CBP extracts $10 million settlement from Pioneer Speakers
Pioneer Speakers Inc. has agreed to pay $10 million to settle charges that it violated U.S. import laws, according to an advance copy of a press release expected to be posted on the Customs and Border Protection Web site by the end of the week.
San Diego-based Pioneer Speakers allegedly filed false claims for preferential duty treatment under the North American Free Trade Agreement for imported speakers assembled in Mexico from parts made in other countries. CBP determined that the parts did not qualify for lower tax rates and fined Pioneer more than $21 million, plus an additional $15.8 million for failing to comply with record-keeping requirements for the imports.
Under NAFTA products must have 60 percent of their content produced in Mexico, Canada and North America to be eligible for the lowest possible duty rates. Companies must produce certificates from their suppliers indicating the country of origin where components were produced.
Pioneer Speakers is the North American sales division for Tohoku Pioneer, a majority-owned subsidiary of Pioneer Corp. Tohoku Pioneer manufacturers speakers are sold to automobile manufacturers and mobile phone makers, as well as electrochemical components used in CD players.
CBP said it would aggressively pursue companies that try to shortchange the government of revenue it is due.