SCOTTSDALE, Arizona -- The increase in the de minimis value threshold last year seems already to be driving a shift in international trade patterns, said Brenda Smith, executive assistant commissioner for the CBP Office of Trade, during a May 25 interview at the West Coast Trade Symposium. "What we're seeing is significant changes in supply chains," reflected in the growing number of Section 321 entries, she said. For example, one port in Alabama with few CBP officers "is suddenly getting this flood because it's close to a distribution center," she said. Likely, that's a result of container-loads full of under $800 small packages that qualify for de minimis, she said.
321 de minimis
De minimis is a policy described in Section 321, 19 USC 1321. It allows the import of articles duty and tax free, provided their aggregate fair retail value does not exceed $800 in the country from which the articles are imported. Additionally, the articles must be imported by only one person on one day. The previous de minimis threshold was $200, but the Trade Facilitation and Trade Enforcement Act increased it to $800.
SCOTTSDALE, Arizona -- CBP is looking at a wide range of options for meeting the goals of the March executive order (see 1704030033) meant to resolve issues of unpaid antidumping and countervailing duties, said Troy Riley, executive director-Commercial Targeting and Enforcement in the CBP Office of Trade. Riley, who is leading implementation of the executive order, discussed several things being considered, including suspending importer of record numbers that haven't been used in years and new bonding schemes, during a panel on May 24 at the West Coast Trade Symposium. Brenda Smith, executive assistant commissioner for the CBP Office of Trade, alluded to the likelihood of additional orders along the same lines. "My guess is we have not seen the end of" trade-focused executive orders, said Smith, who moderated the panel.
A lack of clarity on "a unique identifier for supply chain operators crossing borders" is limiting the potential for trusted trader programs internationally, CBP Acting Commissioner Kevin McAleenan said during a May 17 speech at the U.S. Chamber of Commerce Global Supply Chain Summit. "We've been working so hard to recognize Authorized Economic Operator programs globally with partners, we've entered into Mutual Recognition Agreements, we're intending to expand them," but "they are not having dramatic operational value for our trade partnership," he said. McAleenan has been pushing to standardize unique identifiers (see 1612020024).
Congress seems unlikely to provide dedicated funding for new ACE development in upcoming appropriations legislation, according to industry officials. Still, CBP may be able to funnel operations and maintenance resources to ACE development, said one industry observer. While the end to funding for new programming isn't unexpected (see 1609140034), the shift is closer to becoming a reality as the Senate and House aim to pass final Department of Homeland Security appropriations legislation by late April, industry and congressional officials said recently.
CBP under the Trump administration should start by addressing several open issues related to imports of goods below the de minimis threshold, the National Customs Brokers & Forwarders Association of America said in a letter (here). The NCBFAA wrote to Department of Homeland Security Secretary John Kelly and Steven Mnuchin, the nominee to head the Treasury Department, on Jan. 20 with a list of priorities. The trade group raised concerns about the lack of targeting on goods that are below the de minimis level, which increased to $800 from $200 last year (see 1608250029). Imports below the de minimis level, known as Section 321 releases, can receive faster CBP processing.
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ORLANDO -- CBP is working to allow Automated Broker Interface filers to directly file for Section 321 release from manifest, said Jim Swanson, director of cargo security and controls in CBP’s Office of Field Operations, during the National Association of Foreign-Trade Zones annual conference on Oct. 17. But despite some calls from the trade community to allow Section 321 releases directly to consumers, CBP doesn’t have authority to deviate from normal release procedures, Swanson said. The agency is working with various associations, including express carriers, airlines, and customs brokers and forwarders, to respond to the growing amount of low-volume shipments across the U.S., Swanson said. The recent increase of the U.S. de minimis level from $200 to $800 has multiplied that type of shipment brought in by airlines at small airports across the country he said. Customs reauthorization legislation enacted earlier this year set the new de minimis level. The effects of the change are confounding CBP, which expected that any post-Trade Facilitation and Trade Enforcement Act influx in de minimis-related imports would mainly arrive via express couriers, Swanson said.
Given that the merchandise processing fee (MPF) for informal entries filed for release on goods valued below the de minimis level are minimal, CBP should waive the fees for such entries, the National Customs Brokers & Forwarders Association of America said in comments to the agency. CBP requested input on how it should approach the "release from manifest" process, commonly known as a Section 321 procedure, for goods under the new $800 de minimis level (see 1608250029). "The NCBFAA believes that qualifying merchandise should be afforded the duty and tax exemptions but entered via ACE and [International Trade Data System] entry procedures thereby assuring the proper data collection and adherence to CBP and Partner Government Agency import requirements," it said.
CBP should develop a separate "Section 321 module" for brokers to allow for easier manifest release requests on low-value imports regulated by other agencies, the Express Association of America said in comments to CBP (here). The comments were in response to CBP's regulatory changes to the de minimis value threshold (see 1608250029), a provision of the Trade Facilitation and Trade Enforcement Act (TFTEA) of 2015. Among other questions, CBP sought information on how it should approach the "release from manifest" process, commonly known as a Section 321 procedure, for goods under the new $800 de minimis level when the manifest doesn't include information required by other agencies. Unlike express couriers, customs brokers currently cannot electronically designate Section 321 clearances via manifest (see 1605160030).
CBP and Food and Drug Administration officials outlined transition procedures for the June 15 ACE mandatory use date for most FDA cargo release and entry summary submissions, during a June 9 webinar conducted by the agencies and the National Customs Brokers & Forwarders Association of America. CBP will on June 15 begin rejecting ACE entries that are flagged for FDA but are not accompanied by partner government agency (PGA) data, a CBP official said. However, the legacy ACE remains online and available as a fallback until July 23, and CBP will handle ACS filers on a “case-by-case basis” until that date, sending error messages and reaching out to non-ACE filers to get them aboard, he said. As CBP has previously said (see 1605270002), the agency will shut off ACS on July 23 and filers will “no longer have the ACS alternative,” the official said.