CBP Answers Questions on ISFs, ACE, Etc. From its 2009 Trade Symposium

Importer Security Filing

CBP describes its account based approach to ISF. In response to a question asking why CBP refused to consider some option of account management for the importer security filing (ISF) for trusted shippers, etc., CBP states that data transmission requirements are universal; therefore, all carriers, and importers are subject to the same ISF requirements, regardless of whether they are trusted partners such as Customs-Trade Partnership Against Terrorism (C-TPAT) members. However, because CBP now receives more detailed data sooner, it is able to more quickly and accurately identify trusted partners, which will speed cargo release.

CBP notes that it also allows Tier 3 C-TPAT members the opportunity to register and receive ISF progress reports directly from CBP. Additionally, certification as a Tier 2 or Tier 3 member of C-TPAT is a mitigating factor that CBP will take into account when assessing liquidated damages of penalties for failure to comply with ISF requirements. CBP states that this is the way it takes an account based approach to implementation of ISF.

Use of ISF data for trade enforcement currently precluded. CBP notes that the interim final rule on ISF stated that the information was to be collected for the express purposes of ensuring cargo security and counterterrorism. The interim final rule went on to note that use of the data for trade enforcement purposes was precluded.

However, it should be noted that Customs reauthorization legislation pending in the Senate contains a provision that would repeal the prohibition on using ISF data for commercial enforcement purposes. (See ITT’s Online Archives or 09/15/09 news, 09091505, for BP summary.)

Confidentiality

Trade can prevent release of AMS data. In response to a question about whether there is any way a decision to make Automated Manifest System (AMS) data available to the public under the Freedom of Information Act (FOIA) can be reversed, CBP notes that the release of AMS data to the public is mandated by 19 U.S.C. 1431(c) and implemented by 19 CFR 103.31 et seq.; while the information may also be available under the FOIA, the requirement to release, publicly, AMS data is the result of a law passed by Congress. A statutory amendment by Congress would be required to reverse this mandate.

However, both the statute and the 19 CFR 103.31 (d) provide means for importers and consignees to request confidentiality with regard to the release of the name and address of the importer (notify party), consignee, and shipper. Importers and consignees or their agents (e.g., brokers) may request confidential treatment.

Impact of President’s data transparency initiative. CBP states that the President’s announcement on his Federal Agency data transparency initiative is not going to affect CBP’s treatment of importer data protected by FOIA Exemption 4. So, although there is a commitment to transparency, the administration recognizes that FOIA contains exemptions to protect confidential commercial information.

Trusted Traders

No exception to invoice descriptions for ISA members. When asked whether Importer Self Assessment (ISA) members could have an exception to the invoice description requirement, CBP states that invoice data must be adequate to allow for the examination of the merchandise, determination of duties, and for verifying the information required for statistical purposes.

PEAs allow correction prior to liquidation. When questioned about the possibility of allowing ISA members to “reconcile” overages and shortages as part of their annual assessment reporting under the importer of record number, CBP noted that post-entry amendments (PEAs) would allow correction prior to liquidation. Being a member of ISA does not allow waiving of legal requirements.

No plans for ACE message on whether manifest meets FAST standards. CBP states that there are currently no plans to notify manifest filers that a standard manifest meets FAST-PAPS standards for FAST lane processing.

Automation

No plans for FP&F processing in ACE. CBP states that it has no plans to bring Fines, Penalties and Forfeiture (FP&F) processing into ACE at this time.

CBP allows for testing of ISF software compatibility. On the issue of testing software compatibility, CBP states that there is a test system for Importer Security Filing (ISF) and there will continue to be one as processing in the Automated Commercial System (ACS) migrates to ACE. Whether transmitting to ACS via the Automated Broker Interface (ABI) or the AMS, ISF trade software can be tested in the certification environment (ProdCert). When ISF filing is implemented in ACE, ISF test filing will also be permissible in the ACE certification region.

CBP notes that it always provides advance notice of programming changes and backward compatibility is afforded whenever possible. CBP note that historically, minor changes are implemented in the production and certification regions simultaneously and it has no plans to change that practice.

