Changes to U.S. In-Bond Process - Now in Effect

On September, 28, 2017 the U.S. Customs and Border Protection (CBP) published a final rule(1) implementing changes to the In-Bond Process.  The final rule adopts, with changes, proposed amendments originally published on February 22, 2012.  

The in-bond process allows imported merchandise to be entered into the U.S. at one port of entry without payment of duties and then transported by a bonded carrier to another U.S. port of entry.  The merchandise is then either entered or exported.  

The changes to the rule will enhance CBP's ability to track in-bond merchandise and ensure it is properly entered or exported.  The rule became effective on November 27, 2017 but several key changes did not become effective until 2018.  Key changes include:

July 2, 2018

• All in-bond move requests, by a carrier, must be filed electronically.  The paper 7512 form for truck shipments traveling through the US from Canada is eliminated. 

August 6, 2018

• Carriers are required to electronically report the arrival and location of the in-bond merchandise within 48 hours of arrival at the port of destination or port of exportation;
• Carriers are required to electronically report the export of the in-bond merchandise within 48 hours of export; and
• Carriers are required to electronically request and receive permission from CBP before diverting in-bond merchandise from its intended destination port to another port.

Definitions:

• Bonded Carrier - a carrier of merchandise whose bond under 113.63 of this title is obligated for the transportation and delivery of merchandise.(1)

References:

• (1) US CBP - Changes to the In-Bond Process - 82 FR 45366-45408
• US CBP
• US CBP - In-Bond Regulatory Changes Frequently Asked Questions

Indian Customs makes key arrival and departure manifest changes

On May 11, 2018, India's Central Board of Indirect Taxes and Customs (CBIT) released a notification(1), that outlines new sea cargo manifest and transshipment regulations. 

The new requirements require shipping lines to comply with the timelines and requirements of the cargo manifestation for exports from India and imports arriving in India.  The changes include:

• Delivery of an Arrival Manifest - all authorised sea carriers carrying imported goods, export goods, or coastal goods, are required to file an electronic (unless it's not possible to file electronically) arrival manifest with Indian Customs prior to the vessel's departure from the last port of call before arriving in India; and
• Delivery of a Departure Manifest - all authorised sea carriers carrying imported goods, export goods, coastal goods or goods meant for foreign transit or foreign transshipment, are required to file an electronic (unless it's not possible to file electronically) departure manifest Indian Customs prior to the vessel's departure from the Indian port. 

The effective date of the new regulations was August 1, 2018. 

Definitions:

• Arrival Manifest - means an integrated declaration required to be delivered by an authorised carrier on arrival of the vessel or train or truck carrying imported goods, export goods and coastal goods.(1)  
• Authorised carrier - means an authorised sea carrier, authorised train operator, shipping line or custodian registered under regulation 3.(1)
• Authorised sea carrier - means the master of the vessel carrying imported goods, export goods and coastal goods or his agent.(1)
• Coastal goods transited through a designated foreign route - means (i) coastal goods transported between an Indian port on east coast and another Indian port on west coast or vice versa, by a vessel through the territorial waters of Sri Lanka, whether or not calling any port in Sri Lanka in between and without change of vessel; and (ii) coastal goods transported between an Indian port on east coast and a river port in India or vice versa, by a vessel through a route passing through the Bangladeshi waters and without change of vessel.(1)
• Departure Manifest - means integrated declaration required to be delivered by an authorised carrier before departure of a vessel or train or truck for imported goods, export goods and coastal goods.(1)

References:

• (1) Government of India, Ministry of Finance, Department of Revenue, Central Board of Indirect Taxes and Customs - "Notification No. 38 / 2018-Customs (N.T.)"
• India - Central Board of Indirect Taxes & Customs
• India - Central Board of Indirect Taxes & Customs - Notifications

US CBP Expands ISF Importer Definition

On April 12, 2018, the U.S. Customs and Border Protection (CBP) published a final rule that expands the definition of an Importer Security Filing (ISF) Importer.  The final rule adopts the proposed rule published in the Federal Register on July 6, 2016 (1).

