By William (Bill) Scopa
The US Customs and Border Protection (CBP) has varied enforcement responsibilities, including detecting drug smuggling, weapons of mass destruction, and Immigration. Typically, these concerns are not what will cause the importer delays in their cargo shipments. The more common delays, ones where consultants such as EAS with expertise in CBP operations can assist, are due to CBP’s other mission, assigned to it from its inception in 1789 – trade and revenue. Under this mission, CBP has programs such as Antidumping and Countervailing Duties; Import Safety, Intellectual Property Rights; Revenue; Textiles; Trade Agreements; and country of origin marking. All of these have risk to them, and any inconsistencies in paperwork, descriptions, value; and tariff classification are likely to cause delays. It is up to you and/or your Customs broker to be knowledgeable of all requirements.
As an importer, it is your personal responsibility to take “reasonable care” to ensure that you are compliant. As a consultant, we can review or even generate documents based on your data that keeps your company in compliance with the many varied and complex entities that oversee the legality and safety of product entry into the U.S. Generally, “reasonable care” means that you have put in place the proper compliance procedures. CBP has put out excellent informed compliance documents, even one on taking “reasonable care”. Click for CBP Compliance Documents.
Before you import, a few fundamental questions need to be answered. Did you consult these documents? CBP also has a system, Customs Rulings Online Search System (CROSS), where importers request rulings on classification and other matters, and CBP publicizes its response. Click for CROSS. If your facts and circumstance are the same, the ruling can assist you to make the proper entry, or help should your shipment be detained at the border. Understanding how to assess the similarity of products within CROSS is key to compliance.
One important point is to ensure that your broker is knowledgeable about your products, understands program codes associated and has verified that data. Many products can be regulated by other federal agencies, and you and your broker need to know those requirements. Generally, the importer remains liable, even for a broker error. Are you sure that your broker knows which FDA program code to submit? Mistakes will likely cause delays. CBP’s Automated Commercial Environment (ACE) verifies data as well as provides FDA and other agencies visibility into your entries. Are you sure that your broker is provided all the necessary information by you or the manufacturer to submit a proper entry?
CBP also provides programs to help importers increase the level of trust with CBP. Being trusted means benefits such as fewer exams and expedited releases. Did you know that at the land border the delay could be with the trucking company or driver? CBP offers a program for low risk commodities named The Free and Secure Trade (FAST) program Click for FAST This program allows expedited processing for commercial carriers who have completed background checks and fulfill certain eligibility requirements. To be eligible, you must also be a part of CBPs Customs-Trade Partnership Against Terrorism (C-TPAT) program. C-TPAT is available to all qualified importers, and other entities. The issues with both concern supply chain security. The CTPAT benefits are:
- Reduced number of CBP examinations,
- Moving your imported product entries to the front of the inspection line,
- Possible exemption from Stratified Exams,
- Shorter wait times at the border,
- Assignment of a Supply Chain Security Specialist to the company, and
- Access to the Free and Secure Trade (FAST) Lanes at the land borders.
Besides securing the supply chain, CBP offers programs to assist with trade compliance. One is account management through CBP’s Centers of Excellence and Expertise (CEE). CBP has 10 CEES, and each focuses on certain parts of the tariff. For example, there is the Agriculture and Prepared Products CEE in Miami. There is also the Pharmaceutical, Health and Chemicals CEE in New York. Consultants such as EAS can help address any questions or confusion with these CBP CEEs.
Finally, CBP has an Importer and Self-assessment (ISA) Program CBP ISA Program. Show CBP that you can monitor your own compliance with proper controls, and you can be removed from CBP’s regulatory audit pool, and should CBP find noncompliance, there is an opportunity to avoid penalties by filing a [Prior Disclosure](https://www.cbp.gov/sites/default/files/assets/documents/2017-Oct/Prior Disclosure FINAL.pdf). Generally, an importer can file a prior disclosure and avoid penalties when it finds its own mistakes and informs CBP. One way to proactively keep your business on top of irregularities is to have a qualified consultant perform a desk audit of documentation and filings to ensure data is in order. A more in-depth audit of SOPs and facilities could be warranted in instances where significant discrepancies are found.
Let’s discuss a little bit about the different programs that can cause delays.
Antidumping and Countervailing Duties (ADCVD). There are 483 different ADCVD orders issued, these orders affect a wide range of products from grocery plastic bags; to pencils, and seafood products. The orders are assessed, not only against specific countries, but against different exporters and manufactures, and each exporter or manufacturer can be assessed different rates of duty. In the agricultural arena, duty rates can be high 2 or 3 hundred percent. CBP enforces these orders. Did you check the ITC and Commerce websites or have your consultant check to see if your product is covered? ITC ADCVD Orders Did you or your consultant check CBP web site for ADCVD messages which describe the products covered? CBP ADCVD messages Submitting a tariff classification covered by one of these ADCVD orders without the proper entry type will likely have your cargo stopped.
Import safety. Did you know there are 47 government agencies that have access to all or parts of the import entry data? Fifteen of them actually require that importers provide import data attached to the CBP entry. Products can overlap different agency regulation; especially with FDA; for example, drugs with DEA, food products with APHIS, wildlife with FWS, seafood with NMFS, and tobacco and alcohol with TTB. CBP is the border agency and CBP officers and import specialist will assist the other agencies in enforcement.
Revenue (value, classification, description) All of your imports require proper Harmonized Tariff classification, valued correctly and described accurately. An ambiguous or too general description on the entry or manifest cargo description increase the risk for further review
Trade Agreements There are trade agreements with 20 countries that CBP enforces. Free-trade-agreements all have their own document requirements. Delays can occur, for instance, by not having the proper country of origin certificates.
Country of Origin No matter what type of examination CBP does, if a product is found not to be properly marked with the country of origin, the importer can be forced to mark the goods before release. Please see the Marking Requirements for more information.
Preparing and maintaining the required documentation, applications and oversight of suppliers and transporters of your imported FDA regulated products can be a challenging and confusing process if you try to “go it alone”. It is crucial for the smooth flow of your products through US Customs, that all requirements are addresses properly. One way to do so is to work with a consultant such as EAS Consulting Group to conduct an assessment of your current CBP program for imports, review documentation prior to filing with CBP or to just have a periodic consultant with your import team and that of EAS’ import team. Doing so increases the confidence that your shipments will arrive on-time and in a salable condition. EAS’ CBP Team is managed by Senior Director Allen Sayler. For more information on services or to discuss you specific CBP questions send Allen an email here.