U.S. CBP’s Heightened Enforcement, Tightening Rules for Foreign Importers of Record

            Under Executive Order 14411 (Strengthening Customs Enforcement), a CBP interim rule issued November 5, 2026, mandates that any entity failing to qualify as a U.S. Importer of Record will be classified as a foreign importer of record. Effective January 5, 2027, these foreign importers must either hold a validated CTPAT membership or utilize a validated CTPAT customs broker to file entries.

FLEGENHEIMER INTERNATIONAL, INC. IS A CTPAT VALIDATED CUSTOMS BROKER. 

According to the interim rule:

“CBP establishes the requirements that must be met to be considered a U.S. IOR in new 19 CFR 110.2(a), to allow CBP, IORs, and customs brokers to know who qualifies as a U.S. IOR and who does not.

Pursuant to this new provision, a U.S. IOR is:
an individual who is a United States citizen or lawful permanent resident, or an entity that is organized under the laws of the United States, is located in the United States, and maintains at all times: (i) at least 51% of beneficial owner(s) who are United States citizens or lawful permanent residents and have control of the entity; or (ii) direct ownership of a significant amount of unencumbered real property in the United States. With respect to real property ownership, the property can be subject to some encumberment, but the net unencumbered value of the real property must be of a significant amount.”

In the new § 110.2(b), CBP has set forth a verification process for confirming that a party meets the requirements to be considered a U.S. IOR.

Some Key Takeaways:

CBP may determine U.S. IOR qualifications on a case-by-case basis. Relevant criteria include:

• Principal Place of Business: Where the entity is physically and operationally headquartered.

• Physical Operations & Presence: The location and scale of physical operations, employees, and active revenue-generation activities in the U.S.

• Domestic Assets & Capitalization: The volume of physical domestic assets, real estate holdings, net unencumbered property value, profitability, and overall capitalization.

• Ownership & Control: Who ultimately owns and controls the importing entity (looking beyond mere state incorporation paperwork), including the citizenship or permanent residency status of natural-person beneficial owners and senior officers.

• Instrumentality Status: Whether the entity is merely an instrumentality of a foreign manufacturer lacking substantial domestic presence.

Required Documentation: Records to retain for 5 years may include:

• Proof of U.S. citizenship or permanent residency
• Corporate charters and formation documents
• Financial statements and accounting records
• Purchase receipts and bills of lading
• Title documents for real property or goods

Customs brokers now face strict legal responsibilities before declaring a client as a “U.S. IOR” on updated CBP Forms 3461 or 7501 as the broker must request, review, and verify physical records confirming the client’s domestic legitimacy.

Flegenheimer International, as part of our broker due diligence, already implements a pretty stringent vetting when on-boarding importers. We will be contacting you if we need to re-vet your entity as an importer of record. We may ask for additional verification documents if necessary. 

If you would like to read and/or submit public comments on the interim final rule, you must submit them electronically on or before the deadline of January 5, 2027. All submissions must explicitly reference the docket number USCBP-2026-1387.

Public Comments Website:

https://www.regulations.gov/docket/USCBP-2026-1387/document?withinCommentPeriod=true

Flegenheimer International Team