Customs broker due diligence is no longer just a best practice — it is now a named enforcement target under a sweeping Executive Order signed by President Trump on June 3, 2026, and the compliance industry is still absorbing what that means. The order, titled “Strengthening Customs Enforcement,” sets a 50 percent minimum penalty floor on customs violations, directs maximum penalties against brokers who fail adequate due diligence, and begins reshaping who can serve as an importer of record in the United States.
| Provision | Detail | Deadline |
|---|---|---|
| Penalty floor | Minimum 50% of assessed customs penalty; eliminates mitigation for repeat offenders | 90 days (CBP/DHS rulemaking) |
| Broker penalties | Maximum penalties for failed due diligence, repeated non-compliant clients, or slow CBP cooperation | Immediate directive |
| IOR eligibility revision | Higher bond coverage, domestic asset minimums, beneficial ownership disclosure, risk-based registry | 180 days (DHS) |
| Foreign IOR restrictions | No continuous bonds on formal entry unless CTPAT-validated or filing through CTPAT-validated broker | 180 days |
| Enforcement priorities | Forced labor, misclassification, undervaluation, illegal transshipment; EPA investigations prioritized by DHS and DOJ | Ongoing |
BDO described the order as calling for “the most comprehensive reform of U.S. Customs and Border Protection import requirements in more than a decade.” That framing holds up. The EO’s full text, published on the White House presidential actions page, cites six statutory authorities — 19 U.S.C. 66, 1484, 1498, 1623, 1624, and 4320 — under which the Secretary of Homeland Security must revise importer eligibility regulations within 180 days. That is not a narrow technical amendment.
CBP welcomed the order with notable sharpness, characterising importing into the United States as having “for too long been treated as a right and not a privilege.” That framing signals how enforcement posture inside the agency is likely to shift as the 90-day and 180-day rulemaking windows run out.
The accompanying White House Fact Sheet adds heightened import certification and supply-chain disclosure requirements to the list, framing the whole package as building on the administration’s trade enforcement record. For importers and their brokers, the practical effect is a documentation burden that did not formally exist at this level before June 3.
What the Executive Order Demands on Customs Broker Due Diligence
The customs broker due diligence provisions are the sharpest part of the order for intermediaries. CBP is directed to impose maximum penalties on brokers who fail to vet their clients, who repeatedly represent non-compliant importers, or who drag their feet on CBP information requests. Those are three distinct triggers, any one of which can bring the full penalty down.
On the importer side, foreign entities lose access to continuous bonds for formal entry unless they are CTPAT-validated or filing through a CTPAT-validated U.S. customs broker. Combined with the new IOR registry requirements — beneficial ownership disclosure, minimum domestic assets, risk-based tiering — the barrier to entry for foreign-domiciled importers rises considerably. Domestic importers with compliance histories are not exempt either: the elimination of penalty mitigation for repeat offenders removes a long-standing pressure valve.
The order also directs CBP to increase audits, enforce liquidated damages claims against bonds, restrict in-bond movements, and accelerate seizure and disposal of non-compliant goods. Investigations under the Enforce and Protect Act become a DHS and DOJ priority, with forced labor, misclassification, undervaluation, and illegal transshipment named explicitly.
A UK Tribunal Set the Stage Months Earlier
The U.S. order lands against a backdrop that customs professionals in the UK had already absorbed. On April 15, 2025, the First-tier Tribunal handed down its decision in Roseline Logistics Ltd v HMRC [2025] UKFTT 427 (TC), holding a customs agent jointly and severally liable for a post-clearance demand of £1,126,249.64 in unpaid import VAT across 32 transactions.
The agent had acted on third-party instructions and had no intent to breach customs law. The tribunal found that irrelevant. Failure of due diligence on the underlying importer’s compliance was enough, under sections 6(3)(d) and 6(4)(b) of the Taxation (Cross-border Trade) Act 2018. The International Trade Compliance Update’s coverage of the ruling underscores that the logic — intermediary liability absent intent, grounded in failed vetting — is structurally similar to what the U.S. EO now codifies on the penalty side.
The practical read for U.S. brokers: “I was just following the importer’s instructions” is not a defense that survived a UK tribunal in April, and the June EO’s maximum-penalty directive for brokers who fail due diligence suggests it will not carry much weight with CBP either.
The 90-day CBP and DHS rulemaking window closes around early September 2026. That is the date when the new penalty floor and mitigation standards become operational — and when brokers running on informal documentation practices will find out whether their audit trails hold up.
