CBP finds evasion of Canadian softwood lumber AD/CVD via New Zealand transshipment
On May 4, 2026, U.S. Customs and Border Protection (CBP) issued a formal notice of determination finding that Coastal Specialty Forest Products evaded anti-dumping and countervailing duty (AD/CVD) orders on Canadian softwood lumber by transshipping covered merchandise through New Zealand to avoid paying required cash deposits. CBP has suspended the importer's entries, adjusted rates to type 03 entries, and continues to evaluate the importer's bonds. The agency reserves the right to pursue civil penalties or criminal investigations under its Enforce and Protect Act (EAPA) authority.
Photo: Lum3n / PexelsCBP Determines Evasion in Softwood Lumber Case
On May 4, 2026, U.S. Customs and Border Protection issued a formal notice of determination in EAPA Cons. Case 8199, finding substantial evidence that Coastal Specialty Forest Products, Inc. (doing business as Coastal Forest Products) evaded anti-dumping and countervailing duty orders on Canadian softwood lumber.
Evasion Method and Affected Orders
The investigation, filed by the Committee Overseeing Action for Lumber International Trade Investigations or Negotiations, focused on entries of covered merchandise from Canada. According to CBP's findings:
"Evidence on the record indicates that Coastal Forest Products entered covered merchandise from Canada that was transshipped through New Zealand, thereby failing to pay cash deposits associated with the AD/CVD orders."
The evasion involved AD/CVD orders A-122-857 and C-122-858 on softwood lumber originating in Canada. By routing shipments through New Zealand, the importer attempted to obscure the Canadian origin and evade the applicable duties and deposit requirements.
Enforcement Actions
In response to the determination, CBP has implemented the following enforcement measures:
- Entry suspension: All entries covered by the investigation remain suspended pending liquidation instructions.
- Rate adjustment: Entries previously extended under interim measures have been reclassified as type 03 entries and remain suspended.
- Bond review: CBP continues to evaluate the importer's continuous bonds in accordance with standard policies.
Potential Additional Penalties
CBP emphasized that the determination does not limit its authority to pursue further enforcement. The notice states:
"These actions do not preclude CBP from taking additional enforcement measures as it determines appropriate under its EAPA or other legal authorities, which include pursuing civil penalties or investigations into criminal violations."
Importers and freight forwarders should note that transshipment schemes intended to conceal country of origin or evade duty obligations are subject to substantial civil and criminal exposure under EAPA.
What this means for shippers
If you import softwood lumber from Canada or use transshipment routes, verify that your entries comply with AD/CVD deposit requirements—routing through third countries does not exempt you from duties. Review your supplier agreements and entry documentation immediately to confirm origin declarations match actual sourcing. Non-compliance exposes you to entry suspension, bond forfeiture, and civil or criminal penalties. Check /hs-codes/search to confirm the HS classification and origin requirements for your forest products.
