Customs Brokers Bankruptcy Bill's Sponsors Say More Sponsors Needed to Get a Vote
Although continuing the treatment of customs brokers' pass-throughs to CBP in bankruptcy is not controversial, lawmakers say, the bill that would make this treatment permanent has a ways to go to be able to get a vote before the temporary protection expires.
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Currently, if a customs broker sent tariff payments to CBP, and its client subsequently filed for bankruptcy protection, the broker's fees would be subject to the claw-back period but the payments to the government would not. When payments to vendors are clawed back, those vendors only get a fraction of what they were paid in those last months before bankruptcy, as all debtors take a haircut in bankruptcy.
This protection for customs brokers expires in December. The Customs Business Fairness Act would make the arrangement permanent.
Rep. Gregory Meeks, D-N.Y., is one of 13 sponsors of the bill now, and frequently sponsored the legislation in years when it did not come up for a vote. He said that by educating members on why this bill is important, it develops momentum. "My goal would be, and my hope would be, we could get" 50 more sponsors, he said in a hallway interview Sept. 29. "It may still take a vehicle to jump on, we don't know.... it would ...at least put it at the top of people's minds, and make it something that becomes prioritized. We want to make sure it becomes prioritized."
Sponsor Rep. Andrew Garbarino, R-N.Y., told International Trade Today in a recent hallway interview that his staff is pushing the bill "very hard. We're hoping it gets through. We're speaking with Congressman Meeks' office to get some extra pressure from that side. I've spoken to a couple of my colleagues, they seem to understand the issue. It's something I would not have known about unless they called me, and probably something nobody knows about until you talk to them about it, so the more and more I talk to people, the better it is." The Judiciary Committee has jurisdiction over the bill, so getting co-sponsors on that committee is most valuable.
Garbarino said he's trying to identify what bill the customs bill could hitch a ride on. He said getting on the calendar is difficult, even though he expects it would be able to pass. The suspension calendar allows bills in the House to come up without needing to take a lot of time for debate, and Meeks said that could still be a possibility. He said Garbarino would have to get Republican leaders to agree to it, as both sides decide what goes on the suspension calendar. "If he has that kind of support, I'd love it. Because it should be noncontroversial," Meeks said.
Rep. Kevin Brady of Texas, the top Republican on the House Ways and Means Committee, said through a spokesperson that he's aware "that this has been a priority for Customs brokers for several years," but he is not taking a position on it. He's not aware of opposition to the bill, he said.
When asked what the bill's prospects for passage this year are, at first Meeks said it could pass. Then he said it should pass, then said, "I think it will."