"The changes are necessary to ensure that the definition of ISF Importer includes parties that have a commercial interest in the cargo and the best access to the required information." (2)  

Background

The ISF Importer is required to submit an ISF to CBP before the cargo is loaded on a vessel that is destined to the United States.  Except for foreign cargo remaining on board (FROB), the ISF must be filed no later than 24 hours before any cargo is laden aboard a vessel.  For FROB cargo the ISF is required any time prior to lading.   

ISF Importers (or their agents) are required to submit to CBP (3):

• 10 data elements for goods intended to be entered into the U.S. or to be delivered to a foreign trade zone (FTZ)
• 5 data elements for shipments that consist solely of FROB, immediate exportation (IE), and Transportation and Exportation (T&E) in-bond shipments  

What is Changing?

The existing definition of an ISF Importer is generally defined (4):

• As the party causing goods to arrive within the limits of a port in the United States by vessel and is generally the goods owner, purchaser, consignee, or agent
  • However, the definition is limited to just certain named parties for FROB, IE and T&E in-bond shipments, and for merchandise being entered into an FTZ
• To designate the Carrier as the ISF Importer for FROB cargo
• To designate the party filing the IE, T&E, or FTZ documentation as the ISF Importer for IE and T&E in-bond shipments, and for goods to be delivered to an FTZ

Based on feedback from the trade community, CBP determined that the definition did not always reflect commercial realities.  The updated definition of an ISF Importer now generally (2):

• Expands the definition for FROB cargo, IE and T&E shipments and for goods to be delivered to an FTZ by:
  • Broadening the definition to include non-vessel operating common carriers (NVOCCs) for FROB shipments
  • Including the goods owner, purchaser, consignee, or agent as a responsible party for IE and T&E in-bond shipments and for goods to be delivered to an FTZ

The vessel operating carrier is the ISF Importer for FROB shipments under the current definition.  In many cases, the carrier does not have access to all the data elements.  As a result, often the NVOCC files the information with CBP (even though legal responsibility remains with the carrier).  In addition, under the current definition, the ISF Importer is the filer of the IE or T&E documentation, but this documentation is often not created until the cargo arrives in the US. 

The expansion of the definition shifts the responsibility to file the ISF, in the instances noted above, to the party that actually has the data.  In many instances this was already occurring so the change is not expected to have a significant impact on the trade community.

What do we need to do?

If your imports into the U.S. require an ISF to be filed:

• Evaluate if you are currently relying on any carrier's to file your ISF
• Recognize that in the event you were relying on the carrier to file the ISF, the responsibility to file may now have shifted to your own operation       

The rule becomes effective on May 14, 2018.

Contact the experts at GCSG for more information, assistance with evaluating how the ISF definition change may affect your business, and/or assistance with facilitating the change within your supply chain.    

E  info@globalcompliancesg.com   

References and Definitions:

• (1) 83 FR 43961-43965 - "Definition of Importer Security Filing Importer"
• (2) 83 FR 15736-15740 - "CBP Decision No. 18-04; Definition of Importer Security Filing Importer"
• (3) 19 CFR 149.3 - "Data Elements"
• (4) 19 CFR 149.1 - "Definitions"
• ISF Importer (Current) - "means the party causing the goods to arrive within the limits of a port in the United States by vessel.  For shipments other than foreign cargo remaining on board (FROB), immediate exportation (IE) and transportation and exportation (T&E) in-bond shipments, and goods to be delivered to a foreign trade zone (FTZ), the ISF Importer will be the goods' owner, purchaser, consignee, or agent such as a licenses customs broker.  For FROB cargo, the ISF importer will be the carrier.  For IE and T&E in-bond shipments, and goods to be delivered to an FTZ, the ISF Importer will be the party filing the IE, T&E, or FTZ documentation." (4)
• ISF Importer (New) - "means the party causing goods to arrive within the limits of a port in the United States by vessel. For shipments other than foreign cargo remaining on board (FROB), the ISF Importer will be the goods' owner, purchaser, consignee, or agent such as a licensed customs broker. For immediate exportation (IE) and transportation and exportation (T&E) in-bond shipments, and goods to be delivered to a Foreign Trade Zone (FTZ), the ISF Importer may also be the party filing the IE, T&E, or FTZ documentation. For FROB cargo, the ISF Importer will be the carrier or the non-vessel operating common carrier." (2)
• U.S. Customs and Border Protection

Singapore Customs Issues Best Practices Advisory Document

Singapore Customs recently issued an advisory document that included basic import requirements, common issues of non-compliance, red flags, and a list of some Best Practices.

