US Appellate Courts Begin Dissecting Criminal Customs Violations

Keywords: US appellate courts, criminal customs, violations

There has been an increasing trend toward the criminalization of customs violations in the United States, with a greater number of cases being referred to the US Department of Justice for criminal prosecution.1 However, as some of these cases have reached the US appellate courts, questions are being raised about the circumstances that can lead to criminal liability.

On February 22, 2013, the US Court of Appeals for the Eleventh Circuit held in United States v. Izurieta that a criminal smuggling conviction could not be premised on a violation of 19 C.F.R. § 141.113(c)—a customs regulation that requires importers to redeliver merchandise that has been conditionally released by US Customs and Border Protection.2 The criminal statute under which the defendants had been convicted, 18 U.S.C. § 545, makes it a crime to knowingly import merchandise into the United States "contrary to law." The defendants, Anneri and Yuri Izurieta, were convicted of failing "to redeliver, export, and destroy with FDA supervision" several shipments of adulterated goods and of failing to "hold and make available for examination" one other shipment, in violation of 19 C.F. R. § 141.113(c). The Eleventh Circuit vacated their convictions, concluding that the term "law," in the criminal statute, does not refer to the particular regulation that the defendants were found to have violated.

In so holding, the Eleventh Circuit charted a middle course between prior decisions of the Fourth and Ninth Circuits. The Ninth Circuit had previously held, in United States v. Alghazouli,3 that the term "law" in § 545 does not refer to agency regulations unless some other statute makes a violation of a specific regulation a crime. The Eleventh Circuit quickly dismissed the Ninth Circuit's approach as based on "unconvincing[]" statutory interpretation.

The Fourth Circuit, on the other hand, has concluded that any regulation with the "force and effect of law" can be the basis for a conviction under § 545.4 The Fourth Circuit applied a three-prong test to determine whether a particular regulation has the force and effect of law. First, the court considered whether the rules were "substantive" as opposed to rules of policy or procedure. Second, the court "considered whether the regulations were promulgated pursuant to delegated quasi-legislative authority." And finally, the court reviewed the regulation for compliance with procedural...