CBP Move Towards Electronic Bulletin Notice of Liquidation 'Long Overdue,' Say Industry Lawyers

Elimination of the paper bulletin notice of liquidation will require an amendment to the Customs regulations, so the change will have to go through the rulemaking process, said a CBP spokeswoman. But implementation would not require legislation, she said. “This would mean for the importing community that they would not have to travel to the customshouse to view the liquidation bulletin,” the spokeswoman said. “They could view it online and the document would be searchable.”

Obama Budget Proposal Included Posting ‘Customs Inspection Info’ Online

The Customs regulations at 19 CFR 159.9 require that the bulletin notice of liquidation be posted for importers in a conspicuous place in the customhouse at the port of entry. “The process of posting on the board at the customshouse has been around forever,” said John Brew of Crowell Moring. “It’s just something that’s never been fixed.”

But tucked in near the end of Obama’s FY 2014 budget proposal, under administrative consolidations and savings, is the line “post customs inspection information online” (here). The budget proposal follows a submission from Laurie Dempsey, chief of the Entry, Summary & Drawback Branch at CBP, for the SAVE Award program, which allows federal employees submit ideas to make government more effective and efficient. Dempsey, one of the four finalists for the 2012 SAVE Award, suggested that CBP “post customs inspection information online.” According to the White House website (here), CBP “is required to post a bulletin weekly that lists all imported items that have completed the customs inspection process. Currently, Customs ports across the country print this bulletin, which can be hundreds of pages long, and post it in the customs house.”

Dempsey suggested posting the bulletin on CBP.gov instead, the White House said. “This change would save paper, reduce costs, and make it easier for the public to find out about what items have been inspected without having to visit the facility in person.” CBP is now working toward posting the bulletin notice of liquidation online and a team has been formed, including Dempsey, to implement the idea, said an agency spokeswoman.

"My immediate thought is that it's a good idea, and that it's long overdue," said Brew. The move would "provide a more open and transparent process that allows all parties to get access to information, not just ABI users," he said. “You can make this change without a legislative fix -- you would just have to fix the regulation through a proposed rulemaking process. ... I don’t know why it hasn’t been done sooner."

Posting at Customhouse Inconveniences Smaller Importers

For importers that don’t have Automated Commercial Environment (ACE) or Automated Commercial System (ACS) accounts, the current system can be troublesome. Before 2011, importers received unofficial “courtesy notices” of liquidation in the mail when their entries liquidated. But when CBP did away with that system in 2011, CBP’s automated systems became the only way to keep track, short of visiting the customhouse.

“It’s important for importers to keep track of liquidation,” said international trade lawyer Paula Connelly. “A lot of times people don’t really think much of it, but you want to make sure your entries are liquidating,” she said. For example, failure to liquidate could be a sign that CBP is looking at an entry, she said. On the other hand, an overlooked liquidation could result in missing the 180-day deadline for protests. But many smaller and medium-sized importers lack ACE accounts, Connelly said. Because they don’t get the courtesy notices anymore, they aren’t aware of when their entries are liquidating, and have become reliant on their brokers for that information. “A change that would actually allow somebody to go onto the customs website and access that information would be great,” she said.

Kelly Herman of Venable agreed. “Those dates are so critical, and getting access to it is so important,” she said. Under the current system, many importers have to rely on their customs brokers for liquidation dates. But if there’s a problem, the importer can’t blame it on the broker, she said. “As an importer, you have the responsibility to have informed compliance, but likewise the government is supposed to be helping you,” Herman said. “In this case there are more hurdles to being able to help than are necessary.”

Increased Access Would Help Lawyers, Other Services Too

Increased access to liquidation information would make life easier for lawyers and other service providers as well, Connelly said. Without the ability to create an ACE account, lawyers are reliant on their clients for things like liquidation information for use in filing protests. But now that CBP isn't sending out courtesy notices of liquidation, importers that don’t have ACE accounts make matters more complicated for service providers acting on their behalf.

“If I’m dealing with a company that’s not on ACE, and we need liquidation information, they have to go back to their broker, and they’ve got to give them the list of entries and ask the broker to check the liquidation, Connelly said. In her experience, the process has worked without any issues. “The brokers have always been more than willing to do a query and come back with the liquidation date,” Connelly said. “But it’s just one more step in the whole process.” If Customs were to allow third-party service providers to use an entry number and get access to a liquidation date, “it would make things a lot easier for people,” she said.

Searchable Bulletin Would Maintain Confidentiality, Cut Paper Costs

The posting of bulletin notices of liquidation at customhouses recently affected one of Bruce Shulman’s clients, he said. The client wanted to protest CBP’s liquidation of entries, but needed the liquidation information to file the protests, said Shulman, an attorney at Stein Shostak. The importer had used an express courier to transport the merchandise. Because the express courier was importer of record on the entries, the courier alone had the liquidation information, and wanted to charge the importer for access, Shulman said. Because the merchandise entered at several ports, it would have been difficult to go to each port’s customhouse and examine the bulletin notices of liquidation. Refusing to pay the express courier, the importer instead filed Freedom of Information Act requests for the liquidation information, Shulman said in a blog post (here). Because of the delays associated with the request, the company missed out on the chance to protest several of the entries.

“There has got to be a better way,” Shulman said. In his view, which is shared by some government employees he’s spoken to, the solution is for CBP to put liquidation information on a website. The website would be searchable either by importer ID or entry number to provide some confidentiality, he said. “It would save Customs a huge amount of paper and printing costs,” Shulman said, noting the agency already has websites for rulings and recorded trademarks and copyrights. It would also save CBP money on staffing the room at each customhouse where the bulletin is kept, he said, and probably save them from Freedom of Information Act requests as well.

It's surprising that the update hasn't already happened "given how much they’ve been trying to modernize since early 2000,” Herman said. CBP has been extensively modernizing its processes, requiring more and more electronic filing. “But for some reason this was the lone holdout, and it hasn’t happened,” she said.

If completed, elimination of the paper bulletin notice of liquidation wouldn’t be the only SAVE award submission implemented by the agency. The recent final rule allowing CBP to publish seizure and forfeiture notices on the internet also comes from a 2010 SAVE award candidate put forward by CBP Paralegal Specialist Paul Behe (here) (see 13012808).-- Brian Feito, Tim Warren