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WASHINGTON – Ford Motor can pay $365 million to resolve U.S. expenses that it violated federal tariff regulation by misclassifying and undervaluing hundreds of its Transit Join autos.
The Justice Division stated the settlement resolves allegations that Ford devised a scheme to keep away from larger duties by misclassifying cargo vans imported from Turkey from April 2009 to March 2013.
The federal government stated the settlement is without doubt one of the largest customs penalty settlements in current historical past.
A Ford spokesperson stated, “Ford strongly disagrees with most of the characterizations within the DOJ's assertion and accepts no legal responsibility on this matter.” “However within the curiosity of transferring ahead from this advanced, decade-old dispute, we’ve got agreed to settle the matter as soon as and for all.”
Customs and Border Safety dominated in 2013 that Transit Connects imported as passenger wagons and later transformed to cargo vans have been topic to the 25% obligation utilized to cargo autos as a substitute of the two.5% passenger car obligation. .
The Justice Division stated Ford imported autos with gimmicky again seats and different makeshift options to make the vans look like passenger autos. These makeshift rear seats have been by no means supposed to hold passengers and have by no means been used.
The federal government stated Ford included these seats and options to keep away from paying the 25% obligation charge.
After customs clearance, Transit Join autos have been instantly stripped of the rear seats and returned to its unique identification as a two-seat cargo van.
“The federal government won’t enable firms to keep away from duties by including gimmicky options to their merchandise after which misclassifying them,” stated Brian Boynton, head of the DOJ Civil Division.
Ford stated it may face fines of as much as $1.3 billion in 2021 in a long-running dispute over import duties paid on Ford Transit Join autos after the Supreme Court docket declined to listen to its enchantment in 2020. Denied that it had paid elevated duties for some prior imports.
The 25% tariff stems from a Nineteen Sixties commerce warfare involving frozen rooster, and the bigger tariff on cargo autos is named the “rooster tax”.
Ford shares have been down 0.5%.