Understanding The Lacey Act is Essential for Yacht Manufacturers Using Imported Wood
The Lacey Act, a landmark U.S. law enacted in 1900, was originally designed to combat illegal wildlife trafficking. In 2008, its scope expanded to include plants and plant products, making it one of the most significant legal tools in preventing illegal logging and deforestation. Today, the act regulates the import of timber and wood-based materials, ensuring that unlawfully harvested wood does not enter the U.S. supply chain.
For industries that rely on imported wood – including yacht manufacturing, furniture, flooring, and construction – understanding the Lacey Act is essential. The act applies only to permanently installed furniture and wood products and does not cover removable or loose furniture. Failure to comply can result in severe penalties, including seizures, fines, and criminal prosecution.
In September 2009, the National Marine Manufacturers Association (NMMA) issued a regulatory alert clarifying that the Lacey Act’s import regulations apply to marine products, including yachts with permanently installed wood-based furniture and materials. The NMMA highlighted that yacht manufacturers and importers must ensure the legality of wood and plant materials used in their products. It also noted that certain products, such as fully assembled yachts, would require an import declaration under the amended act. This regulatory alert marked a key moment in extending Lacey Act enforcement to the yacht industry.
Additionally, as of December 1, 2024, Phase VII of the Lacey Act went into effect, introducing new compliance requirements for yacht imports. This phase mandates detailed declarations for wood-based components used in yacht construction, such as teak decks and mahogany cabinetry. Importers must now provide comprehensive documentation proving the legality of all wood materials used in yachts entering the U.S. market.
Understanding the Lacey Act
The Lacey Act does not ban specific countries from exporting wood to the U.S. Instead, it makes it illegal to import, sell, or transport any wood that was harvested in violation of the laws of its country of origin. This ensures that businesses importing timber follow proper legal channels and source their materials responsibly.
A violation of the Lacey Act occurs in two steps. First, the wood must have been illegally harvested, transported, or sold in violation of a country’s forestry laws. This includes theft from protected areas, logging without permits, exceeding legal quotas, failing to pay harvesting fees, or violating export bans. Second, once that illegally sourced wood enters interstate or foreign commerce, the Lacey Act is violated. This means that if an importer sells, transports, or purchases timber that was illegally harvested – even unknowingly – they may be held responsible under the act.
Which countries are affected?
The Lacey Act does not single out specific countries, but certain nations have been flagged for compliance risks due to widespread illegal logging and regulatory challenges. Some of the high-risk regions for timber imports include:
• Myanmar (Burma) – The U.S. has banned Burmese teak imports due to concerns about illegal logging and political instability.
• Russia & Belarus – Trade restrictions and illegal harvesting concerns have resulted in increased scrutiny.
• Brazil & Peru – The destruction of the Amazon rainforest has led to closer monitoring of timber exports.
• Democratic Republic of the Congo (DRC) & Central Africa – Illegal deforestation in protected areas remains a concern.
• China – While China is not a major timber source, it serves as a key processing hub for wood that may have been illegally harvested elsewhere.
While wood from these regions is not automatically banned, importers must conduct due diligence to ensure that timber is sourced legally and complies with forestry regulations.
Compliance for importers
For businesses importing timber, compliance with the Lacey Act requires three key steps.
First, check if a declaration is required. The U.S. Department of Agriculture’s Animal and Plant Health Inspection Service (APHIS) has a Lacey Act Declaration requirement for many wood-based products. Importers should review the Harmonized Tariff Schedule (HTS) codes to determine if their product falls under this requirement.
Second, complete the Lacey Act Declaration (PPQ Form 505). If a declaration is required, importers must submit details such as the scientific name of the wood species, country of harvest, quantity and description of the wood, and the corresponding HTS code.
Third, provide proof of legal sourcing. If U.S. Customs or USDA requests additional information, importers must be able to provide documentation proving the wood was legally sourced. This may include certification from suppliers, export permits, and evidence that the wood was harvested before 2008, which may exempt it from certain Lacey Act requirements.
Lacey Act penalties
Penalties for Lacey Act violations depend on whether the importer knew or should have known that the wood was illegally sourced.
For unintentional violations, penalties can include fines up to $10,000 per violation and confiscation of the non-compliant goods. Even if an importer was unaware of a violation, they are still held responsible for ensuring their wood was legally sourced.
For knowing or intentional violations, the consequences are much more severe. Fines can reach $250,000 for individuals and $500,000 for companies, with responsible individuals facing up to five years in prison. Additionally, businesses found in violation may suffer reputational damage and face permanent bans from importing wood.
Lacey Act enforcement has increased in recent years, with major seizures and lawsuits against companies found importing illegal timber. Companies that fail to conduct proper due diligence risk losing shipments, facing financial penalties, and even criminal charges.
Compliance in a global context
For businesses operating internationally, it’s important to understand that the U.S. is not the only country enforcing strict timber regulations. The UK Timber Regulation (UKTR) and the EU Timber Regulation (EUTR), in effect since 2013, require importers to verify the legality of their wood products before placing them on the market. The UK and EU regulations share many similarities with the Lacey Act, including due diligence requirements. However, U.S. enforcement tends to be stricter, with more aggressive investigations and penalties for violations. Companies that already comply with UK and EU regulations should find it easier to meet Lacey Act standards, but additional steps may still be required for the U.S. market.
Recent enforcement actions demonstrate the consequences of failing to meet Lacey Act compliance requirements. Sunseeker International, a UK-based yacht manufacturer, was fined £358,759.64 for importing illegally sourced teak from Myanmar. The Environmental Investigation Agency (EIA) found that Sunseeker failed to exercise due diligence, violating both UK Timber Regulations and the principles of the Lacey Act.
Similarly, Tip the Scale LLC, a U.S.-based home goods importer, pleaded guilty in 2024 to falsifying timber origin declarations for kitchen cabinets and bathroom vanities. The company misrepresented Chinese-sourced wood as originating from Malaysia, avoiding over $850,000 in import duties and regulatory oversight. As a result, Tip the Scale was sentenced to pay $360,000 in fines, serve three years of probation, and implement an environmental compliance program subject to third-party audits.
Why the Lacey Act matters
The Lacey Act is a powerful tool in the fight against illegal logging, ensuring that only legally sourced timber enters the U.S. market. For businesses, compliance is not just a legal necessity – it’s a commitment to sustainability and ethical trade. By following due diligence practices, maintaining thorough documentation, and working with reputable suppliers, importers can navigate Lacey Act regulations while contributing to global forest conservation.
As enforcement continues to expand, understanding and adhering to the Lacey Act is more important than ever for anyone involved in the import, sale, or use of wood products.
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By Umberto Bonavita & Hannah Bertematti, Robert Allen Law.
Umberto Bonavita, Esq., and Hannah Bertematti, Esq., are both attorneys with Robert Allen Law. For more information, visit robertallenlaw.com.