Express Industry Recommends CBP Regulatory Reforms, Eliminations

The EAA said CBP should allow the electronic filing of Section 321 entries via the ACE Automated Broker Interface (ABI), and not limit filing to the Automated Manifest System (AMS). All government agencies with border release authorities should develop expedited release procedures for Section 321 entries, it said.

The agency should also not determine how importers store their records, only whether they can be produced upon request, said one recommendation urging for the elimination of 19 CFR 163.5(b), which requires importers to follow certain guidelines for maintaining records other than those required to be maintained in their original format. Among other things, the regulation requires advance written notification of any “alternative storage method” to CBP’s Office of Regulatory Audit. In another recommendation, the EAA said CBP should eliminate regulations requiring triennial status reports from customs brokers. CBP should also get rid of another regulation at 19 CFR 111.36(c)(2) requiring brokers to send a statement of brokerage charges to the importer when referred by a freight forwarder, the EAA said.

The EAA also called for the elimination of CBP’s district permitting structure outlined in 19 CFR 111.19. Currently, CBP may waive its requirement for an individual broker to be located at the port where the district permit application is filed only if the applicant can “demonstrate to the satisfaction of CBP” that he/she “regularly employs at least one individual broker in a larger geographical area in which the district is located” and that “adequate procedures” exist for the broker to exercise “reasonable supervision and control” over customs business in that district. The EAA said the current district permit structure is outdated because of electronic transmission of data, and that a “customs territory permit structure” would allow CBP to eliminate 19 CFR 143 Subpart E covering remote location filing and associated maintenance costs. CBP Office of International Trade Deputy Executive Assistant Commissioner Cynthia Whittenburg in April said CBP was considering switching from a district to an exclusively national broker permitting system (see 1704040086).

Customs brokers, carriers and other trade parties should be able to make prior disclosures of violations to mitigate potential monetary penalties upon becoming aware of a potential breach, the EAA said. The group noted that only importers are currently afforded such an opportunity, despite many other trade parties being subject to penalties. The EAA also called for the elimination of the merchandise processing fee (MPF), arguing that CBP has started paying for officer overtime through methods other than MPF, which was originally created to allow for entry processing and to eliminate CBP requests for overtime. The EAA also wants CBP to allow for cloud retention of data outside U.S. territory.

The EAA is recommending the streamlining of six “unnecessarily repetitive” regulations requiring separate submissions of air carrier employee information into a requirement for a single ACE filing of the information. Currently, regulations require air carriers to submit to the port director the name, address, Social Security number, place of birth, date of birth, photos and sometimes fingerprints of the same individuals working in an air carrier cargo facility multiple times via various paper formats. “The submission of carrier employee information to CBP should be done electronically via ACE one time by the carrier, and CBP should access this information electronically for all of its various internal uses,” the recommendation says.

The EAA is also calling for a modification of 19 CFR 19.1 to account for air carrier inspection facilities, as CBP port directors under current regulations expect air carriers to adhere to CBP’s Bonded Warehouse Manual, forcing air carriers to attempt to comply with impractical or “entirely irrelevant” requirements. Regulations should allow for a single entry for split shipments that arrive in two or more different ports of entry, as CBP currently requires all pieces of an original shipment to be present at a single port of entry in order to enter the commerce of the U.S., the recommendations say.

Also, CBP has historically required one shipment under a single house air waybill attached to two different master air waybills to have separate entries filed, the EAA said, largely because of technological limitations with the legacy ACS system. This has increasingly troubled the air cargo industry as carriers are more often using conventional carriers to move shipments, which means a single shipment under a single house air waybill may be split between two carriers, translating to two different master air waybill numbers being attached to the same house air waybill number. The inflated requirements incur additional labor and technology costs, and higher MPFs, the EAA recommendations say. “Now that the newer and more flexible ACE system has been implemented, it is imperative that CBP reexamine this policy that is contrary to the regulations, and implement the necessary technology tweaks that will allow these true single shipments to be properly treated as such,” the recommendations say.

The EAA also called for CBP to amend regulations that require penalty and liquidated damage notifications related to ACE air manifest to be sent to the “captain of the ship,” even though carrier manifesting and reporting is done electronically by the carrier to a central CBP system, “which has eliminated the physical manifest entirely.” CBP issues those notices on a local port basis, “often to any number of potential carrier contacts at the local level,” resulting in a lack of notice to the carrier and missing of deadlines for response to the notifications, the EAA said. CBP should issue penalties in the carrier’s name, and deliver all penalty notices to a central air carrier or a carrier-designated contact responsible for manifesting and/or compliance with manifesting requirements.

CBP employs “unnecessarily" rigid” requirements for reporting exports that arrived in the U.S. by air and depart for Canada via an airline truck traveling a flight number, the EAA said. “Combined with the lack of a truck manifest requirement, this creates the need for significant manual workarounds by air carriers to avoid penalties and delay,” the EAA said. “Until a truck manifest regime is developed, CBP should allow such shipments to be reported as if they were exported on flights via the air manifest (import) system.”

Email ITTNews@warren-news.com for a copy of the list of recommendations.