bonding, or both, and to increase minimum required bond coverage. IORs will also need to disclose to CBP additional data, including anticipated import volumes, year of organization, and information on ownership and beneficial ownership, business affiliations, and domestic assets.
The EO distinguishes between US and “foreign” IORs and imposes heightened requirements on “foreign” IORs. “Foreign” IORs are to be prohibited from making informal entries. For formal entries, they may not rely on a continuous bond (unless CBP is satisfied revenue is fully protected and compliance assured) and must either be CTPAT-validated or use a CTPAT-validated licensed customs broker for formal entries. The EO defines a US IOR entity as one that is organized under the laws of the United States, is located in the United States, and has controlling beneficial owners who are United States citizens or lawful permanent residents. An entity may also qualify as a US IOR by virtue of owning “a significant amount of real property in the United States.” A “foreign” IOR is any IOR who does not meet the definition of a US IOR.
The EO directs DHS to ensure that IORs maintain “good standing” with CBP. Good standing is defined based on compliance history and payment of customs liabilities. IORs not in “good standing” will be barred from importing into the United States or designating a customs broker to act as IOR on their behalf. Within 180 days, DHS is directed to update the IOR registry, by removing inactive IORs, confirming compliance of active IORs, and creating risk-based tiers, and establish enhanced vetting procedures all individuals and entities involved in import activities, including customs brokers, custodians of bonded merchandise, and freight forwarders.
New Disclosure and Certification Requirements
The EO directs DHS to establish heightened import disclosure and certification requirements, including certifying compliance with critical supply chain requirements in line with the Countering America’s Adversaries Through Sanctions Act (CAATSA), disclosing certain foreign tax and global business identifiers, and providing detailed supply chain and production information such as manufacturer product identifiers and key specifications. DHS is to require submission of any documentation that the foreign exporter was required to submit to the foreign customs administration prior to exporting to the United States.
Enforcement
New enforcement measures directed by the EO include enforcing liquidated damages claims against bonds, restricting in-bond utilization, increased audits, and imposing maximum penalties on brokers who fail to conduct due diligence, repeatedly represent noncompliant clients, or fail to cooperate with CBP information requests. DHS and the Department of Justice are to prioritize enforcement against importations involving forced labor, misclassification, undervaluation, and illegal transshipment. The EO orders DHS to revise all mitigation standards, including establishing a minimum penalty floor of not less half of the assessed penalty (absent exceptional circumstances), establishing a minimum liquidated damages floor, and eliminating mitigation for repeat offenders.
Takeaways
The EO reflects a continued focus under the Trump administration to bolster customs enforcement and shore up practices that it perceives as circumventing US trade policy, such as transshipment. Importers and customs brokers should assess whether their IOR structures, diligence processes, bond coverage, ownership disclosures, and supply chain records are likely to satisfy the anticipated new requirements. Companies should also continue to monitor DHS and CBP implementation of the EO for further details.
