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ERAI Blog

Authentic Parts Classified as Counterfeit and Seized by CBP Highlight Financial Risks for Importers and Exporters

Kristal Snider
07/11/2016

For more than a year, beginning in January 2014, a distributor in the U.S. placed eleven (11) orders for more than 16,000 pieces of Texas Instruments part number TMS320VC5416ZGU160 from an Israeli distributor and subcontractor servicing the defense, medical and communications industries in Israel. No nonconformities were ever detected during the inspection of these shipments. No complaints or concerns were raised by the U.S. distributor’s end user and sole recipient of all prior shipments. For all intents and purposes, the Israeli and American companies enjoyed a mutually beneficial relationship and no one, including the end user, had reason to suspect the goods in question were anything other than genuine Texas Instruments parts. That is, until May 4, 2015, when one of the final three scheduled deliveries containing 4,000 pieces of the aforementioned part worth $46,435.00 was detained and subsequently seized by CBP under Title 19, United States Code, Section (USC) 1595a(C) for bearing a counterfeit trademark. The initial detention notice triggered a flurry of activity that would slow to a crawl, then drag on for ten costly, labor-intensive months and ultimately conclude with the release of the goods. This distributor’s experience captures the significance of goods being correctly classified as authentic or counterfeit, highlights the importance of an open line of communication between CBP and industry, and personifies the struggles business owners are facing that could result in substantial financial loss. 

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NEW Data Source Offered by ERAI Adds Additional Layer of Protection for Members

Kristal Snider
02/05/2016

Since 2001 ERAI has been collecting and storing data on nonconforming and suspect counterfeit parts.  This searchable high risk and suspect counterfeit database includes nonconformance descriptions and images, if available. Each reported part is assigned one of the following “ERAI Part Alert Classifications”:


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Who is responsible for the cost of goods if the goods are detained or seized by Customs?

Kristal Snider
09/29/2015

When goods are seized by Customs, is the Supplier entitled to payment or is the Buyer within its right to cancel the order and refuse payment?

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Supplier and Counterfeit Risk Management and Your Legacy ERP

07/30/2015

How old is your ERP?

This is an important question, because a lot of people are using painfully obsolete systems. And I don’t just mean “Windows 2000” obsolete; I mean “Ronald Reagan was president the last time this system was updated” obsolete. Yes, it’s an often-painful irony that the companies that source and distribute electronic components are frequently using outdated technology to do business. And while you may feel like you’re trucking along just fine, the fact is that, if you’re using a system that was new when it was still “Morning in America,” then you’re crippling your ability to effectively source components, track shipping, and manage inventory. And that doesn’t just make you less competitive; it exposes you to the risk of unknowingly handling subpar or even counterfeit parts. That severely reduces your credibility as a parts distributor – and without credibility, what do you have?

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