NCBFAA Presses FMCSA for Answers on MAP-21 Exemptions for Customs Brokers, NVOCCs

Among the three exemptions spelled out within MAP-21 are licensed customs brokers "only to the extent that the customs broker is engaging in a movement under a customs bond or in a transaction involving customs business," as defined by CFR 19 Part 111.1. While the NCBFAA said it expects that FMCSA agrees with the association that the exemption applies to customs brokers and any inland transportation arrangements as long as they involve movement under a customs bond, there's some uncertainty how the exemption applies to other inland movement. The NCBFAA believes that a customs broker is also exempt if the inland movement is part of "the international through transportation intended by the shipper and the transaction also involves performance of customs services", it said. .

Any interpretation that considers the "customs transaction" to end once customs releases the shipment is not supported by "the plain words of the statute or the underlying purpose for the exemption," the filing said. Although CBP considers incidental "trucking activities" to fall outside of "customs business," the phrasing of "a transaction involving customs business" means that the statute "refers to something outside of the customs clearance process," the NCBFAA said. "In other words, the phrase has to cover the arrangement of trucking services for import shipments in the course of movement to the importer's intended destination." That phrase would also be unnecessary if the exemption were to only apply to transportation before CBP releases the goods, it said.

The only "sensible" understanding of that statute is that it exempts the entire transaction, from "the customs processing at the border and the movement to its destination in the U.S.," said the filing. As such, any customs broker that handles domestic movement of goods that never were or are no longer part of an international transaction would be outside the MAP-21 exemption, said NCBFAA. The exemptions in themselves show that Congress sought to avoid creating "a new, duplicative layer of regulation" for companies that are already "highly regulated by CBP and other regulatory agencies," it said. The NCBFAA also submitted a number of suggested Frequently Asked Questions the agency should use.

The agency should also consider the intent of a buyer and seller when looking at when the "international Character of a shipment comes to an end" in order to determine if inland transportation is part of an international through movement for the NVOCC exemption, it said. The inland transportation's character "is dependent upon both the seller and buyer's intended destination for the goods," and can only be determined by looking at all the facts involved and "not just the bill of lading," it said. "Where the facts make it clear that one or both of the parties intended that the transportation not come to an end until the goods reach a specific point, the international character of the transportation continues until that occurs," it said.

The NCBFAA previously interpreted the bill's language to mean most work done by customs brokers is exempt from the new bonding requirements of MAP-21, the a FMCSA official recently said the issue remains unresolved (see 13100910). "Although the NCBFAA had worked with Congress to secure an exemption from those requirements for customs brokers, NVOCCs, ocean freight forwarders and air forwarders, the scope of that exemption has been called into question by numerous parties," it said in a press release (here). "In view of the confusion, the NCBFAA has met several times with FMCSA officials to get the agency to issue formal guidance in this matter" and the Nov. 14 filing is part of that effort, it said..

Email ITTNews@warren-news.com for a copy of the letter NCBFAA sent to FMCSA.