CBP Giving ISF Benefits to C-TPAT Importers, ISF Data Dumps Targeted for Spring 2011

The following are additional details from the November 9, 2010 COAC¹ meeting, as well the minutes from an October 21, 2010 COAC ISF Subcommittee conference call. (See ITT’s Online Archives or 11/12/10 news, 10111226, for initial BP summary on the discussion of 10+2 and ISF at the COAC meeting.)

C-TPAT Importers Already Receiving ISF Benefits

In response to COAC requests that more benefits be provided to highly compliant importers, a CBP official noted at the COAC meeting that CBP already provides ISF benefits to C-TPAT importers.

CBP states that prior to 10+2 CBP did not know that a shipment was from a C-TPAT importer until the cargo had almost arrived, but with ISF CBP knows this information 24 hours prior to vessel lading. CBP provides a significant targeting “credit” to such shipments and they are less likely to be subject to exam.

ISF Data Dumps Targeted for Spring 2011

At both meetings, CBP stated that it plans to stop issuing ISF progress reports as soon as its ISF data warehouse is functional. This would allow the trade, via the ACE portal, to tailor ISF reports to their specific needs (also referred to as ISF data dumps).

A CBP official told the COAC meeting that CBP has targeted February/March 2011 for ACE portal reports for ISF.

COAC expressed support for CBP’s ISF data warehouse, but requested that CBP not discontinue the progress reports until everyone has access to the ISF data warehouse.

Using NII Holds if No ISF, Liquidated Damages Not Yet Needed

At the COAC meeting, a CBP official stated that CBP continues to focus its ISF enforcement efforts on situations where no ISF has been filed. CBP is allowing the ports to place a non-intrusive inspection (NII) hold on such shipments. CBP has not used DNL messages and has not been putting indefinite, indiscriminate holds on cargo.

During the subcommittee conference call, CBP stated that since its other efforts seem to be driving compliance there has been no need for use of liquidated damages to date. CBP notes that holding the trade’s cargo seems to improve compliance; however, it reserves the right to use liquidated damages if the need arises.

Ports Told Not to Focus NIIs on FROB, Cargo for CA/MX Covered by ISF-5

During the subcommittee conference call, CBP officials stated that the ports have been instructed not to focus NII holds on foreign cargo remaining on board (FROB) and cargo destined for Canada or Mexico that will be covered by an ISF-5.

COAC Wants to Know if NII Is Done for ISF or Another Issue

During both the meeting and conference call, COAC expressed a desire to have CBP provide the trade with information on whether a NII hold was done for the ISF or another reason.

COAC Wants Assurances on Six-Year ISF Statute of Limitations

At the subcommittee conference call, COAC urged CBP to put in writing that it will not be going after small issues if the trade is doing what they are supposed to be doing in regards to ISF filing.

CBP responded by stating that from a legal point of view, it does not support limiting its enforcement capability and that it would be up to the Office of Field Operations discretion to continue being lenient on the trade community and not use the authority on minor infractions.

(CBP’s position on ISF finality has been that “pursuant to 28 USC 2415, the statute of limitations for ISF liquidated damages is six years from the date of the breach of the bond. CBP will not limit its authority to enforce the ISF requirements.” COAC has previously asked CBP to shorten the ISF statute of limitations, but CBP decided to maintain the status quo.)

CBP Working on Centralizing ISF Materials on Web Site

At both the full COAC and ISF subcommittee meetings, CBP stated that it is continuing its outreach efforts, including working on centralizing all ISF materials on its Web site.

ISF Compliance is over 90%, Reject Rate is 2.5%

During the COAC meeting, CBP provided the following updated statistics on ISF filing and compliance:

• Approximately 7.7 million ISFs have been received since January 26, 2010.
• The daily compliance rate is over 90%.
• There is a reject rate of approximately 2.5%.

Top Reason for ISF Rejects is Duplication

In addition, CBP noted the following during the subcommittee conference call:

• The number one reason for rejection was duplicate ISF.
• There are about 2,400 ISF filers, most of which are customs brokers and service centers and the rest are other types of agents and then some importers are doing the filings on their own.
• CBP has seen over 205,000 unique importers reporting.

¹Departmental Advisory Committee on Commercial Operations of U.S. Customs and Border Protection and Related Homeland Security Functions.

(See ITT’s Online Archives or 10/28/10 news, 101022809, for BP summary of remarks by CBP officials at the Western Cargo Conference.

See ITT’s Online Archives or 10/13/10 news, 10101307, for BP summary of recent GAO report on CBP’s progress in implementing 10+2.)

(Minutes, dated 10/231/10)