ACE not system of record for reference data. According to CBP, ACE is not the system of record for reference data such as currency, tariff, etc. Such data is provided as a courtesy to the trade, whose responsibility it is to provide correct data.

CBP working on ACE data integrity issues. In response to concerns about the data integrity within ACE, CBP states that it is working on multiple system changes which address improving data reporting quality.

Notification of untimely entries. When asked when CBP be able to tell the filer which entries are not filed timely, CBP states that filers must exercise reasonable care as required by the Mod Act which includes timely filing of the entry summary. CBP states that notification for untimely entries is in the form of liquidation damage case notification

ACE will allow account based processing of importers. CBP states that ACE will allow information to be shared by all the ports for entry findings and allow account based processing of importers instead of each port working independently.

RLF for AD/CV entries possible in future. CBP states that remote location filing (RLF) for antidumping/countervailing duty (AD/CVD) entries is contingent upon EDI imaging capability in ACE. Currently, where entered merchandise falls within the scope of an AD and/or CV duty order, the broker is precluded from using RLF. The possibility of allowing this in ACE could be evaluated in the future.

(See ITT’s Online Archives or 04/12/10 news, 10041205, for BP summary of CBP’s plans to complete EDI imaging in the fourth quarter of fiscal year 2010 -- first quarter FY 2011, which would bring the trade closer to paperless filing.)

Intellectual Property Rights

eAllegations is open everyone. CBP states that intellectual property rights holders and other members of the trade community can assist CBP in targeting for intellectual property right (IPR) violations by providing information through CBP’s online eAllegations system. This system allows external parties to provide CBP with information regarding suspected non-compliance and possible infringement of intellectual property rights. The system is open to everyone and is not limited to individuals or companies that have recorded trademarks or copyrights with CBP.

CBP enforces ITC exclusion orders. CBP states that it is committed to enforcing ITC exclusion orders. The ITC’s Office of Unfair Import Investigations conducts a survey approximately every five years on the enforcement of exclusion orders. The current survey suggests that the majority of parties that obtain exclusion orders are satisfied with the resulting level of enforcement. A new survey is forthcoming and is expected to align with past outcomes. For its part, CBP is continually exploring ways to improve its IPR border enforcement processes, including exclusion order enforcement and welcomes input in this regard from all relevant stakeholders.

Supply, distribution chain mgmt processes being used for IPR enforcement. CBP states that it has begun consideration of using supply and distribution chain management processes and methodologies for IPR enforcement purposes. While C-TPAT was developed as a cargo security and anti-terrorism program, and its requirements do not include certification of compliance with IPR laws, as CBP seeks input from the trade community in exploring possible implementation of supply and distribution chain management programs for IPR, the relationship of these programs to C-TPAT will be considered.

Gray market importers should prepare to submit supporting evidence. On the issue of importers of goods who are not rights holders and do not buy from rights holders (so called parallel or grey market imports) having to convince port personnel that goods are not counterfeit, CBP notes that its determination of whether the placement of a mark on imported merchandise has been authorized by the trademark owner is fact specific and is undertaken on a case-by-case basis based on the available evidence. To assist CBP with making that determination, importers should be prepared to submit all relevant documentary evidence to support a claim that the placement of a mark on the merchandise was authorized by the trademark owner.

Miscellaneous

CBP is upgrading training for FTA verifications. CBP states that it is upgrading the training for Free Trade Agreement (FTA) verifications. This training should be helpful to port personnel when processing verifications which include some instruction on what are the right documents to request.

All checks presented to CBP must have TIN. CBP states that all checks presented to CBP must have the TIN (Taxpayer Identification Number) of the person making the payment, including prior disclosures.

CBP describes account management. According to CBP’s description, managing by account seeks to aggregate risk management and leveraged end-to-end visibility of trade entities. This approach strengthens security, facilitates low-risk trade, ensures swift and consistent enforcement action, and increases overall efficiency of CBP’s processes. The goals are to effectively monitor and manage risk; raise and maintain compliance; strengthen enforcement actions through an aggregate approach; increase efficiencies and reduce redundancies; and accurately identify CBP trusted partners by linking security and trade programs through risk management and field activity.