Overview of COAC Meeting: CHB Regs, Simple Entry, Cargo, M1, Etc.

(This was the first meeting of the 12th term of COAC. In the 12th term, 13 of the 20 COAC members are newly appointed. See ITT’s Online Archives or 03/30/11 news, 11033013 for list of 12th term members.)

An overview of the discussions include:

CBP is Looking at the Role of the Broker, Modernization of Broker Regs

A CBP official states that CBP has consolidated its efforts to examine the role of the broker into one project in which it will define the role of the broker and look for ways to modernize broker regulations (19 CFR Part 111). According to CBP, the major areas to be addressed in this project are: (i) broker responsibilities; (ii) regulatory modernization; (iii) professionalism; (iv) penalty regime and disciplinary actions; and (v) C-TPAT broker partnership.

CBP also noted that the trade has asked CBP to look at offshore customs business operations.

(See ITT’s Online Archives or 04/12/11 news, 11041221, for BP summary of CBP Commissioner Bersin’s recent remarks on the evolving role of brokers.)

Update on Account Pilots, Simplified Entry & Financial Processing Under Consideration

CBP officials gave COAC an update on the status of the two management by account pilots -- the Center of Excellence and Expertise pilot for the pharmaceutical industry in Los Angeles, CA and the Account Executive pilot to engage trusted partners in the electronics industry.

CBP then discussed another management by account-related issue under consideration -- simplified entry and simplified financial processing (simplified processes). CBP noted that discussions on these issues began in September 2010, but it is interested in revitalizing the discussions with COAC and the trade. CBP hopes to flesh out the concepts over the next few months.

(See ITT’s Online Archives or 03/18/11 news, 11031809, for BP summary on CBP’s fact sheet on the CEE pilot. See ITT’s Online Archives or 03/23/11 news, 11032315, for most recent BP summary on the Account Executive pilot.)

CBP “Tool Box” for IPR Enforcement Inadequate, List of What Needs to Improve

CBP officials expressed the view that they do not have the tools they need to effectively enforce intellectual property rights (IPR). As a result, when an enforcement decision is reached, it is often too little, too late; when a penalty is assessed, it often cannot be collected; and when CBP needs information from private sector, it is often barred from getting it.

According to CBP, priorities for improving IPR enforcement include:

• Enhanced targeting -- CBP is working toward a better advanced targeting system for IPR that will better support officers decision making regarding the selection of shipments examination of IPR violations.
• Partnership programs -- CBP is exploring the expansion of existing partnership programs to include a provision for IPR
• Penalties -- CBP is looking at ways to enhance the assessment and collection of IPR penalties to deter IPR violations

(See ITT's Online Archives or 04/11/11 news, 11041114, for BP summary on CBP guide on how business can partner with CBP on IPR.)

CBP to Move Forward with IBM for M1, Trade Testing to Begin in May

CBP officials announced that a decision has been made to move forward with IBM on M1 (e-Manifest: Ocean and Rail). Trade testing with 15 major carriers is scheduled to begin in mid-May and M1 is scheduled to be rolled out in the ports during September 2011 through January 2012.

CBP officials also stated that the PGA message set (aka the standard data set) is currently being reviewed by the ITDS Board of Directors and its finalization is expected by the end of April.

(See ITT’s Online Archives or 03/08/11 news, 11030832, for BP summary on M1, cargo release, and other ACE issues.)

ACE Cargo Release Still a Priority, CBP Considers Expediting Release & Exports

ACE cargo release continues to be a CBP priority and CBP is in the middle of developing the business requirements for cargo release. CBP states that with cargo release, it is “contemplating” a number of things, including (i) incorporating an e-Bond process; (ii) developing one release status for all messages; (iii) developing expedited release (possibly by expanding the Free and Secure Trade (FAST) process to all modes of transportation); and (iv) incorporating export functionality.

CBP is Almost Finished with Bond Centralization Final Rule

CBP is close to completing its final rule on updating 19 CFR parts 101, 113, and 133 to reflect the centralization of the continuous bond program at CBP’s Revenue Division.

(See ITT’s Online Archives or 03/26/10 news, 10032615, for BP summary of comments on CBP’s proposed rule.)

New Interagency Council Created to Resolve Border Issues

As a result of the Import Safety Conference held in fall 2010, the major agencies involved in import safety created the Border Interagency Executive Council (BIEC), the first interagency coordination body operating under the national security staff of the White House to resolve problems at the border between/among CBP and other agencies. (CBP notes that prior to the creation of BIEC, there was no mechanism to resolve differences in agency points of view.)

The goals of BIEC are: (i) explore the feasibility of sharing enforcement actions (criminal and civil) and administrative information; (ii) discuss possibilities for using the technology and identify any necessary changes in business practices; and (iii) explore best practices in using partnership programs and consider the possibility of mutual recognition.

(See ITT’s Online Archives or 03/21/11 news, 11032123, for previous BP summary on BIEC.)

Express Carriers Are Participating in Air Cargo Advance Screening Pilot

After the Yemen incident, CBP and TSA decided to engage the trade and created an air cargo advance screening pilot with express consignment carriers (UPS, FedEx, DHL, and soon TNT). The pilot gathers seven manifest data elements electronically through the targeting system for air cargo from 28 countries in north Africa and the Middle East as soon as it is available. CBP states that the next piece of pilot will be to gather advance data for passenger and freight forwarder air cargo shipments.

(See ITT’s Online Archives or 03/07/11 news, 11030729, for BP summary of CBP remarks on air cargo security efforts, etc.)

CBP Provides COAC with Data on Debt Write-Offs, Talks of New Bond Directive

CBP finally delivered the write-off data that COAC had requested. The data provides COAC with the reasons that CBP writes-off and does not collect certain debt. (One COAC member noted that CBP’s data indicates that 75% of the amounts written-off by CBP are related to antidumping and countervailing duty issues.)

CBP then asked for COAC input into how CBP can use this data to write a new bond directive that allows it to collect the revenues it is due.

(See ITT’s Online Archives or 11/24/10 news, 10112405, for BP summary of COAC’s discussion of bond issues, including CBP’s efforts to re-write/update two of its bond directives - Monetary Guidelines for Setting Bond Amounts, #099 3510-004 and Bond Sufficiency, #099 3510-005) - in order to consolidate all of the various amendments, telexes, and procedures that exist for managing the CBP bond process into one directive.)

CBP Announces FY 2010 Agriculture Statistics, Discusses Past Ag Initiatives

CBP agriculture officials announced the availability of a new report, its agricultural annual report covering fiscal year 2010, which provides statistics on CBP agriculture inspections and resulting enforcement actions, etc. (See ITT’s Online Archives or 04/13/11 news, 11041339, for BP summary announcing the availability of the report.)

CBP officials also discussed the success they have had with certain agriculture programs, including those for cut flower release and Asian Gypsy moth training.

DHS’ National Strategy on Global Supply Chain Security Expected Soon

DHS officials discussed their efforts to prepare DHS’ National Strategy on Global Supply Chain Security. This report is undergoing DHS and White House adjudication and is expected to be completed in spring 2011.

(Although this effort was initially started in order to satisfy certain congressional reporting requirements, DHS decided that a better approach would be to include all agencies and consult outside stakeholders.)

CBP press release on April 12 COAC meeting available here