Newspaper: US Customs reveals a secret warehouse in Malaysia in an investigation into customs evasion

 US Customs agents infiltrated a warehouse in Penang, Malaysia, after information revealed suspicions of customs evasion related to shipments of wooden safes. According to a report published by the American newspaper (The Wall Street Journal) on Sunday, the warehouse was crowded with boxes ready for export bearing different labels, some of which indicated that they were “Made in China.” Another shows “Made in Malaysia”.

The American newspaper explained that the investigation was launched – in late 2022 – and focused on the “Qingdao Haiyan” group. The Chinese company is accused of using Malaysia as a front to hide the true origin of its products with the aim of circumventing US customs duties.

The investigation sparked great controversy within the safekeeping sector in the United States, where “Haiyan” is considered the A major supplier to some major American companies such as “American Woodmark” Which supplies major retailers such as "Home Depot" And "Louise" But Cabinets2Go, a former Haiyan client, sparked investigations when US Customs reported suspicions of evasion by the Chinese company in 2021.

Company owner Tom Sullivan said: " “No one cares… They still allow them to import from these companies,” he said, noting that major companies continue to deal with the suppliers involved.

For its part, it denied "Haian" Its products in Malaysia are made in China, and it denied direct control over the operations of its branches in Malaysia or the United States. As for the director of the Malaysian factory, he justified his failure to inform about the secret warehouse by saying that he misunderstood the customs agents’ request to provide a list of all facilities owned by the company.

In light of the high customs duties imposed by the United States on Chinese treasuries since 2018, which reached 262% in 2020, many Chinese companies, including Haiyan had to move its operations or establish new factories in countries such as Malaysia and Vietnam to avoid duties, but investigations showed that some companies were using these countries as temporary fronts to hide the true origin of the goods.

The company had filed a lawsuit against Haiyan. Cabinets to Go" A lawsuit against "Haian" After it discovered that shipments coming from Malaysia contained safes made in China, which cost it more than 650 thousand dollars in additional fees. The US Treasury and the Department of Commerce investigated the use of Chinese components in products exported from Malaysia and Vietnam.

The investigations sparked divisions within the industry, as major companies such as "Master Brand" and "American Woodmark" From the association, considering that expanding the imposition of duties may harm legitimate trade. 

At the same time, local companies confirmed that customs evasion practices weaken their ability to compete in the American market, where importing companies can offer much lower prices. .

During January 2023, US Customs concluded that "Haian" It was involved in customs evasion, but the decision was later overturned after requesting an administrative review.

However, the International Trade Court ruled in October 2024 to reopen the case again, stating that the Chinese company had control over its operations in Malaysia and the United States While investigations continue, American industry faces continuing challenges as it attempts to strike a balance between protecting domestic production and maintaining the flow of international trade.

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