Some of the Best Practices listed for traders included:

• Request copies of the Customs permits taken up under your company name from your service provider
• Request itemized invoice/receipts from service providers/consolidators
• Report to Singapore Customs and/or relevant Competent Authorities on any discrepancy detected as appropriate
• Ensure that your service providers/consolidators are aware of the permit conditions and comply with them accordingly
• Ensure that the hauliers engaged comply with the requirement to produce the containers at the red lane for clearance, when directed to do so

Key Links:

• Singapore Customs
• Singapore Customs - "Advisory: Customs Requirements & Best Practices for Import of Goods"

ACE will be sole CBP-authorized EDI system effective July 23, 2016

On May 23, 2016, the U.S. Customs and Border Protection (CBP) published a Federal Register notice (81 FR 32339-32340) announcing, effective July 23, 2016, that the Automated Commercial Environment (ACE) will be the sole CBP-authorized EDI system for electronic entry and entry summary filings (for all filers).

On the effective date the electronic filings listed immediately below must be formatted for submission in ACE, and will no longer be accepted in the Automated Commercial System (ACS). 

 01--Consumption--Free and Dutiable
 02--Consumption--Quota/Visa
 03--Consumption--Antidumping/Countervailing Duty
 06--Consumption--Foreign Trade Zone (FTZ)
 07--Consumption--Antidumping/Countervailing Duty and Quota/
Visa Combination
 11--Informal--Free and Dutiable
 12--Informal--Quota/Visa (other than textiles)
 21--Warehouse
 22--Re-Warehouse
 23--Temporary Importation Bond (TIB)
 31--Warehouse Withdrawal--Consumption
 32--Warehouse Withdrawal--Quota
 34--Warehouse Withdrawal--Antidumping/Countervailing Duty
 38--Warehouse Withdrawal--Antidumping/Countervailing Duty & 
Quota/Visa Combination
 51--Defense Contract Administration Service Region (DCASR)
 52--Government--Dutiable
 61--Immediate Transportation
 62--Transportation and Exportation
 63--Immediate Exportation
 69--Transit (Rail only)
 70--Multi-Transit (Rail only)

Until CBP publishes a future Federal Register notice, with a transition date, the 
following entry types must continue to be filed only in ACS. 

 08--NAFTA Duty Deferral
 09--Reconciliation Summary
 41--Direct Identification Manufacturing Drawback
 42--Direct Identification Unused Merchandise Drawback
 43--Rejected Merchandise Drawback
 44--Substitution Manufacturer Drawback
 45--Substitution Unused Merchandise Drawback
 46--Other Drawback

Filings for the below entry types will not be automated in ACS or ACE.

 04--Appraisement
 05--Vessel--Repair
 24--Trade Fair
 25--Permanent Exhibition
 26--Warehouse--Foreign Trade Zone (FTZ) (Admission)
 33--Aircraft and Vessel Supply (For Immediate Exportation)
 64--Barge Movement
 65--Permit to Proceed
 66--Baggage

U.S. CBP Publishes ACE Development and Deployment Schedule

On March 10, 2016 the U.S. Customs and Border Protection (CBP) published the revised "ACE Development and Deployment Schedule." 

U.S. CBP Increases De Minimis Value to $800

On March 10, U.S. Customs and Border Protection (CBP) announced that it has raised the value of a shipment of merchandise imported by one person on one day that can generally be allowed to be imported free of duties and taxes from $200 to $800. 

CBP will publish an Interim Final Rule that amends the appropriate regulations. Please note that CBP reserves the right to require a formal entry on any shipment where they believe it is required.  In addition, the duty and tax free treatment can be denied if it is used for the purpose of avoiding compliance with any law or regulation. 

U.S. CBP Provides Tips to Importers and Exporters

U.S. Customs and Border Protection provides the trade community with some basic tips on importing into and exporting out of the Customs territory of the United States.  Click on the following hyperlink to go to the relevant web page: "Basic Importing and Exporting".