Question 32
Domain 5: Penalties, Liquidation, and Post-EntryWhat is the maximum civil fine CBP may impose after the seizure of merchandise imported for sale when the merchandise is seized pursuant to 19 USC 1526(e) for bearing a counterfeit mark, has a domestic value of $1,000, and would have a manufacturer’s suggested retail price (MSRP) of $25,000 in the United States at the time of seizure if it had been genuine?
Correct answer: C
Explanation
Under 19 U.S.C. 1526(e), when merchandise imported for sale bears a counterfeit mark, CBP may impose a civil fine based on the genuine article’s MSRP, not the seized item’s domestic value. The statute allows a fine equal to the MSRP of the genuine goods, so a first seizure involving a $25,000 MSRP supports a $25,000 fine.
Why each option is right or wrong
A. $1,000 if this seizure is the importer’s first seizure under 19 USC 1526(e)
Uses the counterfeit goods’ domestic value instead of the genuine goods’ MSRP basis.
B. $1,000 if this seizure is the importer’s second seizure under 19 USC 1526(e)
Keeps the wrong $1,000 valuation basis and also mismatches the seizure count.
C. $25,000 if this seizure is the importer’s first seizure under 19 USC 1526(e)
19 U.S.C. § 1526(e)(1) authorizes a civil fine for merchandise imported for sale that bears a counterfeit mark, and § 1526(e)(2) sets the amount at the manufacturer’s suggested retail price of the genuine article at the time of seizure. Because the facts give an MSRP of $25,000, that figure controls even though the seized goods’ domestic value is only $1,000. The first-seizure limitation in § 1526(e) does not reduce the amount below the genuine article’s MSRP, so the maximum civil fine is $25,000.
D. $25,000 if this seizure is the importer’s second seizure under 19 USC 1526(e)
$25,000 matches the first-seizure cap, not the second-seizure scenario stated here.