World Shipping Council Submits Extensive Comments on 10+2 Proposed Rule

WSC States it Fully Supports Strategy Behind 10+2

WSC states that its comments are made in full support of the strategy behind the 10+2 proposed rule, and to identify technical and practical issues that should be addressed in order to facilitate the implementation of the proposed new regime.

While this initiative is needed to improve the government's ability to detect security questions and to prevent them from disrupting commerce or threatening populations, it could also be very important in the event the government had to manage the consequences of a major maritime security incident involving a container.

Practical Implementation Specifics Should be Discussed Beforehand

WSC states that industry needs to clearly understand the time frame the U.S. government intends to use to adopt 10+2, as these proposed regulations will require more significant changes to business practices than the 24 Hour Rule.

Carriers, U.S. importers, foreign exporters, and third party service providers need to plan and allocate limited operational and information technology resources for this initiative, at the same time that they are having to deal with other projects in other parts of the world, including entry summary declaration and manifest filing requirements in Europe, Mexico and China, and presumably U.S. export declaration and manifesting requirements, as well as migration to the Automated Commercial Environment (ACE).

In addition, the WSC sees the need for a defined period of time for CBP to work in an open and interactive way with shippers, ocean carriers, non-vessel operating common carriers (NVOCCs), forwarders and brokers to address practical implementation specifics, which include data formats, technical specifications, and data interchanges, before implementation of the 10+2 regulation occurs.

Numerous Issues of Concern Identified

WSC has identified a number of issues that need to be addressed, adding that where its comments have identified an issue of concern in the proposed rule, it has tried to offer a recommended solution. Examples of concerns and solutions include the following (partial list):

Need for unique ISF filing acknowledgements. WSC states that it is aware that some NVOCCs, non-NVOCC consolidators, and their customers are concerned about how this system will work in practice, and how they can be sure that one importer's failure to file its required Importer Security Filing (ISF) does not delay the loading or release of the shipments in a consolidated container. In addition, some importers will want the CBP system to allow them to check to see if an ISF for their shipment has been filed in a timely manner.

Some of these questions could be addressed by commercial agreement amongst the directly affected parties, for example, by the consolidator agreeing to only load shipments for which it knows an ISF has been filed, either by filing the ISF itself for that importer or by having the importer provide it with a CBP confirmation message that an ISF has been filed for that shipment.

WSC also states that when CBP provides to the filer an electronic acknowledgment that the filer's submission has been received, that this acknowledgment have a unique reference number.

NVOCCs should be responsible for house BL info for FROB, IEs, T&Es. Regarding the house bill of lading number for foreign cargo remaining on board (FROB), and IE and T&E cargo, WSC states that the ocean carrier does not and will not have access to house bill of lading information, unless it is filing for the NVOCC.

If CBP wishes to require, for FROB and these in-bond shipments, house bill of lading level information for 1) the booking party, 2) place of delivery, 3) ship to name and address, and 4) 6-digit HTS cargo classification number, the regulations would need to make it clear that this is an NVOCC responsibility, as ocean carriers do not have such information and cannot reasonably obtain it.

"Do not unlade" messages. While the carrier industry can work with CBP and the trade on many implementation and enforcement strategies, including "Do Not Load" messages and "Hold" messages, "Do Not Unlade" messages would be an inappropriate enforcement mechanism as they would cause operational and commercial chaos, and should not be used except in the most dire security situations.

WSC recommends that ocean carriers receive from CBP a timely receipt against its Automated Manifest System (AMS) manifest filing of any DNL message that CBP issues based on the filing or the non-filing of an ISF, regardless of who or how the ISF is filed.

Cargo diversion to avoid 10+2. With respect to the likelihood of cargo diversion, WSC states that in the absence of a similar 10+2 regime being adopted by Canada and Mexico, it would seem likely that some shippers would find it advantageous to route U.S. destination cargo through these nations' ports to avoid the ISF requirements.

(WSC's comments are divided into six sections: Importer Security Filing; Requirement to Submit Stow Plans; Requirement to Submit Container Status Messages (CSMs); Cargo Diversion of Immediate Exportation (IE) and Transportation and Exportation (T&E) Shipments; Bonds, Penalties and Enforcement; and Effective Date of the Regulations and Their Implementation Plan.)

To Date, 39 Comments Have Been Submitted on 10+2 Proposed Rule

Written comments on CBP's 10+2 proposed rule are due by March 18, 2008. As of the afternoon of March 5, 2008, 39 comments had been posted by CBP on the Federal eRulemaking portal, which may be viewed at http://www.regulations.gov/fdmspublic/component/main?main=DocketDetail&d=USCBP-2007-0077.

Comments on CBP's proposed rule may be submitted, identified by docket number, by either of two methods:

• via the Federal eRulemaking Portal(http://www.regulations.gov, docket number USCBP-2007-0077)
• via mail to the following address: Border Security Regulations Branch, Office of International Trade, U.S. Customs and Border Protection, 1300 Pennsylvania Avenue N.W. (Mint Annex), Washington, DC 20229

(See ITT's Online Archives or 01/17/08 news, 08011710, for the final part of BP's summary of the 10+2 proposed rule, with links to previous parts.

See ITT's Online Archives or 02/04/08 news, 08020405, for BP summary of CBP's 10+2 comment period extension notice.

See ITT's Online Archives or 02/21/08 news, 08022105, for BP summary of COAC's comments on 10+2.)

World Shipping Council comments (dated 03/03/08) available at http://www.worldshipping.org/comments_cbp_proposed rule_10_%20plus_%202.pdf