The global supply chain is more complicated than ever. Federal agencies are paying closer attention to how goods enter the United States, and tariff levels in certain sectors continue to climb.
For companies with a large presence in Northwest Arkansas — whether they operate regional distribution hubs, food production facilities or corporate headquarters — this reality brings both cost pressures and compliance challenges.
Legal exposure is significant. The Department of Justice increasingly uses the False Claims Act (FCA) to combat customs fraud, particularly through its “reverse false claims” provision, which penalizes anyone who conceals, avoids or decreases an obligation to pay the government. This means that importers who undervalue goods, misclassify products, or misstate their country of origin to reduce duties can face treble damages and steep civil penalties, even if they believed their practices were routine.
Beyond the FCA, errors in tariff classification or valuation can spark costly audits, disrupt supply chains and invite criminal investigation. The good news is that with thoughtful preparation, businesses can manage these risks. Here are three practical steps that any large importer should consider.
Stay abreast of changes. Many companies assume that because their imports clear customs, everything in their paperwork must be correct. That assumption is dangerous. Regulators focus closely on whether tariff classifications under the Harmonized Tariff Schedule (HTS) are accurate. Misclassifications, even if unintentional, can trigger penalties. Companies should monitor HTS codes actively, paying attention not only to how products are currently classified but also to whether variances appear across divisions or brokers. A single product described in multiple ways raises a red flag.
Equally important is staying current with changes to country-of-origin rules. The legal test for determining where a good “originates” is not static; agencies issue rulings that alter the outcome in significant ways. Businesses that fail to update their analyses when the law changes risk relying on outdated assumptions. Supply chain optimization strategies also matter here. For example, shifting production steps across borders to capture tariff benefits can be legitimate, but only if the transformation meets the legal threshold. Companies that track these developments and document their reasoning are far better positioned if regulators come asking questions.
Be wary of shortcuts. When tariffs rise, the temptation to find quick workarounds grows stronger. Yet what looks like a clever fix can be treated as fraud. Routing goods through a third country without genuine transformation, undervaluing invoices to reduce duties or reclassifying products under less expensive tariff categories are practices that draw enforcement attention. The penalties can include fines, the loss of import privileges and in some cases even criminal exposure.
Make compliance everyone’s business. Import compliance fails when it lives on the margins. Large corporations should assign clear ownership — whether through a compliance officer or dedicated team — and give them the authority to enforce policies.
Imports remain vital to Northwest Arkansas’ economy, from distribution centers to food producers to major retail headquarters. Rising tariffs and heightened enforcement do not have to be a roadblock. By closely monitoring changes, with attention to HTS codes and origin rules, steering clear of risky shortcuts, making compliance part of the business itself while planning for potential tariff volatility, companies can reduce exposure and strengthen long-term operations.
Editor’s note: Allison Raley is a partner at Arnall Golden Gregory LLP and chair of the firm’s Global Trade & Sanctions practice. Raley is based in Bentonville. The opinions expressed are those of the author.
